Delhi District Court
Bank Of Baroda vs Mr. Tarun Pal Singh on 26 May, 2014
IN THE COURT OF MS. POONAM CHAUDHARY ADDITIONAL DISTRICT
JUDGE03, SAKET COURT, NEW DELHI.
CS No.21/2014
Unique ID No. 02403C0296622009
IN THE MATTER OF :
Bank of Baroda, a body corporate
constituted under The Banking Companies
(Acquisition & Transfer of Undertakings)
Act, 1970 having its Head Office at Mandvi,
Baroda and having a branch inter alia,
at 55, Madhuban, Nehru Place,
New Delhi110019 ...Plaintiff
Versus
Mr. Tarun Pal Singh
S/o Mr. Ajit Singh Oberoi
Sole Proprietor Subu Exports
i) A34, Kailash Colony
New Delhi110048
ii) C2/5, Vasant Vihar
New Delhi110057
iii) C2/10, Vasant Vihar
New Delhi110057
iv) C/o Chail Palace Pvt. Ltd.
R10, Green Park
New Delhi110016 ...Defendant
DATE OF INSTITUTION : 24.09.2009
DATE OF RESERVING FOR JUDGMENT/ORDER : 19.05.2014
DATE OF PRONOUNCEMENT : 26.05.2014
JUDGMENT
1. The plaintiff has filed the present suit for recovery of Rs.7,00,136/ (Rupees Seven Lacs One Hundred Thirty Six Only) with pendente lite and future CS No. 21/2014 Page No. 1 interest as well as cost of the suit against the defendant.
2. Briefly stated the facts of the case are that plaintiff is a body corporate constituted under the Banking Companies Act, 1970. It is further stated that Sh. Pabitra Kumar Dass, Assistant General Manager of plaintiff is duly constituted attorney and authorized signatory of plaintiff vide GPA dated 24.03.1990 and is empowered interalia to institute, sign, verify the plaint and other documents and to depose on behalf of plaintiff and do all acts incidental and consequential as may be necessary thereto.
3. It is further stated defendant who is sole proprietor of M/s. Subu Exports approached the plaintiff for opening an account in the name of his proprietorship firm. The defendant accordingly, submitted the requisite forms on 03.02.04 and offered to open current account with the plaintiff. It is further stated defendant tendered attested copies of his PAN card which was considered by plaintiff and opened an account in the name of firm of defendant. It is further stated defendant declared that he was the sole proprietor of the firm and would be solely responsible for the liabilities.
4. It is further alleged that defendant operated and utilized the services of plaintiff qua the account. It is also averred that the defendant issued a cheque dated 03.10.06 in favour of M/s. Subu Promoters & Developers for a sum of Rs. 4,10,000/. The said cheque was received by the plaintiff for clearing but at that time there was credit balance of only Rs.333/ in the account of defendant. As such the balance was not sufficient to honour the cheque, however on the request of defendant the cheque was paid in clearing by the plaintiff by creating temporary overdraft facility. It is further stated that as a result of payment of abovesaid cheque there was debit balance of Rs. 4,09,667/ in the account of defendant as defendant availed and utilized temporary overdraft in the account maintained by him with the plaintiff. It is also alleged that temporary overdraft was supposed to be adjusted in a short period but even CS No. 21/2014 Page No. 2 after lapse of considerable time the debit balance was not adjusted by the defendant. It is also alleged that defendant had been assuring the plaintiff that he would discharge his contractual obligation by adjusting the debit balance, however, till 18.09.07 the same was not cleared. The plaintiff thus vide letter dated 18.09.07 and subsequent letters dated 13.10.07 and 15.01.08 reminded the defendant of its liability. The defendant however, failed to discharge his contractual obligation.
5. It is stated that plaintiff was thus constrained to issue a notice to the defendant through his counsel dated 28.08.09 calling upon the defendant to discharge the contractual obligation. The notice was sent by registered AD and UPC, the defendant avoided to receive the notice however, he was deemed to have been served as the notice sent by UPC was not received back.
