Delhi District Court
Punjab National Bank vs Kavita Singh on 29 January, 2026
IN THE COURT OF SHRI DEVENDER KUMAR, DISTRICT JUDGE
(COMMERCIAL COURT-01), EAST DISTRICT
KARKARDOOMA COURTS : DELHI
CS (Comm) No. 19/2025
Punjab National Bank
Through Chief Manager / AR
/ Power of Attorney Holder
Circle Sastra Centre- East Delhi,
Phase-II, Mayur Vihar, Delhi-110091
Also at : Branch Office at Laxmi Nagar, at A-16,
Priyadarshini Vihar, Laxmi Nagar, Delhi-110092 .......Plaintiff
Versus
1. Kavita Singh (Borrower)
D/o Sh. Ratan Singh,
R/o H.No. 37, A/2, Gali no. 2,
Near PNB Enclave, Kundan Nagar,
Laxmi Nagar, Delhi -110092
Also at : A-11, First Floor, Lane 3, Gurunanakpura,
Laxmi Nagar, Delhi -110092
Also at : 9/1022, First Floor, Laxmi Cinema,
Patel Block, Near Gandhi Nagar Police Station,
Gandhi Nagar, Delhi -110031 ..........Defendant No. 1
2. Abhishek Singh Malik (Guarantor)
S/o Sh. Karamveer Singh Malik,
R/o A-11, First Floor, Gurunanakpura,
Laxmi Nagar, Delhi -110092 ...........Defendant No. 2
Digitally signed
by DEVENDRA
CS (Comm) No. 19/2025 KUMAR
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 1/32
Date:
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+0530
Date of institution : 20.01.2025
Date of reserving judgment : 16.01.2026
Date of judgment : 29.01.2026
JUDGMENT:
1. Vide this judgment, I shall dispose off this suit for recovery of Rs.4,90,340.60/- along with pendente-lite and future interest @ 11.85% per annum with monthly rest filed by the plaintiff and against the defendants. Brief facts of the case are as under:
2. Plaintiff is a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970 and is being represented through its Chief Manager, Shri Deepak Kumar, who is authorized through GPA to institute this suit. It is further alleged that loan was advanced by United Bank of India, but now has merged into Punjab National Bank vide notification dated 01.04.2020, issued by Government of India, hence this suit filed by Punjab National Bank.
2.1. Plaintiff has further alleged that the defendant no. 1 approached to the plaintiff bank for a term / car loan of Rs. 7,80,000/- for purchasing a new car Jeep Compass from P.P. Cars P. Ltd., which was duly sanctioned on 03.05.2018. It is further alleged that plaintiff-maintained loan account No. 1652300003018 and the defendant no. 1 signed various documents including promissory note dated 03.05.2018, deed of hypothecation, letter of authority and undertaking to deduct EMI amount dated 03.05.2018 and the defendant no. 2 signed letter of guarantee. It is further alleged that the Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 2/32 DEVENDRA Date:
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defendant no. 1 agreed to repay in 36 EMIs of Rs. 25,000/- per month, with interest @ 9.85% with 2% penal interest.
2.2. Plaintiff has further alleged that the plaintiff disbursed loan amount through Pay Order No. 141397 dated 03.05.2018 in favour of M/s P P Cars Pvt. Ltd. and a new car Jeep Compass vide registration No. DL-2CAY 7423 was purchased by the defendant no. 1. It is further alleged that the defendant no. 1 failed to maintain financial discipline and defaulted in payment of EMIs and loan was declared NPA on 01.09.2020. It is further alleged that the defendant no. 1 acknowledged her liability on 02.05.2021 for Rs. 4,11,329.62/- due as on 31.05.2024. It is further alleged that as per statement of account maintained by the plaintiff, outstanding amount along with interest amount is of Rs. 4,90,340.60/- as on 31.12.2024. Plaintiff has prayed that this suit may be decreed in favor of the plaintiff and against the defendants.
3. Defendant No. 1 has filed WS thereby denying her liability to pay suit amount and has alleged that the plaintiff has no locus standi to file this case and the plaintiff has concealed material facts from this court. However, the defendant no. 1 has not denied loan amount as well as execution of loan documents, but it is denied that the defendant no.1 is liable to pay suit amount. Defendant no. 1 has denied all the allegations of the plaintiff and has prayed that this suit is liable to be dismissed.
4. Defendant no. 2 was duly served through publication in newspapers 'The Times of India' and Nav Bharat Times' dated 08.05.2025, but failed to appear and to contest this case.
Digitally
signed by
CS (Comm) No. 19/2025 DEVENDRA
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA KUMAR 3/32
KUMAR Date:
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5. Plaintiff has not filed any replication to WS despite granting opportunity and opportunity of the plaintiff to file replication was closed vide order dated 17.10.2025.
6. On the basis of pleadings of the parties the following issues were framed vide order dated 17.10.2025 as under:
ISSUES:
1. Whether plaintiff has locus standi to file this case as alleged?
OPP
2. Whether plaintiff is entitled for decree of amount of Rs.
4,90,34.60/- as prayed for? OPP
3. Whether plaintiff is entitled for interest against decreetal amount as prayed, if so, at what rate and for what period? OPP
4. Relief
7. To discharge the onus, the plaintiff has examined Branch Manager / AR, Sneha Jaiswal as PW1, who has tendered affidavit in examination in chief in verbatim of allegations in the plaint and has relied upon the documents Ex.PW1/1 to Ex.PW1/18 and Mark A to Mark F. 7.1. During cross examination, PW1 has deposed that she has been posted at Laxmi Nagar Branch of the plaintiff since 06.06.2024. It is further deposed that the plaintiff sanctioned car loan amount of Rs. 7,80,000/- against interest @ 9.85% p.a. It is further deposed that the defendant no.1 availed term car loan to purchase a new car/jeep compass and vehicle was hypothecated to create a charge of the bank against vehicle. It is further Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 4/32 DEVENDRA Date:
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admitted that the bank has claimed interest @ 11.85% per annum including penal interest @ 2% per annum against defaulted EMIs. It is further deposed that she was not aware exactly how many EMIs of the defendant defaulted but a total amount of Rs. 5,00,000/- is outstanding towards the defendant no.1. It is further deposed that loan account is to be declared NPA on default of three consecutive EMIs but the customer is to be intimated through letter about 60 days after defaulting of EMIs that the bank was going to declare his account NPA. It is further deposed that letter was issued to the defendant no.1 but no such letter/intimation has been placed on record.
7.1.1. PW1 has further deposed that no collateral security was obtained from the defendant no.1 at the time of loan. It is admitted that bank was aware about theft of vehicle of the defendant no.1 financed by the plaintiff, but thereafter deposed that no such information was given. It is denied that the plaintiff has charged interest beyond RBI guidelines. It is further admitted that the defendant no.1 approached to the plaintiff bank for settlement but she was not aware whether bank agreed for settlement against total sum of Rs. 1,25,000/-.
