Madras High Court
Ruchi Health Foods Limited vs Union Bank Of India
Author: V.Bharathidasan
Bench: V.Bharathidasan
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Judgment Reserved on: 28.04.2018
Judgment Pronounced on: 28.06.2018
CORAM
THE HON'BLE MR.JUSTICE V.BHARATHIDASAN
Civil Suit No.132 of 2005
Ruchi Health Foods Limited,
No.40/41, East Mada Church Street,
Royapuram, Madras 600 013. ... Plaintiff
-Versus-
1. Union Bank of India,
Rep. by its Chief Manager,
No.152, Mount Road,
Madras 600 002.
2. P.Venkatesalu,
Proprietor,
Sri Balaji Enterprises,
No.9, M.G. Road,
Kumaran Nagar,
Padi, Madras 600 050. ... Defendants
Suit filed under Order IV, Rule 1 of the Madras High Court [Original Side] Rules, 1956 r/w order VII Rule 1 of the Code of Civil Procedure, 1908 praying for a decree directing the defendants jointly and severally to pay a sum of Rs.29,00,306.75 paise to the plaintiff together with interest @ 21% p.a. on Rs.18,59,171/- from the date of plaint till date of decree and thereafter @ 21% p.a. till date of realization of the decree amount and for costs.
For Plaintiff : Mr.P.B.Ramanujam
For Defendants : Mr.N.V.Srinivasan for
M/s.N.V.S. Associates for D1
No appearance for D2
JUDGEMENT
Suit for recovery of a sum of Rs.29,00,306.75 paise from the defendants jointly and severally together with interest @ 21% p.a. on Rs.18,59,171/- from the date of plaint till date of decree and thereafter @ 21% p.a. till date of realization of the decree amount and for costs.
2. The case of the plaintiff in brief is as follows:- The plaintiff in the course of its business, at the request of the 2nd defendant, offered to supply palmolein oil at the specified quantifies. The plaintiff insisted on security for the credit facility being offered to the 2nd defendant. The 2nd defendant accordingly assured that he would provide necessary bank guarantee. After several rounds of discussions, the 1st defendant bank came forward to execute the bank guarantee in favour of the plaintiff in BG No.179 of 2001. In the said bank guarantee, the 1st defendant bank undertook to pay the plaintiff any money, subject to a maximum of Rs.25,00,000/- without any dispute raised by the 2nd defendant. As per the arrangement, the bank guarantee was to be in force for a period of one year from 11.02.2002 to 10.02.2003. Pursuant to the bank guarantee, various orders were placed by the 2nd defendant. The plaintiff made supplies of palmolein oil to the 2nd defendant to the tune of Rs.18,59,171/-. The details of supplies are as follows:-
Sl.No. Date of Supply Amount 1 08.04.2002 Rs.3,10,990/-2
08.04.2002 Rs.3,08,149/-3
12.04.2002 Rs.3,15,283/-4
12.04.2002 Rs.3,02,555/-5
13.04.2002 Rs.3,03,899/-6
13.04.2002 Rs.3,18,295/-
Total Rs.18,59,171/-
3. It is the further case of the plaintiff that the 2nd defendant had issued separate cheque for each invoice drawn on the 1st defendant bank in favour of the plaintiff and on presentation of the same for collection, all those cheques were returned by the 1st defendant bank with an endorsement "exceeds arrangements and insufficient funds". When the cheques issued by the 2nd defendant were not honoured, a representative of the plaintiff along with two other employees went to the 1st defendant bank on 02.05.2002 along with a covering letter dated 30.04.2002 expressing his desire to invoke the bank guarantee and also handed over the original bank guarantee to the Branch Manager one Mr.Kamarudeen, who, in turn, requested the representative of the plaintiff and the employees to wait outside his cabin stating that he would call them back after a few minutes. But, they were not called called as promised and when they enquired about the Manger, they were informed that the Manager had already left the bank premises. Thereafter, on enquiry, the plaintiff came to know that the manager did not turn up duty for next two days. When the Manager of the 1st defendant bank joined duty, the plaintiff demanded payment under the bank guarantee. But, he did not give any positive reply. Thereafter, the plaintiff was constrained to issue a notice dated 07.05.2002 for which the 1st defendant bank had sent a reply with all sorts false allegations on 16.05.2002. In the said circumstances, the plaintiff lodged a complaint before the Banking Ombudsman on 21.05.2002 against the unilateral cancellation of bank guarantee by the 1st defendant bank in collusion with the 2nd defendant. After the Banking Ombudsman took the complaint on file, the 2nd defendant, on the instigation of the 1st defendant filed W.P.No.30011 of 2002 before this Court and the same was disposed of on 19.02.2005 with a direction that the 2nd defendant should also be given an opportunity to take part in the proceedings before the Banking Ombudsman. Inspite of the same, the 2nd defendant had chosen to file an appeal in W.A.No.1603 of 2003 which is still pending before this court. The plaintiff supplied goods to the 2nd defendant under the strength of the irrevocable bank guarantee given by the 1st defendant bank. But, the 1st defendant bank has acted arbitrarily and colluded with the 2nd defendant in order to deprive the monies lawfully due to the plaintiff. Therefore, the defendants are jointly and severally liable to pay the suit amount with interest. In these circumstances the plaintiff is constrained to file the present suit for recovery of money due on supply of goods.