6. It is further stated that at the time of institution of the suit a sum of Rs. 4,44,770/ (Rupees Four Lakhs Forty Four Thousand Seven Hundred Seventy Only) was due and payable by the defendant as per the books of account of plaintiff maintained in the normal and ordinary course of its banking transactions. In addition interest as per the rules applicable in consonance with the directive of the Reserve Bank of India given from time to time was also payable. It is further alleged that plaintiff is entitled to Rs. 7,00,136/ (Rupees Seven Lakhs One Hundred Thirty Six Only) with pendente lite and future interest @ 17% per annum compounded monthly from the date of institution till realization from defendants jointly and severally. It was also alleged that the temporary overdraft facility was utilized by defendant within territorial jurisdiction of this court. Moreover, defendant resides and work for gain within the territorial jurisdiction of this court, hence this court has the territorial jurisdiction to try the suit.
7. Defendant filed WS contesting the suit taking preliminary objections that the suit was not maintainable. It was also alleged that suit was an abuse of the CS No. 21/2014 Page No. 3 process of law. It was further stated plaintiff has no cause of action. It was also averred that plaintiff had not come to the court with clean hands and has misrepresented the facts by making false averments.
8. It was further stated no credit overdraft facility was ever sanctioned or granted by plaintiff to defendant. It was further stated that neither any agreement was executed between the plaintiff and defendant, whereby the alleged claim can be fastened upon the defendant in relation to the alleged facilities allegedly granted to the defendant.
9. It was further stated defendant had approached the plaintiff for opening a current account and at that time certain blank documents were got signed by plaintiff which seems to have been misused by plaintiff for filing the present suit. It was further averred that legal notice was never received by the defendant. The plaintiff had sent the same at the Kailash Colony address of the defendant, which was lying locked and this fact was well within knowledge of the plaintiff.
10.It was further alleged that the alleged cheque was never signed by the defendant, thus, there was no occasion for defendant to maintain balance in his account to honour the said cheque. It was further stated that the cheque was misused by plaintiff in connivance with its officials. It was also alleged that cheque in question bearing no. 468578 was wrongly honoured by the plaintiff in connivance with its officials who forged and fabricated the documents and filed the present suit.
11.It was further stated that suit was not signed, filed and instituted by duly authorized person. It was also averred that the power of attorney relied upon by plaintiff to file the suit was also not properly stamped. It was further alleged that the statement of account relied upon by the plaintiff was not maintained in the ordinary course of banking business, thus, the entries were disputed and denied. It was also alleged that as there was no agreement CS No. 21/2014 Page No. 4 between the plaintiff and defendant for the alleged overdraft facility, the question of payment of the principal and interest thereon does not arise. It was also alleged that interest which has been claimed was exorbitant. It was also stated that the suit has not been properly valued for the purpose of court fee.
12. On merits it was denied that defendant was liable to pay Rs.4,10,000/ (Rupees Four Lakhs Ten Thousand Only) to Subu Promoters & Developers as such defendant did not maintain sufficient balance in his bank account to honour the cheque in question. It was reiterated that the alleged cheque dated 03.10.06 was not issued by defendant. It was denied that the said cheque bears the signature of defendant. It was alleged that the cheque some how fell into the hands of unscrupulous person who in connivance with the officials of plaintiff got it honoured. It was denied that defendant requested the plaintiff to clear the cheque in question and create temporary overdraft facility. It was denied that there was debit balance of Rs.4,09,667/ as a result of payment of cheque in question in the account of defendant. It was denied that defendant assured the plaintiff that he would clear the debit balance. It was denied that defendant availed and utilized the alleged temporary overdraft facility. The receipt of letters, dated 18.09.07, 13.10.07, 15.01.08, were denied. The receipt of legal notice was also denied. It was also denied that there was deemed service of notice on the defendant. It was denied that plaintiff has cause of action to file the suit. It was also denied that suit was within time. It was prayed that suit be dismissed.
13.In the replication the averments made in the plaint were reaffirmed and reiterated and the averments made in the WS were controverted denied.
