Delhi District Court
State Bank Of India vs Jitendra Pratap Srivastava Etc on 16 April, 2024
In the Court of Sh. Fahad Uddin,
Additional Senior Civil JudgeCum Judge Small Cause Court/Guardian Judge,
(East District), Karkardooma Courts, Delhi.
Civ Suit No. 17/18
CNR No. DLET030000212018
State Bank of India
A corporation constituted under the State Bank of India Act, 1955
having Its Central Office/corporate center at State Bank Bhavan,
Madam Cama Road, Mumbai 400024, one of its local head office at 11,
Sansad Marg, New Delhi 110001 And
as Retail Assets and Small Medium And Enterprises Center (RASMEC),
1st Floor, Aggarwal Fun City Mall Karkardooma, CBD Shahdara,
Delhi 110032.
...Plaintiff.
VERSUS
1. Jitendra Pratap Srivastava
S/o. Sh. S.N. Srivastava,
Flat No.F5, First Floor,
Plot B166, Shalimar Garden Main,
Sahibabad, Ghaziabad, U.P.201005
Also At
Jitendra Pratap Srivastava
S/o. Sh. S. N. Srivastava,
C339, Bihari Colony,
Sector53, Noida UP
Also At
Jitendra Pratap Srivastava
S/o. Sh. S. N. Srivastava,
Digitally signed
B49, Sector10, FAHAD by FAHAD
UDDIN
Noida (U.P.) UDDIN Date: 2024.05.01
17:22:53 +0530
Page no.1 of 20
2. Nidhi Srivastava
W/o Sh. Jintendra Pratap Srivastava,
Plot No.F5, First Floor,
Plot No.B166, Shalimar Garden Main,
Sahibabad, Ghaziabad, U.P.
Also At :
Nidhi Srivastava
W/o Mr. Jitendra Pratap Srivastava,
C339, Bihari Colony,
Sector53, Noida UP
3. Shyam Srivastava
S/o. Sh. S.D.L. Srivastava,
656/2B, Vasundhra,
Ghaziabad (U.P.).
Also At :
Shyam Srivastava
S/o Mr. S.D.L. Srivastava,
Designation: Chowkidar,
Identity Card No. 006721,
New Delhi Municipal Council,
Palika Kendra, Sansad Marg,
New Delhi110001.
Also At:
Shyam Srivastava
S/o Mr. S.D.L. Srivastava,
Designation: Chowkidar,
Identity Card No. 006721,
Youth Centre, Lodhi Road, Digitally signed
New Delhi 110003. FAHAD by FAHAD
UDDIN
UDDIN Date:
2024.05.01
17:23:08 +0530
..Defendants.
Page no.2 of 20
Date of Institution : 04.01.2018
Date of reserving of Judgment : 16.02.2024
Date of Judgment : 16.04.2024
JUDGMENT:
1. Vide this judgment/order, I shall dispose of the present suit filed by the plaintiff (State Bank of India through its AR) against the defendants No. 1, 2 and 3 (i.e. Sh. Jitendra Pratap Srivastava, Ms. Nidhi Srivastava and Sh. Shyam Srivastava) for recovery of Rs. 1,11,708.90 (Rupees One Lac Eleven Thousand Seven Hundred Eight and Ninety Paisa Only) alongwith interest as mentioned in the plaint. The brief facts necessary to decide the present case may be described as under: Plaintiff's case as per the amended plaint:
2. It is the case of the plaintiff bank that the plaintiff (State Bank of India) is a Corporate body constituted under the State Bank of India Act 1955 and is engaged in the business of banking and has various branches throughout India including one at Retail Assets & Small and Medium Enterprises Centre (RASMEC) First Floor, Aggarwal Fun City Mall, Karkardooma, CBD Shahdara, Delhi32. The defendant No. 1 (Jitendra Pratap Srivastava) is the borrower and is self employed and defendant No. 1 and 2 are residing at Flat No. F5, First Floor, Plot No. B166, Shalimar Garden, Main Sahibabad, Ghaziabad, U.P. and also at C339, Bihari Colony, Sector53, NOIDA, UP and defendant No. 3 (Shyam Srivastava) is the guarantor and is employed as Chowkidar in NDMC at Palika Kendra, Sansad Marg, New Delhi and is residing in Ghaziabad, U.P. The defendant No. 1 and 2 had approached the State Bank of Hyderabad, Vikas Marg, Delhi (now merged with the State Bank of India) i.e. the plaintiff bank for a term loan under home loan scheme for financial assistance of Rs. 4,50,000/ (Rs. Four Lac Fifty Thousand Only) for purchase of residential flat FAHAD Digitally signed by FAHAD UDDIN UDDIN Date: 2024.05.01 17:23:18 +0530 Page no.3 of 20 bearing No. F5/B166, LIG, First Floor without roof rights having super covered area 450 sq ft. i.e. 41.805 sq mtr. being part of plot bearing No. B166 situated in Shalimar Garden Main, Hadbast Village, Pasonda, Pargana, Loni, Tehsil and Distt. Ghaziabad, U.P. The said requests of the defendants was accepted by the plaintiff bank and consequently a home loan for a sum of Rs. 4,50,000/ was sanctioned and secured by equitable mortgage of the said property and personal guarantee of defendant No. 3 and hence the term loan under housing loan scheme for a sum of Rs. 4,50,000/ was lent and released by the plaintiff bank and availed by defendant No. 1 and 2 from 25.10.2004 after execution of the necessary documents by defendant No.1, 2 and 3 in favour of the plaintiff bank. The defendant No. 1 and 2 also created equitable mortgage of the said property by deposit of original title deed in favour of the plaintiff bank and defendant No. 1 and 2 acknowledged and confirmed the deposit of original title deed alongwith other documents in favour of the plaintiff bank. The defendant No. 1 and 2 being the borrowers also agreed to repay the entire loan facility to the plaintiff bank in equal monthly installments of Rs. 4,460/ each alongwith agreed rate of interest. The defendant No. 1 and 2 being the borrowers agreed to repay the first equal monthly installments from December 2004 and the subsequent installments on or before the same date of each succeeding month thereafter till the entire loan is fully repaid with interest and other penalty, cost, charges and expenses. The defendant No. 1 and 2 further agreed that in case they commit any default in repayment of agreed installments, the entire amount shall become due and repayable.
