Delhi District Court
Ads Spirits Pvt. Limited vs State Bank Of India on 17 October, 2020
IN THE COURT OF SHRI RAJ KUMAR: ADDITIONAL
DISTRICT JUDGE, DELHI WEST(01) DELHI
Suit No. 605/17
ADS SPIRITS PVT. LIMITED
Regd. Office FF-2, Harmony Apartment
52/78, Punjabi Bagh(West)
New Delhi 110 026
........... Plaintiff.
VERSUS
1 State Bank of India
Head Office,
11, Parliament Street
New Delhi
Through
General Manager(Legal)
2 State Bank of India
SME Branch, Moti Nagar
Najafgarh Road, New Delhi
Through
Branch Manager
3 State Bank of India
Bahadurgrah Branch
15/7, Model Town,
Bahadurgarh(Haryana)
Through
Branch Manager ........ Defendants
Date of institution of the suit : 20.05.2019
Date on which order was reserved : 30.09.2020
Date of decision : 17.10.2020
SUIT FOR RECOVERY OF RS. 32,35,000/-(RUPEES THIRTY TWO
LAS THIRTY FIVE THOUSNAND ONLY)
JUDGMENT
1 The facts in brief, necessary for the disposal of the present Suit No. 605/17 Page No. 1/20 suit for recovery of the amount of Rs. 32.35 lacs as disclosed by the plaintiff in the plaint are that the plaintiff is a private limited company registered under the Companies Act and the Board of Directors of the plaintiff vide resolution dated 10.05.2017 has authorized Sh. Sahil Garg to institute, verify and sign the present suit on behalf of the plaintiff. 1.1 It has been further stated that the defendant no.1 is a public sector bank, the defendant no.2 is the SME Branch of SBI and the defendant no.3 is the branch of SBI in which the plaintiff company is maintaining its current account. It has been further stated that the plaintiff company has its current account no. 35130545425 at the branch office of the defendant no.1 and loan account no. 32842613525 with the defendant no.2.
1.2 It has been further stated that in 2012, the plaintiff applied for a term loan and cash credit limit with the defendant no.1 and Punjab National Branch, Kassar Branch. It has been further stated that the loan was sanctioned and released in consortium for a sum of Rs. 50 crore as term loan and Rs. 8.9 crore as cash credit limit. It has been further stated that the cash credit limit was Rs. 5 crore from the defendant no.1 and Rs.3.9 crore from Punjab National Bank. 1.3 It has been further stated that the loan was taken in the month of July 2012 and all went fine till April 2015. It has been further stated that the plaintiff took every care to maintain the account properly according to terms of loan agreement. It has been further stated that there was no default at all at any point of time. It has been further stated that the plaintiff was categorized as a valued customer by the defendant no. 1 and the Punjab National bank due to timely payment of the loan. It has been further stated that the loan availed by the plaintiff has never been in risk zone.
1.4 It has been further stated that as per the practice, the extra Suit No. 605/17 Page No. 2/20 rate of interest is charged only when the risk involved for the bank in the loan account becomes higher. It has been further stated that the loan was repaid entirely much before the due date. It has been further stated that the plaintiff is a reputed company, having an annual turnover of approx.. Rs. 250 cores.
1.5 It has been further stated that on 01.6.2015, the defendant arbitrarily charged and debited a sum of Rs. 7,94,210/- as arrears of interest for the period from 01.10.2014 to 01.06.2015. It has been further stated that the bank has no explanation for this authorized debit of Rs. 7,94,210/- and Rs. 16,410/- as interest. It has been further stated that a vague reply was given by the defendant that this interest was charged on the basis of internal rating of the loan account. 1.6 It has been further stated that the bank cannot charge higher interest rate than the sanctioned rate of interest from back date without intimating the customer about the increased rate of interest and that too from the current account maintained with other branch of the bank. It has been further stated that the plaintiff closed its loan account after re-payment of the loan amount on 26.07.2017. 1.7 It has been further stated that the plaintiff was betrayed by charging higher interest rate and further unauthorized debit entry of Rs. 15 lacs on 22.09.2015 on account of delay in submission of stock statement. It has been further stated that the current account of the plaintiff company was debited @ Rs. 5 las per month for the delayed submission of stock statement for the month of January to March 2015. It has been further stated that there was a delay of three days in the month of January 2015, two days in February and one day in March 2015 but as per the agreement, the period for submission of stock was 60 days.