14.On the pleadings of the parties following issues were framed:
1. Whether the plaintiff is entitled to the decree of recovery as prayed for ? OPP
2. Whether the defendant availed of credit facility in the nature of overdraft facility from the plaintiff ? OPP CS No. 21/2014 Page No. 5
3. Whether the suit of the plaintiff has been properly valued for the purpose of court fee ? OPP
4. Relief.
15. ISSUE NO. 1 and 2:
16.As finding on Issue No.1 will have bearing on Issue No.2, both issues are taken up together. Plaintiff in support of its case examined Sh. Narain Singh, a manager of the plaintiff as PW1, he tendered his evidence in examination in chief by affidavit reiterating therein the averments made in the plaint. He proved the form submitted by defendant dated 03.02.04 to open current account with the plaintiff as Ex.PW1/1. A copy of PAN Card Mark A of defendant. He also proved cheque in question No. 468578 dated 03.10.06 issued by defendant in favour of Subo Promoters & Developers for a sum of Rs. 4,10,000/ as Ex.PW1/2. He also proved letters sent by plaintiff to defendant dated 18.09.07, 13.10.07 and 15.01.08 as ExPW1/3 and Ex.PW1/4 reminding defendant of its contractual liability. He also proved the application dated 30.01.04 for availing home loan submitted by defendant as Ex.PW1/6 and form submitted by defendant to show his credit worthiness as Ex.PW1/7. He also proved the legal notice as Ex.PW1/8 and its postal receipt and envelopes Ex.PW1/9 to Ex.PW1/15. He also proved the statement of account maintained by plaintiff in the normal course of its banking business Ex. PW1/16. He further stated Ex.PW1/17 is certificate of interest accrued. He further testified that Sh. Pabitra Kumar Dass, AGM of plaintiff was the duly constituted attorney of plaintiff vide General Power of Attorney dated 24.03.1990 as Ex. PW1/18.
17. In his crossexamination he stated that he was not posted in the concerned branch at the time when defendant opened the account or at the time when the transaction took place. Thereafter, he stated that he was posted in the concerned branch at the relevant time but was not involved in the transaction CS No. 21/2014 Page No. 6 in question. He further stated that defendant opened an account in the name of Subo Promoters in 2006 with the plaintiff. He further stated that he could not state whether defendant was a privileged customer but defendant could not be termed as a normal customer since he was being accommodated by the bank like the paying the amount of cheque on the same day when deposited. He further stated overdraft facility was not extended to defendant prior to 05.10.06, the transaction in question. He further stated overdraft facility is not extended without request but the procedure to be followed for grant of overdraft facility depends upon the sanctioning authority and clients. He further stated no documentation is required for grant of temporary overdraft facility. He denied that no overdraft could be obtained without proper documentation and procedure. He further stated no documentation or procedure was required for temporary overdraft facility. He further stated that he did not know whether no request was given by defendant for overdraft facility. He further stated no document has been placed on record to show that any request for overdraft facility was made by defendant. He also stated no agreement was entered between the plaintiff and the defendant for overdraft facility. He further stated that the cheque was for sum of Rs.4,10,000/. He denied that the cheque in question Ex.PW1/2 was a manipulated document and denied that it was not issued by the defendant. He also testified that he could not state whether the cheque in question bears the signatures of defendant without comparing the signatures of defendant on the cheque in question with his admitted specimen signatures available with the bank. He denied that no overdraft facility was availed by the defendant and all documents in this regard placed on record were forged and fabricated. He denied that defendant was not liable for the overdraft facility availed by him. He denied legal notice dated 28.08.2009 Ex.PW1/8 was sent at wrong address. He denied that Mr. Dass had no authority to file the suit. He also stated that CS No. 21/2014 Page No. 7 defendant had applied for home loan which was not sanctioned.