7.1.2. PW1 has further deposed that address of customer is to be physically verified before sanction of any loan. It is further deposed that loan amount was disbursed through DD in the name of dealer M/s PP Cars from where the defendant purchased vehicle. It denied that the plaintiff sanctioned top up loan to pay 100% finance amount of vehicle or that any blank cheque was obtained from the defendant no.1 at the time of sanction of loan Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA KUMAR 5/32 KUMAR Date:
2026.01.29 16:11:23 +0530 amount. It is further deposed that EMIs of loan amount was of Rs. 25,000/- per month and Mr. Abhishek Verma was guarantor to this loan amount.
7.1.3. PW1 has admitted that there was only one guarantor to this loan and no separate notice was sent to guarantor. It is denied that there were two guarantors to this loan as per Ex. PW1/2 namely Priyanshu and Abhishek.
It is further deposed that legal notice was served upon the defendants. It is further deposed that as per record, there was no intimation of theft of vehicle and even no insurance amount was received by the bank from insurance company. It is denied that loan amount was sanctioned by HDFC bank and not by the plaintiff.
8. Defendant no. 1 has examined herself as DW1 and has deposed in verbatim of written statement and has relied the documents Ex. DW1/1 and Mark 1 to Mark 4.
8.1. During cross examination, DW1 has deposed that she availed top up loan from United Bank of India and has denied to avail car loan of Rs. 7,80,000/- from the plaintiff. It is admitted that her car registration number was DL-2C-AY-7423, which is already Mark 4. It is further deposed that she availed loan of around 15-16 Lakhs from HDFC bank through showroom of Jeep/dealer at Moti Nagar to purchase new car. It is denied that she never borrowed any loan from HDFC bank. It is admitted that she has not filed documents that she ever availed loan from HDFC bank but she has paid loan amount to HDFC Bank. It is further deposed that vehicle was stolen on 2/3.09.2020 and loan account was closed. It is further deposed that her vehicle was stolen and she informed PNB about theft of vehicle but Digitally signed CS (Comm) No. 19/2025 by DEVENDRA KUMAR Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 6/32 Date:
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she was not aware whether she has filed any such document on record or not.
8.1.1. DW1 has denied that she has filed any document on record that PNB was ever informed about theft of vehicle. It is further deposed that last vehicle insurance was done during Corona period and it is denied that she procured a fake insurance policy of vehicle in connivance with insurance company. It is admitted Ex. PW1/2 bearing her photograph and signatures but it is denied that FIR Ex. DW1/1 is forged and fabricated to avoid her liability to pay loan amount. It is further deposed that she approached to the plaintiff bank in the month of February 2025 to settle account but account could not be settled owing to some error in bank system. It is denied that there was no error in system or that his OTS failed. It is admitted that Mark A is bearing her signature and contents of Mark A are correct.
9. I have heard the arguments and perused the record. My issue wise findings are as under: -
ISSUE Nos. 1 & 2: The onus to prove both issues was put upon the plaintiff. To discharge the onus, the plaintiff has examined PW1 Sneha Jaiswal and has also cross examined DW1. However, before giving findings on issues, it is necessary to ascertain authority of AR to institute this suit on behalf of the plaintiff.
Authority of AR to Institute this suit
10. Plaintiff has filed this suit through its Chief Manager, Deepak Kumar, who was authorized vide Power of Attorney Mark A to institute this Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 7/32 DEVENDRA Date:
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suit. PW1 has proved this GPA as Mark A. However, Ld. Counsel for defendant no.1 has argued that PW1 has not proved authorization of Mr. Deepak Kumar to institute this suit, as the plaintiff has not examined him in evidence and this suit is liable to be dismissed. On the other hand, Ld. Counsel for plaintiff has argued that PW1 has proved POA in favor of Mr. Deepak Kumar as Mark A, which is sufficient to institute this suit in terms of Order 29 Rule 1 CPC and suit is liable to be decreed.
11. Admittedly, a civil suit by a company / corporation has to be signed and verified by Authorized Representative in terms of Order 29 Rule 1 of CPC, whereas appointment of Recognized Representative must be in terms of Order 3 Rule 2 of CPC. Order 29 Rule 1 is as under:
Order 29 Rule 1. Subscription and verification of pleading.-- In suit by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case.
12. In view of Order 29 Rule1 of CPC, authorities mentioned therein must sign and verify pleadings like Secretary, Director, or any other Principal Officer of the company / corporation. These Authorities may sign and verify pleadings besides other Authorized Representatives, as appointed by a company / corporation on its behalf through board resolution. The authority of other recognized agents has been prescribed under Order 3 Rule 1 & 2 of CPC as under:
Rule 1. Appearances, etc., may be in person, by recognized agent or by pleader.--Any appearance, application or act in or to any Court, required or authorized by law to be made or done by a party in such Court, may, except where otherwise expressly provided by any law CS (Comm) No. 19/2025 Digitally signed Punjab National Bank Vs. Kavita Singh & Anr. by DEVENDRA 8/32 DEVENDRA KUMAR KUMAR Date:
2026.01.29 16:11:37 +0530 for the time being in force, be made or done by the party in person, or by his recognized agent, or by a pleader [appearing, applying or acting, as the case may be, on his behalf :
Provided that any such appearance shall, if the Court so directs, be made by the party in person.
Rule 2. Recognised agents.--The recognised agents of parties by whom such appearances, applications and acts may be made or done are--
(a) persons holding powers-of-attorney, authorising them to make and do such appearances, applications and acts on behalf of such parties;
(b) persons carrying on trade or business for and in the names of parties not resident within the local limits of the jurisdiction of the Court within which limits the appearance, application or act is made or done, in matters connected with such trade or business only, where no other agent is expressly authorised to make and do such appearances, applications and acts.
13. In view of abovesaid legal proposition, it stands proved that Recognized Representative may be authorized by way of power of attorney / resolution of board of directors / gazette notification in terms of Section 291 of Companies Act, 1956 (Now corresponding section under Companies Act, 2013). The authority of Authorized Representative under Order 3 Rule 1 & 2 CPC viz-a-viz signing authority of authorized representative under Order 29 rule 1 & 2 of CPC has been defined in case titled Nibro Ltd. v. National Insurance Co. Ltd., (1991) 70 Comp Cas 388 (Delhi) as under:
Order 3, rule 1 provides that any appearance, application or act in or to any court required or authorise by law can be made or done by the party in person or by his recognized agent or by a pleader appearing, applying or acting, as the case may be, on his behalf. Provided of course, such an appearance, application or act in or to any court is required or authorised by law to be done or done by a party in such court. Where, however, there is an express provision of law, then that provision will prevail. Thus, if an authority is given to a pleader or a recognised agent as provided by law, the recognised agent or pleader can file an appearance or file a suit in court if the party himself is not in a position to file it. In my view, if a party is a company or a corporation, the recognised agent or a pleader has to be authorise by Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 9/32 DEVENDRA Date:
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law to file such a plaint. Such an authority can be given to a pleader or an agent in the case of a company by a person specifically authorised in this behalf. In other words, a pleader or an agent can be authorised to file a suit on behalf of a company only by an authorised representative of the company. If a director or a secretary is authorised by law, then he can certainly give the authority to another person as provided under Order 3, rule 1.