1.8 It has been further stated that the plaintiff made the Suit No. 605/17 Page No. 3/20 representation to the defendant no.1 against the unfair banking practices of debiting the account without intimating the plaintiff. It has been further stated that firstly the account was debited with the amount of Rs. 15 lacs and thereafter after two months, the bank gave credit worth Rs. 5 lacs. It has been further stated that the defendants admitted that the alleged circular regarding the increased in the penalty for the delayed submission of stock statement was intimated on 09.06.2015.
1.9 It has been further stated that the charging on account of the late submission of statement of stock is contrary to the agreement signed between the parties at the time of taking of the loan. It has been further stated that as per the terms of sanctioned letter dated 28.06.2012, the penal interest for non submission of stock statement was 2% per annum on the entire balance if the account was continuously irregular for 60 days. It has been further stated that no charge could be levied for delay of 1,2 or 3 days as there was no continuous irregularity in account of the plaintiff company. 1.10 It has been further stated that the plaintiff filed a complaint against charging this huge amount for Rs. 5 lacs per month for delayed submission of monthly stock statement before Bank Ombudsman where the defendant bank took the plea that the bank sent the e-mail in April 2015 but failed to submit the copy of the said e-mail. 1.11 It has been further stated that the defendants have wrongly charged the amount and unauthorizedly deducted a huge sum from the account maintained at defendant no.3 branch on two occasions and after the closure of the loan. It has been further stated thus the recovery is being claimed from the defendants. It has been further stated that the defendant no.2 took this undue advantage of unauthorized debit/withdrawal from the other account maintained by the Suit No. 605/17 Page No. 4/20 plaintiff in the same bank but with a different branch. It has been further stated that as per the banking policy and fair play, the act of defendants amounts to breach of trust and unfair practice.
1.12 The total claim of the plaintiff in the present suit is for Rs. 32.35 lacs along with pendente-lite and future interest @ 24% per annum. However, the plaintiff has bifurcated the amount in para no.18 of the plaint and claimed that the amount of Rs. 8,10,620/- on account of interest which was wrongly charged as interest on 01.06.2015. The plaintiff has also claimed the interest @ 18% per annum totaling to Rs. 2,55,345/- and thus the plaintiff has claimed the amount of Rs. 10,65,965/- on this count. The plaintiff has further claimed the amount of Rs. 10 lacs which was wrongly debited on 22.09.2015 for the delayed submission of stock statement together with the interest amounting to Rs. 2.70 lacs and thus, the plaintiff has claimed the total amount of Rs. 12.70 lacs on this count. The plaintiff has further claimed the amount of Rs. 8 lacs on account of damage to the reputation and Rs. 1 lac for harassment related expenses including legal fees of the advocate.
2. On the basis of the above said allegations as contained in the plaint, the plaintiff has prayed for a decree for an amount of Rs. 32.35 lacs along with pendentelite and future interest @ 24% per annum from the date of the filing of the present suit till the date of its realization. The plaintiff has also prayed for the costs of the suit.
3. Separate written statements have been filed on record by the defendant no.1 and 2 and by the defendant no.3. In the written statement filed by the defendants no.1 and 2, it has been stated that the present suit has not been filed by a legally authorized person. It has been further stated that the present suit is bad for mis-joinder and non joinder of the necessary parties. It has been further stated that the Suit No. 605/17 Page No. 5/20 plaintiff has no locus standi to file the present suit. It has been further stated that the plaintiff has no cause of action to file the present suit. 3.1 It has been further stated that no authority letter has been placed on record by the plaintiff. It has been further stated that the present suit is not maintainable as nothing illegal has been done by the defendants. It has been further stated that the defendants were legally entitled to recover the said rate of interest from the plaintiff as the plaintiff has not followed the terms and conditions of the agreement. It has been further stated that Rs. 8,10,620/- was debited as interest on Term loan for the period from 01.10.2014 to 01.06.2015 as rate of interest of the unit was increased retrospectively from 01.10.2014. It has been further stated that the original proposal was sanctioned on 28.06.2012 and Credit Rating Assessment ( the internal rating which determines pricing) which was done on projected BS(Balance statement) as on 31.03.2014. It has been further stated that CRA rating is done annually based on financial data provided by the company. It has been further stated that the terms and conditions of the sanction remain the same except for interest rate which is linked to internal rating and same was communicated to the company through Arrangement letter.
