JUDGMENT
Jaspal Singh, J.
(1) As far back as in the year 1982 the plaintiff Bank had instituted this suit under Order 37 of the Code of Civil Procedure for the recovery of Rs.21,73,825. The defendants were granted leave to appear and defend the suit and as many as seven issues were framed which read as under: “1.Was the account in dispute opened by defendant No.1 under fraud as alleged in the written statement ? 2. Did the defendant No.1 not receive the amount from the plaintiff-bank as alleged in the plaint? If so to what effect ? 3. Did defendants sign the documents of the transaction in dispute when they were blank ? If so to what effect ? 4. If issues No.1 to 3 are not proved, what is the amount due to the plaintiff from the defendants ? 5. Is the suit bad for non-joinder of necessary and proper parties ? 6. Has the suit been instituted by a duly authorised person on behalf of the plaintiff-bank and the plaint signed and verified by such person ? 7. Relief.”
(2) As would be borne out from the issues so framed, it was only Issue No.6 which was required to be proved by the plaintiff Bank and to do so it examined in affirmative one of its managers Shri H.S.Jolly as PW-1 who proved the power of attorney Ex. P-4 executed by the plaintiff Bank in favor of one Shri Gajinder Singh besides an authorisation letter Ex. P-5. It may be mentioned that the plaint is proved by this witness to have been signed and verified by said Gajinder Singh. After the plaintiff Bank closed its evidence in the affirmative, the defendants were proceeded against exparte. This happened on May 27, 1991. Since the order passed on that day came under fierce attack at the hands of Mr.I.C.Kumar the learned counsel for the defendants, I think I would do well to rather reproduce it. It runs as under: “THE defendants are set down exparte. The plaintiff is granted liberty to file affidavit by way of evidence. Let the case be done within six weeks. List this matter before the Dy.Registrar on 13th September, 1991 for exhibiting the documents.”
(3) Consequent upon the order of May 27, 1991 the plaintiff bank led evidence in the form of affidavits. On December 29, 1992 the court passed an order fixing the matter for arguments. However, before the arguments could be heard, defendants No.1 and 2 moved an application under order 9 for setting aside the order for proceeding ex parte. It was dismissed on February 4, 1994. Finding that order as not acceptable, defendants No.1 and 2 preferred an appeal which was dismissed by a Division Bench on May 16, 1994. However, the Division Bench did allow the appellants to cross- examine the deponents subject to payment of costs. The relevant portion of that order runs as under: “PLAINTIFF in support of its case, on merits has filed affidavits; proceedings are at the stage of arguments, because, no other witness is permitted to be examined by the defendant. A very large amount is claimed against the appellant, in the suit. Having regard to these circumstances, interest of justice could be met, by permitting the appellant to cross-examine the deponents of the affidavits, after treating the said affidavits as statements on examination-in-chief. The appellant should be ready to cross-examine the deponents without seeking any further adjournments. Similarly the appellant shall examine its witnesses on a day to be fixed by the learned single judge, and offer them for cross-examination. Any further adjournment at the request of the appellant shall not be granted. in addition to the above conditions, as a condition precedent for reopening the suit, as above, the appellant shall pay a sum of Rs.15,000.00 as costs to the plaintiff and this payment shall go to the plaintiff absolutely, irrespective of the result of the suit and it shall not be taken note of while computing the costs in the suit while making the decree. This payment of Rs.15000.00 shall be made within two weeks from today.
(4) Instead of paying costs and availing of the opportunity to cross-examine the deponents, the defendants in question moved another application (IA 7659 of 1994) praying that the affidavits filed by the plaintiff Bank by way of evidence be not taken into consideration. This application was dismissed on August 5, 1994. It was time again for defendants 1 and 2 to feel aggrieved and to go in appeal though it is another matter that once again the appeal met the same fate. While dismissing the appeal, and this was on October 6, 1994, the Division Bench observed: “ITwill, however, be open to the appellants to argue before the learned Single Judge that the affidavit evidence produced is not evidence. It will be open to the Bank to contend that, in the events that have happened and the orders passed at various stages of the case, affidavits can be taken as evidence or that even this question is barred either by estoppel or constructive res judicata or otherwise. It will be for the learned Single Judge to decide the question in accordance with law.”
(5) The defendants still feel undaunted. Their latest and hopefully the last application (IA 1989 of 1995) is under Order 19 Rule 1 of Chapter xviii of the Delhi High Court (Original Side) Rules, 1967. The contention is that affidavits by way of evidence could not be invited.
(6) Before I proceed to deal with the objection, let me, for purposes of clarity reproduce Rule 1 of Order 19 of the Code of Civil Procedure and so also Rule 1 of Chapter xviii of the Delhi High Court (Original Side) Rules. They are as under: “ORDERXIX Rule 1, Code of Civil Procedure “Any Court may at any time for sufficient reason order that any particular fact or facts may be proved by affidavit, or that the affidavit of any witness may be read at the hearing, on such condition as the Court thinks reasonable: Provided that where it appears to the Court that either party bona fide desires the production of a witness for cross-examination, and that such witness can be produced, an order shall not be made authorising the evidence of such witness to be given by affidavit. Rule 1 Chapter xviii, Delhi High Court (Original Side) Rules 1.Proof of facts by affidavits – The Court may at any time for sufficient reasons, order that any particular fact or facts may be proved by affidavit, or that the affidavit of any witness may be read at the hearing, on such conditions as the Court thinks reasonable: Provided that where it appears to the Court that either party bonafide desires that production of a witness for cross-examination and that such witness can be produced, an order shall not be made authorising the evidence of such witness to be given by affidavit.”
