Bangalore District Court
Vijaya Bank vs Sri K.M.Vinay Kumar S/O.Late on 20 June, 2015
THE COURT OF XLIV ADDL. CITY CIVIL & SESSIONS JUDGE,
BANGALORE (CCH-45).
DATED THIS THE 20th DAY OF JUNE, 2015.
PRESENT
Shri.RAVI N.M, B.Com., LL.B.,
XLIV Addl.City Civil & Sessions Judge, Bangalore.
O.S.NO.4714/2011
Plaintiff: Vijaya Bank, Chickpet branch,
No.18, Ranga Maruthi Plaza, 1st
floor, R.T.Street, Chickpet,
Bengaluru-53. By its Principal
Officer & Senior Brach Manager,
Sri Nithyananda Shetty
S/o.H.Raghura,a Shetty, aged
about 55 years.
[By Sri K.N.Mahabaleshwara Rao,
Adv.]
-Vs-
Defendants: 1. Sri K.M.Vinay Kumar S/o.Late
K.A.Murthy, aged about 46
years, Superintendent, Block
Education Office, Kanakapura.
2. Smt.Rama Mani R/at.No.378,
10th 'B' Main, III Block,
Jayanagar, Bengaluru-11.
(D1: By Sri R.R.Upadhya,
Adv., & D2: Ex-parte)
2 OS.No.4714/2011
Date of Institution : 01.07.2011
Nature of the suit : Money Suit
Date of recording
of evidence : 31.10.2012
Date of Judgment : 20.06.2015
Total Duration : Days Months Years
19 11 03
JUDGMENT
The suit of the plaintiff-bank is for recovery of Rs.2,34,880/- together with 14% interest per annum and cost of the suit from the defendants.
2. The facts pleaded in the plaint in brief are that, the defendants No.1 and 2 had approached the plaintiff-bank for grant of loan of Rs.1,30,000/- and accordingly, on 21.12.2002 a loan of Rs.1,30,000/- was granted to the defendants and the 1st defendant is the principal borrower and 2nd defendant is the guarantor to the said loan. Both the defendants have executed On Demand Promissory Note and 3 OS.No.4714/2011 undertaking letter for repayment and articles of agreement and letter of guarantee by the 2nd defendant and both of them had agreed to pay 12% interest + 2% additional interest p.a. in case of default in repayment of loan amount to the plaintiff-bank. Though the defendants have availed the loan, they have not cleared the loan amount as agreed by them, in this connection, the demand made by the plaintiff-bank through sending notice by RPAD did not serve any better purpose. The statement of account of the plaintiff-bank shows that, there is a due amount of Rs.2,34,880/- as on the date of suit which is liable to be paid by the defendants, apart from that, they are liable to pay interest at the rate of 14% over suit claim and prayed for judgment and decree in favour of the plaintiff-bank and against the defendants.
3. In response to the suit summons, the defendant No.1 has appeared through his advocate and filed his written statement. Inspite of service of summons, the defendant No.2 remained absent and she was placed ex-parte. 4 OS.No.4714/2011
4. The gist of the written statement filed by the 1st defendant runs thus, the 1st defendant has admitted that, on 21.12.2002 he availed a loan of Rs.1,30,000/- from the plaintiff-bank agreeing to repay the same with interest at 12% p.a. and additional interest of 2% in case of default in paying the loan amount and the instalment was fixed at Rs.3,100/- p.m. and it was started from 20th January 2003. It is also admitted that the 2nd defendant stood to be the guarantor for the loan availed by the 1st defendant, but he has pleaded that, he is not aware that whether the 2nd defendant has executed the letter of guarantee in favour of plaintiff-bank. He has further denied that the 1st defendant did not keep up his promise in repaying the loan amount and also denied that there was issuance of legal notice to him and also denied his liability to pay the suit claim on the ground that, he has not availed the loan from the plaintiff-bank.