3. The relevant documents were duly filled, read over and explained to the defendants and they put their signatures on the said documents voluntarily and consciously after understanding their implications and delivered the same to the plaintiff bank. For the said purpose, an account was opened in the books of account of the plaintiff bank on 25.10.2004 in the name of defendant No. 1 and 2 which was being operated by them. The defendant No. 1 and 2 made repayment of certain FAHAD EMIs Digitally signed by FAHAD UDDIN UDDIN Date: 2024.05.01 17:23:27 Page no.4 of 20 +0530 as agreed and the said payment was credited to the loan account of the defendants. The defendant No. 1 and 2 lastly repaid the amount in their loan account no. 52005398237 on 29.09.2017. The defendants in breach of the agreement/arrangement entered into with the plaintiff bank, failed and neglected to repay the installments as and when they became overdue. The account of the defendants therefore became irregular and the defendants were requested to regularize the account and to repay the remaining installments. However, despite the said request made by the plaintiff bank, the defendants failed to regularize their account. Therefore , in accordance with the applicable directions and guidelines relating to the assets classification, the account of the defendants was declared as nonperforming asset on 31.08.2017 and due to persistent defaults of the defendants, the plaintiff bank served a legal demand notice dated 04.12.2017 to the defendants, but the defendants paid no heed to the same. After giving credits to all the sums of money deposited by the defendants in their loan account, still a sum of Rs. 1,11,708.90/ (Rupees One Lac Eleven Thousand Seven Hundred Eight and Ninety Paisa only) is recoverable from the defendant No. 1, 2 and 3 jointly and severally as per the statement of account maintained by the plaintiff bank against the defendants. Hence, in the said background, the present suit has been filed by the plaintiff bank against the defendants seeking a decree for a sum of Rs. 1,11,708.90/ alongwith interest against the defendants as prayed for in the plaint.
4. It may be noted that defendant No. 1 and 2 were served in the present case by way of publication in the newspaper Veer Arjun, New Delhi Edition dated 18.02.2020 at their given addresses. However, despite this, no written statement was filed on behalf of the said defendants to contest the suit of the plaintiff bank and accordingly, the defence of defendant No. 1 and 2 was struck off vide order dated 27.02.2020 and they were proceeded exparte in the present case. Written statement was filed on behalf of defendant No. 3 (Shyam Srivastava) only in the present case wherein the said defendant denied the case of the plaintiff bank and stated that he has nothing to do with the loan account pertaining to defendant No. 1 and FAHAD
2. The Digitally signed by FAHAD UDDIN Page no.5 of 20 UDDIN Date: 2024.05.01 17:23:42 +0530 defendant No. 1 and 2 had applied for housing loan with erstwhile State Bank of Hyderabad and contacted defendant No. 3 for signing certain documents as witness to the said housing loan. The defendant No. 3 was known to defendant No. 1 and 2 and therefore, he signed certain documents as the witness and not as guarantor. The plaintiff bank had obtained the signatures on certain blank forms which have been misused by the plaintiff bank in connivance with defendant No. 1 and 2. The contents of the said documents were not read over to defendant No. 3 and his signatures were obtained without knowledge of true purpose and consent. Therefore, defendant No. 3 is not liable to the illegal and malafide demands of the plaintiff bank. The defendant No. 1 and 2 had applied for a loan of Rs. 4,50,000/ and the plaintiff bank has failed to provide the details of the disbursement of the amount. As per the sale deed dated 25.10.2014, the plaintiff bank disbursed a sum of Rs. 3,50,000/ vide bankers cheque bearing No. 617420 dated 25.10.2014. The plaintiff bank intentionally has not filed the complete statement of accounts in order to mislead this Court. The plaintiff bank illegally and malafidely charged a sum of Rs. 12,000/ towards insurance cover charges for the housing loan whereas it was categorically mentioned that the same would be applicable only if the loan amount exceeds Rs. 7.5 lacs. The plaintiff bank had debited the unexplained charges and therefore, the entries of the statement of account do not reflect true amount of debit and credit and therefore, the statement of account filed by the plaintiff bank cannot be relied upon by this Court. The documents executed by the plaintiff bank were not properly stamped and therefore, they cannot be read into the evidence for any purpose whatsoever. The plaintiff bank