3.2 It has been further stated that the amount of Rs. 15 lacs was recovered from the plaintiff on account of late submission of stock statement for the month of January to March 2015 @ 1% of total FBWC limits for each default for limits above Rs. 1 crore. It has been further stated that the plaintiff company delayed the submission of stock statement by 3 days in January 2015, 2 days in February 2015 and 1 day in March 2015. It has been further stated that the charges for the month of January 2015 was reversed on 27.11.2015 as the same was wrongly deducted. It has been further stated that as per the Suit No. 605/17 Page No. 6/20 Arrangement letter exchanged with the company, time period allowed for submission of stock statement for a particular month is 10 days of the subsequent month. It has been further stated that the penalty for non submission of stock statement was revised by the bank with effect from 01.03.2015 and the details of charges were available on bank's website. It has been further stated that the defendants have recovered the said rate of interest legally from the plaintiff. It has been further stated that the plaintiff did not follow the terms and conditions of the loan agreement. Rest of the contents of the plaint have been denied and it has been prayed that the suit of the plaintiff be dismissed with costs.
4. In the written statement filed by the defendant no.3, it has been stated that the defendant no.3 has no concern with the present matter. It has been further stated that the plaintiff is having a current account no. 35130545425 with the defendant no.3 and the defendant no.2 had withdrawn the amount twice from the account of the plaintiff through cheques. It has been further stated that the defendant no.3 never charged any amount from the account of the plaintiff. Rest of the contents of the plaint have been denied and it has been prayed that the suit of the plaintiff be dismissed.
5. Separate replications have been filed by the plaintiff reiterating and re-affirming the stand as taken by the plaintiff and denying the contents of the written statement of the defendants no.1 and 2 and that of the defendant no.3. In the replication to the written statement of the defendants no.1 and 2, the plaintiff has stated that the defendant bank had done a detailed scrutiny of the accounts of the plaintiff and only then sanctioned the loan. It has been denied that the CRA rating was again done on 31.03.2014 or that the CRA rating of the plaintiff deteriorated from SB 5 to SB 8 and correspondingly, the rate of Suit No. 605/17 Page No. 7/20 interest was increased. The plaintiff has categorically stated that the abovesaid explanations are not only false and frivolous but the same are merely an after thought.
6. From the pleadings of the parties, the following issues were framed by this court on 22.02.2018:-
1 Whether the defendants no.1 and 2 were within their rights to deduct the amounts as stated by them, in the preliminary objections of the written statement? OPD1 and OPD2 2 Whether the suit of the plaintiff is beyond the period of limitation? OPD 3 Whether the suit of the plaintiff is not maintainable against the defendant no.3 as stated by the defendant no.3 in the preliminary objections of the written statement? OPD3 4 Whether the plaintiff is entitled for recovery for an amount of Rs.
32,35,000/- along with interest, as prayed for, by the plaintiff in the plaint? OPP 5 Relief.
EVIDENCE
7. The plaintiff has examined Sh. Sahil Garg, its Finance Manager as PW1 and in his evidence by way of affidavit, he has reiterated and reaffirmed the stand as taken by the plaintiff in the plaint. He has filed on record his evidence by way of affidavit as Ex.PW1/A, the board resolution dated 10.05.2017 as Ex.PW1/1, sanction letter dated 28.07.2012 as Ex.PW1/2, no dues certificate of bank dated 07.09.2015 as Ex.PW1/3, bank statement dated 01.07.2015 as Ex.PW1/4, bank statement dated 17.02.2017 as Ex.PW1/5 and the copy of complaint dated 02.12.2015 as Ex.PW1/7.
7.1 In the cross examination, PW1 states that there were three Directors in the plaintiff company. PW1 admits it to be correct that there Suit No. 605/17 Page No. 8/20 was no stamp on the board resolution Ex.PW1/1. By way of volunteer, PW1 states that the board resolution was already placed on record and the same was supplied to the defendants. PW1 further states that the sanctioned loan amount was Rs. 59.15 crores and the sanction was in consortium of two banks ie Punjab National Bank and State Bank of India.