18. On the other hand the defendant examined himself as DW1, he tendered his evidence in examination in chief by affidavit reiterating therein the contents of the WS. In his crossexamination he stated that he had opened an account with the plaintiff bank, but he could not remember the name by which the account was opened, it was either Tarun Pal or Subu Exports. He was confronted with cheque No. 468577 Ex.DW1/2 but he stated that it was not issued by him. He further stated since he had opened an account, cheque book must have been issued to him. He further stated he could not recall whether he had any company by the name of M/s. Oberoi Promoters & Developers. He further stated he could not recall any connection with Subo Promoters & Developers but stated that it was a family concern of which he was not the proprietor. He admitted that he was introduced to the plaintiff bank by Oberoi & Company as mentioned in the account opening form which is Ex. DW1/3 and the signature of his father appear at point D on Ex.DW1/3. He testified that statement of account Ex. PW1/16 was of Subu Exports of which he was a proprietor and authorized signatory. He admitted that the name of Subu Promoter and Developers appears on Ex.PW1/2, which was a family concern. But denied that Ex. PW1/2 bears his signature or was filled up in his writing. He denied that he had requested the bank to encash the cheque Ex.PW1/2. He denied that he received the letters from plaintiff i.e. Ex. PW1/3 & PW1/4. The defendant thereafter, closed his evidence.
19. I have heard the Ld. Counsels for parties and perused the record. The contention of Ld. Counsel for defendant is that initial burden of proof lies on party who shall lose in case of failure to prove its case. Thus, plaintiff was under obligation to discharge the burden initially that defendant had submitted the cheque for withdrawal of the amount as mentioned in the plaint. In this regard PW1 deposed that defendant issued a cheque in CS No. 21/2014 Page No. 8 question Ex. PW1/2 in favour of Subu Promoters & Developers for a sum of Rs. 4,10,000/. The said cheque was received by plaintiff in clearing. At that time there was a credit balance of only Rs. 333.00/ in the account of defendant, the balance was not sufficient to honour the cheque. He also stated that on the request of defendant the cheque was cleared by plaintiff by creating temporary overdraft. He also stated that as a result of payment of the cheque there was a debit balance of 4,09,667/ in the account of defendant.
20. On the other hand DW1 in his cross examination admitted that he had opened an account with the plaintiff bank bearing no. 194427. He also testified that since he had opened an account a cheque book must have been issued to him, but denied that he issued the cheque in question Ex.PW1/2. It was contended on behalf of defendant that his signatures on the cheque were forged and that cheque had been misused and encashed by plaintiff in connivance with its officials.
21. Ld. Counsel for defendant further stated that all the documents relied upon by the plaintiff were forged fictitious and the suit was filed in collusion with the officials of the bank. It was also submitted that as the signatures on cheque in question were denied by defendant, the plaintiff who alleged execution of it ought to have got it examined by a hand writing expert or produce any other corroborating evidence. It was further alleged that plaintiff had the specimen signatures of defendant but did not make any efforts to get the cheque in question, examined by a hand writing expert. Thus, plaintiff did not adduce indirect or presumptive evidence to corroborate its version.
22. In support of his above contention Ld. Counsel for defendant placed reliance upon 2011(7)ADJ696 State Bank of India Vs. Om Narain Agarwal and Ors. wherein it has been held as follows:
Held, there must be chain of evidence so as to complete and not to leave any reasonable ground for conclusion consistent with effect and must be such as to CS No. 21/2014 Page No. 9 show that within all human probability act must be done by person - Respondent no.1 had not deposited amount in Bank, but was allowed overdraft through aforesaid cheque - Bank showed that there was agreement between Bank and Respondent no. 1 to allow such overdraft or that it was otherwise under any obligation to allow such overdraft However, it presupposed that sufficient funds had been deposited by person concerned wherefrom amount would be paid by Bank - Further, in absence of any contract permitting Respondent no.1 for overdraft, Bank was never under obligation to encash cheque merely on its presentation though sufficient funds were not available in account concerned It was true that Application for signatures of Respondent no.1 through handwriting expert was submitted by Bank but same was rejected by Tribunal and not challenged by Bank thereafter - Therefore, dismissal of Suit of Bank by Tribunal was neither erroneous nor illegal warranting any interference - Thus, order passed by Tribunal was justified - Writ Petition dismissed.