had mortgaged the immovable property of defendant No. 1 and 2 and the plaintiff bank can easily recover the outstanding dues from selling the mortgaged property as well as through other modes. The defendant No. 3 denied that he is the guarantor in the said loan facility provided by the plaintiff bank or signed and executed any document for furnishing his guarantee. The defendant stated that he signed certain blank forms as witness but not as guarantor as alleged by the plaintiff bank. The alleged documents were not executed by defendant No. 3 for the FAHAD purpose of Digitally signed by FAHAD UDDIN Page no.617:23:52 UDDIN of +0530 20 Date: 2024.05.01 furnishing of any guarantee. The said blank forms were subsequently filled by the plaintiff bank and its officials and are now being misused to harass the defendants. The defendant denied that he voluntarily and consciously signed the documents after understanding their implications or is bound by the terms and conditions of the said documents. The defendant denied that he is jointly and severally liable to pay the outstanding amount to the plaintiff bank as alleged in the plaint. No cause of action has arisen in favour of the plaintiff bank to file the present suit against defendant No. 3 and hence, defendant No. 3 prayed for dismissal of the suit of plaintiff bank against him on the grounds as raised in the WS.
5. Replication has been filed in the present case on behalf of the plaintiff bank wherein the plaintiff bank denied the case of the defendant No. 3 as stated in the WS and reiterated and reaffirmed its own case as per the plaint. The plaintiff bank denied that it had obtained the signatures on certain blank forms and misused the same in connivance with defendant No. 1 and 2 as alleged in the WS. The plaintiff bank stated that duly filled in documents were executed by the defendants and handed over to the plaintiff bank on the basis of which the plaintiff bank has released the loan amount. The defendant No. 3 is taking advantage of his own wrong and the entire story has been cooked up to escape his liability towards the plaintiff bank. The plaintiff bank specifically denied that the bank obtained the signatures of the defendant on the blank form as a witness. In the present suit, all the documents are complete and statements of accounts have been filed which are legally admissible to prove the case of the plaintiff bank. The plaintiff bank denied that it had debited unexplained charges or the statement of account do not reflect the true accounts of the debit and credit. The plaintiff bank stated that it had kept and maintained all entries of debit and credit correctly in regular and ordinary course of business. The case of the Plaintiff bank is based on true and correct documents. Rest of the submissions made by the plaintiff bank in the replication are not being repeated Digitally signed FAHAD by FAHAD UDDIN UDDIN Date: 2024.05.01 17:24:01 +0530 Page no.7 of 20 herein for the sake of brevity. Suffice is to say that the plaintiff bank prayed for decree of the suit in favour of the Plaintiff bank as per the plaint.
Issues:
6. Out of the pleadings of the parties, the following issues were framed by the Court for adjudication in the present case vide order dated 27.02.2020:
(i) Whether the plaintiff is entitled to a decree for a sum of Rs. 1,11,708.90/ against the defendants as prayed for in prayer clause (a) of the plaint? OPP.
(ii) Whether the signatures of defendant No. 3 on the loan documents were obtained by the plaintiff fraudulently in connivance with defendant No. 1 and 2 and the documents were misused? OPD
(iii) Relief.
Plaintiff's evidence
7. To prove the case of the plaintiff bank before this Court, the plaintiff bank got examined one witness i.e. Sh. Sharat Jain, who is the Chief Manager of the plaintiff bank. The said witness tendered his evidence by way of affidavit which is Ex. PW1/A on Court record. In his evidence by way of affidavit, PW1 reiterated and reaffirmed the case of the plaintiff bank as stated in the plaint on oath. In addition, PW1 also relied upon the following documents in support of the case of the plaintiff bank:
(i) Original home loan agreement executed between the plaintiff bank and the defendants no. 1 & 2 is Ex. PW1/1.
(ii) Original arrangement letter dated 25.10.2004 is Ex. PW1/2.
(iii) Original housing loancumagreement dated 25.10.2004 is Ex. PW1/3.
(iv) Original agreement for mortgage of the property dated 25.10.2004 is Ex. PW1/4.
(v) Original agreement for house loan insurance is Ex. PW1/5.
(vi) Original letter of undertaking executed by defendant No. 1 and 2 is Ex. Pw1/6. Digitally signed FAHAD by FAHAD UDDIN UDDIN Date: 2024.05.01 17:24:11 +0530 Page no.8 of 20
(vii) Original letter of guarantee executed by defendant no. 3 is Ex. PW1/7.
