Delhi District Court
Idbi Bank Ltd vs Sh. Subhash Chandra on 25 January, 2014
1
IN THE COURT OF DR. ARCHANA SINHA, ADDL. DISTRICT &
SESSIONS JUDGE (CENTRAL 03), THC, DELHI
Date of institution : 04.01.2011
Judgment reserved on : 21.01.2014
Judgment delivered on : 25.01.2014
Suit No. 94/2011
Unique Case ID No. 02401C0002542011
IDBI Bank Ltd., A body Corporate constituted
under the Banking Regulations Act 1949 and
A company incorporated under the Companies
Act 1956 having its registered office at IDBI Tower,
World Trade Centre Complex, Cuffe Parade,
Mumbai400005 and amongst other places
A branch at first floor, Videocon Tower,
Jhandewalan, New Delhi110005 and also at
Retail Asset Centre, First floor, 54 Ring Road,
Lajpat NagarIII, New Delhi110024 through its
Assistant Manager Sh. Rohit Mehra .....Plaintiff
Versus
Sh. Subhash Chandra,
1791A/8, Govind Puri Extension,
Kalkaji, New Delhi - 110019.
Also at :
M/s. Chandra Garments,
1573/13, Govind Puri Extension,
Kalkaji, New Delhi - 110019. ....Defendant
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 1/20
2
J U D G M E NT
1.This is a suit for recovery for an amount of Rs. 6,52,789/ along with pendentelite and future interest, costs, incidental expenses and other charges, filed under summary procedure prescribed within Order 37 CPC, but vide order dated 29.01.2011 passed by Ld. Predecessor, it was treated as an ordinary suit and the summons for settlement were issued in an ordinary way.
2. The brief resume of the facts of the case is that the plaintiff bank is a body corporate constituted under the Banking Regulations Act 1949, having various branches all over India including one at Retail Asset Centre, First Floor, Lajpat Nagar III, New Delhi24. The plaint is filed through Sh. Rohit Mehra, an Assistant Manager, IDBI Bank Ltd., who was appointed as an authorized representative by the plaintiff, vide its board resolution dated 19.10.06, to sign, verify and file the present suit.
3. The case, as has been set out in the plaint, is that in the month of June, 2008, the defendant approached the plaintiff bank through an application dated 10.06.2008, for grant of a personal loan facility for a sum of Rs. 6,00,000/ (Rupees Six Lakhs) for the purposes of investments and allied activities and executed the loan agreement dated 30.06.2008 and other documents and sanctioned an amount of Rs. 5,65,000/ (Rupees Five Lakh Sixty Five Thousand) under a specific discipline of repayment in 36 EMIs (Equated monthly Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 2/20 3 installments) of Rs. 20,425/ along with a floating rate of interest @ 18% per annum and promised to adhere to the terms and conditions of the Agreement, but the bank credited only an amount of Rs. 3,34 , 387/ vide transfer entry, to the account no. 05621010000330 of the defendant maintained with the Oriental Bank of Commerce, New Delhi.
4. As per the pleadings, the defendant had failed to adhere the financial discipline, as per the terms agreed by him and the loan account of the defendant was declared as NonPerforming Assets (NPA), but the defendant failed to regularize such account.
In these circumstances, the plaintiff had issued a legal notice of demand dated 10.11.2010, to deposit the outstanding payment within a period of 7 days from the receipt of such notice, but the defendant despite service of such notice, neither replied to nor complied with the demand. Hence the suit.
5. To contest the claim of the plaintiff, the defendant has filed the written statement stating that the claim of the plaintiff bank is false, frivolous and unsubstantiated and that there is no cause of action in the present suit, and the suit is also liable to be rejected under Order 7 Rule 11(e) CPC. It is also submitted that the suit cannot be entertained within the provisions of Order 37 of CPC, as there was no written agreement between the parties. It is prayed that the suit be dismissed with costs.