The authority of a principal officer of a company in relation to suits filed on behalf of the limited company does not extend beyond what is laid down in Order 29 of the Code of Civil Procedure. That provision does not entitle the principal officer of a company to file a suit on its behalf and for that the authority has to be found either in the articles of association of the company or in the resolution of its board of directors. In the articles of association of several companies, provision is generally made authorizing their managing directors and other officers to file and defend suits on their behalf. Similarly, the board of directors of a company can authorize the institution of a suit on behalf of the company by a resolution. In the case of some companies the articles empower the managing director or directors to appoint general attorneys and general managers and given them authority to institute suits on behalf of the company. But in the absence of any proof in regard to any such power having been conferred on Shri Ram Lal Choudhary, it is not possible to accept his statement that he was authorised to file the suit as the principal officer of the plaintiff hotel.
It is well-settled that under section 291 of the Companies Act except where express provision is made that the powers of a company in respect of a particular matter are to be exercised by the company in general meeting, in all other cases the board of directors are entitled to exercise all its powers. Individual directors have such powers only as are vested in them by the memorandum and articles. It is true that ordinarily the court will not unsuit a person on account of technicalities. However, the question of authority to institute a suit on behalf of a company is not a technical matter. It has far-reaching effects. It often affects the policy and finances of the company. Thus , unless a power to institute a suit is specifically conferred on a particular director, he has no authority to institute a suit on behalf of the company. Needless to say such a power can be conferred by the board of directors only by passing a resolution in that regard.
14. Further, in another landmark judgment titled United Bank of India v.
Naresh Kumar, (1996) 6 SCC 660, it has held that;
Digitally signed by DEVENDRACS (Comm) No. 19/2025 DEVENDRA KUMAR
Punjab National Bank Vs. Kavita Singh & Anr. 10/32
KUMAR Date:
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9. In cases like the present where suits are instituted or defended on behalf of a public corporation, public interest should not be permitted to be defeated on a mere technicality. Procedural defects which do not go to the root of the matter should not be permitted to defeat a just cause. There is sufficient power in the courts, under the Code of Civil Procedure, to ensure that injustice is not done to any party who has a just case. As far as possible a substantive right should not be allowed to be defeated on account of a procedural irregularity which is curable.
10. It cannot be disputed that a company like the appellant can sue and be sued in its own name. Under Order 6 Rule 14 of the Code of Civil Procedure a pleading is required to be signed by the party and its pleader, if any. As a company is a juristic entity it is obvious that some person has to sign the pleadings on behalf of the company. Order 29 Rule 1 of the Code of Civil Procedure, therefore, provides that in a suit by or against a corporation the Secretary or any Director or other Principal Officer of the corporation who is able to depose to the facts of the case might sign and verify on behalf of the company. Reading Order 6 Rule 14 together with Order 29 Rule 1 of the Code of Civil Procedure it would appear that even in the absence of any formal letter of authority or power of attorney having been executed a person referred to in Rule 1 of Order 29 can, by virtue of the office which he holds, sign and verify the pleadings on behalf of the corporation. In addition thereto and dehors Order 29 Rule 1 of the Code of Civil Procedure, as a company is a juristic entity, it can duly authorise any person to sign the plaint or the written statement on its behalf and this would be regarded as sufficient compliance with the provisions of Order 6 Rule 14 of the Code of Civil Procedure. A person may be expressly authorised to sign the pleadings on behalf of the company, for example by the Board of Directors passing a resolution to that effect or by a power of attorney being executed in favour of any individual. In absence thereof and in cases where pleadings have been signed by one of its officers a corporation can ratify the said action of its officer in signing the pleadings. Such ratification can be express or implied. The court can, on the basis of the evidence on record, and after taking all the circumstances of the case, specially with regard to the conduct of the trial, come to the conclusion that the corporation had ratified the act of signing of the pleading by its officer.
13. The court had to be satisfied that Shri L.K. Rohatgi could sign the plaint on behalf of the appellant. The suit had been filed in the name of the appellant company; full amount of court fee had been paid by the appellant-Bank; documentary as well as oral evidence had been led on behalf of the appellant and the trial of the suit before the Sub-
Digitally signed by DEVENDRA CS (Comm) No. 19/2025 KUMARPunjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 11/32 Date:
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Judge, Ambala, had continued for about two years. It is difficult, in these circumstances, even to presume that the suit had been filed and tried without the appellant having authorised the institution of the same. The only reasonable conclusion which we can come to is that Shri L.K. Rohatgi must have been authorised to sign the plaint and, in any case, it must be held that the appellant had ratified the action of Shri L.K. Rohatgi in signing the plaint and thereafter it continued with the suit.
15. A combined reading of both abovesaid judgments made it clear that pleadings must be signed by authorities mentioned under Order 29 Rule 1, or by any Authorized Agent / Representative. The authorization of any Authorized Representative may be in terms of Order 3 Rule 2 of CPC, or by the company through resolution of board of directors in terms of Section 291 of Companies Act, 1956 (or corresponding section under Companies Act, 2013). However, authority of a person/s mentioned under Order 29 Rule 1 of CPC to sign the pleadings must be proved through Article of Association, or resolution of board of directors as held in case titled State Bank of Travancore v. Kingston Computers (I) (P) Ltd., (2011) 11 SCC 524 as under:
14. In our view, the judgment under challenge is liable to be set aside because the respondent had not produced any evidence to prove that Shri Ashok K. Shukla was appointed as a Director of the Company and a resolution was passed by the Board of Directors of the Company to file a suit against the appellant and authorised Shri Ashok K. Shukla to do so. The letter of authority issued by Shri Raj K. Shukla, who described himself as the Chief Executive Officer of the Company, was nothing but a scrap of paper because no resolution was passed by the Board of Directors delegating its powers to Shri Raj K. Shukla to authorise another person to file a suit on behalf of the Company.
13. The Division Bench of the High Court did take cognizance of the fact that the Company had not summoned any witness from the office of the Registrar of Companies to prove that Shri Ashok K. Shukla was a Director of the Company and that the minute book of the Company Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA KUMAR 12/32 KUMAR Date:
2026.01.29 16:11:55 +0530 had not been produced to prove the appointment of Shri Ashok K. Shukla as a Director, but reversed the finding of the trial court on Issue 1 on the basis of the authority letter issued by Shri Raj K. Shukla and resolutions dated 14-2-2001 and 19-4-2001, by which the Board of Directors of the Company had authorised some persons to operate the bank account.
16. In view of abovesaid law, it stands proved that PW1 has proved authority of Mr. Deepak Kumar, who has instituted this suit in the capacity of manager of the bank and there is no challenge to this authority, due to institution of this suit stands proved.