(viii) Original annexureII executed by defendant No. 1 is Ex. PW1/8.
(ix) Original annexureIII executed by defendant No. 3 is Ex. PW1/9.
(x) Original declaration from borrower is Ex. PW1/10.
(xi) Original declaration from guarantor is Ex. Pw1/11.
(xii) Original confirming deposit of title deed dated 28.10.2004 is Ex. PW1/12.
(xiii) Office copy of legal notice dated 04.12.2017 alongwith postal receipt is Ex. PW1/13 (colly).
(xiv) Statement of account maintained by the plaintiff bank qua the account of defendants under the bankers book evidence Act is Ex. PW1/4.
(xv) Copy of sale deed is Ex. PW1/15 (OSR).
(xvi) Copy of gazette notification is mark A. (xvii) Copy of driving licence is mark B. (xviii) Copy of Pan Card is mark C. (xix) Copy of ration card is mark D (colly).
(xx) Copy of ID card of defendant No. 3 is mark E. (xxi) Salary slip for the month of September 2004 of defendant No. 3 is mark F. The said witness PW1 Sh. Sharat Jain was duly crossexamined by the Counsel for defendant No. 3 and after conclusion of crossexamination, the said witness was discharged. No other witness has been examined on behalf of the plaintiff bank in support of its case and on separate statement of PW1 Sh. Sharat Jain, plaintiff evidence was closed on 18.08.2022.
Defendant's evidence
8. To disprove the case of the plaintiff bank, defendant No. 3 got examined one witness i.e. D3W1 Sh. Shyam Srivastava (defendant himself) who tendered his evidence by way of affidavit which is Ex. D3W1/1 bearing his signatures at point A Digitally signed FAHAD byUDDIN FAHAD UDDIN 17:24:19 +0530 Date: 2024.05.01 Page no.9 of 20 and B. The said witness was duly crossexamined by the Counsel for the plaintiff bank and after conclusion of crossexamination, the said witness was discharged. No other witness has been examined on behalf of defendant No. 3 in support of his case and on separate statement of defendant No. 3, defendant evidence was closed on 20.04.2023.
9. Thereafter, final arguments were addressed in the present case on behalf of the plaintiff bank as well as defendant no.3 wherein the counsel for the plaintiff bank stated that the plaintiff bank is entitled to a decree in its favour on the basis of testimony of PW1 Sh. Sharat Jain as well as documentary evidence relied upon by him which is Ex.PW1/1 to Ex.PW1/15 and MarkA to MarkF on court record. On the other hand, counsel for defendant no.3 stated that defendant no.3 is not liable to pay any amount to the plaintiff bank and the suit of the plaintiff bank is liable to be dismissed qua defendant no.3 as prayed for in the written statement.
10. Submissions heard. Record perused. The documents filed on behalf of the plaintiff bank are also gone through.
Findings
11. On the basis of the pleadings of the parties, evidence led on their behalf and arguments advanced by their counsels, the issue wise findings of this Court are as under: Issue no.1 : Whether the plaintiff is entitled to a decree for a sum of Rs.1,11,708.90/ against the defendants as prayed for in the prayer clause (a)? OPP Issue no.2: Whether the signature of defendant no.3 on the loan documents were obtained by plaintiff fraudulently in connivance with defendant no.1 & 2 and documents FAHAD Digitally signed by FAHAD UDDIN were misused? OPD UDDIN Date: 2024.05.01 17:24:30 +0530 Page no.10 of 20
12. Both issue no.1 and 2 are being taken up together as they are interconnected. To prove its case against the defendants, the plaintiff bank got examined one witness i.e. PW1 Sh. Sharat Jain, who is the Chief Manager of the Plaintiff bank. The said witness tendered his evidence by way of affidavit which is Ex.PW1/A on court record. In his evidence by way of affidavit Ex.PW1/A, PW1 Sh. Sharat Jain stated that defendant no.1 is the borrower and defendant no.3 is the guarantor. The defendant no.1 & 2 had approached State Bank of Hyderabad, Vikas Marg for a term loan under home loan scheme for financial assistance of Rs.4,50,000/ (Rupees Four Lakhs Fifty Thousand only) for purchase of a residential flat no. F5/B166, LIG, 1 st floor without roof rights having super covered area 450 sq. feet i.e. 41.805 sq. meter being part of plot bearing no.B166 situated at Shalimar Garden, Hadbast Village, Pasonda, Pargana, Loni, Tehsil & Distt. Ghaziabad, UP on 10.09.2004. The request of the defendants was accepted by the plaintiff bank and consequently a home loan for a sum of Rs.4,50,000/ was sanctioned by the plaintiff bank and the said loan was secured by equitable mortgage of the said property and personal guarantee of defendant no.3 after execution of necessary documents by the defendants no.1, 2 & 3 in favour of the plaintiff bank. The defendant no.1 & 2 also created equitable mortgage of the said property by deposit of original title deeds qua the said property in favour of the plaintiff bank. The defendant no.1 & 2 agree to repay the entire loan amount to the plaintiff bank in equal monthly installments of Rs.4,460/ each alongwith agreed rate of interest to the plaintiff bank. Further, the defendant no.1 & 2 agreed to repay the first equated monthly installment from December, 2004 and the subsequent installments on or before the same date of each succeeding month till the entire loan is repaid with interest and other charges. Further, the defendant no.1 & 2 agreed that in case they commit any default in repayment of the loan amount or agreed installments, the entire amount shall become due and repayable to the plaintiff bank. The documents were duly filled, read over and explained to the defendants and they had put their respective signatures on these documents