23. It was next contended by Ld. counsel for defendant that defendant never request for temporary overdraft facility in his account no. 1944427. It was also contended that there was no agreement entered into between the plaintiff and defendant for overdraft facility in the above account of defendant, therefore, the claim for same does not arise. It was further submitted that as per the current account rules of the plaintiff an account can be overdrawn only after previous arrangement with the bank.
24. It is pertinent to note that in the case relied upon by Ld. counsel for defendant, it was the case of the appellant bank that respondent had not opened a current account with the appellant bank nor withdrawn huge amount as overdraft facility through nine cheques. A legal notice was served upon the respondent requiring him to settle the entire amount, but he failed to do so. Consequently the bank filed a suit against the respondent for recovery.
CS No. 21/2014 Page No. 10Prior to the filing of the suit by the bank respondent had filed a suit for permanent injunction restraining the bank from recovering any amount from him. The suit of the bank was transferred to DRT. The suit filed by the respondent was also summoned by the DRT on the request of the bank as it related to same cause of action. The respondent in his written statement before DRT stated that he never opened any account with the plaintiff nor had he withdrawn any amount as alleged as overdraft facility. The DRT held that respondent had never opened the account in question, neither did he withdraw any amount as alleged. The suit of the bank was dismissed whereas suit of respondent was decreed. The bank thereafter, preferred an appeal. Thus, in the case relied upon the relationship between the bank and respondent was not admitted by the respondent viz a viz the account in respect of which various transaction of default in payment of bank's dues was alleged by the bank. The bank had pleaded that respondent had opened a current account and also on that day itself and on various dates thereafter, respondent was allowed huge overdraft facility which he failed to pay. The case of respondent was that there was no written request for providing overdraft facility nor any such order passed by the bank, thus, there was no agreement between parties. Thus, DRT held that bank had miserable failed to prove that any overdraft was allowed to respondent or that he had submitted any cheque or was allowed to withdrew of the amount as alleged. DRT found irregularities in the cheques as was evident from the fact that the cheques by which the amount in dispute was withdrawn did not denote the account number from which the cheque was to be paid, no account number was given on the cheque, neither the cheque indicated as to who received the payment of the cheque. It was also not clear from which account number the cheques were to be cleared. The statement of account filed by the bank was also not duly certified as required by the Banker's Book of Evidence Act.
CS No. 21/2014 Page No. 1125. I am of the view that the facts of the case relied upon are distinguishable from the facts of the present case. In the present case the defendant had not disputed that he had opened a current account No. 194427 with plaintiff. DW1 also stated that since he had opened an account a cheque book must have been issued to him, but denied his signature on the cheque in question Ex.PW1/2. He also stated that cheque Ex. PW1/2 was drawn in favour of Subu Promoters & Developers which was a family concern. DW1 was confronted with a cheque No. 468577 Ex. DW1/2 issued by him in favour of Subu Promotors & Developers but DW1 denied issuance of the said cheque. However, DW1 admitted that the statement of account Ex.PW1/16 was of Subu Exports of which he was the proprietor. As per the statement of account Ex.PW1/16 the balance in the account was Rs. 944.00/ when the cheque Ex. DW1/2 was presented for clearing, a sum of Rs. 1.10 Lakhs was deposited on the same day for clearing of cheque. The beneficiaries of DW1/2 & PW1/2 was the same family concern of defendant.
26. Thus in view of the testimony of DW1 the beneficiary of the cheque in question was the family concern of defendant whereas in the cases relied upon, it was not known who received the payment of the cheque. Thus, I am of the view that plaintiff had discharged the burden of proving that the account No. 194427 was opened by the defendant. Plaintiff further succeeded in proving that the beneficiary of the cheque in question was a family concern of defendant and defendant had submitted the cheque Ex. PW1/2 for withdrawal of the amount.