Denial of facts under Order 8 Rule 5 of CPC
17. Admittedly, pleadings of the parties are material in civil cases and if the parties have not pleaded their pleas in their pleadings, then they cannot take those pleas in their evidence. In the present case also, pleadings of the defendants are necessary to consider their defense/s. Plaintiff has alleged specifically that the defendants approached to the plaintiff bank for a loan facility and the plaintiff conceded to said loan request and extended loan facility. On the other hand, the defendants have not specifically denied most of the allegations of the plaintiff and, if allegations in pleadings are not denied specifically, then it amounts to admission under Order 8 Rule 5 of CPC. Order 8 Rule 5 of CPC is as under:
Order 8 Rule 5. Specific denial.-- (1) Every allegation of fact in the plaint, if not denied specifically or by necessary implication, or stated to be not admitted in the pleading of the defendant, shall be taken to be admitted except as against a person under disability:
Provided that the Court may in its discretion require any fact so admitted to be proved otherwise than by such admission.
CS (Comm) No. 19/2025 Digitally signed
Punjab National Bank Vs. Kavita Singh & Anr. by DEVENDRA 13/32
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(2) Where the defendant has not filed a pleading, it shall be lawful for the Court to pronounce judgment on the basis of the facts contained in the plaint, except as against a person under a disability, but the Court may, in its discretion, require any such fact to be proved.
(3) In exercising its discretion under the proviso to sub-rule (1) or under sub-rule (2), the Court shall have due regard to the fact whether the defendant could have, or has, engaged a pleader.
(4) Whenever a judgment is pronounced under this rule, a decree shall be drawn up in accordance with such judgment and such decree shall bear the date on which the judgment was pronounced.
18. Order 8 Rule 5 of CPC has been interpreted in case titled Balraj Taneja v. Sunil Madan, (1999) 8 SCC 396 and relevant observations are as under:
7. Order 8 Rule 1 provides that the defendant shall file a written statement of his defence. It is further provided by Rule 3 of Order 8 that it shall not be sufficient for a defendant in his written statement to deny generally the grounds alleged by the plaintiff, but the defendant must deal specifically with each allegation of fact of which he does not admit the truth. The further requirement as set out in Rule 4 is that if the allegation made in the plaint is denied by the defendant, the denial must not be evasive. It is, inter alia, provided in Rule 5 of Order 8 that every allegation of fact in the plaint, if not denied specifically or by necessary implication or stated to be not admitted in the written statement, shall be taken to be admitted.
9. The scheme of this rule is largely dependent upon the filing or non-
filing of the pleading by the defendant. Sub-rule (1) of Rule 5 provides that any fact stated in the plaint, if not denied specifically or by necessary implication or stated to be not admitted in the pleading of the defendant, shall be treated as admitted. Under Rule 3 of Order 8, it is provided that the denial by the defendant in his written statement must be specific with reference to each allegation of fact made in the plaint. A general denial or an evasive denial is not treated as sufficient denial and, therefore, the denial, if it is not definite, positive and unambiguous, the allegations of facts made in the plaint shall be treated as admitted under this rule.
10. The proviso appended to this rule is important in the sense that though a fact stated in the plaint may be treated as admitted, the court Digitally signed by CS (Comm) No. 19/2025 DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA KUMAR 14/32 KUMAR Date:
2026.01.29 16:12:03 +0530 may, in its discretion, still require such "admitted fact" to be proved otherwise than by such admission. This is an exception to the general rule of evidence that a fact which is admitted need not be proved.
19. Further, it has held that Gian Chand and Bros. v. Rattan Lal, (2013) 2 SCC 606 and relevant observations are as under:
23. The said aspect can be looked from another angle. Rules 3, 4 and 5 of Order 8 form an integral code dealing with the manner in which allegations of fact in the plaint should be traversed and the legal consequences flowing from its non-compliance. It is obligatory on the part of the defendant to specifically deal with each allegation in the plaint and when the defendant denies any such fact, he must not do so evasively but answer the point of substance. It is clearly postulated therein that it shall not be sufficient for a defendant to deny generally the grounds alleged by the plaintiffs but he must be specific with each allegation of fact (see Badat and Co. v. East India Trading Co. [AIR 1964 SC 538] ).
24. Rule 4 stipulates that a defendant must not evasively answer the point of substance. It is alleged that if he receives a certain sum of money, it shall not be sufficient to deny that he received that particular amount, but he must deny that he received that sum or any part thereof, or else set out how much he received, and that if an allegation is made with diverse circumstances, it shall not be sufficient to deny it along with those circumstances. Rule 5 deals with specific denial and clearly lays down that every allegation of fact in the plaint, if not denied specifically or by necessary implication, or stated to be not admitted in the pleading of the defendant, shall be taken to be admitted against him.
25. We have referred to the aforesaid Rules of pleading only to highlight that in the written statement, there was absolutely evasive denial. We are not proceeding to state whether there was admission or not, but where there is total evasive denial and an attempt has been made to make out a case in adducing the evidence that he was not aware whether the signatures were taken or not, it is not permissible.
In this context, we may profitably refer to a two-Judge Bench decision in Sushil Kumar v. Rakesh Kumar [(2003) 8 SCC 673] wherein, while dealing with the pleadings of election case, this Court has held thus: (SCC p. 693, para 73) CS (Comm) No. 19/2025 Digitally signed Punjab National Bank Vs. Kavita Singh & Anr. by DEVENDRA 15/32 DEVENDRA KUMAR KUMAR Date:
2026.01.29 16:12:07 +0530 "73. In our opinion, the approach of the High Court was not correct. It failed to apply the legal principles as contained in Order 8 Rules 3 and 5 of the Code of Civil Procedure. The High Court had also not analysed the evidence adduced on behalf of the appellant in this behalf in detail but merely rejected the same summarily stating that vague statements had been made by some witnesses. Once it is held that the statements made in Para 18 of the election petition have not been specifically denied or disputed in the written statement, the allegations made therein would be deemed to have been admitted, and, thus, no evidence contrary thereto or inconsistent therewith could have been permitted to be laid."
26. Scrutinised thus, the irresistible conclusion would be that the defendants could not have been permitted to lead any evidence when nothing was stated in the pleadings. The courts below had correctly rested the burden of proof on the defendant but the High Court, in an erroneous impression, has overturned the said finding.
20. Further, in a latest case titled Thangam v. Navamani Ammal, (2024) 4 SCC 247, it has held that:
25. Order 8 Rules 3 and 5CPC clearly provides for specific admission and denial of the pleadings in the plaint. A general or evasive denial is not treated as sufficient. Proviso to Order 8 Rule 5CPC provides that even the admitted facts may not be treated to be admitted, still in its discretion the Court may require those facts to be proved. This is an exception to the general rule. General rule is that the facts admitted, are not required to be proved.
26. The requirements of Order 8 Rules 3 and 5CPC are specific admission and denial of the pleadings in the plaint. The same would necessarily mean dealing with the allegations in the plaint para-wise.