voluntarily and consciously after understanding their implication and delivered the same FAHAD to the Digitally signed by FAHAD UDDIN Page no.11 of 20 UDDIN Date: 2024.05.01 17:24:39 +0530 plaintiff bank and the defendants are thus bound by the terms and conditions contained in the said documents. An open account was opened in the Books of Accounts of the plaintiff bank on 25.10.2004 in the name of defendant no.1 & 2 which was being operated by them. The defendant no.1 & 2 lastly repaid the amount in the loan account on 29.09.2017 and thereafter, the defendants failed and neglected to repay the installments as and when they become due and the account also became irregular. The defendants were requested to regularize the account and to repay the remaining installments, but the defendants failed to abide by the terms and conditions agreed between the defendants and plaintiff bank at the time of disbursement of the said loan. Therefore , in accordance with the directions and guidelines relating to the asset classification, the account of the defendants was declared as NPA on 31.08.2017. The plaintiff bank also served a legal demand notice dated 04.12.2017, but the defendants paid no heed to the same. After giving credits for all the sums of money deposited by the defendants in the said home loan account including the part repayments, still a sum of Rs.1,11,708.90/ (Rupees One Lac Eleven Thousand Seven Hundred Eight and Ninety Paise only) is recoverable from defendant no.1, 2 & 3 jointly and severally as per the statement of account filed on record.
13. In support of the case of the plaintiff bank, PW1 Sh. Sharat Jain also relied upon the documentary evidence which is Ex.PW1/1 to Ex.PW1/15 and MarkA to MarkF on Court record. Original Home Loan Agreement entered into between the plaintiff bank and defendant no.1 & 2 for housing loan for Rs.4,50,000/ is Ex.PW1/1 (colly). The said document shows that the said housing loan was applied by defendant no.1 & 2 for purchase/construction of flat no.F5 (LIG), 1 st floor, Plot no.B166, Shalimar Garden, Ghaziabad, UP. Original arrangement letter dated 25.10.2004 entered into between the plaintiff bank and defendant no.1 & 2 for availing the said loan of Rs.4,50,000/ is Ex.PW1/2. Clause4 of the said document shows that the said loan was to be repaid in equated monthly installments of Rs.4,460/ each and the repayment was to be commenced from 04.12.2004 and the FAHAD Digitally signed by FAHAD UDDIN UDDIN Date: 2024.05.01 Page no.12 of 20 17:24:48 +0530 liability towards the plaintiff bank was supposed to be extinguished only when the outstanding in the loan account becomes Nil on payment of the residual amount. The said document bears the signatures of defendant no.1 & 2 as well as defendant no.3 as guarantor. Original housing loan cum agreement executed by defendant no.1 & 2 in favour of plaintiff bank for availing the said loan facility of Rs.4,50,000/ which contains the terms and conditions of the said loan facility is Ex.PW1/3. Original agreement to mortgage dated 25.10.2004 whereby the defendant no.1 & 2 had agreed to create an equitable mortgage of property bearing no.F5/B166, Shalimar Garden, Ghaziabad, UP in favour of the plaintiff bank is Ex.PW1/4 (colly). Original agreement for house loan insurance signed by defendant no.1 in favour of the plaintiff bank is Ex.PW1/5. Original letter of undertaking executed by defendant no.1 & 2 in favour of plaintiff bank is Ex.PW1/6. Original letter of guarantee for the said housing loan executed by defendant no.3 (Shyam Shrivastav) in favour of the plaintiff bank is Ex.PW1/7 and the said document shows that defendant no.3 had agreed to make him liable jointly or severally to pay the loan amount to the plaintiff bank. Original AnnexureII executed by defendant no.1 & 2 in favour of the plaintiff bank is Ex.PW1/8. Original AnnexureIII executed by defendant no.3 in favour of the plaintiff bank is Ex.PW1/9. Original declaration from the borrower i.e. defendant no.1 & 2 is Ex.PW1/10 (colly). Original declaration from guarantor i.e. defendant no. 3 is Ex.PW1/11. Original confirming the deposit of title deeds qua the property bearing no.F5, 1st floor, B166, Shalimar Garden Main, Ghaziabad, UP executed by defendant no.1 & 2 in favour of the plaintiff bank is Ex.PW1/12. Office copy of legal notice dated 04.12.2017 alongwith postal receipts issued on behalf of the plaintiff bank to defendant no.1, 2 & 3 at their given addresses is Ex.PW1/13 (colly) whereby the plaintiff bank had called upon the defendants to pay the outstanding amount of Rs.1,10,931.62P to the plaintiff bank upto 30.11.2017. Statement of account filed on behalf of the plaintiff bank regarding the account of defendant no.1 & 2 from 25.10.2004 till 31.12.2017 which shows that as on 31.12.2017, a sum of Rs.1,11,708.90/ was due and outstanding in the account of defendant FAHAD no.1 & 2 is Digitally signed by FAHAD UDDIN Page no.13Date:
UDDIN of2024.05.01
20
17:24:56 +0530
Ex.PW1/14 on court record. Copy of sale deed of flat no.F5/B166, 1 st floor, Shalimar Garden, Ghaziabad, UP in favour of defendant no.1 & 2 is Ex.PW1/15 (OSR). Copy of Gazette of India notification filed by the plaintiff bank which authorizes all Branch Managers of the plaintiff bank to institute the proceedings on behalf of the bank is MarkA. Copy of driving licence of defendant no.1 is MarkB. Copy of PAN card of defendant no.1 is MarkC. Copy of ration card of defendant no.1 is MarkD (colly). Copy of ID card of defendant no.3 is MarkE and copy of salary slip for the month of September, 2004 of defendant no.3 is MarkF.
