Delhi District Court
State Bank Of India vs Sh. Deepak Gupta on 4 December, 2021
IN THE COURT OF SHRI MAN MOHAN SHARMA,
DISTRICT JUDGE (COMMERCIAL COURT)06,
CENTRAL DISTRICT
TIS HAZARI COURTS, DELHI
IN THE MATTER OF :
CS (Commercial) No. 2574/2019
State Bank of India
Stressed Assets Recovery Centre (SARC)
RACPC, First Floor,
11, Sansad Marg,
New Delhi110001 ......Plaintiff
VERSUS
1. Sh. Deepak Gupta
S/o Sh. Sita Ram Gupta,
R/o House no.356, Gali no.1,
Chhalera Banger,
Sector44, Noida
Gautam Budh Nagar,
U. P. - 201303
2. Shri Vikas
S/o Sh. Sita Ram Gupta
R/o House no. 356, Gali no. 1,
Chhalera Banger,
Sector44, Noida,
Gautam Budh Nagar,
UP201303
Also at
Shop no. 2,
(Opp: Step by Step School)
Tomar Market,
Sector132, Noida, U.P. .......Defendants
CS (Comm.) No. 2574/2019 Page 1 of 13
Date of Institution : 14.08.2019
Date of Arguments : 27.11.2021
Date of Judgment : 04.12.2021
JUDGMENT
1. The plaintiff has instituted a suit for recovery of ₹3,99,394/ (Rupees Three Lakh Ninety Nine Thousand Three Hundred Ninety Four only) against the defendant on 14.08.2019.
Plaintiff's Case
2. Briefly stated, the case of the plaintiff is that it is a body corporate under the State Bank of India Act, 1955. The suit has been instituted through its authorized representative, Shri Rajeev Jain.
3. The defendants approached the plaintiff for grant of a loan amounting to Rs.6,00,000/ (Rupees Six Lakh Only) for purchase of a vehicle namely SWIFT DZIE VDI bearing registration no. UP16AZ5445 vide application dated 24.09.2014.
4. The plaintiff acceded to the request of the defendants and disbursed an amount of Rs.6,00,000/ (Rupees Six Lakh only) to the defendants, which was to be repayable in 84 EMIs of Rs.10,101/ (Rupees Ten Thousand One Hundred One only) each and that the defendants executed following documents in favour of plaintiff:
(a). Loan cum Hypothecation Agreement dated 21.10.2014.
(b). Arrangement Letter dated 21.10.2014.
CS (Comm.) No. 2574/2019 Page 2 of 13(c). Vehicle Delivery Letter dated 21.10.2014.
5. After making various payment through ECS as well as cash payment, the defendants did not adhere to financial discipline and did not care to pay the monthly installments regularly despite various letter dated 04.03.2016, 23.03.2017, 05.09.2017, 26.12.2017, 25.04.2018 and 18.02.2019, personal visits and telephonic reminders.
6. The plaintiff has prayed that the suit be decreed in the sum of ₹3,99,394/ (Rupees Three Lakh Ninety Nine Thousand Three Hundred Ninety Four only) with interest @9.45% per annum from the filing of the suit till actual final realization. Cost of the suit has also been prayed for. Service of the Defendants and Court Proceedings
7. The process had been sent to defendants through WhatsApp on 18.12.2020 as recorded in the minutes of proceedings dated 19.12.2020.
8. Despite service, the defendants neither caused their appearance nor filed their Written Statement. On the expiry of 120 days from the date of service viz. 18.12.2020 the defendants had forfeited their right to file a Written Statement.
9. On 06.09.2021 the case has been posted for plaintiff's evidence for 16.10.2021. No adverse order had been passed against the defendants notwithstanding their absence. Their right to cross examine the PWs, without putting forth their defence (there being no statement of defence on record) and to address oral arguments had been CS (Comm.) No. 2574/2019 Page 3 of 13 kept reserved.
10.PW1 Ms. Ruchika Arora had been examined on 27.11.2021. The defendants did not join the proceedings on that day. Had they appeared they would have rightfully availed the opportunity to cross examine the said witness, of course without putting forth their defence. Thus, they forfeited their rights by nonappearance, nonfiling of written statement etc. and they did not present themselves before the Court to press any such right.