In the absence thereof, the respondent can always try to read one line from one paragraph and another from different paragraph in the written statement to make out his case of denial of the allegations in the plaint resulting in utter confusion.
28. The issue regarding specific admission and denial of the pleadings was considered by this Court in Badat & Co. v. East India Trading Co. [Badat & Co. v. East India Trading Co., 1963 SCC OnLine SC 9 :
AIR 1964 SC 538] While referring to Order 8 Rules 3 to 5 CPC it was opined that the aforesaid Rules formed an integrated Code dealing with the manner in which the pleadings are to be dealt with. Relevant parts of para 11 thereof are extracted below : (Badat case [Badat & Co. v. East India Trading Co., 1963 SCC OnLine SC 9 : AIR 1964 SC 538] , AIR pp. 544-45) Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 16/32 DEVENDRA Date:
KUMAR 2026.01.29
16:12:12
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"11. Order 7 of the Code of Civil Procedure prescribes, among others, that the plaintiff shall give in the plaint the facts constituting the cause of action and when it arose, and the facts showing that the court has jurisdiction. The object is to enable the defendant to ascertain from the plaint the necessary facts so that he may admit or deny them. Order 8 provides for the filing of a written statement, the particulars to be contained therein and the manner of doing so; ... These three rules form an integrated code dealing with the manner in which allegations of fact in the plaint should be traversed and the legal consequences flowing from its non-compliance. The written statement must deal specifically with each allegation of fact in the plaint and when a defendant denies any such fact, he must not do so evasively, but answer the point of substance. If his denial of a fact is not specific but evasive, the said fact shall be taken to be admitted. In such an event, the admission itself being proof, no other proof is necessary."
29. The matter was further considered by this Court in Lohia Properties (P) Ltd. v. Atmaram Kumar [Lohia Properties (P) Ltd. v. Atmaram Kumar, (1993) 4 SCC 6] after the 1976 Amendment Act in CPC whereby the existing Rule 5 of Order 8CPC was numbered as sub-rule (1) and three more sub-rules were added dealing with different situations where no written statement is filed. In paras 14 and 15 of the aforesaid judgment, the position of law as stated earlier was reiterated. The same are extracted below : (SCC pp. 8-9, paras 14-15) "14. What is stated in the above is, what amounts to admitting a fact on a pleading while Rule 3 Order 8 requires that the defendant must deal specifically with each allegation of fact of which he does not admit the truth.
15. Rule 5 provides that every allegation of fact in the plaint, if not denied in the written statement shall be taken to be admitted by the defendant. What this rule says is, that any allegation of fact must either be denied specifically or by a necessary implication or there should be at least a statement that the fact is not admitted. If the plea is not taken in that manner, then the allegation shall be taken to be admitted."
In view of abovesaid cases, it is clear that the allegations in plaint must be specifically denied in written statement, otherwise facts which are not specifically denied shall be considered to be admitted.
Digitally signed by DEVENDRACS (Comm) No. 19/2025 KUMAR
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 17/32
Date:
KUMAR 2026.01.29
16:12:16
+0530
21. Pleadings of the parties in this case: Plaintiff has alleged in Para-2 that on 02.05.2018, the defendants applied for term / car loan facility of Rs. 7,80,000/- for purchasing a new car Jeep Compass from PP Cars P Ltd., Delhi Lacs. This para has been replied in WS that Para 2 of plaint needs no comments.
21.1. Para-3- Plaintiff alleged that said loan proposal of the defendant no.1 was duly sanctioned by the plaintiff for term/ car loan facility of Rs. 7.8 Lacs vide sanction letter dated 03.05.2018 and same has been accepted by the defendant no.1. Accordingly, a Loan account no. 1652300003018 was opened in the name of the defendant no.1 by the plaintiff. This para has been replied in WS that contents of Para 3 are matter of record. However, it is respectfully submitted that officials of the plaintiff bank itself contracted the defendant to arrange top up loan as alleged in para.
21.2. Para-4- Plaintiff alleged that the defendant no.1 executed demand promissory note dated 03.05.2018 for Rs. 7,80,000/-, Letter of lien dated 03.05.2018, Deed of hypothecation dated 03.05.2018, Performa letter dated 03.05.2018, Letter of authority dated 03.05.2018, Letter of Undertaking to deduct EMIs of Loan Dated 03.05.2018 and various other loan documents in favor of the plaintiff and agreed to repay loan as per sanction letter and loan agreement documents. This para has been replied in WS is matter of record.
21.3. Para-5. Plaintiff has alleged that the defendant no.2 executed Agreement of Guarantee dated 03.05.2018, on behalf of defendant no.1 and Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA KUMAR 18/32 KUMAR Date:
2026.01.29 16:12:21 +0530 in favor of the plaintiff, for the car loan facility of Rs. 7,80,000/- availed by the defendant no.1. This para has been replied in WS that it is matter of record and as per general practice, no document has been read over to the defendant.
21.4. Para-6. Plaintiff has alleged that the defendant no.1 agreed to repay the loan amount of Rs. 7,80,000/- in total 36 EMIs of Rs. 25,000/- each.
The EMI amount was fixed and commenced from next month of disbursement. This para has been replied in WS that the contents need no comments. It is submitted that the defendant has paid EMIs to the plaintiff but after sometime vehicle was stolen during covid and lodged FIR and the defendant informed the plaintiff bank about it.
21.5. Para -7. Plaintiff has alleged that the defendant agreed for interest @ 9.85% per annum and agreed to pay additional interest @ 2% per annum. Defendant has denied that she accepted terms and conditions of loan and has alleged that the defendant agreed to settle in total Rs. 1.25 Lacs and even officials of the plaintiff were also agreed and amount was paid but no receipt was executed inadvertently for the best reasons known to them.
21.6. Para-8. Plaintiff has further alleged that on execution of documents, the plaintiff disbursed the loan amount of Rs. 7,80,000/-, the loan account of the defendant no.1 and issued a pay order no. 141397 dated 03.05.2018 of Rs. 7,80,000/- in favor of M/s PP cars Pvt. Ltd. This para has been replied in WS that contents are matter of record.
Digitally signed by DEVENDRACS (Comm) No. 19/2025 KUMAR
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 19/32
Date:
KUMAR 2026.01.29
16:12:27
+0530
21.7. Para-9 - Plaintiff has alleged that the defendant no.1 purchased Jeep Compass DL-2C-AY 7423 and car was hypothecated with the plaintiff. This para has not been denied and stated that it is a matter of record.
21.8. Paras 10 to 12 - Plaintiff has alleged that the defendant failed to maintain financial discipline and failed to repay loan amount despite various requests and became irregular in repayment of overdue EMIs amount to the plaintiff and loan account was declared NPA on 01.09.2020. These Paras are not denied specifically and rather admitted that the defendant paid EMIs but could not pay further due to covid and even the vehicle was also stolen and she also informed to the plaintiff, whereas the plaintiff did not follow due procedure to declare NPA. As such, main contents are not disputed.
