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2000 DIGILAW 1083 (PAT)

Bank Of India v. Sudhir Kumar Pandey

2000-09-06

A.K.PRASAD, N.PANDEY

body2000
Judgment N.PANDEY, J. 1. This appeal under Clause 10 of the Letters Patent of the Patna High Court on behalf of the plaintiff is against the judgment of a learned single Judge in First Appeal No. 61 of 1955 (R), whereby and whereunder, the judgment and decree in Money Suit No. 50/17 of 1981/84 was set aside. 2. In view of the points involved in this appeal and further that the learned trial Court as well as the Court of appeal have stated the facts of the case in great details, it is not necessary to reiterate the entire facts. Suffice it to say that defendant No.1 approached the plaintiff Bank and applied for a loan to purchase a Chassis of Mini Bus. At the relevant time, the total cost involved was Rs. 1,30,000.00 , out of which the plaintiff Bank sanctioned a sum of Rs. 97,500.00 by way of loan repayable on demand together with the interest thereon at the rate of 41/2 per cent over the Reserve Bank of Indias rate and minimum at the rate of 131/2 per cent per annum and consequent to such agreement, defendant No. 1 executed a demand of promissory note on 5-3-1976 for Rs. 97,500.00 . An agreement of hypothication of vehicle was also executed on 5-3-1976 and defendants Nos. 2 to 4 also executed the deed as guarantors of defendant No. 1. Admittedly, in view of the advance of the loan defendant No. 1 purchased the Chassis of Mini Bus and got the body constructed. In view of the aforesaid advance of money, a sum of Rs. 1,50,700.22 paise became due from the defendants inclusive of interest up to 5-3-1981 including other charges and expenses borne by the Bank. On 20-9-1978, as would appear from Ext. 8, the defendants signed a letter of acknowledgement of indebtedness and admitted that they were liable to pay a sum of Rs. 1,06,606.19 paise. The defendants, however, failed to pay the dues to the plaintiff in spite of repeated demands, hence after observing the formalities of notice etc. the suit was filed on 6-5-1981 by the Bank for recovery of the dues. 3. The defendants in their written statement accepted that the loan in question was advanced for purchase of Mini bus, but according to them, the Bank had assured to charge a nominal interest. the suit was filed on 6-5-1981 by the Bank for recovery of the dues. 3. The defendants in their written statement accepted that the loan in question was advanced for purchase of Mini bus, but according to them, the Bank had assured to charge a nominal interest. It was also denied that by a letter dated 20-9-1978 there was any acknowledgment of indebtedness signed by the defendants making themselves liable to pay the dues. 4. On the above facts, the trial Court framed number of issues in the suit and after hearing the relevant parties and on perusal of the oral and documentary evidence decreed the suit, on contest, against defendant No. 1 and ex parte against defendants Nos. 2 to 4, since they had not contested the suit. The said judgment became final against defendants Nos. 2 and 4, since they did not prefer any appeal. 5. As would appear from the impugned judgment, the decree of the trial Court was set aside solitary on the ground that the plaintiffs suit was barred by law of limitation. 6. The question with regard to the limitation of the suit was considered as Issue No. 3 by the trial Court after examining the relevant materials and the acknowledgment of indebtedness made by the defendants and it was held that the suit was not barred by law of limitation. While recording such a finding, the trial Court had noticed that by Ext. 8, the letter of acknowledgment dated 20-9-1978, all the defendants had accepted the liability for a sum of Rs. 1,06,606.19 paise and there was no detail about the signatures on the document. The present suit was filed on 6-5-1981, i.e. within three years from the date of acknowledgment. On the basis of the above discussion, therefore, it was concluded that the suit was not barred by limitation. 7. The above finding of the trial Court was set aside mainly on the ground that the plaintiff Bank had failed to comply with the mandatory provisions of Rule 6 of Order VII of the Code of Civil Procedure (in short the Code). Because admittedly the promissory note and other relevant documents with regard to loan were executed on 5-3-1976, but the suit was filed on 6-5-1981. Therefore, obviously barred by limitation. Because admittedly the promissory note and other relevant documents with regard to loan were executed on 5-3-1976, but the suit was filed on 6-5-1981. Therefore, obviously barred by limitation. Keeping in mind the aforesaid conclusion it was held that in a case where plaintiffs right of action was apparently barred under the Statute of limitation, Order VII , Rule 6 of the Code makes his duty to state specifically in the plaint, the grounds of exemption, upon which he relies to exclude its operation. These facts must be in existence at or before the time when the plaint is filed. The provisions of Rule 6 of Order VII of the Code are mandatory in nature and whenever a plaintiff wants to seek exemption from the operation of law of limitation he must expressly state in the plaint the grounds on which exemption is sought. Since, in the present case no specific ground was stated in the plaint for claiming exemption under the relevant law of limitation, the mandatory provisions of Order VII, Rule 6 of the Code were not followed. Therefore, having regard to such a clear flaw in the plaintiffs case, the suit was fit to be dismissed as barred by law of limitation. 8. On behalf of the appellant Bank it was contended that the learned Court of appeal has completely misdirected himself while holding that in absence of specific pleading of exemption as required by Order VII, Rule 6 of the Code the suit in question was not maintainable and, therefore, barred by law of limitation. He contended that in view of specific acknowledgment of indebtedness by the defendants on 20-9-1978, the period of limitation for filing of such a suit would commence from the date of the acknowledgment and, therefore, the suit as filed on 6-5-1981 was within the period of limitation . Therefore, it was not at all necessary for the plaintiff to comply with the requirements of Order VII, Rule 6 of the Code.On the facts, as noticed above, and the contentions raised on behalf of the parties, the question relevant for consideration is whether the plaintiffs suit was barred by law of limitation and whether in absence of the observance of the necessary formalities as required under Order VII, Rule 6 of the Code , there was any flaw in the plaintiffs case. 9. 