11.PE was closed on 27.11.2021 and on the same day final arguments were concluded. As stated above, none appeared on behalf of the defendants to address the final arguments as well.
Plaintiff's Evidence
12.In its evidence, the plaintiff has examined only one witness i.e. Ms. Ruchika Arora, its Authorized Representative, as PW1.
13.PW1 tendered his oral evidence contained in affidavit Ex.PW1/A He tendered the following documents in evidence: Documents Exhibits Copy of Gazette Notification of 2005 Ex.PW1/1 Photocopy of proforma invoice and Mark 'X' payment Car Loan Application Ex.PW1/2 Loan cum Hypothecaton Agreement Ex.PW1/3 dated 21.10.2014 Arrangement Letter dated 21.10.2014 Ex.PW1/4 CS (Comm.) No. 2574/2019 Page 4 of 13 Vehicle Delivery Letter dated Ex.PW1/5 21.10.2014.
PAN card and Election I Card of Mark 'B'
defendant
Copy of Registration Certificate of Mark 'C'
vehicle
Copy of Insurance Certificate Mark 'D'
Copies of letter sent by the plaintiff to the Ex.PW1/6 defendants Legal notice dated 18.03.2019 sent by Ex.PW1/7 the plaintiff to the defendants Original postal receipt Ex.PW1/8 Statement of account Ex.PW1/9 Certificate under Section 2A(c) of Ex.PW1/10 Banker's Book of Evidence Act
14.The plaintiff evidence has been closed on 27.11.2021.
15.There is no defence statement or defence evidence.
Arguments
16.I have heard the submissions advanced by Sh. Vijay Shukla, ld. counsel for the plaintiff.
17.Ld. counsel for plaintiff has submitted that the subject matter of the suit is a commercial dispute within the meaning of section 2 (1) (c) (i) and other applicable provisions of the Commercial Courts Act, 2015.
18.The plaintiff is a bank under an Act of Parliament. The evidence of its sole witness has been based upon the records maintained by the bank in the ordinary course of its banking business. The testimony of the plaintiff's witness has remained unchallenged and unimpugned as CS (Comm.) No. 2574/2019 Page 5 of 13 the defendant has not come forward to defend the suit despite being duly served. The suit is within the limitation. There is no legal impediment that the suit cannot be decreed in favour of the plaintiff.
19.The plaintiff has relied upon the judgment rendered on 31.01.2018 by the Hon'ble High Court of Delhi in RFA No. 297/2015 titled 'M/S ICICI Bank Limited versus Kamini Sharma & Another' wherein on the similar facts the suit of the plaintiff has been decreed. Thus, the plaintiff is entitled to a decree with costs.
Appreciation of Evidence & Arguments
20. On a meaningful reading of the plaint, the suit is apparently within the provisions of the Commercial Court Act, 2015 and the transaction, which is subject matter of the suit, is squarely covered by the definition of a commercial dispute within the meaning of section 2 (1) (c)
(i) of the Act.
21.I have considered the law laid down in State Bank of India vs Kashmir Art Printing Press, Sirsa AIR 1981 P H 188, 1983 54 Comp Cas 56 P H). I have also gone through the judgments passed by the Hon'ble High Court of Delhi in State Bank of India vs Earnest Traders Exporters 1997 IIIAD Delhi 467, 67 (1997) DLT 218, 1997 (41) DRJ 659 and in State Bank of India vs Indian Utility Products and Ors. AIR 2001 Delhi 30. I have considered the judgment of Mahanagar Telephone Nigam Ltd. vs Bharat Bhushan Sharma passed by Hon'ble High Court of Delhi on 6 CS (Comm.) No. 2574/2019 Page 6 of 13 December, 2010 in RFA No. 343/2001. These judgments consider the position of the plaintiff bank under the State Bank of India Act, 1955 and the institution of suit by its officials, their authority as such and the verification of plaints and pleadings by them. This applies to the subsidiaries of the State Bank of India as well.
