JUDGMENT
P.K. Deb, J. (Chairperson)
1. This appeal has been preferred against the judgment and order dated 21st January, 2001 passed by the then Presiding Officer, DRT, Jabalpur in T.A. No. 184/98, whereby and whereunder the claim of the appellant Bank to the tune of Rs. 14,60,288.80 has been rejected and dismissed.
The brief facts of the case are stated as under:
1. The respondent defendant No. 1 M/s. Van Pharma Laboratories is a partnership firm engaged in the business of manufacturing and sale of medicines. The respondent defendant Nos. 2 and 3 are the partners of the respondent No. 1 firm. The respondent No. 1 Firm enjoyed the cash credit facility from the appellant Bank and respondent Nos. 4 and 5 stood as guarantors. As per the plaint story the respondent No. 1 through its partners respondent defendant Nos. 2 and 3 requested the appellant Bank for grant of working capital and as such cash credit facility of Rs. 2.15 lakh was granted by the Bank and sanctioned as per the terms and conditions attached to the agreement which was executed by the respondent defendant Nos. 2 and 3 on 1st June, 1983. The rate of interest at the relevant time was 16% per annum with quarterly rest. The respondent defendant Nos. 2, 3 and 4 in their personal capacity executed the guarantee agreement on 1st June, 1983 in respect of said cash credit facility granted to the respondent defendant No. 1 Firm/Subsequently respondent defendant No. 5 had also executed revival letters in respect of the aforesaid credit facility. Respondent No. 1 again executed a letter of revival on 15th October, 1988, but as no repayment was made, then originally a suit was filed in the Civil Court claiming Rs. 14,60,288.80 against all the respondent defendants claiming themselves to be jointly and severally liable.
2. The respondent defendant Nos. 1,2 and 3 filed joint written statement stating inter alia that the Bank failed to provide adequate finance to them as per the agreement, as a result the respondent No. 1 firm incurred heavy loss in the business and because of the fault of not providing adequate funds the claims of the appellant Bank should be dismissed.
3. The respondent defendant No. 4 Rati Bhai Patel filed separate written statement denying all the averments in the plaint. It was stated that he did not wilfully executed the guarantee agreement and that his signatures were obtained on blank documents and on 16th June, 1987, he requested the appellant Bank for return of his guarantee and discharge of his liability. No written statement was filed by the respondent defendant No. 5.
4. The main contention of the respondent defendant No. 5 was with respect to the opening balance of the loan facility as per exhibit No. P/7 wherein 10th June, 1983 a sum of Rs. 3,26,102.54 was shown to be transferred from the previous account of respondent No. 1 to the new account. In that way it was the contention of respondent defendant No. 4 that his liability as guarantor remains oblique when his guarantee even if taken to be correct and legal, then the same cannot exceed Rs. 2.15 lakh and he cannot be and should not be made liable as a guarantor for the accounts maintained by the Bank in exhibit No. P/7. On such position the appellant Bank filed a rejoinder stating that the respondent Nos. 1,2 and 3 were enjoying the facility of cash credit since 1978 and in the year 1983 fresh agreement of cash credit balance of Rs. 2.15 lakh was entered into and the balance of the previous loan account have been transferred in admittance of the respondent defendant Nos. 1,2 and 3. It was further contention of the respondent defendant No. 4 that his guarantee agreement stood as discharged when the respondent defendant No. 5 had executed a fresh guarantee agreement in the year 1985.
5. On adjudication of the rival claims of the parties, learned D.R.T., Jabalpur came to the finding that the rejoinder story as revealed by the appellant Bank was not there in their initial pleadings when the suit was filed and if the pleadings in the initial suit are taken as it is, then the same does not conform to the statement of accounts as maintained in regular course of the business admissible under Section 34 of the Evidence Act, 1872 and the provision of Banker’s Books Evidence Act, 1891 as contained in Exhibit P/7 is not in conformity and as such it was held that the Bank was not coming with clean hands and the suit as a whole has been dismissed, hence the present appeal.
6. Before this appellate Court it is a fair submission of the learned Advocate appearing for the appellant State Bank of India that the learned Trial Court ought not to have dismissed the suit as a whole when the main borrower had never denied of the cash credit facility being taken to the tune of Rs. 2.15 lakh and though the accounts which were always being operated by the principal borrowers i.e. respondent defendant Nos. 2 and 3 had never objected to the accounts being maintained in regular course of business by the appellant Bank. His submission is that although in the accounts there might not be signatures of respondent Nos. 1,2 and 3 while bringing forward the remaining balance of previous loan account to the present loan account which can well be construed as admission on the part of the principal borrowers and in that way exhibit No. P/7 ought not to have been rejected as not being maintained in regular course of business as admissible under Section 34 of the Evidence Act, 1872 and also as per provision of Banker’s Books Evidence, 1891. His further contention is that the objection regarding opening balance has only been taken by the respondent defendant No. 4 who was a guarantor and it is said that this defendant No. 4 was also a guarantor in the previous loan account of principal borrowers and in that way even if the opening balance of Rs. 3.00 lakh and odd may not be very proper for the purpose of claim in respect of respondent defendant No. 4 guarantor but his whole liability cannot be swayed away when it could be proved by the Bank official the guarantee documents executed by respondent-defendant No. 4 to the tune of Rs. 2.15 lakh. It is the fair concession being given by the learned Counsel for the appellant that respondent defendant No. 4’s liability might be restricted to Rs. 2.15 lakh and interest accrued thereon as per the terms of the agreement. In opposition to such submission, learned Counsel of the respondent defendant No. 4 has submitted that when the Bank accounts are not in conformity with the pleadings, in that case, the judgment of dismissal cannot be interfered with and the defendant No, 4 being discharged of his liability in the year 1985 itself, when the defendant No. 5 stood as guarantor and as such no decree can be granted against the respondent defendant No. 4.