4. On service of summons, the 1st defendant entered appearance through his counsel. The suit summons to the 2nd defendant returned as "vacated the premises". But, despite substitution of service of summons through paper publication on 17.01.2006 and the printing of the name of the 2nd defendant in the cause list all along, the 2nd defendant remained absent. From the case records, it is seen that the 2nd defendant has not participated in trial throughout, hence, the 2nd defendant is set ex parte.
5. The 1st defendant filed his written statement, inter alia, contending that the 2nd defendant, who is a proprietary concern, is a constituent of the 1st defendant bank. The 2nd defendant has been enjoying certain credit facilities and one such facility was guarantee limit extended to the and the 2nd defendant. The 2nd defendant requested the 1st defendant for a guarantee to be issued in favour of the plaintiff. The 1st defendant after considering the proposal of the 2nd defendant issued a guarantee No.179/2001 dated 11.02.2002 for a sum of Rs.25,00,000/- in favour of the plaintiff and the guarantee was to remain in force for one year from 11.02.2002 to 10.02.2013. The bank guarantee was handed over to the 2nd defendant on 11.02.2002 itself. Even though the bank guarantee was issued on the request of the 2nd defendant, the plaintiff never confirmed the acceptance of the bank guarantee.
6. While so, on 02.05.2002 , the 2nd defendant handed over the original bank guarantee along with a covering letter dated 30.04.2002 requesting the bank to cancel the bank guarantee and to release the margin money held by the bank. Accordingly, the 1st defendant cancelled the bank guarantee in the normal course of business.
7. The 1st defendant denied the receipt of the original bank guarantee along with a covering letter from the plaintiff. The 1st defendant further denied the averment in the plaint that the representative of the plaintiff along with his two employees approached the 1st defendant's Branch Manager and sought for invocation of the bank guarantee stating that the 2nd defendant failed to perform his obligation.
8. The 1st defendant denied the averment in the plaint that the Manager Mr.Kamarudeen received the representatives of the plaintiff and he had left the bank without informing them and he did not report for work for the next two days. The Branch was headed by Chief Manager and assisted by Senior Manager and other Managers and Officers. Mr.Kamarudeen was not the final authority to decide on the question of any payment under a guarantee claim. The averment made in the plaint that the plaintiff approached Mr.Kamarudeen for invoking of the bank guarantee is only an after thought and the claim was made on a non existent guarantee.
9. The 1st defendant further contended that the bank guarantee in question was not irrevocable one. The 1st defendant had no obligation to settle the dues as the claim was made on a non existent bank guarantee and the 1st defendant had cancelled the bank guarantee in the normal course of business and the same was returned by the bank to the 2nd defendant. There is no cause of action for the suit as against the 1st defendant. The 1st defendant, therefore, prayed for dismissal of the suit.
10. On the above pleadings of either parties, this court framed the following issues for trial:-
1. Whether the 1st defendant bank furnished irrevocable bank guarantee bearing No.179/2001 dated 11.02.2002, at the instance and on behalf of 2nd defendant, in favour of the plaintiff?
2. Whether 1st defendant handed over the said original bank guarantee to 2nd defendant, who subsequently requested the Bank to cancel the said bank guarantee and accordingly, whether 1st defendant cancelled it, legally?