22.It is the settled position that State Bank of India and its subsidiaries are a creation of a special statute and is thus entitled to the special status as provided under the State Bank of India Act, 1955. Thus, various notifications published in the Gazette of India do not require any formal proof and a judicial notice of the same can be taken under section 57 of the Indian Evidence Act, 1872. In light of this, the instant suit has been validly instituted. The plaint has also been supported with a State of Truth subsequently. Thus there is compliance of Order VI Rule 15A of the Code of Civil Procedure as well.
23.The summons which has been sent to the defendants in this case have been the summons for the settlement of issues. The summons did not put the defendants on a caveat that in case of their nonappearance the averment in the plaint shall be deemed to be admitted. Thus, even when the defendants have not come forward to contest the suit and have not joined the proceedings, the plaintiff is still liable to prove its case on preponderance of probabilities. The suit of the plaintiff has been accordingly examined on this touchstone.
CS (Comm.) No. 2574/2019 Page 7 of 1324.PW 1 has tendered his oral evidence which is contained in his affidavit Ex. PW1/A. A question may arise here that PW1 is not privy to the execution of various documents on which the cause of action has been founded upon by the defendant. On this aspect the Ld. Counsel for the plaintiff has placed strong reliance on judgment passed on 31.01.2018 by the Hon'ble High Court of Delhi in RFA No. 297/2015 titled 'M/S ICICI Bank Limited versus Kamini Sharma & Another'. The judgment of Hon'ble High Court of Delhi in ICICI Bank Ltd. vs. Sunil Sharma passed in RFA 340/2015 on 31.01.2018 in which the pronouncement has been made regarding appreciation of documentary evidence in cases of public financial institution, appreciation/certification of electronic evidence etc. is also applicable in the facts and circumstances of this case.
25.The sum and substance of the facts of this case are similarly placed as the facts in the above judgments.
26.PW1 has tendered in evidence a gazette notification of 2005 as Ex. PW1/1 with memo dated 11.04.2008. These are in public domain and under section 57 of the Evidence Act, 1872 a judicial notice of the same can be taken. The authority to sue on behalf of the plaintiff has been stated them as well as the other incidental and ancillary powers.
27.One pertinent question that may arise is whether the power to give evidence can be delegated. The answer has to be in negative in view of the law laid down by the Hon'ble Apex CS (Comm.) No. 2574/2019 Page 8 of 13 Court in Man Kaur (Dead) by LRs vs. Hartar Singh Sandhwa (2010) 10 SCC 512. However, the evidence in this case is documentary evidence maintained in the ordinary course of business by a bank created under an Act of the Parliament.
28. The evidence in this case is primarily documentary. At the cost of repetition, the documents tendered in evidence by the plaintiff are the documents maintained by a bank in the ordinary course of its business. Though the exceptions cannot be ruled out, but generally taking a due notice of the banking business, these documents can be considered to be duly executed in due course of the business and capable of binding the parties into a contractual relationship. I am also supported by the judgments of our own High Court in the case of Kamini Sharma (supra) and Sunil Sharma (supra) on this aspect.
29.A civil case proceeds on the doctrine of preponderance of probabilities and not on proof beyond reasonable doubt. There is no denying the fact that nonappearance of defendant cannot be taken as a circumstance against him to draw an inference that it tantamount to an admission of the case of the plaintiff, as there may be thousand and one reasons for his nonappearance, and the Court cannot speculate into the reasons for his nonappearance on some analogy based on certain conjectures and surmises. Yet, it is the settled law that in any trial absolute certainty is a myth and the law has provided for working solution in the CS (Comm.) No. 2574/2019 Page 9 of 13 form of doctrine of preponderance of probabilities. Placing reliance upon the judgment cited by the plaintiff and on the strength of the pronouncement made therein there is enough room to take the documents tendered by the plaintiff on their face value without any demur. The defendants by sitting back, despite service of summons, cannot derive any advantage to the detriment of the plaintiff.
30.The plaintiff has proved on record that the defendants had applied for a car loan vide loan application Ex. PW1/2 and subsequently, entered into a loan cum hypothecation agreement Ex. PW 1/3. The bank has accepted the request and sanction the loan vide letter Ex. PW1/4. The vehicle delivery letter is Ex. PW1/5.