14. PW1 Sh. Sharat Jain was also cross examined by Ld. Counsel for defendant no.3 and in his cross examination PW1 Sh. Sharat Jain stated that he has the Gazette of India as well as authority letter on the basis of which he is deposing in the present case and on the basis of the guidelines and Gazette of India, he is authorized to depose in the present case. He has stated as correct that the guarantor /defendant no.3 did not sign the documents in his presence as he was not posted in the branch at that time. He denied the suggestion that signatures of defendant no.3 upon the said documents were taken as witness and not as a guarantor or that the signatures of defendant no.3 were obtained on blank papers. He further denied the suggestion that the bank officials in connivance with defendant no.1 had forged the documents to implicate wrongly defendant no.3. He further denied the suggestion that at the time of granting of loan, the documents were got signed and same were filled up subsequently. He admitted as correct that the property is mortgaged against home loan for the purpose that in case, the loan is not repaid, the said property can be sold. He admitted as correct that the property was mortgaged so that the amount can be recovered in case of default of payment of loan. He stated that it is a secondary issue and first they try to recover the loan from the principal borrower and guarantor. He stated that they had taken action for the repossession of property under the SARFAESI Act in the year 2017, however, they had not proceeded further for the same. He denied the suggestion that the plaintiff bank is under the influence of FAHAD Digitally signed by FAHAD UDDIN UDDIN Date: 2024.05.01 Page no.14 of 20 17:25:05 +0530 borrower and for this reason they have not proceeded with action under SARFAESI Act and therefore, they want to implicate defendant no.3. PW1 stated that he cannot tell the amount of stamp affixed on home loan agreement and he denied the suggestion that the document Ex.PW1/3 bears insufficient stamps and therefore, it cannot be read in evidence. He stated that they do not intimate registrar office at the time of mortgaging the property. The provision of affixing of stamp duty upon mortgage agreement is not applicable in Delhi. He denied the suggestion that the mortgage of property is defective mortgage and therefore, the plaintiff bank is not recovering the amount from the mortgage property. He further denied the suggestion the defendant no.3 is not liable to pay any amount to the plaintiff bank. He admitted as correct that the statement of account placed on record is not complete. Since the loan was sanctioned by the State Bank of Hyderabad and the said bank was subsequently merged with the State Bank of India, therefore, complete statement might not have got prepared. He denied the suggestion that the plaintiff bank has knowingly not placed on record complete statement of account. He further denied the suggestion that they have paid a loan of Rs.3,50,000/ and not of Rs.4,50,000/. He stated that they had taken KYC documents and further formed opinion report of guarantor prior to sanctioning of loan. He stated that as per their code, they initiate both the proceedings, i.e. proceedings under the SARFAESI Act as well as proceedings for recovery of loan from principal borrower and guarantor together. He stated that he is not aware as to why the SARFAESI proceedings initiated in the year 2017 were not proceeded with and as on date there is no action under the SARFAESI Act against the defendants, however, they will initiate the same accordingly. In case, the money is recovered under SARFAESI Act, 2002 they do not further proceed with the recovery from the guarantor. He admitted as correct that all the agreements qua the loan are the standard form of contract. No other material fact was deposed to by Digitally PW1 during his cross examination. signed by FAHAD FAHAD UDDIN UDDIN Date:
2024.05.01 17:25:12 +0530 Page no.15 of 20
15. On the other hand, to disprove the case of the plaintiff bank, the defendant no.3 got examined one witness i.e. D3W1 Sh. Shyam Shrivastava (Defendant no.3 himself) who tendered his evidence by way of affidavit which is Ex.D3W1/1 on court record. In his evidence by way of affidavit D3W1 stated that he has nothing to do with the loan account pertaining to defendant no.1 & 2. The defendant no.1 & 2 had applied for the loan from the State Bank of Hyderabad and contacted defendant no.3 for signing certain documents as a witness. He stated that he signed certain documents as the witness and not as a guarantor. He further stated that the plaintiff bank had obtained signatures on certain blank forms which are misused by the plaintiff bank in connivance with defendant n.1 & 2. D3W1 also stated that defendant no.1 & 2 had applied for loan of Rs.4,50,000/ and the plaintiff bank has failed to provide the details of disbursement of the amount. As per sale deed dated 25.10.2014, the plaintiff bank disbursed a sum of Rs.3, 50,000/ vide cheque bearing no.617420 dated 25.10.2014. The plaintiff bank had debited the unexplained charges and therefore, the entries of statement of account does not reflect the true amount of debit and credit. It may be noted that no documentary evidence has been filed on behalf of defendant no.3 in support of his case.
