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FA/1196/1988 6/ 6 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 1196 of 1988
For
Approval and Signature:
HONOURABLE
MR.JUSTICE M.R. SHAH
=========================================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
No
2
To
be referred to the Reporter or not ? No
3
Whether
their Lordships wish to see the fair copy of the judgment ?
No
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ? No
5
Whether
it is to be circulated to the civil judge?
No
=========================================================
STATE
BANK OF SAURASHTRA - Appellant(s)
Versus
D
M MEHTA & 2 - Defendant(s)
=========================================================
Appearance :
MR
JD AJMERA for Appellant(s) : 1,
NOTICE SERVED
for Defendant(s) : 1, 3,
None for Defendant(s) :
2,
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE M.R. SHAH
Date
: 19/06/2008
ORAL
JUDGMENT
1. Present
appeal under Section 96 of the Code of Civil Procedure is filed by
the appellant ? original plaintiff challenging the judgment and
decree dated 03.01.1986 passed by the learned Civil Judge (S.D.).,
Porbander in Summary Suit No.4 of 1985 dismissing the said summary
suit against the original defendant Nos.4 to 6 who were guarantors.
2. The
plaintiff filed suit to recover an amount of Rs.6,93,238.93 paise
with cost and interest against all the defendants on the basis of the
Hundis. It was summary suit filed by the plaintiff. Defendants Nos.4
to 6 -respondents herein were joined as party defendants who were
guarantors of defendant No.3. Defendant No.2 was the drawer in case
of need. Defendant No.3 was given commercial credit by process of
purchasing said hundi drawn by defendant No.3 in favour of the Bank
on defendant No.1. Said Hundi were payable on or before 45 days after
presentation with interest at the rate of 21.50% per annum. It was
the case on behalf of the plaintiff that defendant was the payee and
lawful holder in due course of said hundis and same were forwarded by
the plaintiff ? Bank to its Branch for realization. Original
defendant accepted unqualifiedly that on the date of maturity the
said hundis were presented to defendant No.1 for payment. But it was
refused as note – notice of dishonour was served to defendant No.3.
The suit hundis were again presented with defendant No.1 for payment
but he refused. Thereafter said hundis were personally presented by
the Notary public to defendant No.2 ? drawer in case of need which
was also dishonoured. Thereafter notice of dishonour was served upon
defendant No.2, but no payment was made. Hence, the plaintiff filed
suit to recovery the amount by way of filing the aforesaid summary
suit.
3. Though
served, nobody appeared on behalf of defendant No.2. On behalf of
defendant Nos.3 to 6, application for leave to defend under Order
XXXVII Rule 3(5) of the C.P.C. was filed. Defendant No.3’s
application for leave to defendant was rejected whereas defendant
Nos. 4 to 6 application for leave to defend was allowed. The learned
trial Court has framed the issues at Exh.34. The learned Civil Judge
(S.D.), Porbander in a very cryptic one paragraph judgment and order
dismissed the suit so far as defendant Nos.4 to 6 are concerned and
decreed the suit against defendant Nos.1 and 2. The learned Civil
Judge(S.D.), Porbander accordingly granted summons for judgment
against defendant Nos.1,2 and 3. The learned trial Court in
paragraph-4 while dismissing the suit against defendant Nos.4 to 6
has observed that defendant Nos.4 to 6 are Directors of the Company
and the Company is liable, however, without considering the fact that
defendant Nos.4 to 6 stood as guarantors in their individual capacity
dismissed the suit. Being aggrieved and dissatisfied with the
judgment and decree passed by the learned Civil Judge (S.D.),
Porbander dated 03.01.1986 passed in Summary Suit No.4 of 1985 in
dismissing the suit against defendant Nos.4 to 6 ? respondents
herein, the appellant ? plaintiff has preferred present First
Appeal.
4. Mr.J.D.Ajmera,
learned Advocate has appeared on behalf of the appellant. Though
served, nobody appears on behalf of the respondents herein ?
defendant Nos.4 to 6.
5. I
have gone through the judgment and order passed by the learned trial
Court dismissing the suit against the respondents ? original
defendant Nos.4 to 6. Impugned judgment and order passed by the
learned trial Court cannot sustain for a minute. The learned trial
Court has passed a very cryptic order in one paragraph only and
dismissed the suit against defendant Nos.4 to 6 by observing that
defendant Nos.4 to 6 were Directors of the Company, therefore, they
cannot be held individual liable. I have gone through the Record and
Proceedings of the case and it appears that defendant Nos.4 to 6 were
joined as defendants in their individual capacity as guarantors and
not as Directors of the Company. The learned trial Court has not
considered and/or dealt with the said aspect at all. Looking to the
deposition of the witness examined on behalf of the plaintiff and
other documents, it is found that defendant Nos.4 to 6 stood as
guarantors and have given guarantee in their individual capacity.
When respondents herein ? defendant Nos.4 to 6 stood as guarantors
and when decree came to be passed against the Company i.e. principal
debtor, necessary consequence would be to pass decree against the
guarantors also.
6. Under
the circumstances, impugned judgment and decree passed by the learned
trial Court dismissing the suit against the respondents herein ?
defendant Nos.4 to 6 deserves to be quashed and set aside and
accordingly, it is quashed and set aside. Judgment and decree dated
03.01.1986 passed by the learned Civil Judge (S.D.), Porbander in
Summary Suit No.4 of 1985 in dismissing the suit against defendant
Nos.4 to 6 ? respondents herein is hereby quashed and set aside.
Summary Suit No.4 of 1985 is hereby decreed against original
defendant Nos.4 to 6 ? respondents herein also and the appellant ?
original plaintiff is entitled to recover the said amount of
Rs.6,93,238.93 paise with 21.50% interest per annum from 01.02.1985
till realization from original defendant No.s 4 to 6 also. The appeal
is accordingly allowed. In the facts and circumstances, there shall
be no order as to costs.
[M.R.Shah,J.]
satish
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