21.9. Paras 13 & 14 - Plaintiff has alleged that the defendant no.1 executed balance and security confirmation letter dated 02.05.2021 to acknowledge debt of Rs. 04,11,329.62/- and also made part payment of Rs. 5,000/- on 25.02.2022 due as on 10.10.2024. These paras have not been denied in replies and rather a different version that the defendant settled this dispute for Rs. 1.25 Lacs and paid amount to the bank account and the plaintiff did not issue receipt was raised, but payment of Rs. 5,000/- is not disputed.
21.10. Para 16 - Plaintiff has alleged that the defendants are liable to pay an amount of Rs. 03,77,849.62/-, Rs. 93,898.00/- and total amount of Rs. 4,90,340.60/-. This para has been denied in WS and replied needs no comments.
Digitally signedCS (Comm) No. 19/2025 by DEVENDRA
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA KUMAR 20/32
KUMAR Date:
2026.01.29
16:12:33 +0530
21.11. Paras 17 & 20 - Plaintiff has alleged that the plaintiff is entitled for interest @ 9.85% per annum and 2% per annum penal interest with monthly rest. However, there paras have been simply denied with explanation that vehicle was stolen and the plaintiff was informed about it.
22. Perusal of abovesaid paragraphs of plaint and WS would show that the defendant no.1 has neither denied to avail loan facility nor has proved to repay it. Order VIII Rule 5 of CPC has further amended through Sechdule under The Commercial Courts Act, 2015 by inserting Rule "3A as follows;
Rule.3A - Denial by the defendant in suits before the Commercial Division of the High Court or the Commercial Court (1) Denial shall be in the manner provided in sub-rules (2), (3), (4) and (5) of this Rule.
(2) The defendant in his written statement shall state which of the allegations in the particulars of plaint he denies, which allegations he is unable to admit or deny, but which he requires the plaintiff to prove, and which allegations he admits. (3) Where the defendant denies an allegation of fact in a plaint, he must state his reasons for doing so and if he intends to put forward a different version of events from that given by the plaintiff, he must state his own version.
(4) If the defendant disputes the jurisdiction of the Court he must state the reasons for doing so, and if he is able, give his own statement as to which Court ought to have jurisdiction.
Digitally signedCS (Comm) No. 19/2025 by DEVENDRA
Punjab National Bank Vs. Kavita Singh & Anr. 21/32
DEVENDRA KUMAR
KUMAR Date:
2026.01.29
16:12:39 +0530
(5) If the defendant disputes the plaintiff's valuation of the suit, he must state his reasons for doing so, and if he is able, give his own statement of the value of the suit.
23. Further, in Rule 5, in sub-rule (1), after the first proviso, the following proviso shall be inserted, namely:--
''Provided further that every allegation of fact in the plaint, if not denied in the manner provided under Rule 3A of this Order, shall be taken to be admitted except as against a person under disability.";
24. In fact, after going through Order VIII Rule 5 r/w Proviso added by amendment through Schedule under The Commercial Courts Act, 2015, it stands proved that the defendants have nowhere disputed case of the plaintiff and most of the facts including advancing of car loan facility and its default as well as non-payment are admitted. Defendants were supposed to prove that after loan facility, they repaid it, which is not proved.
Locus Standi of the plaintiff to file this case
25. Defendant no.1 has challenged locus standi of the plaintiff to file this suit. However, she has admitted availing of car loan of Rs. 7,80,000/- on 02.05.2018 and also that loan amount was released to M/s PP Motors and she purchased vehicle bearing No. DL2CAY 7423, Jeep Compass. Not only this, the defendant no.1 also executed loan documents Ex.PW1/2 to Ex.PW1/9 including promissory note, letter of lien, deed of hypothecation, Digitally signed by DEVENDRA CS (Comm) No. 19/2025 KUMAR Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 22/32 Date:
KUMAR 2026.01.29
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letter of authority, proforma of letter and undertaking to deduct EMI amount. It is further proved that loan was repayable in 36 EMIs of Rs. 25,000/- per month and this fact is also not denied by the defendant no.1 and rather part payment was also made. As such, the plaintiff has proved that the defendant no.1 availed vehicle loan of Rs. 7.80,000/- and also purchased a vehicle.
26. Not only this, affidavit of admission-denial of documents filed by the defendant no. 1 has also corroborated that the defendant no.1 has admitted loan documents and nothing is denied except promissory note, which is already proved as Ex.PW1/4. As such, case of the plaintiff is not disputed by the defendant no. 1 in her pleadings, so evidence beyond pleadings is not sustainable.
27. Ld. Counsel for defendant no.1 has argued that car loan was advanced by HDFC Bank and even vehicle was also stolen. However, it is beyond explanation, on the one hand, the defendant no. 1 has alleged that she did not avail loan from United Bank of India / Punjab National Bank, on the other hand, she has admitted that she has repaid amount to the plaintiff. Both the stands are contradictory. If loan was not availed from Punjab National Bank / United Bank of India, then why the defendant no. 1 paid EMIs of loan amount, which proves that the plaintiff availed car loan from the plaintiff and failed to repay it.
28. Ld. Counsel for defendant has further argued that the plaintiff has no locus standi to file this case, as the defendant no.1 never availed loan from the plaintiff and rather some blank documents of various banks got signed Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 23/32 DEVENDRA Date:
KUMAR 2026.01.29
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by showroom owner which have been misused by the plaintiff. It is further argued that the defendant no.1 was not aware which particular bank sanctioned her car loan, but as per contents of RC, HDFC Bank released this loan amount and the defendant has already settled loan account with HDFC Bank after theft of vehicle, due to the defendant no.1 is not liable to pay any amount.
29. On the other hand, Ld. Counsel for plaintiff has opposed these submissions and has submitted that the defendants have failed to prove any document to prove that loan amount was ever sanctioned by HDFC Bank or no loan was availed by the defendants from the plaintiff, due to loan was availed by the defendants and plea taken by the defendants is false.
30. Admittedly, as per loan documents, the defendant no. 1 approached to the plaintiff for a car loan and the plaintiff advanced loan of Rs. 7,80,000/- on 03.05.2018 and the defendant no.1 signed loan application Ex. PW1/2 and the bank sanctioned loan vide sanction letter Ex.PW1/3. No only loan application, the defendant no.1 also singed promissory note Ex.PW1/4, letter of lien Ex.PW1/5, deed of hypothecation and proforma of letter Ex.PW1/6, Ex.PW1/7, letter of authority Ex.PW1/8 and undertaking to deduct EMIs of loan amount Ex.PW1/9. PW1 has been cross examined by the defendant and has duly proved that the plaintiff sanctioned loan of Rs. 7,80,000/- to purchase a new Jeep Car and vehicle was hypothecated with the bank. However, during cross examination, DW1 has proved Mark DW1/4 to prove that the defendant no. 1 availed loan from HDFC Bank and even HDFC bank also got an order to repossess vehicle, due to the Digitally signed by DEVENDRA CS (Comm) No. 19/2025 KUMAR Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 24/32 Date:
KUMAR 2026.01.29
16:12:59
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defendant is not liable to pay suit amount.
