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2000 DIGILAW 483 (AP)

Naimuddln Ahmed Nirvana v. Indian Bank, Hyderabad

2000-07-13

V.ESWARAIAH

body2000
V. ESWARAIAH, J. ( 1 ) THIS appeal is filed against the decree and judgment dated 27-8-1983 in ,o. S. No. 162 of 1982 on the file of the Additional chief Judge-cum-I Additional Special Judge for SPE/acb cases, City Civil Court, hyderabad. ( 2 ) THE appellants herein are the defendants 1 and 2 and the first respondent is the plaintiff and the 2nd respondent is the defendant No. 3 in the suit. For the sake of convenience the parties as arrayed in the suit are referred herein. ( 3 ) THE plaintiff bank filed a suit for recovery of Rs. 1,62,228-54 towards the loan advanced to the first defendant for the purchase of a lorry recoverable jointly and severally from all the three defendants and for the sale of hypothecated vehicle mentioned in the schedule and for the interest in the suit amount at the contract rate and for costs of the suit. ( 4 ) THE averments in the plaint are that the plaintiff is a Nationalised Bank and the third defendant is a Co-operative Society registered under the A. P. Co-operative societies Act, 1964 (hereinafter be referred to as the Act for short) for the benefit of its members. The first and second defendants are the members of the Society. The third defendant under the self-employment scheme, sponsored by the Government, the plaintiff allowed first defendant on medium term loan credit facility with a limit of rs. 1,00,000/- for the purchase of Ashok leyland lorry and the first defendant availed the same and executed the demand promissory note dated 2-2-1976 for the said amount as collateral security for the loan advanced. Second and third defendants signed the pronote as co-obligants of first defendant and they also executed an agreement of hypothecation. Defendants made some payment and renewed the pronote on 21-9-1979 for Rs. 1,09,040/- agreeing to repay the same with interest thereon at the rate of 6% per annum over the official rate of the Reserve Bank of India with a minimum of 15% per annum with quarterly rests. After the renewal of the pronote, they did not pay any amount allowed and huge amount was accumulated by way of interest and the : principal and inspite of repeated demands the defendants have not paid any amount. After the renewal of the pronote, they did not pay any amount allowed and huge amount was accumulated by way of interest and the : principal and inspite of repeated demands the defendants have not paid any amount. Therefore, the plaintiff got issued a legal notice dated 6-1-1982 on the defendants and also on the Registrar of Co-operative societies, Hyderabad under Section 126 of the Co-operatives Act which was acknowledged on 7-1-1982 and also by the defendants and however there was no response. Hence the plaintiff filed the suit. ( 5 ) THE first defendant filed written statement denying the averments made in the plaint and it is admitted that the facility open loan cash credit was awarded to the defendant Nos. l and 3 and for the said purpose the plaintiff bank has obtained a pronote from the defendants 1 and 3 on 2-2-1976. It is denied that 2nd defendant signed on the said pronote as co-obligant for the first defendant. The first defendant stated that he has not executed agreement of hypothecation of the lorry. The first defendant sated that the plaintiff bank had obtained signatures on blank printed forms and further stated that the said agreement is forged and fabricated one. Further, the first and third defendants had purchased the lorry Premier Road Master and not Leyland as stated by the plaintiff and the third defendant has repaid some instalments and the third defendant is joint owner of the vchicle. It is further stated that the first and second defendants did not make any payments and he denied that there was no renewal of pronote and the renewal is false, fabricated and forged one. Further, the receipt of the notice is also admitted by him and he did not reply the same alleging that the claim was barred by limitation as the plaintiff have not complied with the previsions of Section 126 of the Act, ( 6 ) THE second defendant filed a separate written statement denying the allegations tade in the comnlainf staing that he has no interest or any concern with the said loan amount and he is nothing to do with the alleged transaction. He further stated that he has not signed on the pronote as co- obligant and the plaintiff bank obtained his signatures on the blank pronote on 2-2-1976 as a witness and he has signed as a witness only and he is nothing to do with the said recovery. He further stated that he did not renew the agreement on 29-1-1979 or on any other date and he is no way responsible for the repayment of the said loan. He further stated that though he received notice he did not reply the same as the contents of the notice are not correct and he was not responsible for the repayment of the said loan at all. ( 7 ) ON the aforesaid pleadings the learned additional Chief Judge framed the following issues. (I) Whether the defendant No. 2 has not signed the pronote as co- obligant of defendant No. 1 but he signed only as a witness? (II) Whether the defendants have not executed the agreement of hypothecation of lorry? (III) Whether the defendant had not renewed the loan documents on 21-9-1979? (IV) Whether the suit claim was barred by limitation? (V) Whether the defendants 1 to 3 are jointly and severally liable to pay a sum of Rs. 1,62,288-54 to the plaintiff? (VI) Whether the interest as claimed in the plaint is not correct? (VII) To what relief? ( 8 ) IN support of the contention of the plaintiff, the Manager of the bank is examined as P. W. I and got marked documents Exs. A-1 to A-32 on its behalf. On behalf of the defendants, the first defendant was examined as D. W. 2 and the 2nd defendant was examined as D. W. I and got marked documents Exs. B-1 to B-4. The third defendant remained ex parte. On consideration of the oral and documentary evidence, the learned Additional Chief judge decree the suit as prayed for vide his judgment dated 27-8-1993. ( 9 ) QUESTIONING the said judgment and decree in O. S. No. 162 of 1982 the first and second defendants filed the present appeal. B-1 to B-4. The third defendant remained ex parte. On consideration of the oral and documentary evidence, the learned Additional Chief judge decree the suit as prayed for vide his judgment dated 27-8-1993. ( 9 ) QUESTIONING the said judgment and decree in O. S. No. 162 of 1982 the first and second defendants filed the present appeal. ( 10 ) THE questions that arise for consideration in the