7.2 PW1 further states that Rs. 25 crores in the form of term loan, Rs. 5 crore in the form of cash credit limit and Rs. 25 lacs were sanctioned in the form of bank guarantee etc. PW1 further states that he does not know whether the bank charged any interest as per RBI guidelines. PW1 further states that he does not know why the company took the loan from SBI. PW1 admits it to be correct that the loan agreement was signed by the plaintiff company after reading and going through the same. PW1 further states that the plaintiff has been properly maintaining and operating its account. By way of volunteer, PW1 states that the loan was for a period of 7 years and the same was re-paid only within a period of three years.
8. The defendants have examined its Branch Manager Sh. Jaibeer Singh Gaharwar as DW1 and in his evidence by way of affidavit Ex.DW1/A on record, he has reiterated and reaffirmed the stand as taken by the defendants in the written statements. He has filed on record his additional affidavit as Ex.DW1/B, the copy of sanction letter dated 28.06.2012 as Ex.DW1/1 and the copy of arrangement letter dated 11.07.2013 as Ex.DW1/2. 8.1 In the cross examination, DW1 states that there was no document in his record to show that the loan sanctioned by the defendant bank to the plaintiff company was a bad loan or an irregular loan. DW1 admits it to be correct that the entire loan was paid timely by the plaintiff company to the bank. DW1 admits it to be correct that Suit No. 605/17 Page No. 9/20 the plaintiff had closed the loan account on 26.07.2015. DW1 admits it to be correct that the defendant had debited a sum of Rs. 15 lacs on 22.09.2015 from the other account of the plaintiff maintained as current account with the defendant no.3 DW1 admits it to be correct that neither the defendant no.2 nor the defendant no.3 had sent any written notice to the plaintiff before debiting a sum of Rs. 15 lacs. By way of volunteer, DW1 states that the mail regarding the same was sent to the plaintiff. DW1 further states that the copy of the mail was not available in the system on account of crashing of computer.
8.2 The witness was shown para no.5.1 of Working Capital Consortium Agreement as Ex.D1/P1 to which the witness admits that there was a provision of notice to the borrower in a particular form. DW1 admits it to be correct that as per para no.5.1 of Ex.D1/P1, the notice was to be given in writing. DW1 admits it to be correct that as per para no.9 of Ex.DW1/2, there was no provision of a notice to be given by the defendant to the plaintiff. By way of volunteer, DW1 states that as per para no.9 of Ex.DW1/2, the stock statement had to be submitted by 10th of every month and the charges have been levied on account of delay in the submission of stock statement. DW1 admits it to be correct that he has mentioned on what date, stock statement was submitted and how much it was delayed. DW1 admits it to be correct that the circular for changing the rate of charge for delayed submission of stock statement was not communicated to the plaintiff. DW1 further states that on the website of SBI, all the circulars including the said circular were always available. DW1 admits it to be correct that he has no personal knowledge about the uploading of the circular on the website of SBI. By way of volunteer, DW1 states that the same was done by the Central level by corporate center. DW1 admits it to be correct that he would have given the notice of demand to the plaintiff if Suit No. 605/17 Page No. 10/20 the plaintiff had not been operating the account in the same bank. DW1 admits it to be correct that there was no provision in Ex.DW1/2 to charge Rs. 5 lacs for delay of one day of stock statement. By way of volunteer, DW1 states that the charges for delay in submission of stock statement were applicable with effect from 01.03.2015 while Ex.DW1/2 was executed before that.