(7) Time now to come to the bones. Mr.Kumar had three judgments in his armoury. He started with a judgment from the Supreme Court in Sudha Devi v. M.P.Narayanan . It says that affidavits are not included in the definition of “evidence” in section 3 of the Evidence Act and can be used as evidence only if for “sufficient reason” court passes an order under Order Xix, rule 1 or 2 of the Code of Civil Procedure.
(8) Let me refer to the two other judgments as well. In Jagdish v. Premlata Rai , the learned single Judge has relied upon the above-noted judgment of the Supreme Court and has merely echoed what was already said by the Apex Court.
(9) The last judgment comes from Mysore. It is B.N.Munibasappa v. G.D.Sivamigal Air 1959 Mysore 139. Mr.Kumar fondly referred to it as the mother of all judgments on the point. As I read it, it lays down that what the Court is entitled to do under the said Rule is to order that any particular fact or facts made be proved by affidavits provided there were sufficient reasons for doing so and that an order under Order 19n Rule 1 permissible only in exceptional circumstances.
(10) Relying upon the judgments referred to above, it was contended by Mr.Kumar that the order directing the plaintiff Bank to produce affidavits in support of its case was a clear misuse of the provisions of Order 19 Rule 1 of Chapter xviii of the Delhi High Court (Original Side) Rules.
(11) I have no manner of doubt that in order to justify an order directing the parties to produce affidavits in support of their cases, there must be sufficient reason. The question is: Is the order passed in this case bereft of a sufficient reason?
(12) Lest me forget, it may be emphasised that the defendants had been proceeded exparte. This fact was specifically noted in the order. And, it is this which makes the case stand on a different pedestal. The jurisdiction was already there. What was required was a sufficient cause and the order for proceeding ex parte furnished it. Though not referred to by either side, I may profitably rely upon a judgment of the Madras High Court in Srinivasa Ayyangar v. Pichumani Ayyangar Air 1933 Madras 164. It was a suit by a minor on the basis of a promissory note. The defendant, though served, did not appear. The learned Judge thereupon admitted an affidavit made by the plaintiff’s next friend in proof of the execution of the promissory note and the “yadaast” and passed a decree. In revision the defendant raised the objection that the affidavit could not be acted upon. Pandalai J. observed as follows: “IN my opinion the ground urged is without any substance. O.19 R.1 enables any Court to order that any fact may be proved by affidavit and the proviso enables the Court to compel the attendance of the deponent in case of need. In Woodroffe and Ameer Ali it is stated that it is common practice to admit affidavits at the hearing when there is no contention as to the facts. That is what happened in this case and I can see nothing illegal in it.”
(13) Nearer in time is the judgment of the Bombay High Court in M/s Mangilal Rungta, Calcutta v. Manganese Ore (India) Ltd., Nagpur Air 1987 Bombay 87 which lends further support to the view I am taking.
(14) However, this still is not the end of the matter. In the first order of the Division Bench (FAO (OS) 86/94) it was specifically held that the affidavits would be treated as evidence-in-chief and the appellant would be entitled to cross-examine the deponents of the affidavits provided Rs.15,000.00 costs were paid. The costs were not paid. The defendants left that order unchallenged and the order was allowed to become final. The plea is no more open now. Principle of res judicata operate.
(15) MR.KUMAR had nothing much to say on merits. His only argument was that the affidavits in question could not be looked into and that the solitary statement of Mr.Jolly (Public Witness -1) was not sufficient to invite a decree against the defendants.
(16) The statement of PW-1 Mr.Jolly and the affidavit of Mr.Jasbir Singh prove issue No.6. On merits of the claim, the affidavit of Mr.Sohan Singh proves that defendants 2 and 3 are the directors of the defendant No.1 company, that account opening form Ex.P-6 was filled in and signed by defendants 2 and 3 and that on request of the defendants the plaintiff bank allowed overdraft facility to the extent of Rs.20 lakhs. The loan application Ex. P-7, letter Ex.P-7A and documents Ex.P-8 to P-13 go to prove it. Defendants 2 and 3 in their individual and personal capacity also executed and delivered a letter of guarantee (Ex P-14). The affidavit further goes to prove that the current Account was operated by defendants No. 2 and 3 as the Directors of defendant No.1 and the overdraft facility was also availed by them in that capacity by withdrawing amounts from the overdraft account. It also stands proved that defendant No.1 through its Director defendant No.2 presented cheque Ex.P-15 in the sum of Rs.15 lakhs and through endorsement made on reverse of the cheque by defendant No.2 request was made to the plaintiff bank to issue a Demand Draft in favor of defendant No.2. Consequent thereupon Demand Draft Ex.P-16 was issued by the plaintiff bank which was deposited by defendant No.2 and got it cleared as is borne out from Certificate Ex.P-17. Thereafter on march 3, 1981 defendant No.1 through its Director, defendant No.2 issued cheque Ex.P-18 in the sum of Rs.5000.00 . Its payment was obtained by defendant No.2. It stands further proved from the said affidavit that the defendants failed to make payment despite notice Ex.P-20. The statement of account is Ex.P-19 which shows that a sum of Rs.21,73,825.00 was due from the defendants as on 31st December, 1982. Mr.Sohan Singh has also proved letter Ex.P-21 of defendant No.1 through its Director defendant No.2 admitting the liability. The letter is dated June 17, 1983.
(17) In view of the evidence noticed above I hold that the plaintiff Bank has fully proved its case. I, therefore pass a decree for the recovery of Rs.21,73,825.00 with costs in favor of the plaintiff Bank and against the defendants with interest at the rate of 19.50% per annum with effect from January 1, 1983 till realisation. The decree is passed exparte against defendant No.3.