31. No doubt Mark DW1/4 court order has proved that HDFC Bank got a court order to seize vehicle through the court receiver but this order has falsified the plea of the defendant no.1 that vehicle was stolen. It is beyond explanation, if vehicle was stolen, then how it got repossessed by HDFC Bank. Similarly, it is also beyond explanation, if the defendant no.1 availed loan from United Bank of India and also repaid loan amount, then how vehicle got hypothecated with HDFC Bank. Further, she approached the bank and moved Ex.DW1/2 for one time settlement, which was possible only if loan was availed by the defendants from the plaintiff. In any case, on the basis of loan documents and repayment record, it stands proved that loan was availed by the defendant no.1 from the plaintiff. As such, the defendant no.1 has not proved any document to discard that she did not avail loan from the plaintiff and has not examined any witness from HDFC Bank to prove it, due to this defense could not be proved.
Effect of theft of vehicle
32. Ld. Counsel for defendant has argued that vehicle was stolen and the defendant no.1 duly informed the plaintiff about it. Ld. Counsel has further argued that the plaintiff might have received insurance amount of vehicle, as the defendant lodged FIR and also intimated about theft, due to the defendant no.1 is not liable to pay suit amount. However, PW1 has deposed from court record that there was no intimation about theft of vehicle and even no insurance amount has been received by the bank from Insurance company. Contrary to it, the defendant no. 1 has not proved any document CS (Comm) No. 19/2025 Digitally signed Punjab National Bank Vs. Kavita Singh & Anr. by DEVENDRA 25/32 KUMAR DEVENDRA Date:
KUMAR 2026.01.29
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on record that she availed loan from HDFC Bank or that any intimation of theft was sent to the plaintiff. Even theft of a vehicle is altogether different from recovery of outstanding amount and claim of insurance of vehicle depends upon insurance policy and if the defendant no.1 failed to continue with insurance policy, then she could not escape her liability to repay loan amount. Even otherwise, insurance claim was also subject to cooperation by the defendant no.1 but the defendant no.1 has not mentioned anything about it, due to it could not be proved that the plaintiff has received insurance claim. As such, it could not be proved that there is any effect of theft of the vehicle on the merit of this case.
Liability of Guarantor
33. Defendant no. 2 is guarantor and the plaintiff has proved his letter of guarantee Ex.PW1/10 duly executed by the defendants no. 2 Abhishek Singh Malik. The guarantor, who has signed Guarantee Letter and opinion sheet, is liable to pay guarantee amount in terms of Indian Contract Act. Relevant Sections of Indian Contract Act are as under.
Section-126. "Contract of guarantee", "surety", "principal debtor" and "creditor".--A "contract of guarantee" is a contract to perform the promise, or discharge the liability, of a third person in case of his default. The person who gives the guarantee is called the "surety"; the person in respect of whose default the guarantee is given is called the "principal debtor", and the person to whom the guarantee is given is called the "creditor". A guarantee may be either oral or written.
Section 127. Consideration for guarantee.--Anything done, or any promise made, for the benefit of the principal debtor, may be a sufficient consideration to the surety for giving the guarantee.
Digitally signedCS (Comm) No. 19/2025 by DEVENDRA
Punjab National Bank Vs. Kavita Singh & Anr. 26/32
DEVENDRA KUMAR
KUMAR Date:
2026.01.29
16:13:16 +0530
Illustrations
(a) B requests A to sell and deliver to him goods on credit. A agrees to do so, provided C will guarantee the payment of the price of the goods. C promises to guarantee the payment in consideration of A's promise to deliver the goods. This is a sufficient consideration for C's promise.
(b) A sells and delivers goods to B. C afterwards requests A to forbear to sue B for the debt for a year, and promises that, if he does so, C will pay for them in default of payment by B. A agrees to forbear as requested. This is a sufficient consideration for C's promise.
(c) A sells and delivers goods to B. C afterwards, without consideration, agrees to pay for them in default of B. The agreement is void.
Section 128. Surety's liability.--The liability of the surety is co- extensive with that of the principal debtor, unless it is otherwise provided by the contract.
Illustration A guarantees to B the payment of a bill of exchange by C, the acceptor. The bill is dishonoured by C. A is liable, not only for the amount of the bill, but also for any interest and charges which may have become due on it.
Section - 145.Implied promise to indemnify surety.--In every contract of guarantee there is an implied promise by the principal debtor to indemnify the surety, and the surety is entitled to recover from the principal debtor whatever sum he has rightfully paid under the guarantee, but, no sums which he has paid wrongfully.
In view of abovesaid law, it stands proved that liability of a guarantor is co- extensive and Section 128 of the Act makes it clear that guarantor is equally liable to pay amount, in case of default by principal borrower in terms of Section 145 of Contract Act.
34. The liability of a guarantor has been defined by Hon'ble Apex court in case titled Industrial Investment Bank of India Ltd vs Bishwanath CS (Comm) No. 19/2025 Digitally signed Punjab National Bank Vs. Kavita Singh & Anr. by DEVENDRA 27/32 DEVENDRA KUMAR KUMAR Date:
2026.01.29 16:13:20 +0530 Jhunjhunwala, Civil Appeal No. 4613 of 2000 and relevant observations are as under:
18. Mr. Gupta also submitted that the liability of the guarantor and the principal debtor are co-extensive and not in alternative. He also submitted that sections 29, 31 and 32 of the State Financial Corporations Act are pari materia with sections 39, 40 and 41 of the IRBI Act.
19. Mr. Gupta, in support of his submission, placed reliance on a judgment of this Court in Bank of Bihar Ltd. v. Damodar Prasad & Another (1969) 1 SCR 620. In that case, the court referred to a judgment in Lachhman Joharimal v. Bapu Khandu and Tukaram Khandoji (1869) 6 Bombay High Court Reports 241, in which the Division Bench of the Bombay High Court held as under:
"The court is of opinion that a creditor is not bound to exhaust his remedy against the principal debtor before suing the surety and that when a decree is obtained against a surety, it may be enforced in the same manner as a decree for any other debt."
This Court, while approving the said judgment, observed that, "the very object of the guarantee is defeated if the creditor is asked to postpone his remedies against the surety. In the present case the creditor is a banking company. A guarantee is a collateral security usually taken by a banker. The security will become useless if his rights against the surety can be so easily cut down."
20. In State Bank of India v. M/s. Indexport Registered (supra), this Court held that the decree holder bank can execute the decree against the guarantor without proceeding against the principal borrower. Guarantor's liability is co- extensive with that of the principal debtor. In that case, this court further observed that, "the execution of the money decree is not made dependent on first applying for execution of the mortgage decree. The choice is left entirely with the decree- holder. The question arises, whether a decree which is framed as a composite decree as a matter of law, must be executed against the mortgage property first or can a money decree, which covers whole or part of the decretal amount covering mortgage decree can be executed earlier. There is nothing in law which provides such a composite decree to be first executed only against the principal debtor. The court further observed that "the liability of the surety is co-extensive with the principal debtor, unless it is otherwise provided by the contract".