8.3 DW1 further states that he cannot tell whether any letter changing the internal credit rating was given to the plaintiff. DW1 admits it to be correct that there was no provision of change of credit rating or detail of credit rating in Ex.DW1/1 and Ex.DW1/2. DW1 admits it to be correct that the loan was repaid only in three years while it was taken for 8 years. DW1 admits it to be correct that there was no provision of charging increased interest rate retrospectively. By way of volunteer, DW1 states that it is the banking practice, that the rating of borrower was done on the basis of audited balance sheet. DW1 further states that in the audited balance sheet for 31.03.2014, the CRA rating was assessed as SB 8 from earlier SB 5 and therefore, the increased rate was charged with effect from 01.10.2015. 8.4 DW1 admits it to be correct that he has not seen any balance sheet of the plaintiff company of the concerned year and he has no personal knowledge of difference in credit rating. DW1 further states that he cannot say about the deduction of Rs. 2000/- on 07.08.2015 on account of delay in filing the stock statement. 8.5 DW1 further states that the bank returned Rs. 5 lacs to the plaintiff which was charged for January 2015 as delayed submission of stock statement as per the charges applicable from 01.03.2015.
9. I have carefully gone through the entire material available on record and heard the rival submissions of both the Ld. Counsels for the parties. I have also meticulously perused the written final arguments Suit No. 605/17 Page No. 11/20 filed on record by both the parties.
10. My issue wise findings on the abovesaid issues are as under:-
Issues no.1 to 3
11. All these issues are being taken up together as the same are connected interse and overlap each other. Issues no.1 to 3 pertain to the objections of the defendants as contained in their respective written statements and as such, the onus to prove issues no. 1 to 3 has been placed upon the defendants. Issue no.4 pertains to the prayer clause of the present suit and as such, the onus to prove issue no.4 has been placed upon the plaintiff.
12. In the written final arguments filed on record by the plaintiff, the cross examination of DW1 has been heavily relied upon and it has been argued that the document of the rating degradation of the plaintiff's loan was with the defendants but the defendants have failed to place and to prove the same on record. It has been further argued that as per the own admission of DW1 in the cross examination, the notice in writing was to be given by the defendants to the plaintiff but no such notice has ever been given. It has been further argued that there was a delay of three days in the month of January 2015, two days in the month of February 2015 and one day in the month of March 2015 and as such, the amount of Rs. 10 lacs could not have been deducted on account of delay in the submission of stock statement. It has been further argued that as per the clause no. 5.1 of Ex.D1/P1, no such notice was ever given by the defendants to the plaintiff. It has been further argued that the plaintiff has been able to prove its case.
13. Whereas on the other hand, in the written arguments filed on record by the defendants, it has been argued that the plaintiff has not followed the terms and conditions of the arrangement letter Suit No. 605/17 Page No. 12/20 Ex.DW1/2 on record. It has been further stated that in para no.3 of Ex.DW1/2, it has been specifically mentioned that the bank is entitled to vary the margin based on the credit rate assessment of the borrower and the base rate on its discretion.
14. It has been further argued that as per the audited balance sheet submitted by the plaintiff on 31.03.2014, the CRA of the plaintiff deteriorated from SB 5 to SB 8 and as such, the rate of interest was increased retrospectively. It has been further argued that as per the arrangement letter exchanged with the plaintiff company, time period allowed for submission of stock for a particular month was 10 days of the subsequent month. It has been further stated and argued that the penalty for non submission of stock statement was revised by the bank with effect from 01.03.2015. It has been further argued that the details of the charges were available on the bank's website also. It has been further argued that as per the own admission of PW1 as contained in its cross examination, the rate of interest was legally charged and the penalty for non submission of stock statement in time was rightly levied by the defendant bank.
15. The litmus test, which is applied in civil cases is the test of preponderance of probabilities. The court has to weigh the evidence led by both the parties and thereafter, has to come to a just and fair conclusion by applying the test of preponderance of probabilities.
16. At the same time, it has to be seen that the principles of natural justice have been recognized as the rules which have been laid down by the court for the protection of the rights of the individual against the arbitrary procedure that may be adopted by a judicial, quasi judicial or an administrative authority while passing any order affecting those rights.
17. There are mainly two constituents of the principles of Suit No. 605/17 Page No. 13/20 natural justice. The first rule is the rule of " Audi Alteram Partem" or the right to a fair hearing. The second rule is that no one should be a judge in his own cause(Nemo Judex in causa sua).
18. Now applying the test of preponderance of probabilities, in the case in hand, this court has to see and to consider as to whether the defendants violated the principles of natural justice or not when the amount of Rs. 10 lacs was debited on 21.09.2015 on account of alleged delayed submission of stock statement or as to whether the defendants were justified in levying the increased interest retrospectively to the tune of Rs. 8,10,620/-.