3. Whether the plaintiff handed over the bank guarantee to 1st defendant for encashment as per law?
4. Whether the plaintiff, within the time stipulated in the bank guarantee, exercised its option to enforce and encash the bank guarantee?
5. Whether the cheques issued by the 2nd defendant in favour of the plaintiff were all dishonored on various dates and thereby, paving the way for invoking the said bank guarantee?
6. Whether the plaintiff is entitled to recover the suit amount of Rs.29,00,306.75?
7. Whether the plaintiff is entitled to recover interest at the rate of 21% p.a. on Rs.18,59,171/- from the date of plaint till date of decree and thereafter also at the same rate till the realization?
8. To what relief is the plaintiff entitled"
11. During trial, the plaintiff examined its Manager-Accounts as P.W.1 and exhibited Ex.P.1 to P.24 and on the side of the defendants, 1st defendant bank examined its Chief Manager Mrs.N.Rekha as D.W.1 and its Manager Mr.Kamarudeen as D.W.2 and marked Ex.D.1 to D.9.
Issue Nos.1, 2 and 3:
12. The case of the plaintiff is that the plaintiff is engaged in the business of supply of palmolein oil and the 2nd defendant purchased palmolein from the plaintiff on credit basis and as security for the credit facility, at the instance of the 2nd defendant, 1st defendant bank has issued a bank guarantee for a maximum limit of Rs25,00,000/-. As per the guarantee agreement, the bank guarantee was to be kept in force for one year from 11.02.2002 to 10.02.2003 and the 1st defendant bank had agreed to pay the money notwithstanding any dispute.
13. As already stated above, the 2nd defendant did not choose to file his written statement and participate in the trial. The 1st defendant never disputed the execution of bank guarantee. But, it is the contention of the 1st defendant bank that even though bank guarantee was issued at the behest of the 2nd defendant, the plaintiff never confirmed the acceptance of the bank guarantee. Hence, according to the 1st defendant bank, the bank guarantee in question had become non existent guarantee.
14. The learned counsel for the plaintiff would contend that the bank guarantee being an irrevocable guarantee and the 1st defendant bank undertook and promised to pay the amount due from the 2nd defendant to the plaintiff subject to guarantee amount as stated above without any demur merely on demand from the plaintiff and the 2nd defendant is liable to pay a sum of Rs.18,59,171/- towards supply of palmolein and in order to discharge the above liability, the 2nd defendant had issued separate cheques for each supply totaling to a sum of Rs.18,59,179/- drawn in the 1st defendant bank, but all the above cheques were returned on presentation for collection with an endorsement "exceeds arrangements and insufficient funds". Since the 2nd defendant did not come forward to settle his liability, the plaintiff has invoked the bank guarantee.
15. Ex.P.2 is the bank guarantee. The invoices for the supplies made to the tune of RS.18,59,171/- are produced under Ex.P.4 to P.9. The dishonored cheques are produced Ex.P.10 to Ex.P.14. The letter sent by the plaintiff to the 1st defendant bank for invocation of bank guarantee is marked as Ex.P.3. The legal notice dated 07.05.2002 issued by the plaintiff to the 1st defendant for payment of money due under the bank guarantee is Ex.P.15.
16. The 2nd defendant did not come forward to disprove the claim of the plaintiff and it was only the 1st defendant bank which has filed the written statement contending that the plaintiff never confirmed the acceptance of the bank guarantee and hence, the bank guarantee had become non existent guarantee and based on the request made by the 2nd defendant, the 1st defendant bank had cancelled the bank guarantee in the normal course of business.
17. It is settled law that when in the course of commercial dealings an unconditional bank guarantee is given, the beneficiary is entitled to realize such a bank guarantee in terms thereof irrespective of any pending disputes. The bank giving such a guarantee is bound to honour it as per its terms irrespective of any dispute raised by its customer and it is an independent contract between the guarantor namely the bank and the guarantee namely the recipient.