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 3/20 4
6. On merits, it is stated that defendant has never applied for loan of Rs.
6,00,000/, nor any loan for an amount of Rs. 5,65,000/ was ever sanctioned to him, and that he has applied only for a loan 89 years back before, and he was paying the installments to discharge such loan liability to the bank. He has specifically denied that any amount of Rs. 6,52,789/ was ever due or payable or any interest thereupon by him to the bank. Also that the statement of account filed in this case by the plaintiff bank is absolutely in contravention of the guidelines given by the Apex Court and is not prepared and proved to have been maintained in accordance with Bankers Books of Evidence Act. Also that, the signatures of the defendant were obtained on certain blank documents, at the time of applying of first loan with the bank & those were filled up and some typed matter of words and figures have been filled up, without the knowledge, consent and information and most probably for the filing of the present suit, and that there was no loan agreement for any second loan, as alleged ever executed. It is prayed that the suit may be dismissed with costs.
7. Replication has been filed by the plaintiff to the Written Statement of the defendant in which the allegations made in the Written Statement were denied in toto and those made in the plaint were reiterated as correct.
8. On the basis of pleadings of the parties, vide order dated 05.11.11, the following issues were framed:
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 4/20 5
(i) Whether there is no cause of action against the defendant for filing the suit by the plaintiff? OPP
(ii) Whether the plaint of the suit is liable to be rejected U/o 7 R 11 (e) CPC? OPD
(iii) Whether the plaintiff is entitled for the recovery of the amount as claimed in prayer clause of the suit? OPP
(iv) Whether the plaintiff is entitled for any interest? If so at what rate and for which period ? OPP
(v) Relief.
9. The plaintiff in support of its case, has produced and exhibited the following documents:
1. The General Power of Attorney dated 22.06.2007 as Ex.PW1/1.
2. The Loan Application dated 10.06.2008 as Ex. PW1/2.
3. The Personal Loan Agreement dated 30.06.2008 as Ex. PW1/3.
4. The summary of accounts Ex.PW1/4.
5. Copy of Legal Notice along with postal receipt is Ex.PW1/5(colly).
6. The certified copy of statement of accounts is Ex. PW1/6.
10.Also, the plaintiff bank in support of its case has examined Sh. Rohit Mehra, Manager as PW1 and in rebuttal, the defendant has examined himself as DW1.
11.I have heard Sh. Vivek Munshi, Ld. counsel for the plaintiff and Sh.
Rahul Sharma, Ld. Counsel for defendant and also perused the record.
12.My issue wise findings are as under:
ISSUES No. 2 : Whether the plaint of the suit is liable to be rejected U/o 7 R 11
(e) CPC? (OPD) Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 5/20 6 The onus of establishing this issue was on the defendant. The defendant has submitted that the duplicate copy of the plaint was not filed along with the suit and therefore, the suit was liable to be rejected under Order 7 Rule 11 (e) CPC.
It is observed that the copy of the plaint has been supplied to the defendant, as per the directions, with the process and such minor technicality is only an irregularity of not filing of the duplicate copy with the plaint at the time of filing of the suit. It is also observed that the defendant has not uttered even a single word either in his affidavit of evidence to support his submissions on this aspect and thus, it was mere a plea that was never supported with any kind of evidence on record.
Thus, the defendant has failed to discharge his burden of proving this issue and this issue is decided against the defendant.
13. Issue No.(i), (iii) and (iv)
(i)Whether there is no cause of action against the defendant for filing the suit by the plaintiff? OPP
(iii)Whether the plaintiff is entitled for the recovery of the amount as claimed in prayer clause of the suit? OPP
(iv)Whether the plaintiff is entitled for any interest? If so at what rate and for which period ? OPP The onus to establish all these three issues has been laid on the plaintiff, and as all these three issues are interrelated and dependent on each other and the evidence of the Plaintiff is the same for establishing these issues, thus all three are taken up together.