31.Thus, appreciating the evidence tendered by the plaintiff it is clear that the defendants had approached the plaintiff bank for disbursement of loan. The bank acceded to the request and consequent upon the same the defendants executed various loan documents. The defendants failed to adhere to the financial discipline. The various transactions have been recorded in the statement of account Ex. PW1/9, maintained by the plaintiff in the ordinary course of its business. The same being electronic records have been accompanied with certificates under the Bankers' Books Evidence Act and the Indian Evidence Act respectively. As such they are admissible in evidence without production of the originals or the production of the computer system.
CS (Comm.) No. 2574/2019 Page 10 of 1332.These documents prove the factum of the defendants applying to the plaintiff for grant of a loan facility to purchase a car. There plaintiff accepted the request and sanctioned a term loan. The defendants made various payment till 23.07.2018. On no further payment received the account became irregular. The plaintiff has also served a notice dated 18.03.2019 vide Ex. PW1/7 upon the defendants calling upon them to clear the outstanding in their account. However, the defendants did not comply with the same. Due to noncompliance of its terms on the part of the defendants, the plaintiff took legal recourse by filing the instant suit for recovery on 14.08.2019.
33.The loan has been disbursed by the plaintiff to the defendants on 21.10.2014. Various payment were made by the defendant and the last payment was received by the plaintiff on 23.07.2018 during the currency of limitation. The suit has been instituted on 14.08.2019 and the same is therefore within the prescribed period of limitation.
34.The plaintiff has claimed the suit amount, the components of which have been stated in para 14 of the plaint as under: Particulars Amount ₹ Outstanding due towards principal as 3,59,796.29 well as applied interest Un applied interest at applicable rate 37,977.00 w.e.f. 31.07.2018 to till 31.07.2018 Miscellaneous Debits 1,621.00 Total outstanding due (rounded of) 3,99,394.00 CS (Comm.) No. 2574/2019 Page 11 of 13
35. The plaintiff is entitled to the outstanding principal and pendentelite and future interest. The same flow from the contractual relationship as per the terms and conditions settled and part forming of the loan documents.
36.The plaintiff has claimed pendentelite and future interest w.e.f. 14.08.2019 @ 9.45% per annum. The plaintiff is entitled to same as it is reasonable and in consonance with the contemporary banking and economic milieu, risk factors involved and other attendant circumstances.
37.The interest accrued from the date of suit till the date of decree shall stand capitalized in the principal sum/suit amount. The plaintiff shall be liable to pay the deficient court fee accordingly.
38.Thus, the suit of the plaintiff is liable to be decreed in terms as stated above.
ORDER
39.The suit of the plaintiff is decreed in the sum of ₹ 3,99,394/ (Rupees Three Lakh Ninety Nine Thousand Three Hundred Ninety Four only) with simple interest @ 9.45% per annum from the date of the institution of the suit i.e. 14.08.2019 till realization of the entire amount. The interest accrued from the date of suit viz. 14.08.2019 till the date of decree viz. 04.12.2021 shall stand capitalized in the principal sum/suit amount. The plaintiff shall be liable to pay the further court fee accordingly. The decreetal sum shall be payable by both the defendants jointly and severally.
CS (Comm.) No. 2574/2019 Page 12 of 1340.The plaintiff shall be entitled to the costs of the suits as well as per the rules. Certificate of counsel fee (if any submitted) be taken into reckoning while computing the costs.
41.Balance Court Fee be deposited by the plaintiff within 30 days of the passing of this judgment. Thereafter the decree shall be drawn accordingly.
Copy of the Judgment
42.In compliance of the provisions of the Order XX Rule 1 of the Code of Civil Procedure (as amended uptodate by the Commercial Courts Act, 2015) a copy of this judgment be issued to all the parties to the dispute through electronic mail, if the particulars of the same have been furnished, or otherwise. This judgment be also uploaded on the website of the Delhi District Court forthwith.
43.File be consigned to the Record Room.
Announced in the open court MANMOHAN Digitally signed by MANMOHAN SHARMA on 04.12.2021 SHARMA Date: 2021.12.14 16:05:54 +0530 (Man Mohan Sharma) District Judge (Commercial Court)06
Central District, Tis Hazari Courts,Delhi CS (Comm.) No. 2574/2019 Page 13 of 13