18. In U.P. State Sugar Corporation vs M/S. Sumac International Ltd , 1997 (1) SCC 563 has held as follows:-
"The law relating to invocation of such bank guarantees is by now well settled. When in the course of commercial dealings an unconditional bank guarantee is given or accepted, the beneficiary is entitled to realize such a bank guarantee in terms thereof irrespective of any pending disputes. The bank giving such a guarantee is bound to honour it as per its terms irrespective of any dispute raised by its customer. The very purpose of giving such a bank guarantee would otherwise be defeated. The courts should, therefore, be slow in granting an injunction to restrain the realization of such a bank guarantee. The courts have carved out only two exceptions. A fraud in connection with such a bank guarantee would vitiate the very foundation of such a bank guarantee. Hence if there is such a fraud of which the beneficiary seeks to take advantage, he can be restrained from doing so. The second exception relates to cases where allowing the encashment of an unconditional bank guarantee would result in irretrievable harm or injustice to one of the parties concerned. Since in most cases payment of money under such a bank guarantee would adversely affect the bank and its customer at whose instance the guarantee is given, the harm or injustice contemplated under this head must be of such an exceptional and irretrievable nature as would override the terms of the guarantee and the adverse effect of such an injunction on commercial dealings in the country. The two grounds are not necessarily connected, though both may co-exist in some cases."
19. In another judgment in Ansal Engineering Projects Ltd v. Tehri Hydro Development Corporation Limited, (1996) 5 SCC 450, the Hon'ble Supreme Court has held as follows:-
"4. It is settled law that bank guarantee is an independent and distinct contract between the bank and the beneficiary and is not qualified by the underlying transaction and the validity of the primary contract between the person at whose instance the bank guarantee was given and the beneficiary. Unless fraud or special equity exists, is pleaded and prima facie established by strong evidence as a triable issue, the beneficiary cannot be restrained from encashing the bank guarantee even if dispute between the beneficiary and the person at whose instance the bank guarantee was given by the bank, had arisen in performance of the contract or execution of the works undertaken in furtherance thereof. The bank unconditionally and irrevocably promised to pay, on demand, the amount of liability undertaken in the guarantee without any demur or dispute in terms of the bank guarantee. The object behind is to inculcate respect for free flow of commerce and trade and faith in the commercial banking transactions unhedged by pending disputes between the beneficiary and the contractor.
... ... ... ... ... ...
6. A conjoint reading of the bank guarantee and the letter of invocation demanding payment of amount due and payable by the petitioner would show that the first respondent had specified and quantified in terms of the bank guarantee a total sum with interest due thereon in a sum of Rs 57,57,970 as on 5-4-1995. A demand in terms of clause (i) of the bank guarantee was made. The bank had irrevocably promised and undertaken to pay to the Corporation without any demur or damage an amount not exceeding Rs 57,57,970 plus interest as per terms and conditions contained in the bank guarantee untrammelled by the bilateral agreement between the petitioner and the first respondent-Corporation stating the amount claimed was due and payable on account of loss or damage caused to or likely to be caused to or by the Corporation by reason of any breach by the said contract or any of the terms and conditions contained in the said agreement notwithstanding any dispute or disputes raised under the contract in any suit or proceedings pending before any court or tribunal relating thereto. The liability of the bank is absolute and unequivocal; it would thereby be clear that the bank is not concerned with the ultimate decision of a court and a tribunal in its finding after adjudication as to the amount due and payable by the petitioner to the first respondent. What would be material is the quantification of the liability in the letter of revocation. The bank should verify whether the amount claimed is within the terms of the bank guarantee or letter of credit. It is axiomatic that any payment by the bank, obviously be subject to the final decision of the court or the tribunal. At the stage of invocation of bank guarantee, the need for final adjudication and decision on the amount due and payable by the petitioner, would run contrary to the terms of the special contract in which the bank had undertaken to pay the amount due and payable by the contractor. Thus we hold that there is no question of making out any prima facie case much less strong evidence or special equity or exceptional circumstances for interference by way of injunction.
20. Keeping the above principle in mind, let me now consider Ex.P.2 bank guarantee issued by the 1st defendant bank and the relevant portions of the bank guarantee read as follows:-
Whereas the said bank do hereby further undertakes and promise to pay the amount due from the dealer to the suppliers subject to guarantee amount as stated above without any demur, merely on a demand from the suppliers stating that the amount claimed is due to the supplier against their business dealing with the dealer.