The 1st defendant further pleaded that, he has never executed any acknowledgement of debt on 20th August 2005 and on 1.8.2008 accepting his liability to pay the due amount 5 OS.No.4714/2011 to the plaintiff-bank, on the dates pleaded by the plaintiff in his plaint, the 1st defendant was not at all at Bengaluru and he had been transferred and had no occasion to visit the plaintiff-bank to execute the alleged documents. The 1st defendant has denied that the plaintiff is entitled for the suit claim on the ground that the statement of account produced by the plaintiff is a false document and no cause of action has arisen for the plaintiff-bank to file the present suit against the defendants.
It is further pleaded by the 1st defendant that, since he was transferred in the year 2004, he had stopped operating the S.B.Account through which the loan account was operated and he never made any payment. Since there was no transaction from the year 2004 in the S.B.Account of the 1st defendant, as per the guidelines of R.B.I, the plaintiff had to treat that account as N.P.A. and thereby, the plaintiff- bank could not rely on any of the transactions said to be disclosed from the S.B.Account from the account of the 1st defendant for filing the present suit. It is contended that the 6 OS.No.4714/2011 plaintiff-bank had taken number of signatures of the 1st defendant at the time of granting the loan, on blank printed matter without filling up anything and made use of the same by filling the contents claiming that those documents are executed by the 1st defendant. The plaintiff through the alleged acknowledgement of debt said to be executed by the 1st defendant is trying to enforce the debt dated 21.12.2012 in the year 2011 which is hopelessly barred by limitation and contended that the plaintiff is not entitled for the suit claim and the 1st defendant is not liable to pay any amount to the plaintiff-bank and sought for dismissal of the suit.
5. On the basis of the pleadings and the documents produced, the transferor Court has framed the following issues:
1. Whether the plaintiff proves that the defendant No.1 borrowed loan of Rs.1,30,000/- on 21.12.2002 by agreeing to pay interest at 12% and default interest at 2% p.a.?7 OS.No.4714/2011
2. Whether the plaintiff further proves that the defendants have committed default?
3. Whether the defendant proves that suit of plaintiff is barred by Limitation?
4. What Order or Decree?
6. In order to discharge the burden casted through the relevant issues, the Senior Branch Manager of the plaintiff-bank was examined as P.W.1 and one another retired Sr.Manager of the said Bank by name Dayananda Alva was examined as P.W.2 and one another retired Senior Branch Manager of the plaintiff-bank by name J.Jagannatha Shetty came to be examined as P.W.3 and Exs.P.1 to P.10 documents were got marked. The defendant No.1 has been examined as D.W.1 and Ex.D1 and D2 documents were got marked.
7. I have heard the arguments of learned advocates appeared for the respective parties and perused the case records and also citations relied on by he counsel for 1st 8 OS.No.4714/2011 defendant, on its basis, my findings on the above issues are as under:
Issue No.1 : In the affirmative
Issue No.2 : In the Affirmative
Issue No.3 : In the Negative
Issue No.4 : As per final order,
for the following:
REASONS
8. ISSUE NOs.1 to 3: These issues are inter-connected with each other, for better appreciation of oral and documentary evidence and to appreciate the legal prepositions, all these issues are taken together for consideration.
9. The evidence of P.W.1 is to the effect that the defendant No.1 had approached the plaintiff-bank requesting for sanction of personal loan of Rs.1,30,000/- and accordingly, loan was sanctioned on 21.12.2002 and the 1st defendant as principal borrower and 2nd defendant as 9 OS.No.4714/2011 guarantor have executed the loan documents in favour of the plaintiff-bank and the 1st defendant transacted with the plaintiff-bank and paid some instalments and thereafterwards, from 2004 and onwards failed to repay the remaining balance loan amount and thereby, a notice was issued to the defendants. The 1st defendant on 20th August 2005 and also on 1.8.2008 approached the plaintiff-bank and executed the acknowledgement of debts and admitted his liability to pay the balance loan amount to the plaintiff-bank, but despite execution of the loan documents and acknowledgement of debts have failed to pay the balance loan amount and thereby, sought for decree for the suit claim.