19. As discussed and stated herein above, the first claim of the plaintiff is that the defendants arbitrarily charged and debited the amount of Rs. 8,10,620/- as arrears of interest for the period from 01.10.2014 to 01.06.2015. The defendant bank on the other hand, has taken the recourse to the alleged fact that as per the credit rating assessment of the plaintiff, assessed by the defendant bank on the basis of balance sheet submitted on 31.03.2014, the credit rating was decreased from SB 5 to SB 8 and that is why, the increased rate of interest was charged.
20. It has to be seen that Ex.DW1/1 is the copy of sanction letter dated 28.06.2012 and the arrangement letter dated 11.07.2013 has been exhibited as Ex.DW1/2. Ex.D1/P1 is the working capital consortium agreement in between the plaintiff, the State Bank of India and Punjab National Bank. The abovesaid three documents admittedly constitute the basis of agreement in between the parties to the present suit containing the terms and conditions of the loan which was advanced by SBI and PNB to the plaintiff company.
21. It is true that as per clause no.3 of Ex.DW1/2, the bank was entitled to vary the margin based on the credit risk assessment of the Suit No. 605/17 Page No. 14/20 borrower and the base rate at its discretion but at the same time, as per the own admission of DW1(the sole witness examined by the defendants) there is clause no. 5.1 in Ex.D1/P1 which specifically contains the provision of notice to the borrower in a particular form. Needless to mention that DW1 has categorically admitted that no such notice in writing was ever given by the defendants to the plaintiff.
22. DW1 has again admitted in the cross examination that there was no provision of charging the increased rate of interest retrospectively. DW1 admits that he has not seen any balance sheet of the plaintiff company of the concerned year and he does not have any personal knowledge of the difference in credit risk assessment of the plaintiff. No such credit risk assessment assessed by the defendant bank on the basis of the alleged balance sheet submitted on 31.03.2014 has been placed on record by the defendant bank at all.
23. In these circumstances, I have no hesitation to hold that the principles of natural justice have been grossly violated by the defendant bank. Needless to mention that as per the own admission of DW1 as contained in his cross examination, the loan was granted to the plaintiff bank for a period of 8 years but the plaintiff re-paid the loan only within a period of three years. DW1 categorically admits that there was no document on record to show that the loan sanctioned by the defendant bank to the plaintiff was a bad loan or an irregular loan.
24. I am of the opinion that the second limb of the arguments advanced by the Ld. Counsel for the defendants is bound to meet the same fate. The second limb of arguments pertain to the deduction of the amount of Rs. 15 lacs on 22.09.2015 on account of delayed submission of stock statement by the plaintiff with the defendant bank. Admittedly, the amount of Rs. 5 lacs was returned and reversed by the defendant bank in favour of the plaintiff but the amount of Rs. 10 lacs Suit No. 605/17 Page No. 15/20 has not been reversed or returned. The delay in submission of stock statement was only of 3 days in January 2015, two days in the month of February 2015 and one day in the month of March 2015. DW1 in the cross examination has categorically admitted that no notice in writing was ever given by the defendant bank to the plaintiff on this aspect of the matter.
25. DW1 states that e-mail was sent by the defendants to the plaintiff but no e-mail has either been placed on record or has been proved by the defendant bank. DW1 states that he has no personal knowledge about the noting or circulars on the website of SBI. The loan was repaid on 26.07.2015 and the amount was deducted by the defendant bank from the account of the plaintiff company maintained with the defendant no.3, which is the other branch of the same bank on 22.09.2015 and this act on the part of the defendant bank, in the considered opinion of this court amounts to a gross violation of the Principles of Natural Justice.
26. To my mind, the amount of Rs. 10 lacs was arbitrarily and wrongly deducted by the defendant bank from the account of the plaintiff company maintained with the defendant no.3 without following the Principles of Natural Justice. No opportunity of being heard was ever given by the defendant bank to the plaintiff company and no notice in writing was ever given by the defendants to the plaintiff.
27. I have no hesitation to hold that the entire act and conduct on the part of SBI amounts to a gross violation of the Principles of Natural Justice.
