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1946 DIGILAW 160 (CAL)

Nitya Gopal Sarkar v. Rai Mohon Dutta

1946-06-07

body1946
JUDGMENT Lodge, J. - The facts of this case briefly are as follows. The present Petitioner, Nitya Gopal Sarkar, was at all material times the officer in local administrative charge in Faridpur of the Calcutta Exchange Bank, Limited. The Opposite Party Rai Mohon Dutta was induced by the present Petitioner to deposit his money in that Bank and the present Petitioner gave him an assurance that if the Bank failed to repay the money the present Petitioner would himself make the payment. The Calcutta Exchange Bank went into liquidation in December, 1943, and a liquidator was appointed. Some of the properties of the Bank were also attached at the instance of the creditors of the Bank and they were in the custody of the Official Receiver of the High Court. The Opposite Party, Rai Mohon Dutta, instituted a suit in the Court of the Sadar Munsif at Faridpur in its Small Cause Court Jurisdiction against the Calcutta Exchange Bank, Limited as Defendant No. 1 and against the present Petitioner, Nitya Gopal Sarkar as Defendant No. 2, for recovery of the money deposited in the Calcutta Exchange Bank. In March, 1944, the learned Munsif was informed that the Bank had gone into liquidation and the learned Munsif sent for the pleader of the Plaintiff and informed him that the Bank had gone into liquidation and that a Liquidator and Official Receiver had been appointed. At the request of the pleader for the Plaintiff the hearing of the suit was adjourned to April 10, 1944, to enable the Plaintiff to take proper steps. On April 10, 1944 an application was filed on behalf of the Plaintiff to the effect that he would, not proceed against the Calcutta Exchange Bank, Limited, Defendant No. 1 and praying that the name of the Bank as party Defendant No. 1 be struck out of the" plaint. Accordingly the Defendant No. 1 was struck out and the case proceeded against the present Petitioner, Defendant No. 2. The suit was decreed on contest against Defendant No. 2. This Rule has been obtained by Defendant No. 2. In support of the Rule three arguments were placed before me. In the first place it was argued that the Bank had not failed to repay the debt and that accordingly there was no occasion for the Plaintiff to institute a suit against the surety. This Rule has been obtained by Defendant No. 2. In support of the Rule three arguments were placed before me. In the first place it was argued that the Bank had not failed to repay the debt and that accordingly there was no occasion for the Plaintiff to institute a suit against the surety. In the second place it was argued that inasmuch as the Plaintiff had instituted a suit against the Bank and had then prayed to have the name of the Bank struck out of the plaint, the Plaintiff had performed an act the legal consequence of which was that the principal debtor, the Bank, had been discharged from liability. Therefore under the provisions of sec. 134 of the Indian Contract Act the surety was also discharged from liability. The third argument was that on the date of hearing of the suit, September 11, 1945, the Defendant No. 2 had applied for an adjournment in order to enable him to produce his witnesses. This application had been wrongly rejected and the suit had been heard without the Defendant having a reasonable opportunity to examine his witnesses and establish his defence. 2. With regard to the first of these grounds, it seems to me that by going into liquidation the Bank had done an act which was the equivalent of failing to repay the money deposited and that therefore the Plaintiff had acquired a right to sue the surety under the contract. I can see no force therefore in the first of the points argued. 3. With regard to the second ground argued, it is claimed by the present Petitioner that by instituting a suit against the Bank and making the Bank Defendant No. 1 and by then praying for amendment of the plaint and for the omission of the Defendant No. 1 from the plaint, the Defendant No. 1, the Bank, had obtained a complete discharge of the debt. Several rulings have been placed before me, none of which is on all fours with the present case. Several rulings have been placed before me, none of which is on all fours with the present case. It is conceded that the Bank was sued as a limited company without any attempt being made to represent the Bank by the Official Liquidator or by the Official Receiver, and it is conceded that after the Bank had gone into liquidation the Plaintiff ought to have had the Bank represented in the suit either by the Official Liquidator or by the Official Receiver. This was not done. It is clear therefore that the Bank was never properly represented in the suit. The Bank had gone into liquidation before the suit was instituted and the Bank was never properly a party to the suit, it seems to me that the nearest case to the one with which we are concerned is the case of Krishto Kishori Chowdhrain v. Radha Romun Munshi I. L. R. (1885) Cal. 330. In that case the principal was dead at the time the suit was instituted, but the principal, though dead, was in name made a party to the suit. When the fact of death came to the knowledge of the Plaintiffs in the suit a representative of the principal was not made a party before the expiry of the period of limitation. It was held that the case was a case of forbearing to sue the principal and not a case in which the principal was exonerated from liability. 4. It seems to me that in the present case the Exchange Bank Limited was never properly a party to the suit. Therefore when the Plaintiff instead of taking steps to make the Exchange Bank properly a party to the suit, asked that the name of the Exchange Bank be struck off and the plaint amended, this was the same as though the Plaintiff had never made the Exchange Bank a party even in name. The facts in this case, in my opinion, indicate an omission on the part of the Plaintiff properly to sue the Bank and it is not a case of properly instituting a suit and then withdrawing the suit so as to exonerate the principal debtor. In my opinion the case is covered by sec. The facts in this case, in my opinion, indicate an omission on the part of the Plaintiff properly to sue the Bank and it is not a case of properly instituting a suit and then withdrawing the suit so as to exonerate the principal debtor. In my opinion the case is covered by sec. 137 of the India Contract Act and the conduct of the Plaintiff in amending his plaint and striking off the name of the Exchange Bank did not operate to discharge the surety from liability. 5. With regard to the third point, it appears that the case had come up before the Court on April 10, 1944, and had been decreed ex parte against the present Petitioner. A Rule was obtained from this Court to show cause why the ex parte decree should not be set aside. That Rule was made absolute by an order dated May 31, 1945. After the case went back to the Court below, September 7, 1945, was fixed for peremptory hearing of the suit. This date was fixed as early as July 27, 1945. Defendant No. 2 made no prayer for the issue of summons upon his witnesses until August 6, 1945, and did not deposit the necessary travelling allowances for the witnesses until August 14, 1945, and the summons upon the witnesses was actually issued on that date. On September 11, 1945, the witnesses were not present and it appeared that the notices had been returned unserved for want of time. According to the Petition before me Defendant No. 2 also wanted time to enable him to call for accounts and papers from the Bank lying with the Liquidator. There is nothing to indicate that the present Petitioner had taken prompt steps in July or immediately afterwards for calling for these papers, and I have no material before me to justify me in holding that the learned Munsif exercised a wrong discretion in refusing to grant a further adjournment on September 11, 1945. I cannot hold therefore that the learned Munsif acted wrongly in refusing to grant an adjournment and in proceeding to hear the case. 6. None of the three arguments placed before me therefore convince me that I would be justified in interfering in this case. The Rule is accordingly discharged with costs-hearing-fee, one gold mohur.