Whereas the said Bank further undertakes to pay the suppliers any money so demanded, subject to maximum of Rs.25,00,000/- (Rupees Twenty Five Lakhs only) notwithstanding any dispute or disputes raised by the dealer and pending with any court of law or arbitrators."
21. Under Ex.P.2 bank guarantee, the 1st defendant bank undertook to pay the the plaintiff on demand not withstanding any dispute or disputes raised by the dealier and pending with any court of law or arbitrators. P.W.1 has spoken about the supplies made to the 2nd defendant and the liability of the 2nd defendant by producing Ex.P.4 to Ex.P.9. The cheques issued for the dues were all returned on presentation by the 1st defendant bank and the same been marked as Ex.P.10 to Ex.P.14. The 2nd defendant, who was supposed to either accept or disprove the claim did not file his written statement and contest the suit. Thus, this court is of the view that the plaintiff has proved his claim. Apart from that absolutely there is no plea of fraud committed by the plaintiff. In such circumstances, the 1st defendant bank is bound to honour the bank guarantee.
22. It is the contention of the 1st defendant that even though the bank guarantee was issued by the 1st defendant to the 2nd defendant, the same was not received by the plaintiff and the plaintiff has failed to accpet the same. Hence, in the absence of acceptance on the part of the plaintiff, there is no concluded contract between the plaintiff and the 1st defendant and the 1st defendant is not bound to honour the bank guarantee.
23. The learned counsel for the 1st defendant drawing the attention of this court to the provision of Section 126 of the Contract Act and would submit that bank guarantee is a contract to perform the promise and under Section 2(b) of the Contract Act, only when the proposal made by the 1st defendant bank is accepted, it becomes promise. When the plaintiff failed to accept the bank guarantee, it does not constitute a binding contract. Hence, the plaintiff being the beneficiary opted to invoke the bank guarantee. Once the contract between the bank and the plaintiff is independent, the plaintiff has to necessarily comply with the principles of The Contract Act.
24. In support of his contentions, the learned counsel for the 1st defendant relied upon the following judgments:
(i) H.Mohamed Khan v. Andhra Bank Limited reported in Manu/KA/0003/1982;
(ii) Vintec Electronics Private Limited v. HCL Infosystems Limited reported in (2008) 1 SCC 544;
(iii) M.P.State Cooperative Oilseed Growers' Fenderation Limited v. Pepsi Co. India Holdings Limited reported in Manu/MP/0547/1998;
(iv) Kuldip Gandotra v. Union of India reported in Manu/DE/3055/2005;
(v) Bank of India v. O.P.Swaranakar reported in AIR 2003 SC 858;
(vi) New India Assurance Co. Ltd v. Raghuvir Singh Narang, reported in (2010) 5 SCC 335;
(vii) Iswar Bhai c. Patel @ Bachu Bhai Patel v. Harihar Behera, reported in (1999) 3 SCC 457;
(viii) P.Dilip Kumar v. Life Insurance Corporation of India reported in Manu/KA/3184/2013;
(ix) Naseem Noorullah v. Abdul Salam reported in Manu/AP/0387/2002;
(x) Anil Rishi v. Gurbaksh Singh reported in (2006) 5 SCC 558; and
(xi) Rangammal v. Kuppuswami, reported in (2011) 12 SCC 220.
25. In the considered opinion of this court, none of the judgment relied upon by the learned counsel would lend support to his case. H.Mohamed Khan' case cited supra, the issue was whether the defendant had executed any letter of guarantee in favour of the plaintiff and in paragraphs 24 to 26 of the judgment, the Hon'ble Supreme Court has only discussed about the legal position regarding the contract of guarantee. In Vintec Electronics Private Limited's case cited supra also the Hon'ble Supreme Court has held in para 12 as follows:-
12. It is equally well settled in law that bank guarantee is an independent contract between bank and the beneficiary thereof. The bank is always obliged to honour its guarantee as long as it is an unconditional and irrevocable one. The dispute between the beneficiary and the party at whose instance the bank has given the guarantee is immaterial and of no consequence. In BSES Ltd. v. Fenner India Ltd. [(2006) 2 SCC 728] this Court held: (SCC pp. 733-34, para 10) 10. There are, however, two exceptions to this rule. The first is when there is a clear fraud of which the bank has notice and a fraud of the beneficiary from which it seeks to benefit. The fraud must be of an egregious nature as to vitiate the entire underlying transaction. The second exception to the general rule of non-intervention is when there are special equities in favour of injunction, such as when irretrievable injury or irretrievable injustice would occur if such an injunction were not granted. The general rule and its exceptions has been reiterated in so many judgments of this Court [Ed.: See e.g. U.P. State Sugar Corpn. v. Sumac International Ltd., (1997) 1 SCC 568 at pp. 574-77, paras 12-16; State of Maharashtra v. National Construction Co., (1996) 1 SCC 735 at p. 741, para 13. See also United Commercial Bank v. Bank of India, (1981) 2 SCC 766; Centax (India) Ltd. v. Vinmar Impex Inc., (1986) 4 SCC 136.] , that in U.P. State Sugar Corpn. v. Sumac International Ltd. [(1997) 1 SCC 568] (hereinafter U.P. State Sugar Corpn. [(1997) 1 SCC 568] ) this Court, correctly declared that the law was settled.