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 6/20 7 For establishing the claim, the plaintiff has to prove that the Plaintiff has sanctioned a personal loan facility of Rs.5,65,000/ to the Defendant vide a loan agreement dated 30.06.2008 and issued a sanction letter, and that as per the terms of the agreement, the loan amount was to be repaid in 36 EMIs of Rs.20,425/ alongwith a floating rate of interest @ 18% per annum and that the Defendant failed to adhere to the financial discipline of payment schedule and a certain amount was outstanding, as per the loan account statement thereupon, the account was declared as NPA and a legal notice dated 10th November, 2010 was duly served to the Defendant who had neither replied nor complied with the notice, and that the Plaintiff was thus, entitled for an outstanding amount of Rs.6,52,789/ alongwith an interest @ 18% per annum.
14.To discharge the burden of establishing his claim and to prove the issues above mentioned, the plaintiff has examined himself as PW 1 exhibiting his evidence in affidavit as Ex.PW1/A and relied on the documents Ex.PW1/1 to Ex.PW1/6.
15.The Defendant has contested the claims of the Plaintiff, on the ground that he has executed no loan documents pertaining to the loan in question and that in fact,there was no loan agreement executed by the parties and no loan amount was ever sanctioned to him, the Plaintiff has no cause of action nor he is entitled for any recovery of an amount as claimed nor any interest that of. In Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 7/20 8 support of his plea and to prove, the defendant has testified these facts through his affidavit in evidence as DW1/1.
16. Ld. Counsel for the defendant has argued that the defendant has taken a loan 89 years back and at that time his signatures were obtained on certain blank papers at the time of granting of such loan, the bank has misused such papers by fillingup the contents of a second loan and that he had never applied for any further loan, nor any loan of Rs.5,65,000/ was ever sanctioned to him.
17. It is further argued that no loan agreement was ever executed between both parties and that the statement of account placed by the Plaintiff is no legal document in the eyes of law and that the statement of account is not prepared and placed, as per the norms settled within Section 2 A of Bankers Book Evidence Act, thus there is no cause of action in the Suit for the want of any loan agreement, as alleged, and the Suit of the Plaintiff is liable to be dismissed.
18. Ld. Counsel for the Plaintiff has submitted that the Plaintiff has exhibited Loan Application Form Ex.PW1/2, Loan Agreement Ex.PW1/3 and the Statement of Account Ex.PW1/6 as prepared as per Bankers Book of Evidence Act, in view of the law settled in the case titled as Indian Bank Vs. Cheese Wafers (India) Pvt. Ltd., vide order / judgment dated 29th April, 1998 of HMJ Vijender Jain of Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 8/20 9 Delhi High Court (uncited judgment).
19. I have carefully perused the record, particularly the evidence, ocular as well as documentary, led by both these parties, in the light of their contentions on the issues under reference.
20. To establish the cause of action in the Suit and to prove the claim of recovery of an amount along with an interest, the plaintiff bank had to prove the basic documents of loan viz, a Loan Agreement executed between the parties, an issuance of an account number against such loan, if sanctioned, and with the sanction letter and the corresponding statement of account duly prepared and proved, as per the Banker's Book of Evidence Act. Also that according to the statement of account against such loan account, there was an outstanding amount that was due and payable and also legally recoverable from the defendant, at a particular point of time.
21. It is observed that as per record proved during the course of trial, the Plaintiff has produced a document Ex.PW1/3 as the Loan Agreement.
On perusal of this document, it is observed that this document is a unilateral document, signed by one party i.e the defendant. This document has been denied to have been executed by the defendant with the plea and depositions on this aspect that the signatures were obtained by the bank on such document, when it Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 9/20 10 was blank and the contents must have been filled up by the bank for the purpose of claiming a recovery in this case, whereas the defendant had never executed any such loan document in the year 2008, rather it appears that this document must have been got signed at the time a loan was sanctioned by the bank 8 9 years back and he was paying the installments for such loan against that loan account.