appeal are that: (I) Whether the first defendant availed the loan for the purchase of a lorry and whether the defendants 1, 2 and 3 have jointly executed the hypothecation deed, demand promissory note, renewal pronote and fresh hypothecation as alleged by the plaintiff. (II) Whether the suit claim is barred by limitation. ( 11 ) POINT No. l: The Manager of the plaintiff bank is examined as P. W. I and exs. A-1 and A-32 have been marked on behalf of the plaintiff. The first defendant is examined as D. W. 2 and second defendant is examined as D. W. I. The first defendant (D. W. 2) had admitted his signature not only on the renewal pronote Ex. A-6 dated 29-1-1979 but also on Ex. A-1, which is the application for loan. He has also admitted his signatures on other documents such as exs. A-2 to A-5 and A-7, but stated that they were blank forms at the time of his signature. The first defendant has not disputed either in the written statement or in the evidence with regard to the alleged transaction, and stated that the loan was applied for Ashok Leyland lorry, but however first defendant took Premier Road i Master lorry. Admittedly, the loan amoun was directly paid by the bank to the supplier of the lorry and the defendant has not given the amount to the Premier Road master lorry therefore it is immaterial whether first defendant has purchased ashok Leyland lorry or Premier Road master lorry. ( 12 ) THE second defendant (D. W. I) has stated that he has signed as a witness only in Ex. A-3, which is demand promissory note, dated 2-2-1976. In a promissory note there is no need of any witness. The signatures have been taken from left to right. Even though the signature of 2nd defendant is on the left side he is also a joint executor. Therefore, he is a joint executor of ex. A-3, which is demand promissory note, dated 2-2-1976. In a promissory note there is no need of any witness. The signatures have been taken from left to right. Even though the signature of 2nd defendant is on the left side he is also a joint executor. Therefore, he is a joint executor of ex. A-3 and not a witness. The learned additional Chief Judge has rightly held that the 2nd defendant has signed as a co- executant but not as a witness. Admittedly, the signatures of 2nd defendant are also found on Exs. A-2, A-3, A-5 and A-6. Therefore, the plea set up by the 2n defendant is rightly negatived by the learned Additional Chief Judge. Admittedly, 2nd defendant also executed ex. A-6 renewal pronote dated 29-1-1979. On a overall consideration of the oral and documentary evidence adduced by both the parties, it is proved that the first defendant availed the loan for the purchase of the lorry and the first and second defendants have jointly executed the hypothecation deed, demand promissory note and renewal pronote. Accordingly, the point no. l is answered against the defendants and in favour of the plaintiff. ( 13 ) POINT No. 2: The renewal pronote dated 29-1-1979 Ex. A-6 signed by all the defendants. According to the defendants the suit is not filed within three years from 29-1-1979 and therefore the suit claim is barred by limitation. It is the contention of the plaintiff that the third defendant is the co-operative Society and it is incumbent on the part of the plaintiff to issue a notice to the Registrar under Section 126 of the Act before filing the suit against the third defendant and a registered notice dated 6-1-1982 was issued to the Registrar of the co-operative Societies and the Registrar received the said notice and acknowledged on 7-1-1982 which is marked as Ex. A-8. The defendants 1 and 2 also received the saic notices and the said receipt of the notices has not been disputed by the defendants and the service of notice on the Registrar is within the period of limitation from the date of renewal pronote Ex. A-6 dated 29-1-1979 and therefore, the suit is within limitation. A-8. The defendants 1 and 2 also received the saic notices and the said receipt of the notices has not been disputed by the defendants and the service of notice on the Registrar is within the period of limitation from the date of renewal pronote Ex. A-6 dated 29-1-1979 and therefore, the suit is within limitation. As per Section 15 (2) of the limitation Act where the law requires a notice to be issued to the Government or any other authority before instituting a suit then the period of such notice shall be liable to be excluded from the period of limitation for filing the suit. In this particular case in view of Section 126 of the Act, the period of 60 days from the date of service of notice on the Registrar shall be liable to be excluded and if the said 60 days period is excluded, the suit is within limitation. If the suit is within limitation in so far as third defendant is concerned it is also within limitation against the first and second defendants as held in the case of Jainsingh vs. Mansharam. The learned Counsel for the appellants has not cited any other case contrary to the said judgment. Therefore, it cannot be said that the suit is barred by limitation and I accordingly hold that the suit is not barred by limitation and the point no. 2 is answered in favour of the plaintiff and against the defendants. ( 14 ) THE learned Additional Chief Judge has considered all the contentions of the defendants and the learned Counsel for the defendants-respondents herein is not able to make any additional contentions to come to a different conclusion from that of the learned Additional Chief Judge. The learned Additional Chief Judge has considered that the second defendant is also a co-obligant against first defendant along with third defendant. As such the learned additional Chief Judge has not committed any error or illegality in his judgment. The learned Additional Chief Judge has considered that the second defendant is also a co-obligant against first defendant along with third defendant. As such the learned additional Chief Judge has not committed any error or illegality in his judgment. The lower Court has properly appreciated the evidence on record and held that whether it is Ashok Leyland lorry or Premier Road master lorry it makes no difference since the loan was paid by the bank to the supplier directly and the first defendant has not paid the amount and further held that in view of hypothecation agreement and the renewal pronote executed by the defendants they are jointly and severally liable to pay the amount to the plaintiff bank. ( 15 ) IN view of the aforesaid findings and consideration of the entire oral and documentary evidence, I do not see any merit in the appeal and the appeal is dismissed, but there shall be no order as to costs.