Karnataka High Court
Smt Velliamma vs The Karnataka Bank Limited on 7 August, 2024
Author: V Srishananda
Bench: V Srishananda
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NC: 2024:KHC:31556
RFA No. 1346 of 2015
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 7TH DAY OF AUGUST, 2024
BEFORE
THE HON'BLE MR JUSTICE V SRISHANANDA
REGULAR FIRST APPEAL NO. 1346 OF 2015 (MON)
BETWEEN:
SMT VELLIAMMA
W/O MR NARSIMHA,
MAJOR
NO.48,24TH CROSS,
K P AGRAHARA,
BHUVANESHWARINAGAR,
BANGALORE-23
...APPELLANT
(BY SRI. RAMESH P KULKARNI.,ADVOCATE)
AND:
THE KARNATAKA BANK LIMITED
RAJAJINAGAR BRANCH,
NO.392, 6TH BLOCK,
RAJAJINAGAR,
Digitally BENGALURU-10
signed by BY ITS MANAGER
MALATESH
KC ...RESPONDENT
Location: (BY SRI. K.V.SHYAMA PRASAD., ADVOCATE)
HIGH
COURT OF RFA FILED UNDER SEC.96 OF CPC., AGAINST THE JUDGMENT
KARNATAKA AND DECREE DATED 18.06.2015 PASSED IN O.S.NO. 4153/2013 ON
THE FILE OF THE XLIV ADDL. CITY CIVIL AND SESSIONS JUDGE,
BANGALORE, PARTLY DECREEING THE SUIT FOR RECOVERY OF
MONEY.
THIS RFA, COMING ON FOR HEARING, THIS DAY, JUDGMENT
WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE V SRISHANANDA
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NC: 2024:KHC:31556
RFA No. 1346 of 2015
ORAL JUDGMENT
1. Heard Sri.Ramesh P.Kulkarni, learned counsel for the appellant and Sri.K.V.Shyama Prasada, learned counsel for the respondent.
2. The defendant's appeal challenging the judgment and decree passed in O.S.No.4153/2013 whereby the suit of the plaintiff came to be decreed as against the defendant and was ordered to pay a sum of Rs.2,63,344/- with interest at 20.50% p.a. from the date of the suit till realization.
3. The facts in brief which are atmost necessary for disposal of the appeal are as under:-
The defendant was running a business in the name and style "Sree Venkateshwara Enterprises". It had the current account with the plaintiff-bank from the year 2007 having an Account No.10607 and was being operated for the said business purpose. On 20.11.2011, the defendant approached the plaintiff-Bank for grant of Temporary Overdraft facility in a sum of Rs.2,00,000/- with an undertaking to repay the same.-3-
NC: 2024:KHC:31556 RFA No. 1346 of 2015
4. The plaintiff, having taken note of the business transactions of the defendant with the plaintiff-bank agreed to serve the temporary overdraft facility and granted the overdraft limit to the extent of Rs.2,00,000/-. An on demand promissory note was executed by the defendant in this regard and the defendant had agreed to pay the simple interest @ 20.50% and also agreed to pay the penal interest at 2% over and above the agreed rate in the event of default.
5. The defendant failed to repay the temporary overdraft facility as agreed. Therefore, the plaintiff issued a legal notice. The defendant did not comply with the callings of notice. Therefore, suit was filed.
6. In pursuance of the suit summons, the defendant appeared before the trial Court and filed the written statement and admitted that she had a current account with the plaintiff's bank and also agreed the facility of temporary overdraft and the defendant denied the execution of the necessary documents in this regard.
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NC: 2024:KHC:31556 RFA No. 1346 of 2015
7. Based on the rival contentions, the trial Court framed the following issues:
1. Whether the plaintiff proves that the defendant availed over draft facility by agreeing to repay outstanding balance with interest at 20.50% p.a.?
2. Whether the plaintiff proves that the defendant executed DPN and other documents in respect of loan transaction?
3. Whether the defendant proves that the bank took the signatures on blank forms?
4. Whether the plaintiff is entitled for future interest at 22.50% p.a.?
5. Whether the plaintiff is entitled for recovery of suit claim amounts?
6. What order or decree?
8. In order to establish the case of the plaintiff, an officer of the plaintiff-bank by name Suresh Nayak got examined himself as PW-1 and placed on record 10 documents which were exhibited and marked as Exhibit-P1 to Exhibit-P10, comprising of Request Letter for grant of Temporary Overdraft by the defendant, Delivery Letter, On-Demand Promissory Note, Copy of the Legal Notice, Statement of Approval, Postal Receipt, Postal Acknowledgement, Copy of Power of Attorney in favor of PW-1 and General Power of Attorney on behalf of DW-1 issued by the defendant.
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NC: 2024:KHC:31556 RFA No. 1346 of 2015
9. Detailed cross-examination of PW-1 did not yield any positive material in disbelieving the version of the bank in granting the temporary overdraft facility and execution of the documents. Suggestions made to PW-1 that the signatures of the defendant were obtained on the blank documents and later on concocted the same as the documents supporting the case of the plaintiff is denied by the PW-1.
10. As against the evidence of Plaintiff, General Power of Attorney holder of the defendant who is the son of the defendant by name Ramesh Babu got examined himself by DW-
1. In his evidence, except denying the transactions and reiterating the contents of the written statement that the documents later on concocted by the Plaintiff, no other material evidence is placed on record to disprove the claim of the plaintiff. Thereafter, the learned trial Judge called the parties and framed the issues as referred to supra.