It is observed that this document is a bunch of 7 pages, each bearing signatures of the defendant, either at the extreme top or bottom or extreme left / right margins and the contents were filled up only on some of such papers with different inks and hand writing and even two pages of them were even blank and unfilled with any content, but one was signed at the top and the bottom & the other even on the left margin also, to make it clear even from the bare eyes that such documents might have not been signed, when the contents were filled up by the person, who signed it. As the contents of the document and the execution has been denied by the defendant, the onus of proof of such document becomes more heavier than that of ordinary one, on the plaintiff to establish it, beyond doubt.
Further, during the course of arguments, it was fairly admitted that the contents of fifth page were filled up by some bank employee and on the basis of such filling up of the contents by the bank official, it was argued that it was a loan agreement, against which the claim has been raised in the suit.
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 10/20 11 It is clear that for making any document 'an agreement', it needs to be executed by both the parties to make it binding contract and legally enforceable, but this document does not bear any signatures of the Plaintiff Bank, to make it an agreement, enforceable, in the eyes of law to claim that such agreement was ever entered into between the parties viz, the plaintiff bank and the defendant.
22. By definition 'an Agreement' is a document that needs to be executed by both the parties, but document Ex.PW1/3 is signed by only Defendant, even if, for the sake of arguments, it is assumed that the document was consciously and knowingly signed by the defendant, then also it cannot be assumed to be a loan agreement. Obviously, in that eventuality, the terms referred therein cannot be binding on either party and of course on the defendant.
23. Further, apart from such kind of socalled loan agreement, the Plaintiff could not prove that any account number was allotted against such loan in pursuance of the loan agreement Ex.PW1/3, nor it could be proved that any sanction letter was issued to the defendant at any point of time, any sanction letter was not placed on record. Nothing has been produced on record by the Plaintiff to show that the Bank, as per the norms of their business or under the RBI guidelines, it can sanction loan on execution of a unilateral agreement for sanctioning of any loan and that is also without issuing any sanction letter or allotting any account number. The Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 11/20 12 plaintiff has not produced any statement of account to show any outstanding amount due and payable by the defendant against any such account number ever alloted, in pursuance of the alleged loan agreement Ex.PW1/3.
24. As per Para 5 of the affidavit in evidence of PW1 Ex.PW1/A, it is deposed that the Plaintiff Bank had sanctioned a personal loan facility of Rs.5,65,000/ to the Defendant vide sanction letter. But no such sanction letter has been placed on record to show that any such amount was sanctioned by the Bank at any point of time.
Thus, the plaintiff bank has failed to establish on record that any loan agreement was ever executed by the parties against the alleged loan to the defendant or there was any sanction letter issued against any account number allotted to such loan agreement, nor any such statement of account has been produced to show for the period of 2008, the year of sanctioning of the alleged loan agreement upto the date of issuing of the legal notice of demand to the defendant. Rather, the statement of account produced in the court Ex.PW1/ by the bank was of the period of 2000 - 2010 that cannot be related to a loan in question, ever sanctioned in the year 2008, rather it is more close to the defence of the defendant that he had taken only one loan 8 - 9 years back and not in 2008.
It is a well settled principles of law that any document prepared or executed during the normal course of business by any business concerned, and if the same is necessary to establish any Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 12/20 13 claim then such document ought to be produced in the Court by the Plaintiff and if any such document is withheld then an adverse inference may be drawn against the Plaintiff that in case of such production of document, it may not support the claim of the Plaintiff.
25. Now come to document Ex.PW1/4, as per the depositions in affidavit Ex.PW1/A, this document is the summary of accounts of the Defendant pertaining to the loan in question but the records of accounts to show the details of the entries made in such summary have not been produced and nowhere it is being clarified that which entry informs and supported by which document kept on record by the Bank. The details of the account alongwith the summary in this case was an important document particularly when the Plaintiff submits that an amount of Rs.5,65,000/ was sanctioned to the Defendant vide some loan agreement dated 30.06.2008 but only an amount of Rs.3,34,387/ was shown to have been transferred to the account Number maintained by the defendant with Oriental Bank of Commerce, New Delhi and an amount of Rs.2,22,328/ was deducted against an outstanding amount of any previous loan taken by the Defendant from the same bank.