16. Defendant no.3 was also cross examined by the counsel for the plaintiff bank and during his cross examination, defendant no.3 stated that he knew defendant no.1 & 2 namely Jitender Shrivastava and Nidhi Shrivastava for last 45 years. He admitted as correct that he had signed duly filled documents Ex.PW1/7 which bears his signatures at Point A on pages 52, 54, 55 and 56 and on Ex.PW1/9 and on Ex.PW1/11 at Point A. He again stated that he had signed the blank documents. The defendant no.3 denied the suggestion that he is an interested witness and to escape from the liability of defendant no.1 & 2 he is deposing falsely with regard to the documentation of the plaintiff bank. He denied the suggestion that he has mentioned false and fabricated facts as stated in para no.2, 3 and 4 in his affidavit. He further stated that he does not have any documentary proof as mentioned in para no.5 of his FAHAD Digitally signed by FAHAD UDDIN UDDIN Date: 2024.05.01 Page no.16 of 20 17:25:20 +0530 affidavit. He denied the suggestion that the entries of the statement of account is as per the RBI guidelines and as per law. No other material fact was deposed to by defendant no.3 in his cross examination.
17. For the purposes of the present case, Section 126,128,129 & 130 of Contract Act, 1872 may be reproduced as under: 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.
128. Surety's liability. The liability of the surety is coextensive with that of the "principal debtor", unless it is otherwise provided by the contract.
129. "Continuing guarantee". A guarantee which extends to a series of transactions is called a "continuing guarantee".
130. "Revocation of continuing guarantee". A continuing guarantee may at any time be revoked by the surety, as to future transactions, by notice to the creditor.
18. A contract of guarantee is between the creditor, the principal debtor and the surety, where under the creditor has a remedy in relation to his debt against both the principal debtor and the surety. The surety may be a corporate or a natural person and the liability of such person goes as far as the liability of the principal debtor. As per Section 128 of the Indian Contract Act, 1872, the liability of the surety is co extensive with that of the principal debtor and the creditor may go against either the principal debtor or the surety or both, in no particular sequence [Chokalinga Chettiar Vs. Dandayunthapani Chettiar AIR 1920, Mad 1262]. Though this may be limited by the terms of the contract of guarantee, the general principle of such contracts is thatDigitally signed by FAHAD FAHAD UDDIN UDDIN Page no.17 of 20 Date: 2024.05.01 17:25:28 +0530 the liability of the principal debtor and the surety is coextensive and is joint and several [Bank of Bihar Vs. Damodar Prasad AIR, 1969 SC 297].
19. In the present case, the documents filed on behalf of the plaintiff bank reveals that the defendant no. 1 & 2 had applied for a housing loan for a sum of Rs. 4,50,000/ from State Bank of Hyderabad, which has now merged with the plaintiff bank for purchase/ construction of Flat No. F5 (LIG), First floor, Plot No. B166, Shalimar Garden Main, Sahibabad, Ghaziabad, U.P and for this purpose a housing loan agreement dated 25.10.2004 (Ex. PW 1/3) was executed by defendant no. 1 & 2 in favor of the said bank. An agreement to mortgage (Ex. PW 1/4) was also executed by defendant no. 1 & 2 in favor of the plaintiff bank thereby mortgaging the said property to the plaintiff bank by deposit of title deed. Letter of guarantee (Ex. PW 1/7) was also executed by defendant no. 3 in favor of the plaintiff bank whereby he stood as a guarantor for the loan facility availed by defendant no. 1 & 2 from the plaintiff bank.