Digitally signedCS (Comm) No. 19/2025 by DEVENDRA
Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 28/32
DEVENDRA
Date:
KUMAR 2026.01.29
16:13:24
+0530
21. The term "co-extensive" has been defined in the celebrated book of Polock & Mulla on Indian Contract and Specific Relief Act, Tenth Edition, at page 728 as under:
"Co-extensive. - Surety's liability is co-extensive with that of the principal debtor.
A surety's liability to pay the debt is not removed by reason of the creditor's omission to sure the principal debtor. The creditor is not bound to exhaust his remedy against the principal before suing the surety, and a suit may be maintained against the surely though the principal has not been sued."
25. A Division Bench of the High Court of Karnataka, in The Hukumchand Insurance Co. Ltd. v. The Bank of Baroda & Others AIR 1977 Kant 204 had an occasion to consider the question of liability of the surety vis-a-vis the principal debtor. The court held as under:-
"The question as to the liability of the surety, its extent and the manner of its enforcement have to be decided on first principles as to the nature and incidents of suretyship. The liability of a principal debtor and the liability of a surety which is co- extensive with that of the former are really separate liabilities, although arising out of the same transaction. Notwithstanding the fact that they may stem from the same transaction, the two liabilities are distinct. The liability of the surety does not also, in all cases, arise simultaneously."
In view of the abovesaid case, it stands proved that liability of a principal debtor and guarantor is co-extensive and both are equally liable.
35. Ld. Counsel for defendants has argued that the defendant no.2 has been impleaded to this suit, whereas there were two guarantors to this suit but only one guarantor has been impleaded which suggests that the plaintiff has filed this suit in whimsical manner. It is further argued that even no notice was served upon the guarantor, due to this suit is not maintainable qua this guarantor. It is further argued that the defendant no.2 is entitled for equal treatment as of another guarantor, due to this case is liable to be dismissed qua guarantor Abhishek Singh Malik.
Digitally signedCS (Comm) No. 19/2025 by DEVENDRA
KUMAR
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 29/32
Date:
KUMAR 2026.01.29
16:13:29
+0530
36. Ld. Counsel for defendant has further argued that the defendant no.1 has already settled this dispute in a total sum of Rs. 1.25 Lacs and has also paid amount but the plaintiff failed issue payment receipt, and if this suit has already been settled, then suit is liable to be dismissed. On the other hand, Ld. Counsel for plaintiff has opposed arguments of Ld. Counsel for defendants and has submitted that the plea taken by the defendant is without supporting any document and is beyond record and suit is maintainable and is liable to be decreed.
37. Admittedly, the plaintiff is dominus litis and is free to prosecute its case in its own manner including impleadment of the parties. If the plaintiff opted to prosecute only single guarantor by leaving other, then it also permissible. In this case also, as per loan application Ex.PW1/2, two guarantors namely Priyanshu and Abhishek singed loan application, whereas letter of guarantee and opinion sheet of guarantor Ex.PW1/10 was signed by the defendant no.2 only. There is no other guarantee agreement / deed / letter except Ex.PW1/10 to assume that there were two guarantors to this loan. It is quite possible that two guarantors singed loan application but only one signed guarantee agreement / letter of guarantee and merely on the basis of loan application, liability of another guarantor cannot be assumed. As such, liability of the defendant no.2 cannot be exonerated on the basis of Ex.PW1/2, especially when he has preferred not to contest this claim and PW1 has admitted that he was guarantor and signed guarantee letter Ex.PW1/10. As such, the defendant 2 is liable to pay loan amount jointly or severely being guarantor.
Digitally signed by DEVENDRACS (Comm) No. 19/2025 KUMAR
Punjab National Bank Vs. Kavita Singh & Anr. DEVENDRA 30/32
Date:
KUMAR 2026.01.29
16:13:34
+0530
Defense of Defendant no.1
38. So far as defense of the defendant no1 that she has already settled and paid amount of Rs. 1.25 Lacs of concerned, this plea is not supported by any document. If the defendant no.1 paid this amount, then she was supposed to prove such document or to lead evidence to support this claim, but she has failed to prove it, due to this defense could not be proved. On the other hand, the plaintiff has proved that the defendant no.1 availed car loan and singed loan documents and failed to repay it and now as per statement of account Ex.PW1/15, an amount of Rs. 3,77,849.62/- as on 01.09.2020 was outstanding against her. As such, the plaintiff has discharged the onus to prove this issue and both issues no. 1 & 2 are decided in favor of the plaintiff and against the defendants.
39. ISSUE No.3. The onus to prove this issue no.3 was put upon the plaintiff. Plaintiff has claimed interest @ 11.85% per annum. Admittedly, the defendant no. 1 signed loan agreement along with promissory note Ex.PW1/4, as per which, rate of interest was @ 8.60% per annum with penal interest @ 2% over and above, which comes to 10.60% pa. However, there is no averment in plain as to why rate of interest @ 11.85% has been claimed, due to rate of interest agreed between the parties @ 10.60% is contractual and the defendants shall be liable to pay this rate of interest only.
40. Not only this, the plaintiff has also claimed Miscellaneous Expenses/ charges incurred in the account till 31.12.2024, but the plaintiff has not proved any specific document which authorized the plaintiff to claim this Digitally signed CS (Comm) No. 19/2025 by DEVENDRA Punjab National Bank Vs. Kavita Singh & Anr. KUMAR 31/32 DEVENDRA Date:
KUMAR 2026.01.29
16:13:38
+0530
amount, due to the plaintiff shall not be entitled to recover this amount. As such, the plaintiff has discharged the onus to prove this issue and issue no.3 is decided in favor of the plaintiff and against the defendants.
41. Relief: Plaintiff has discharged the onus to prove all the issues and the defendants are liable to pay loan amount along with interest. Accordingly, I hereby pass a decree of Rs. 3,77,849.62/- along with interest @ 10.60% per annum, payable w.e.f. 01.09.2020 till its realization, in favour of the plaintiff and against the defendants. Plaintiff also shall be entitled for cost of the suit. Pleader's fee is allowed subject to filing of pleader's fee certificate, if any. Decree Sheet be prepared accordingly.
42. File be consigned to Record Room. Digitally signed by DEVENDRA KUMAR DEVENDRA Date:
KUMAR 2026.01.29
16:13:46
ANNOUNCED IN OPEN COURT +0530
ON 29th day of January, 2026
(DEVENDER KUMAR)
District Judge (Commercial Court-01)
East District
Karkardooma Courts, Delhi
CS (Comm) No. 19/2025
Punjab National Bank Vs. Kavita Singh & Anr. 32/32