The plaintiff bank has not produced any witness to that effect from Oriental Bank of Commerce that any such amount was credited against the loan sanctioned in 2008 to defendant. Nor, the bank has produced any documents related to previous loan ever Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 13/20 14 sanctioned by the bank to the defendant, to prove that there was some outstanding and legally recoverable amount that was allegedly deducted by bank.
26. The plea of the defendant is that he has taken loan only one time and not two times as claimed by the Bank and that a numbers of documents were got signed from him at the time of taking of one time loan from such bank and during such process some blank papers were also signed by him and such papers were misused by the Bank to make it a second loan story.
27. Even if the Bank's plea of 'two loans' is believed then it was the onerous duty of the Plaintiff to prove the records of both the loans and the documents of adjustments and the consent of the Defendant for any such adjustment or deduction of any sanctioned loan by the bank to clarify as to what was the amount sanctioned by the bank at any point of time and what was the adjustment made against any other previous loan taken by the Defendant. Mere submission that there was a previous loan of which an outstanding amount was adjusted with the second loan would not suffice in establishing the issue that against the sanctioned loan of Rs.5,65,000/ only an amount of Rs.3,34,387/ was credited to the account of the Defendant. The documents of previous loan with specification of the period, for the purpose of limitation, were also important documents to ascertain that the outstanding amounts so adjusted by Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 14/20 15 the Bank was a legally recoverable amount and in such case, such outstanding amount could have raised for a separate and distinct cause of action, need to be established separately, as per law.
28. In this case, the Plaintiff has not placed any document relating to the previous loan as averred in his pleadings and deposed in his affidavit in evidence. Non production of such important documents in the Court or withholding such documents is also fatal in the facts and circumstances of the case as onus is on the bank to prove his claim for the amount of Rs.5,65,000/ if any such amount was ever sanctioned by the bank. An adverse inference can be drawn against the Plaintiff Bank in these circumstances for non production of such documents during trial that in case of production of such documents, the same may not support the case of the Plaintiff.
29. Now come to the statement of account Ex.PW1/6. The statement of account was meticulously perused, in the above noted circumstances to observe as to whether any outstanding amount as claimed by the plaintiff bank was ever due against the Defendant. This document on the very first line shows that this was the customer account ledger report from 22.11.2000 to 20.09.2010 against an Account No.200675100000374 of one Subhash Chandra. This statement of account run in two pages shows the total debit of Rs.8,78,364.01 as on 10th September, 2010. At the end in the column of signature there is no signature and only a stamped certificate is attached certifying it as per the Bankers Book Evidence Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 15/20 16 Act.
30. It is observed that even if, it is assumed that the statement of account was certified to have been prepared in accordance with the Banker's Book of Evidence, then also, apart from this document, neither any averment in the pleadings nor any other document is produced or exhibited by the Plaintiff Bank to show 'the account number' of the alleged loan in question could relate with the statement of account exhibited Ex.PW1/6 that the same was showing the entries of the transactions relating to the alleged loan agreement of the Defendant. Moreover, this statement of account mentions that it is for the period of starting from 2000 to 2010 and as the alleged loan agreement was dated 30.06.2008, thus, obviously it cannot be related exclusively to the alleged loan agreement dated 30.06.2008.
Further, to authenticate the statement of account, the plaintiff had to produce the witness, who prepared such statement of account and certified that it was in accordance with Banker's Book of Evidence, but the plaintiff has failed to produce any such witness and the sole witness PW1 has admitted that he was from the Recovery Department and deposed only on the basis of the documents placed on record and had no personal knowledge regarding the account of the defendant or on preparing of any such documents.