26. In the instant case also, the bank guarantee is unconditional and irrevocable. Hence, the judgment relied upon by the learned counsel for the 1st defendant operates only against the 1st defendant bank. In the other judgments relied upon by the learned counsel for the 1st defendant, no principle has been laid down that bank guarantee is only an offer and unless the offer is accepted, there would not be any concluded contract between the parties.
27. Even if the above contention is accepted, in the instant case, it is an admitted fact that Ex.P.2 bank guarantee has been sent to the plaintiff by the 1st defendant bank with the covering letter which has been marked along with Ex.P.2 bank guarantee wherein the bank had requested the plaintiff to only acknowledge the receipt of the same. In the said circumstances, after having forwarded the bank guarantee (Ex.P.2) to the plaintiff, it is not open to the 1st defendant to contend that the offer was not accepted by the plaintiff. The acceptance of offer has been signified by the conduct of the plaintiff. The contract being independent one between the 1st defendant bank and the plaintiff, the 1st defendant bank is bound to honour its obligations under the bank guarantee. In the said circumstances, the contention of the learned counsel for the 1st defendant bank cannot be countenanced. Since the original bank guarantee had already been sent to the plaintiff, there is no occasion for the 2nd defendant to handover the original bank guarantee to the bank with a request to cancel the same. Since the bank guarantee is being unconditional one, the 1st defendant bank cannot cancel the same at the request of the 2nd defendant. In view of the foregoing discussions, I answer the Issue Nos.1, 2 and 3 in favour of the plaintiff and as against the defendants.
28. Issue No.4: It is also an admitted fact that the bank guarantee has been given for a period of one year commencing from 11.02.2002 to 10.02.2003. It is the case of the plaintiff that they have produced the bank guarantee on 02.05.2002 before the 1st defendant during the currency of the bank guarantee for invocation of the bank guarantee along with a cover letter dated 30.04.2002 (Ex.P.3). It was disputed by the 1st defendant. But, subsequently, when the plaintiff sent a legal notice - Ex.P.15, dated 07.05.2002, demanding payment, the bank has sent a reply - Ex.D.5, dated 16.05.2002. In Ex.D.5, the 1st defendant bank has, for the first time, stated that based on the letter - Ex.D.3 dated 30.04.2002, sent by the 2nd defendant, the 1st defendant bank had cancelled the bank guarantee and the plaintiff was not entitled to invoke the bank guarantee. But, even in that notice, absolutely, there is no reference regarding alleged letter given by the 2nd defendant for cancellation of the bank guarantee. The evidence of D.W.1 and D.W.2 did not support the case of the 1st defendant regarding the cancellation of the bank guarantee at the request of the 2nd defendant. Ex.D.3 letter coupled with the legal notice sent by the plaintiff under Ex.P.15 and the subsequent complaint given by the plaintiff before the Banking Ombudsman under Ex.P.17 dated 21.05.2002 and the reply sent by the Banking Ombudsman would all clearly go to establish that the plaintiff had exercised his option to invoke the bank guarantee in time. Hence, this issue is also answered in favour of the plaintiff and as against the defendants.