7. In the light of the submissions made by the learned Counsel for the appellant and the respondent defendant No. 4, I have perused the pleading of the parties, rejoinder filed by the appellant Bank and also the evidence adduced both documentary and oral by way of affidavits. It should be mentioned here that in the present appeal although notices have been served on the principal borrowers i.e. respondent Nos. 1, 2 and 3, they have not come up to contest the appeal. Only the respondent defendant No. 4 is contesting. It also appears from the records of the D.R.T. that although written statement was filed by the defendant Nos. 1, 2 and 3 but main contest was made by the respondent defendant No. 4 alone. The maintaining of accounts is on the transactions being made between the appellant Bank and the principal borrowers. Although there is no signature on transferring or bringing forward the previous loan dues of the principal borrower in the present loan account but nowhere on such maintaining of accounts the principal borrower had ever raised any objection, it might be construed as an admission on the side of the principal borrower regarding transferring of the previous loan accounts to the new accounts. If there is no bar under the Banking Regulations regarding such transfer even without the express consent of the borrower, then perhaps there remains no scope to turn down such borrowing forward of the previous loan account in the new account by closing the previous one. That depends upon the conduct of the parties. The evidence in that respect is there from the side of the Bank but nowhere could I find that any serious objection has been raised regarding the opening balance as recorded in exhibit No. P/7 by the principal borrowers. I do not want to make any further comments on this matter between the appellant Bank and the principal borrowers i.e. respondent Nos. 1, 2 and 3 because of the final order I am going to make in the present appeal.
8. Regarding the objection being raised from the side of respondent defendant No. 4 regarding maintaining of the accounts by the Bank and the opening balance being recorded, I do not find that the respondent defendant No. 4 can have the jurisdiction to raise so but definitely he cannot be bound by the previous transactions in the previous loan account and his liability would be restricted with Rs. 2.15 lakh as being maintained in the present loan account, if not it is found that his liability has been discharged because of fresh guarantee being executed by respondent defendant No. 5 who had never contested the suit or the appeal at any point of time. Now the point comes in, whether the learned Tribunal was justified in dismissing the whole claim of the appellant Bank only on the opening balance being recorded in the new loan account. When objection was raised from the side of the respondent defendant No. 4 by way of explanation as to how the opening balance was recorded, the appellant Bank had raised the issue of previous loan of the principal borrowers and of respondent No. 4 being stood as guarantor in the previous loan account also. It is true that the opening balance as recorded do not totally conform with the plain reading of the pleadings as submitted for the purpose of raising claim from the side of the appellant Bank, but definitely when objection has been raised not by the borrowers, but by the guarantor, then the same was explained by way of rejoinder from the side of the appellant Bank. Does it mean the change of the whole story of the appellant Bank in the claim being made originally or not, is a matter to be scrutinized. According to the observations made in the impugned judgment, exhibit No. P/7, the loan account is not in conformity with the original pleadings and rejoinder given reveals a new story. I do not think that the same is a total new story, rather an explanation has been given as to why an amount more than that of the limited loan amount granted have been recorded in the opening balance when the same has been raised not by the principal borrower but by a guarantor alone. Even if it is taken that the opening balance as recorded is not in conformity with the new loan agreement between the appellant Bank and the principal borrowers, then also the claim as a whole cannot be thrown away, rather Bank could have been asked to prepare a statement on the basis of new loan account without considering the previous B/F account. It is there in the records that revival letters have been given by the principal borrowers on two occasions and the loan accounts have been admitted in those revival letters which again being required to be verified in depth but this much can be said that the total dismissal of the claim of the appellant Bank cannot be sustained in the present circumstances of the case, when the loan accounts as being transacted between the appellant Bank and the principal borrowers had never been objected from the side of the principal borrowers. The claim of the appellant Bank has not been considered in their proper perspective. On consideration of the discussions made above and the dismissal order has been recorded only on a plea that the appellants are coming with new stories again and again, in my view the dismissal order recorded on the grounds as mentioned in the impugned judgment cannot be sustained in law and as such the same is set aside and the matter requires to be re-examined/re-adjudicated in its proper perspective as per the discussions made in this judgment in foregoing paragraphs. The appeal is thus allowed. The impugned judgment and order is hereby set aside and the matter is sent back to the D.R.T., Jabalpur to re-adjudicate the claim petition of the appellant Bank in its proper perspective which he should do and dispose of within six months next positively from the date of receipt of this order and the records thereof. The parties should be given further opportunity to file additional evidence if any in support of their contentions. In the result, the appeal is allowed, but no order as to costs.