9. There is no dispute that the advancement of loan and execution of other relevant documents including promissory note were executed by the defendants on 5-3-1976 whereas the suit was filed on 6-5-1981. According to the plaintiff and findings recorded by the trial Court since by letter of acknowledgment dated 20-9-1978 (Ext. 8) the defendants had acknowledged the indebtedness, therefore, the period of limitation would commence from the date of such acknowledgment. The appellate Court has proceeded on assumption that the defendants in the written statement had denied such acknowledgment, therefore, the period of limitation would start running from 5-3-1976 and the last date of filing of the suit was 18-3-1979, whereas the suit was filed on 6-5-1981. But the appellate Court failed to appreciate that there was no denial on behalf of the defendants regarding their signatures on Ext. 8, dated 20-9-18978. It would further appear from a bare perusal of the said document that no objection whatsoever was raised at the time of its admission. That apart, the appellate Court also failed to take notice of the other relevant document Ext. 7, which is an extract of a document, showing the amount and relevant dates regarding deposits of the loan amount. From a bare reference to the above document it would appear that payments were not made only in the year 1978, rather there are different deposits even after filing of the suit. Therefore, having regard to the facts, stated above, it will not be open to the defendants at subsequent stage to deny the genuineness of Ext. 8, whereby, they had acknowledged the dues of indebtedness. 10. Thus, keeping in mind the views expressed above, there cannot be any denial that the period of limitation in filing of such a suit would run from the date of acknowledgment of indebtedness, i.e., 20-9-1978. Reference in this regard can be usefully made to the decisions of the Apex Court as well as this Court, namely, AIR 1971 SC 1482 (M/s Lakshmiratan Cotton Mills Co. Ltd. V/s. The Aluminium Corporation of India Ltd.), AIR 1961 Pat 134 (Bindeshwari Prasad V/s. District Board of Saran) and AIR 1991 Pat 194 (M/s. Keshari Engineering Works V/s. Bank of India). Ltd. V/s. The Aluminium Corporation of India Ltd.), AIR 1961 Pat 134 (Bindeshwari Prasad V/s. District Board of Saran) and AIR 1991 Pat 194 (M/s. Keshari Engineering Works V/s. Bank of India). It was expressly held that where a loan was advanced to the borrower and the borrower categorically admitted and acknowledged the liability by executing document of acknowledgment, the limitation for filing the suit for repayment of the amount advanced would not run from the date when the loan was obtained, but from the date on which the acknowledgment of liabilities was made. 11. Learned counsel appearing on behalf of defendant No. 1 although could not deny the genuineness of the signature of the defendants on Ext. 8 regarding acknowledgment but contended that such a signature was obtained on a blank paper and, therefore, it cannot be treated as acknowledgment of indebtedness as required under Secs. 18 and 19 of the Limitation Act, even admitted into the evidence without any objection. In support of his contention , learned counsel placed reliance on a decision of the Madras High Court in the case of S. Perumal Reddiar V/s. Bank of Baroda , AIR 1981 Mad 180 , as also other decision of Gauhati High Court in the case of P.G. DOmbrain etc. V/s. Collector of Kamrup, Gauhati, AIR 1980 Gauhati 55 and that of Bombay High Court in the case of Zenna Sorabji V/s. Mirabelle Hotel Co. (Pvt.) Ltd. , AIR 1981 Bom 446 . According to the learned counsel, the documents which are obtained by fraud are always inadmissible and cannot be taken into evidence as a document of acknowledgment. Because there cannot be any debt unless and until admitted by the loanee. 12. In my view, true it is no reliance can be placed on any document, which is obtained by fraud or coercion. But in the case before me there was no such pleading on behalf of the defendants in the written statement nor there was any objection at the time when Exts. 7 and 8 were admitted into evidence. That apart, even no question was raised to the plaintiffs witnesses, who proved the genuineness of Exts. 7 and 8 into evidence. Therefore, the submission what has been raised before this Court, is completely after thought and the plaintiff cannot be non-suited on such a plea. Therefore, there cannot be any substance in such a submission. 13. That apart, even no question was raised to the plaintiffs witnesses, who proved the genuineness of Exts. 7 and 8 into evidence. Therefore, the submission what has been raised before this Court, is completely after thought and the plaintiff cannot be non-suited on such a plea. Therefore, there cannot be any substance in such a submission. 13. For the reasons stated above, in my view, the appellate Court was not justified in holding that the suit of the plaintiff was barred by limitation. It is well known that the statement on which the plea of acknowledgment is founded related to subsisting liability. As was held by the Apex Court in the case of Tilak Ram V/s. Nathu, AIR 1967 SC 935 , an acknowledgment is an admission by the writer that there is a debt owing by him either to the receiver or the debtor or to some other person on whose behalf the letter is received. The person making acknowledgment can be both, the debtor himself as also a person duly authorised by him to make the admission. Simply because the guarantors had not signed the letter of acknowledgment (Ext. 8) its genuineness cannot be doubted. That apart, as I have already noticed, there is no denial on behalf of the defendants that from a bare reference to Ex. 7 it would appear that even up to the year, 1981 payments were made by the defendants, acknowledging the debt. 14. I, therefore, in the facts and circumstances of the case, mentioned above, hold that the suit of the plaintiff was well within time, and therefore, not barred by law of limitation. In the result, for the reasons, stated above, judgment under appeal is set aside and consequent thereto, the judgment and decree of the trial Court are restored and stand confirmed. But in the facts and circumstances of the case, there shall be no order as to costs. 15. A.K. PRASAD, J. : I agree.Order accordingly.