10. The P.W.1 in order to substantiate his oral evidence has produced the following documents:
Ex.P1 : Loan Application
Ex.P2 : Demand Promissory Note dt:21.12.2002
Ex.P3 : Undertaking letter
Ex.P4 : Articles of Agreement dt:21.12.2002
Ex.P5 : Letter of Guarantee
10 OS.No.4714/2011
Ex.P6 : Acknowledgement of Liability dt:20.8.2005
Ex.P6(a) : Signature of D1 on Ex.P6
Ex.P7 : Acknowledgement of Liability dt:1.8.2008
Ex.P7(a) : Signature of D1 on Ex.P7
Ex.P8 : Copy of legal notice
Ex.P9 : Two postal acknowledgements
Ex.P10 : Statement of Account
11. The defendant in the course of his written
statement at one stretch has denied the availment of loan, but in Para No.2 of the written statement he has admitted that on 21.12.2002 he availed loan of Rs.1,30,000/- agreeing to repay the same with 12% interest and further agreed to pay 2% interest in the event of default in paying the instalments. In the course of evidence of D.W.1, he has admitted that, he availed loan of Rs.1,30,000/- from the plaintiff-bank on 21.12.2002 and further admitted that, he has executed Ex.P2 and P3 documents and also he has admitted that the 2nd defendant stood to be the guarantor and he executed the guarantee agreement in favour of the plaintiff-bank.
11 OS.No.4714/2011
12. On perusal of the evidence of P.W.1 coupled with the above referred documents produced by the plaintiff and also the admission in Para-No.2 of the written statement and admission of D.W.1 in cross-examination clearly established that the 1st defendant availed loan of Rs.1,30,000/- from the plaintiff-bank on 21.12.2002 by executing loan documents as referred in the evidence of P.W.1 and also the 2nd defendant stood to be the guarantor to the said loan and he also executed guarantee agreement papers in favour of the plaintiff-bank.
13. The real controversy between plaintiff and the defendants in respect of the suit claim is that, according to the plaintiff, the defendant No.1 from the year 2004 failed to repay the loan instalments and thereby, when the plaintiff- bank Manager approached the 1st defendant demanding for repayment of loan, the 1st defendant on 20th August 2005 executed Ex.P6-acknowledgement of debt admitting his liability to pay the balance amount, but still he did not repay 12 OS.No.4714/2011 the loan amount and thereby, again the plaintiff-bank approached the 1st defendant on 1.8.2008 he executed one another acknowledgement of debt marked at Ex.P7 and admitted his liability to pay the balance loan amount to the plaintiff-bank, but despite execution of acknowledgements of debt, he did not repay the loan amount, thereby, a notice was served on him as per Ex.P8 and inspite of service of notice, the defendants did not repay the loan amount and thereby, it is contended that the defendants are liable to pay the suit claim to the plaintiff-bank.
14. The defendant No.1 in the course of his written statement though admitted the loan transaction with the plaintiff-bank, has seriously denied about the execution of Ex.P6 and P7 acknowledgement of debts in favour of the plaintiff-bank. It is the definite case of the 1st defendant that, in the year 2004, he was transferred from Bengaluru and he stopped operating his S.B.Account with the plaintiff- bank and thereby, there was no transaction carried on in his 13 OS.No.4714/2011 account and he never approached the plaintiff-bank and executed Ex.P6 and P7 documents. It is his further case that on the date of availing the loan, the plaintiff-bank Manager obtained several signatures of his on the blank forms and those forms might have been used for creation of acknowledgements of debt as per Ex.P6 and P7. Since the suit loan was in the year 2002, the suit filed after lapse of 9 years is not maintainable in law and it is barred by limitation.
15. In order to prove the disputed documents i.e., Ex.P6 and P7, the plaintiff-bank has got examined two witnesses who are PWs.2 and 3 and both of them were the Senior Managers worked in the plaintiff-bank at the relevant point of time. The evidence of P.W.1 has been seriously challenged by the counsel for defendant No.1 that the 1st defendant never approached the plaintiff-bank after the year 2004 and never executed Ex.P6 and P7 documents and both the documents are the created documents to recover the alleged loan from the 1st defendant, but P.W.1 has denied 14 OS.No.4714/2011 that suggestion. It was also questioned to the P.W.1 that, whether he was personally aware of the documents executed by the 1st defendant i.e., Ex.P6 and P7, having considered that deposition of P.W.1 and in view of denial of execution of Ex.P6 and P7 documents, the plaintiff-bank has examined PWs.2 and 3 to prove the execution of acknowledgement of debts said to be executed by the 1st defendant.