20. In his crossexamination, defendant no. 3 has admitted as correct that he had signed duly filled documents on Ex. PW 1/7, bearing his signature at Point A on page no. 52,54,55,56 and on Ex. PW 1/9, bearing his signatures at Point A at page no. 58 and on Ex. PW 1/11 at Point A on page no. 61. The documents filed by the plaintiff bank clearly show that defendant no. 1 & 2 had applied for the said loan facility and after availing the said loan facility, the defendants made defaults in repayment of the said loan amount to the plaintiff bank and despite issuance of legal notice dated 04.12.2017 Ex. PW 1/13, the defendant no. 1,2& 3 failed to pay the outstanding amount of Rs. 1,10,931.62/ as on 30.11.2017 in loan account no. 52005398237 to the plaintiff bank. As per the statement of account Ex. PW 1/14 filed by the plaintiff bank in the present case a sum of Rs. 1,11,708.90/ is due and outstanding in the said account of the defendant no. 1& 2 as on 31.12.2017. The said statement of account is accompanied by a certificate U/s 65B of the Indian Evidence Act as wellFAHAD as Section Digitally signed by FAHAD UDDIN Page no.18Date:
UDDIN of2024.05.01 20 17:25:36 +0530 2A (B) of the Banker's Book Evidence Act. Further, to prove his stand before the court, no documentary evidence has been filed by the defendant or any other witness examined which may show that the plaintiff bank had obtained the signatures of the defendant on blank forms which are misused by the plaintiff bank in connivance with defendant no. 1 & 2 or that the defendant no. 3 had signed the said documents as a witness and not as a guarantor.
21. The case of the Plaintiff Bank is duly established by the testimony of PW1 Sh.
Sharat Jain who is the Chief Manager of the Plaintiff Bank and is duly corroborated by documentary evidence which is Ex. PW1/1 to Ex. PW1/15 and Mark A to Mark F on court record. Consequently, after appreciating the testimony of PW 1, Sh. Sharat Jain, Chief Manager of the plaintiff bank as well as the documents relied upon by him i.e. Ex. PW 1/1 to Ex. PW 1/15 and Mark A to Mark F, this court is of the view that the plaintiff bank has been able to prove its case against the defendant no, 1,2 & 3 on the basis of preponderance of probabilities and the documents filed on behalf of the plaintiff bank show that defendant no. 1 & 2 had obtained a loan facility of Rs. 4,50,000/ by depositing title deeds of property for purchase/ construction of Flat No. F5 (LIG), First floor, Plot No. B166, Shalimar Garden Main, Sahibabad, Ghaziabad, U.P and on personal guarantee of defendant no. 3 qua the said loan amount. The said guarantee was a continuing guarantee till the whole amount is paid by the principal debtors/ defendant no. 1& 2 to the plaintiff bank. As per the statement of account filed on behalf of the plaintiff bank still a sum of Rs. 1,11,708.90/ is due and payable by defendant no. 1& 2 to the plaintiff bank and the said defendants seems to be jointly and severally liable to pay the said outstanding amount to the plaintiff bank. Hence, on the basis of said discussion, issue no. 1 is decided in favor of the plaintiff bank and issue no. 2 is decided against the defendant no. 3 as he has miserably failed to prove before this court that the loan documents were fraudulently obtained by the plaintiff bank in connivance with defendant no.signed Digitally by FAHAD 1 FAHAD UDDIN UDDIN Date:
2024.05.01 17:25:43 +0530 Page no.19 of 20 & 2 and are being misused by the plaintiff bank as alleged by defendant no. 3 in the present case.
Conclusion:
22. Accordingly, due to the said reasons, this court deems fit to decree the suit of the plaintiff bank against defendant no. 1,2 & 3 and the defendant no. 1,2 & 3 are held liable to pay a sum of Rs. 1,11,708.90/ (Rs. One lac eleven thousand seven hundred eight and ninety paisa only) jointly and severally to the plaintiff bank as prayed for in the plaint.
Further, the plaintiff bank is held entitled to recover pendentilite interest @ 9 % per annum from the date of filing of the present suit till date of decree and future interest @ 6 % per annum from the date of decree till realization of the amount from the defendants. In the interest of justice, the plaintiff bank is also held entitled to recover the cost of the suit from the defendants as per rules.
Since, this court has already passed a decree in favor of the plaintiff bank for an amount of Rs. 1,11,708.90/ (Rs. One lac eleven thousand seven hundred eight and ninety paisa only) from defendant no. 1,2 & 3 jointly and severally. Hence, this court does not deem fit to pass an injunction order against defendant no. 1 &2, thereby, restraining the said defendant from transferring or selling of the mortgage property in the facts and circumstances of the present case. Accordingly, the said relief as per clause (b) is declined to the plaintiff.
With these observations/ directions, the suit of the plaintiff is decreed/ disposed of.
Let the decree sheet be prepared accordingly in favor of the plaintiff bank and against the defendants in the aforesaid terms.
No further action is required.
File be consigned to Record Room after due compliance.
Digitally signed by FAHAD UDDIN
FAHAD UDDIN Date: 2024.05.01 17:25:54 +0530
Pronounced in the open (Fahad Uddin)
court on 16.04.2024 JSCCcumASCJ/Guardian Judge
East District, KKD Courts Delhi.
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