28. Now, coming of the question of limitation, first of all, it has to be seen that the limitation aspect of the matter has not been argued at all by the defendants in their written final arguments. Otherwise also, it has to be seen that the amount of Rs. 15 lacs was deducted from the Suit No. 605/17 Page No. 16/20 account of the plaintiff on 22.09.2015 and thereafter, the bank credited the amount of Rs. 5 lacs on 27.11.2015 on account of wrong deduction as per the own submission of the defendant bank and the present suit being filed in the month of May 2017, to my mind, is within the period of limitation. The defendants have utterly failed to prove on record that the present suit has been filed beyond the period of limitation.
29. The defendants have also argued that the present suit has not been instituted by a duly authorized person. It has to be seen that as per Ex.DW1/1, Ex.DW1/2 and Ex.D1/P1, the plaintiff company is a private limited company. PW1 has placed on record the copy of board resolution in his favour as Ex.PW1/1.
30. It has to be seen in the authority cited as AIR 1997 SC 3 titled as United Bank of India vs Naresh Kumar and others wherein the Hon'ble Supreme Court of India, in para no. 10 thereof has held as under:-
"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 CPC 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 CPC, 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 CPC 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 Suit No. 605/17 Page No. 17/20 behalf of the corporation. In addition thereto and de-hors Order 29 Rule 1 of the CPC, 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 CPC. 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."
31. In the light of ratio of the above stated authority, I am of the opinion that the defendants have utterly failed to prove that the present suit has not been instituted by a duly authorized person.
32. Now, coming to the claim of the plaintiff to the extent of Rs. 8 lacs which have been claimed by the plaintiff on account of damage to its reputation, it has to be seen that except PW1, no other witness has been examined by the plaintiff company at all. I am of the opinion that the plaintiff has utterly failed to prove that the plaintiff is entitled for the amount of Rs. 8 lacs on account of damage to its reputation. Similarly to my mind, the plaintiff is not entitled for the amount of Rs. 1 lac which has been claimed by the plaintiff on account of harassment and other related expenses including the legal fees.
33. In the light of the abovesaid discussion, issues no.1 to 3 Suit No. 605/17 Page No. 18/20 are decided against the defendants.
34. So far as issue no.4 is concerned, the plaintiff is held entitled for the amount of Rs. 8,10,620/- on account of interest, wrongly charged on 01.06.2015 and the amount of Rs. 10 lacs which were deducted wrongly by the defendants on 22.09.2015 and thus the plaintiff is held entitled for a total amount of Rs. 18,10,620/-.
35. So far as the interest is concerned, the plaintiff company is awarded the interest @ 9% per annum from the date of the filing of the present suit till the date of the realization of the entire amount of Rs. 18,10,620/- in the peculiar facts and circumstances of the present case. Issue no.4 stands decided accordingly.
RELIEF:
36. In the light of my findings on the foregoing issues, the suit of the plaintiff is decreed for the principal amount of Rs. 18,10,622/- along with the interest @ 9% per annum from the date of the filing of the present suit till the date of the realization of the decreetal amount. The costs of the suit are also awarded in favour of the plaintiff.
Decree sheet be prepared accordingly by the Reader, after payment of the additional court fees, if any.
File be consigned to Record Room after due compliance.
RAJ Digitally signed by
RAJ KUMAR
KUMAR Date: 2020.10.21
11:32:39 +0530
Announced in the open court (RAJ KUMAR)
on this 17th day of October 2020. ADDITIONAL DISTRICT JUDGE (WEST) Tis Hazari Courts, Delhi.
Suit No. 605/17 Page No. 19/20 CS no. 605/17 17.10.2020 Present : None.
Vide my separate judgment of even date, announced in the open court today, the suit of the plaintiff has been decreed partly for the amount of Rs. 18,10,620/- and a decree for the amount of Rs. 18,10,620/- has been passed in favour of the plaintiff and against the defendants jointly and severally along with the interest @ 9% per annum from the date of the filing of the present suit till the date of the realization of the decreetal amount. The costs of the suit are also awarded in favour of the plaintiff.
Decree sheet be prepared accordingly by the Reader, after payment of the additional court fees, if any.
File be consigned to Record Room after due compliance.
(Raj Kumar) ADJ (West) Delhi/17.10.2020 Suit No. 605/17 Page No. 20/20