16. P.W.2 in the course of his evidence has deposed that, on 20th August 2005 the 1st defendant came to the plaintiff-bank and executed acknowledgement of debt as per Ex.P6 and he identified the signature of the 1st defendant as Ex.P6(a). P.W.3 has deposed in his evidence that, in the year 2008 he was working as Senior Manager in the plaintiff- bank and on 1.8.2008 the 1st defendant came to the plaintiff- bank and executed acknowledgement of debt as per Ex.P7 and he identified the signature of 1st defendant as Ex.P7(a). 15 OS.No.4714/2011
17. In the course of cross-examination of PWs.2 and 3, the counsel for the 1st defendant has seriously challenged their evidence and suggested that the 1st defendant never approached the plaintiff-bank on the alleged dates of execution of Ex.P6 and P7 documents and never executed any acknowledgement of debt admitting his liability of repayment of loan amount, but the suggestions made to both the witnesses has been denied by both of them and reiterated that, it is the 1st defendant who came to the plaintiff-bank and executed the acknowledgement of debts as per Ex.P6 and P7 on the relevant dates. It was suggested to PWs.2 and 3 there was fixation of CC.Camera in the plaintiff-bank, but P.W.2 has denied that suggestion. It was also suggested to P.W.2 that, on 1.8.2008 the 1st defendant was on duty at Kanakapura and he had been to Mysore on that day, but P.W.3 has denied that suggestion. It was suggested to P.W.3 that, on the alleged date of Ex.P6 document, D.W.1 was not residing in the address shown in the document, but P.W.2 has denied that suggestion also. 16 OS.No.4714/2011
18. In the course of cross-examination of P.W.3, it was suggested that, on 20th August 2005 the 1st defendant never come to the plaintiff-bank and signed on Ex.P6 document and on that day due to ill-health he was hospitalized, but P.W.3 has denied that suggestion.
19. On perusal of the evidence of D.W.1, he has consistently maintained that, he never visited the plaintiff- bank after the year 2004 and executed acknowledgement of debt as per Ex.P6 and P7 documents. It is clear from his evidence and written statement that the signatures made on these two documents are the signatures of the 1st defendant, but he has denied the dates mentioned in those documents for execution of acknowledgement of debt.
20. Though in the written statement, the 1st defendant has pleaded that, he was transferred from Bengaluru in he year 2004, in his evidence at Page No.4 in the cross- examination he has deposed that, during the year 2007 17 OS.No.4714/2011 January he was transferred to Gadag from Bengaluru, that means to say in the year 2005 on the alleged date of execution of Ex.P6 document, the 1st defendant was very well residing at Bengaluru and thereby, his contention that, he never executed Ex.P6 acknowledgement of debt cannot be accepted as a good defence to disown the liability of the plaintiff-bank. It is also admitted by PW.1 that, in the written statement he has not mentioned the actual date of his transfer from Bengaluru to other place. D.W.1 has deposed in the last line of Para No.4 of his cross-examination that, 20th August 2005 he was out of station for his personal work and he answered that, he cannot remember the place where he had been on that day. He has further deposed that, he has not produced any documents to show that, on 20.8.2005 and 1.8.2008 he was out of station.