Thus, the relevant facts relating to the loan in question, Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 16/20 17 could be established only by the person, who had personal knowledge of such facts, as the documents of both the loan so alleged were not produced to enable PW1 to depose and establish the facts stated in affidavit Ex.PW1/A. (For this observation, the reliance is placed on Janki Vashdeo Bhojwani & Anr. Vs. Indusind Bank Ltd. & Ors on 6th December, 2004 in Appeal (civil) No. 6790/2003)
31. It is observed that the plaintiff could not mention the account number pertaining to the loan in question either in the pleadings or in the evidence led by it or otherwise to relate any such loan account number to the statement of account Ex.PW1/6 produced by the plaintiff, to show that any amount was outstanding to be recovered.
Even such account number as shown on statement of account Ex.PW1/6, was nowhere mentioned in the summary Ex.PW1/4, placed by the bank.
This is surprising that the plaintiff has taken pain to disclose the account number of the previous loan and of the account number of the defendant's bank i.e. OBC, more specifically, but the plaintiff bank has forgotten to disclose a very vital fact regarding the account number, if any, alloted to the defendant for the alleged second loan, if the loan was ever sanctioned by the plaintiff.
For nondisclosure of any such account number, it is difficult to be presumed that the statement of account Ex.PW1/6 of the period 20002010 was pertaining to the loan allegedly Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 17/20 18 sanctioned by plaintiff bank for which the claim has been filed in the suit.
It is also observed that the observations in the unreported judgment on which Ld. Counsel has placed his reliance is totally on the distinguished and distinct facts and circumstances, as that was pertaining to an issue of granting of leave to defend for the search on the point as to whether there was any triable issue to grant leave to defend to the defendant and that the plea of blank papers were taken at the first instance or not, but in that case, there was a loan agreement duly executed by the bank on which the plea of the defendant was taken regarding his signatures obtained on the blank papers, but in this case, the plaintiff had failed to discharge its onerous duty to prove even the loan agreement or to say that the same was ever duly executed by both the parties, unfortunately, in this case, the plaintiff has failed to produce any such loan agreement that was executed between the plaintiff bank and the defendant and signed by both the parties and the defendant has raised the plea of signing of the blank papers in the written statement at the very first instance of his contrapleadings and maintained that through his evidence unrebutted. The alleged loan agreement Ex.PW1/3 placed on record bears no signatures of the bank to make it a loan agreement at all duly executed by both the parties.
Thus, the observations made in the unreported judgment relied by Ld. Counsel for the plaintiff is not at all applicable to the present facts and circumstances.
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 18/20 19
32. It is a well settled proposition of law that by nature and by definition, 'a cause of action means every fact, which, if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the court. In other words, it is a bundle of facts which taken with the law applicable to them gives the plaintiff a right to relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action can possibly accrue. It is not limited to the actual infringement of the right sued on but includes all the material facts on which it is founded' (Reliance is placed on the observations made in Swamy Atmananda Vs. Swami Bodhananda, AIR 2005 SC 2392; 2005 (3) SCC 734)
33. Thus, on the basis of above noted facts and circumstances, it is clearly made out that the Plaintiff has miserably failed to establish that any loan agreement was ever executed on 30.06.2008 with the Defendant and that any such amount was ever sanctioned against such loan agreement or that in consonance of such loan agreement any outstanding amount was due and recoverable from the Defendant, on the basis of the evidence led by the Plaintiff.
34. Thus, the Plaintiff could not establish beyond reasonable doubt that there was a cause of action to claim any recovery of the amount prayed in the suit or that it was entitled to recover the suit amount or the interest thereupon.
Thus all the three issues (i), (iii) & (iv) have been decided against the Plaintiff.
Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 19/20 20 Relief
35. In view of the findings on the issues, the suit of the Plaintiff is hereby dismissed.
Decree sheet be drawn accordingly.
File be consigned to the record room.
Announced In the open Court (Dr. Archana Sinha) 25th Day of January, 2014. Addl. District Judge, Central04 Tis Hazari Courts, Delhi 25.01.2014 Suit No. 94/2011 IDBI Bank Vs. Subhash Chandra 20/20