27. Ld. counsel for plaintiff submitted that comparison of the signatures of defendant on Ex.DW1/2 and Ex.PW1/2 with admitted signatures of Ex.PW1/1 as well as Mark A and Ex.PW1/6, application for home loan submitted by defendant to plaintiff, shows that the signature on the admitted documents and disputed cheques Ex. PW1/2 and DW1/2 were similar. It was further CS No. 21/2014 Page No. 12 submitted by Ld. counsel for plaintiff that the beneficiary of cheques Ex.DW1/2 and Ex.PW1/2 was the family concern of the defendant. It was also the case of plaintiff that the defendant did not deny the deposit of an amount of Rs.1,10,000/ (Rupees One Lakh Ten Thousand Only) for clearance of cheque Ex.DW1/2 and withdrawal of the said amount, as is evident from the statement of account Ex. PW1/16. DW1 admitted that Ex. PW1/16 was the statement of account of Subu Exports of which he was the proprietor. For the foregoing reasons, I am of the view that the version of defendant that he did not issue the cheque in question Ex.PW1/2 or DW1/2 stand falsified.
28. The next contention of defendant that he did not receive the letter sent by plaintiff Ex.PW1/3 & PW1/4 reminding him to clear the outstanding amount and also did not receive the legal notice Ex. PW1/8 as it was sent at the wrong address. On the other hand, it was alleged on behalf of plaintiff that defendant did not allege that there was change of his address and the letters Ex.PW1/3 & Ex.PW1/4 and legal notice were sent at the address of the defendant available with the bank. It was also stated that notice sent by UPC was not received back thus, it was deemed to have been served. As regards the contention of the defendant that overdraft facility could only be granted after previous arrangements with the bank only if there was an agreement in this regard between the customer and the bank. In this regard it is noted that in matter involving huge financial liability of a public body like nationalized bank, the Court would not allow sheer technicality to defeat the public interest and just cause.
29. For the foregoing reasons I am of the view that the defendant issued the cheque in question Ex. PW1/2 and availed overdraft credit facility from the plaintiff and plaintiff is entitled to recovery of the same from defendant. Issue No. 1 & 2 are accordingly, decided in favour of the plaintiff and against the defendant.
CS No. 21/2014 Page No. 1330.ISSUE NO. 3 : Onus to prove issue no.3 was on the plaintiff. Plaintiff has valued the suit for the purpose of court fees and jurisdiction at Rs. 7,00,136/ and has paid ad valorem court fees of Rs. 9,225/. PW1 was not cross examined by defendant as regard the fact that suit was not being properly valued for the purpose of court fees and jurisdiction. I accordingly, hold that the suit is properly valued for the purpose of court fees and jurisdiction. This issue is thus, decided in favour of plaintiff and against the defendant.
31.RELIEF: Resultantly, I pass a decree for a sum of Rs. 4,09,667/ ( Rupees Four Lakhs Nine Thousand Six Hundred Sixty Seven Only) in favour of the plaintiff and against the defendant.
32. As regards the rate of interest Ld. Counsel for plaintiff submitted that Section 80 of Negotiable Instruments Act provides that every negotiable instrument is subject to the payment of interest @ 18 % per annum when no rate of interest is specified in the instrument, thus, in view of section 80 of the Negotiable Instrument Act, plaintiff is entitled to interest @ 18 % per annum. But in the present case, plaintiff has claimed interest @ 17 % per annum, accordingly, the plaintiff granted interest @ 17 % per annum from the date of cheque till realization, cost of the suit is also awarded in favour of the plaintiff.
33. Decree sheet be prepared accordingly. File be consigned to record room.
Announced in the open Court (POONAM CHAUDHARY)
on 26.05.2014 ADJ03, SAKET COURT COMPLEX,
NEW DELHI
CS No. 21/2014 Page No. 14
CS No. 21/2014
Bank of Baroda Vs. Mr. Tarun Pal Singh
26.05.2014.
Present: Counsels for parties.
Vide separate judgment dictated and announced, I pass a decree for a sum of Rs. 4,09,667/ ( Rupees Four Lakhs Nine Thousand Six Hundred Sixty Seven Only) with interest @ 17 % per annum from the date of cheque till realization along with cost of the suit in favour of the plaintiff and against the defendant. Decree sheet be prepared accordingly. File be consigned to record room.
(POONAM CHAUDHARY) ADJ03 (SOUTH), SAKET COURT NEW DELHI/26.05.2014.
CS No. 21/2014 Page No. 15