21. On perusal of the evidence of D.W.1 he has deposed before the Court that, he has no document to show that, on the alleged execution of Ex.P6 and P7 documents 18 OS.No.4714/2011 where he had been, but surprisingly after his cross- examination was completed the 1st defendant got re-opened the case by filing an application and produced Ex.D1 and D2 documents claiming them to be the Certificate issued by Kanakapura B.E.O. as per Ex.D1 and Ex.D2 is the diary maintained by the 1st defendant to show his place of visit during his working period. Though in those documents, 1st defendant has mentioned that he visited several places, he has never pleaded those facts in his written statement and also he did not produce Ex.D1 and D2 documents alongwith his written statement or atleast on the date of his examination-in-chief, but he has produced those two documents after his cross-examination was completed and it shows that, only with an intention to avoid his liability in paying the loan amount, he has produced those two documents. The 1st defendant has not examined either the B.E.O. or Principal who certified Ex.D2 document to establish that on the said days he actually worked under them and visited such places mentioned in the said documents. 19 OS.No.4714/2011
22. In the cross-examination of D.W.3, it was suggested that, on 20th August 2005 the 1st defendant was hospitalized due to ill-health, but the evidence produced by the 1st defendant through Ex.D1 and D2 documents are quite contrary to this suggestion. According to Ex.D1 and D2 documents, on the relevant days the defendant has worked at several places, but his own suggestion in the cross- examination to P.W.3 certainly, demolished the defence taken up by the 1st defendant that he never executed acknowledgement of debt on 20th August 2005. Though the 1st defendant has claimed that, from the year 2004 he never transacted with the plaintiff-bank, his own admission that, he was in the Bengaluru up to the year 2007 probabalises the execution of Ex.P6 document, which is the acknowledgement of debt executed by him on 20th August 2005.
23. Considering from the evidence of PWs.2 and 3, it is very well established by the plaintiff-bank that the 1st defendant, who stopped repayment of loan subsequently 20 OS.No.4714/2011 from the year 2004, on approach of the plaintiff-bank Managers i.e., PWs.2 and 3, has visited the plaintiff-bank and executed Ex.P6 and P7 acknowledgement of debts on the relevant dates.
24. Under Section 18 and 19 of Indian Limitation Act two provisions are enumerated which deal with different circumstances. Section 18 deals with a suit where part payment is made by the borrower to the loaner and from that day onwards the limitation extends for another period of three years.
25. Under Section 19 of Limitation Act, it is one another circumstance in which without making payment if the loanee has admitted his liability by executing the acknowledgement of debt, that also enures the benefit in favour of the loaner to seek the limitation from that day for a period of 3 years. In the instant case, though the 1st defendant has stopped operating the S.B.Account from the 21 OS.No.4714/2011 year 2004 still the execution of Ex.P6 and P7 documents definitely falls within the ambit of Section 19 of Limitation Act and thereby, though the loan was availed by the 1st defendant in the year 2002, the 1st acknowledgement of debt as per Ex.P6 was within the period of 3 years from the date of loan and thereby, it is a valid document which has given the re-life to the loan documents executed by the 1st defendant.
26. On perusal of Ex.P7 document, it is also executed by the 1st defendant within three years from the date of execution of Ex.P6 document and thereby, again the limitation has started to run from the 2nd acknowledgement of debt and the suit filed by the plaintiff-bank is within the period of limitation from the date of 2nd acknowledgement executed by the 1st defendant. Under such circumstances, this Court holds that the defence raised by the defendant that, he never executed the acknowledgement of debt as per Ex.P6 and P7 are the false defence taken by him to avoid the payment of balance loan amount to the plaintiff-bank. 22 OS.No.4714/2011
27. The learned advocate for the 1st defendant has relied on the following citations:
1. 2006(4) Kar.L.J., 239(DB), in the case of Canara Bank Vs. Vara Trading Company and others.
2. [1999]2 Kant.L.J., 490, in the case of N.T.Vijayakumar and others Vs. The Allahabad Bank.
3. AIR 1999 SUPREME COURT, 1047, in the case of Sampuran Singh and others Vs. Smt.Niranjan Kaur and others.
28. I have carefully perused the principles ruled in the said citations. In view of the reason that, Section 19 of the Limitation Act is pressed into service by the plaintiff-bank, the 2nd citation relied on by the learned advocate mentioned in the list of citations do not help the 1st defendant in avoiding the liability payable to the plaintiff-bank.
29. I have carefully perused the judgment at Sl.No.2 mentioned in the list which came to be rendered by the 23 OS.No.4714/2011 Hon'ble High Court of Karnataka in a writ petition preferred against the judgment of the Small Causes Court. On perusal of the principles ruled in the said decision mainly that petition came to be allowed for the reason that the plaintiff in the said suit had failed to prove the documents i.e., acknowledgement of debt, but in the instant case, the plaintiff-bank by examining PWs.2 and 3 has clearly established the disputed documents Ex.P6 and P7 and thereby even the principles ruled in the said decision would not help the 1st defendant in refuting the plaint claim of the plaintiff-bank.