29. Issue No.5: In order to prove the liability of the 2nd defendant, the plaintiff has marked the supply bills/invoices under Ex.P.4 to P.9 and the dishonored cheques were also marked as Ex.P.10 to P.14. But, the 2nd defendant, who is the competent person to dispute the claim, as already stated above, has not filed his written statement and let in any evidence to disprove the claim of the plaintiff. IN the above circumstances, this court is of the view that the plaintiff has proved that the cheques issued by the defendants towards his liability were dishonored. Considering all these materials, this court is of the view that the plaintiff has proved his case and hence, he is entitled for decree as prayed for with costs.
30. In the result, the suit is decreed as prayed for with costs.
28.06.2018 kmk Witnesses Examined on the side of the Plaintiff:
P.W.1 - Mr.R.Venkatraman (Manager - Accounts of the plaintiff) Witnesses examined and on the side of the defendant:-
D.W.1 - Mrs.N.Rekha (the then Chief Manager of the 1st defendant bank) D.W.2 - Mr.Kamarudeen (the then Manager of the 1st defendant Bank) Documents marked on the side of the Plaintiff:
Ex.P.1 16.06.2012 Extract from the minutes of the meeting of the Executive Committee of the Board of Directors of the Plaintiff company Ex.P.2 11.02.2002 Xerox copy of the Bank Guarantee along with the covering letter Ex.P.3 30.04.2002 Xerox copy of the letter sent by the plaintiff to the 1st defendant Ex.P.4 08.04.2002 Copy of Invoice Ex.P.5 08.04.2002 Copy of Invoice Ex.P.6 12.04.2002 Copy of Invoice Ex.P.7 12.04.2002 Copy of Invoice Ex.P.8 13.04.2002 Copy of Invoice Ex.P.9 13.04.2002 Copy of Invoice Ex.P.10 18.04.2002 Two cheques along with cheque return memo Ex.P.11 22.04.2002 Cheque along with cheque return memo Ex.P.12 22.04.2002 Cheque along with cheque returned memo Ex.P.13 23.04.2002 Cheque along with cheque returned memo Ex.P.14 24.04.2002 Cheque along with cheque returned memo Ex.P.15 07.05.2002 Xerox copy of the legal notice issued by the plaintiff's counsel to the 1st defendant with the xerox copy of the postal acknowledgments (4 Nos.) Ex.P.16 10.05.2002 Xerox copy of the notice sent by the plaintiff to the 2nd defendant Ex.P.17 21.05.2002 Xerox copy of the complaint given by the plaintiff before the Banking Ombudsman Ex.P.18 12.06.2002 Xerox copy of the acknowledgment sent by the Banking Ombudsman to the plaintiff Ex.P.19 11.07.2002 Xerox copy of the notice sent by the Banking Ombudsman to the plaintiff Ex.P.20 22.07.2002 Xerox copy of the notice sent by the Banking Ombudsman to the plaintiff Ex.P.21 24.07.2002 Xerox copy of the letter sent by the Banking Ombudsman to the plaintiff Ex.P.22 31.03.2003 Xerox copy of the letter sent by the Banking Ombudsman to the plaintiff Ex.P.23 16.04.2003 Xerox copy of the letter sent by the plaintiff to the Banking Ombudsman Ex.P.24 03.01.2005 Extract from the minutes of the meeting of the Board of Directors of the plaintiff company Witnesses examined and on the side of the defendants:
Ex.D.1 16.01.2002 Sanction advice issued by the 1st defendant Ex.D.2 11.02.2002 Bank Guarantee Ex.D.3 30.04.2002 Letter written by the 2nd defendant to the 1st defendant Ex.D.4 07.05.2002 Xerox copy of the legal notice issued by the plaintiff's counsel to the 1st defendant Ex.D.5 16.05.2002 Reply Notice issued by the 1st defendant's counsel on behalf of the 1st defendant to the plaintiff Ex.D.6 12.05.2002 Xerox copy of the letter sent by the Banking Ombudsman to the 1st defendant Ex.D.7 27.06.2002 Xerox copy of the letter sent by the 1st defendant to the Banking Ombudsman Ex.D.8 04.06.2003 Statement of Account Ex.D.9 02.07.2009 Certificate relating to statement of 1st defendant given by the 1st defendant 28.06.2008 V.BHARATHIDASAN.J., kmk Civil Suit No.132 of 2005 28.06.2018 .....0.....