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2011 DIGILAW 1510 (PNJ)

Ram Kumar v. Gurgaon Gramin Bank

2011-08-05

KANWALJIT SINGH AHLUWALIA

body2011
JUDGMENT Mr. Kanwaljit Singh Ahluwalia, J.:- Present revision petition has been instituted by Ram Kumar aggrieved against the order dated 15.2.2011 passed by the District Judge, Narnaul whereby he accepted the appeal of the respondent – Gurgaon Gramin Bank filed against the order dated 6.3.2010 passed by Additional Civil Judge (Senior Division), Mahendergarh and had held that the liability of the present petitioner – a guarantor and the principal debtor is coextensive. 2. Briefly stated, respondent – Bank had filed a suit for recovery under Order XXXIV read with Order VII of the Code of Civil Procedure for recovery of Rs.5,20,583/-. In the suit, it was pleaded by the respondent- Bank that Rohtash Kumar – defendant No.2 to the suit being Secretary of M/s Deepak Gram Udhyog Mandal – defendant No.1 had applied for grant of term loan of Rs.3.00 lacs on behalf of defendants No.1 to 8 for running a brick-kiln. It is not disputed that the respondent/plaintiff Bank had sanctioned a term loan of Rs.3.00 lacs. It is also not disputed that the petitioner/defendant No.10 to the suit is a guarantor and had mortgaged the land with the Bank on the assurance that in case the defendant-loanee failed to re-pay the loan, they being the guarantors, would be liable for the repayment of the loan. Therefore, the present petitioner had mortgaged his land vide mortgage deed dated 14.2.1995. The suit filed by the Bank was decreed and the Court held that the defendants were severely and jointly liable to pay the loan along with interest. 3. Aggrieved against the same, in the execution proceedings the present petitioner had filed objections under Order 21 Rule 66 CPC raising a plea that his property was being auctioned wrongly as there was no justification to do the same. It was specifically pleaded in the objections that the property of the principal debtor was sufficient to satisfy the decree. The Executing Court vide order dated 6.3.2010 (Annexure P-4) accepted the objections and held that in case the property of the judgment debtors No.2, 7, and 11 to 17 is sufficient for satisfying the claim of the decree holder, the attachment of the property of the petitioner can be kept in abeyance. The Executing Court held as under:- “... The Executing Court vide order dated 6.3.2010 (Annexure P-4) accepted the objections and held that in case the property of the judgment debtors No.2, 7, and 11 to 17 is sufficient for satisfying the claim of the decree holder, the attachment of the property of the petitioner can be kept in abeyance. The Executing Court held as under:- “... In other words, property of respondent No.10 being guarantor can be sold but in case mortgaged property of JDs remains insufficient, so as to satisfy the claim of DH, hence, property attached of objector Ram Kumar respondent No.10 is set aside but Ram Kumar son of Dhani Ram shall not alienate this property till satisfaction of claim of DH against the mortgaged property of JDs.” 4. This part of the impugned order Annexure P-4 was assailed by the plaintiff-Bank by filing the appeal. The appeal has been accepted and the lower appellate court relied upon a judgment rendered by Hon’ble the Apex Court in Industrial Investment Bank of India Ltd. v. Biswanath Jhunjhunwala, 2010(1) Law Herald (SC 342) and State Bank of India v. M/s Indexport Registered, AIR 1992 SC 1740 to hold that decree does not put any fetters on the rights of the decree holder to execute it against any party and it is the choice of the decree holder to proceed with it in a way he liked, and held all the defendants jointly and severely liable, including the guarantor. The court held as under:- “8. ... Thus, in view of the authorities cited above, liability of the guarantor and principal debtors was co-extensive and not in the alternative. Both principal debtor and surety are liable at the same time to the creditor. The decree holder/bank can execute the decree against the guarantor without proceeding against the principal borrower because guarantor’s liability is co-extensive with that of the principal debtor. The learned counsel for the respondent/objector could not cite any authority to the contrary. 9. As a result of my above held discussion, I find merit in this appeal and hence allow the same and set aside the impugned order dated 6.3.2010 vide which property of respondent No.10 Ram Kumar (respondentNo.12/Objector in the appeal) was released from attachment. Memo of costs be prepared accordingly. Record of the lower court be sent back with a copy of this judgment. Appeal file be consigned to record room.” 5. Memo of costs be prepared accordingly. Record of the lower court be sent back with a copy of this judgment. Appeal file be consigned to record room.” 5. Shri D.S. Bali, learned Senior Counsel, assisted by Shri Deepak Kumar, Advocate, appearing for the petitioner, has urged that the lower appellate court had committed a grave error in modifying the order Annexure P-4 passed by the Executing Court. Counsel has submitted that the lower appellate court has not taken into consideration para 26 of the judgment rendered in Industrial Investment Bank of India Ltd. v. Biswanath Jhunjhunwala, 2010(1) Law Herald (SC 342) and, thus, has committed grave error. Para 26 thereof reads as under:- “The case of the respondent has never been that the liability of the guarantor is only contingent and if remedies against the principal debtor failed to satisfy the dues of the decree holder, then only the bank can proceed against the guarantor.” 6. However, a perusal of the judgment shows that para 26 only notices that there was no contention of the respondent in that case. However, the legal position has been summed up in para 30 which reads thus:- “The legal position as crystallized by a series of cases of this court is clear that the liability of the guarantor and principle debtors are co-extensive and not in alternative. When we examine the impugned judgment in the light of the consistent position of law, then the obvious conclusion has to be that the High Court under its power of superintendence under Article 227 of the Constitution of India was not justified to stay further proceedings in O.A. 156 of 1997.” 7. Therefore, it is apparent that the liability of the guarantor and principal debtor are co-extensive and not in alternative. Thus, there is no merit in the revision and the same is dismissed in limine. ----------0BSK0----------