11. Being aggrieved by the same, the defendant is before this Court in this appeal on the following grounds:
The fact that the appellant had applied for loan of Rs. 1 Lakh only and as against Rs.2 lakhs was -6- NC: 2024:KHC:31556 RFA No. 1346 of 2015 granted and a sum of Rs. 53,188/- was taken away and an insurance policy was bought in her name for the benefit of the then manager remained unchallenged. Neither the then manager was examined nor any person having personal knowledge about it was examined. In spite of the same the trial court has erroneously decreed the suit for the entire claim.
The appellant had contended that her signatures were taken in blank documents without filling up rate of interest, loan amount etc. The respondent desperately failed to establish anything contrary to it. The only witness examined (PW-1) by respondent made the following admissions:
"I was not working in the plaintiff branch bank at the time of loan transaction. I was not present at the time of signing loan documents by defendant............................... .... In Ex.P-1, the defendant requested for over draft upto Rs.One Lakh.....
.....An amount of Rs.53,270/- on 3.1.2012 was debited in to the account since it was cheque issued by the defendant in the name of metlife Insurance.
It is true that our bank is corporate agent of Metlife Insurance.
.....It is true that plaintiff bank will have monetary benefit in respect of policies which are marketed by Karnataka Bank.
....It is false to suggest that in spite of request of grant of overdraft of Rs. One lakh, we granted Rs.-7-
NC: 2024:KHC:31556 RFA No. 1346 of 2015 Two Lakhs to purchase metlife Policy in the name of defendant and thereby to get benefit."
The trial Court ignored all the above admissions made by PW-1 which went against the respondent. The trial court has failed to note that the respondent has not established any part of its case and the entire evidence led by it was inadmissible and hearsay.
The trial court failed to note that the respondent had miserable failed to establish the correctness of the entries made in its account extract nor the exact amount due.
The court below failed to appreciate the law laid down by the Hon'ble Supreme Court and the High Courts, which supported the case of the appellant. Had the trial court appreciated the same it would have dismissed the suit.
12. Sri.Ramesh Kulkarni, learned counsel for the appellant reiterating the grounds urged in the appeal memorandum contended that the defendant has asked for temporary overdraft in a sum of Rs.1,00,000/- but the transaction of the plaintiff shows that the defendant has availed the temporary overdraft in a sum of Rs.2,00,000/- which is incorrect. Therefore, the very basis for the suit claim itself is incorrect and sought for allowing the appeal. -8-
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13. He also pointed out that apart from the temporary overdraft facility, the plaintiff-bank also debited the insurance premium amount to the account of the defendant which is incorrect and therefore, sought for allowing the appeal.
14. He further argued that the defence taken by the defendant has not been properly appreciated by the trial Court and therefore, sought for allowing the appeal and dismissing the suit.
15. Per contra, Sri.Shyama Prasad, learned counsel for the respondent-bank supported the impugned judgment.
16. Having heard the parties, this Court perused the material on record meticulously.
17. On such perusal of the material on record, following points would arise for consideration:
1) Whether the plaintiff-bank has successfully establish that the bank is entitled to a sum of Rs.2,63,344/- being the amount outstanding in the current account of the defendant on account of the temporary overdraft facility extended to the defendant as per the request letter vide Ex.P1?
2) Whether the impugned judgment is suffering from the legal infirmity or perversity?-9-
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3) What order or decree?
18. Regarding Points No.1 and 2: The case of the plaintiff stands proved to an extent inasmuch as in the written statement, the defendant has admitted the availing of the temporary overdraft facility but according to the defendant, request was for Rs.1,00,000/- and not Rs.2,00,000/-. But the delivery letter and on demand promissory note depicts the amount of Rs.2,00,000/-.
19. Admittedly, the Statement of Account shows that a sum of Rs.2,00,000/- is credited to the current account of the defendant as per the request at Ex.P1. Moreover, the accounts are maintained in computer system. Therefore, manipulation or the human intervention in respect of the entries are not permissible. Further, the defendant has withdrawn the amount credited to her current account on account of temporary overdraft request. If at all the defendant had requested sum of Rs.1,00,000/-, she should have immediately repaid the balance of Rs.1,00,000/- or given a letter to the bank to reverse the entry to the extent of Rs.1,00,000/-. No such effort is made by the defendant. Having utilized the amount of Rs.2,00,000/-
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NC: 2024:KHC:31556 RFA No. 1346 of 2015 and also executed necessary documents, it should not now lie the mouth of the defendant that the facility was requested only for Rs.1,00,000/- and the Bank suo-moto granted the overdraft facility in a sum of Rs.2,00,000/-.
20. Therefore, the execution of the documents and the outstanding amount in a sum of Rs.2,63,344/- stands established on account of the Statement of Account maintained by the bank in a regular course of the business.
21. In the absence of any contra evidence placed on record by the defendant or extra facility being granted by the plaintiff to the defendant, decreeing of the suit by the trial court is just and proper. Accordingly, Points No.1 and 2 are answered in the affirmative and negative respectively.
22. Regarding Point No.3: In view of the foregoing discussion and recording of the finding on Points No.1 and 2 as above, following order is passed.
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NC: 2024:KHC:31556 RFA No. 1346 of 2015 ORDER
(i) The appeal is meritless and thereby dismissed.
(ii) No order as to costs.
Sd/-
(V SRISHANANDA) JUDGE PRS List No.: 1 Sl No.: 74