30. In so far as the 3rd decision referred in the list it is in respect of the legal proposition that, any acknowledgement of debt should be within the time before expiration of limitation provided for enforcing the right through said document. In the instant case, since Ex.P6 and P7 came to be executed by the 1st defendant well within the time of expiration of limitation provided under law i.e., the 24 OS.No.4714/2011 1st acknowledgement of debt was executed on 20th August 2005 and the loan availed by the defendants on 21.12.2002, Ex.P6 i.e., 1st acknowledgement is executed within the limitation period of 3 years. In so far as the 2nd acknowledgement of debt marked at Ex.P7, it was executed on 1.8.2008 that means within 3 years from the date of the limitation started through Ex.P6 document, thereby, even the 3rd judgment referred by the learned advocate for the 1st defendant would not help the defence of the defendant, with these observations, Issue Nos.1 and 2 are answered in the affirmative and issue No.3 is answered in the negative.
31. ISSUE NO.4: For the reasons assigned on issue Nos.1 to 3 and the finding recorded on them, the following order is passed:
ORDER The suit of the plaintiff-bank stands decreed with cost against the defendant Nos.1 and 2.25 OS.No.4714/2011
The plaintiff-bank is entitled to recover Rs.2,34,880/- from the defendant together with 14% interest p.a. [Simple Interest] thereon from the date of suit till realization of entire decretal amount.
Draw decree in terms of judgment.
*** (Dictated to the Judgment Writer, computerised by her, corrected, signed and then pronounced by me in the open court on this the 20th day of June, 2015).
(RAVI N.M.) XLIV ADDL.CITY CIVIL & SESSIONS JUDGE, BANGALORE.
ANNEXURE LIST OF WITNESSES EXAMINED FOR PLAINTIFF:
P.W.1 : Sri Basavaraj Maradi.
P.W.2 : Sri Dayananda Alva.
P.W.3 : Sri J.Jagannatha Shetty.
26 OS.No.4714/2011
LIST OF WITNESSES EXAMINED FOR DEFENDANTS:
D.W.1 : Sri K.M.Vinay Kumar LIST OF DOCUMENTS MARKED FOR PLAINTIFF:
Ex.P1 : Loan Application Ex.P2 : Demand Promissory Note dt:21.12.2002 Ex.P3 : Undertaking letter Ex.P4 : Articles of Agreement dt:21.12.2002 Ex.P5 : Letter of Guarantee Ex.P6 : Acknowledgement of Liability dt:20.8.2005 Ex.P6(a) : Signature of D1 on Ex.P6 Ex.P7 : Acknowledgement of Liability dt:1.8.2008 Ex.P7(a) : Signature of D1 on Ex.P7 Ex.P8 : Copy of legal notice Ex.P9 : Two postal acknowledgements Ex.P10 : Statement of Account
LIST OF DOCUMENTS MARKED FOR DEFENDANTS:
Ex.D1 : Certificate issued by BEO, Kanakapura, dt:18.3.2014 Ex.D2 : Personal diary maintained by defendant Ex.D2(a) : The relevant page dated:31.7.2008 Ex.D2(b) : Another relevant page dt:17.12.2008 Ex.D2(c) : Signature of the Principal XLIV ADDL.CITY CIVIL & SESSIONS JUDGE, BANGALORE.27 OS.No.4714/2011 28 OS.No.4714/2011
20/6/2015:
JUDGMENT PRONOUNCED IN OPEN COURT (VIDE SEPARATE JUDGMENT) The suit of the plaintiff-bank stands decreed with cost against the defendant Nos.1 and 2.
The plaintiff-bank is entitled to recover Rs.2,34,880/- from the defendant together with 14% interest p.a. [Simple Interest] thereon from the date of suit till realization of entire decretal amount.
Draw decree in terms of judgment.
[RAVI N.M.] XLIV ADDITIONAL CITY CIVIL & SESSION JUDGE, BANGALORE.29 OS.No.4714/2011