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2016 DIGILAW 682 (HP)

Gobind Singh v. State Bank of India

2016-05-05

SURESHWAR THAKUR

body2016
JUDGMENT : Sureshwar Thakur, J. 1. The instant Regular Second Appeal is directed against the impugned judgment and decree rendered by the learned District Judge, Shimla in Civil Appeal No. 121-S/13 of 2005 of 1.1.2007, whereby it set aside the judgment rendered by the learned Civil Judge (Junior Division), Jubbal, District Shimla H.P in Civil Suit No. 30/1 of 2004 of 30.9.2005. 2. The brief facts of the case are that the respondent herein (for short “the plaintiff”) filed a suit before the trial Court below with a prayer therein that the appellant herein (for short “the defendant”) approached the plaintiff-Bank for advancing to him agriculture loan. The plaintiff- bank advanced a sum of Rs.26,000/- as loan to him alongwith interest at the rate of 14% per annum with yearly rests subject to the charge as may be directed by the Reserve Bank of India. The plaintiff bank accepted the proposal and a sum of Rs.26,000/- was paid to the defendant. The amount was advanced against hypothecation of land as security for repayment of the loan. The defendant failed to repay the amount aforesaid. The balance due against him up to July, 15, 2004 comes to Rs. 47,507/-. The land mortgaged by the defendant is comprised in Khata/khatoni No. 82/249 and khasra No. 822, 838 and 841 measuring 0-55-81 hectors situated in village Saraswatinagar and the mortgage has been mutated in favour of the plaintiff-bank. It is further averred that land aforesaid be put to sale and the sale proceeds raised therefrom be ordered to be paid to the plaintiff-Bank and in case the sale proceeds are found less than the due amount then a personal decree to the extent of 47,507/- be rendered against the defendant alongwith the interest and costs etc. 3. The defendant contested the suit and filed written-statement. He in his written-statement has taken preliminary objections inter-alia maintainability, jurisdiction, the statement of account has not been property in accordance with the Bankers Books Evidence Act, etc. On merits, it is averred that the plaintiff-Bank has advanced only a sum of Rs.8,000/- to the defendant and the remaining amount was never advanced to him. He was made to deposit Rs.30,000/- and the plaintiff Bank has forged the documents. 4. Replication to the written-statement stood filed. On the pleadings of the parties, the learned trial Court struck following issues inter-se the parties at contest:- 1. He was made to deposit Rs.30,000/- and the plaintiff Bank has forged the documents. 4. Replication to the written-statement stood filed. On the pleadings of the parties, the learned trial Court struck following issues inter-se the parties at contest:- 1. Whether the plaintiff is entitled for the recovery of suit amount as prayed for?.........OPP 2. Whether the suit is not maintainable in the present form as alleged?......OPD 3. Whether the statement of account as filed by plaintiff-Bank is not prepared in accordance with the Banker Books Evidence Act and if so its effect?......OPD. 4. Whether this Court has no jurisdiction to tray and entertain the present suit as alleged?.......OPD. 5. Relief. 5. On an appraisal of the evidence adduced before the learned trial Court, the learned trial Court dismissed the suit of the plaintiff. An appeal by the aggrieved plaintiff was preferred therefrom before the learned first Appellate Court. The first Appellate Court on an appraisal of evidence adduced before it reversed the judgment and decree of the learned trial Court. In sequel, the appeal preferred by the plaintiff before the first Appellate Court came to be allowed. 6. The defendant standing aggrieved by the judgment and decree rendered by the first appellate Court has instituted the instant Regular Second Appeal before this Court. 7. When the appeal came up for admission on 28.2.2008, this Court admitted the appeal on the hereinafter extracted substantial question of law:- “(1) Whether there is mis-reading and mis-appreciation of evidence by the learned Courts below.” Substantial question of Law No. (1):- 8. The plaintiff instituted a suit against the defendant for recovery of Rs.47507/- alongwith interest and other charges. The learned trial Court dismissed the suit of the plaintiff. In an appeal carried by the plaintiff before the First Appellate Court, the first Appellate Court allowed the appeal preferred thereat by the plaintiff. The defendant stands aggrieved by the rendition of the first Appellate Court whereby the suit of the plaintiff stands decreed. 9. The learned trial Court dismissed the suit of the plaintiff. In an appeal carried by the plaintiff before the First Appellate Court, the first Appellate Court allowed the appeal preferred thereat by the plaintiff. The defendant stands aggrieved by the rendition of the first Appellate Court whereby the suit of the plaintiff stands decreed. 9. The learned trial Court had dismissed the suit of the plaintiff for recovery of an amount of Rs.47507/- from the defendant on the anvil of the judgment of the Hon’ble Apex Court in AIR 1967 SC 1058 (V 54 C221) Chandradhar Goswami and others versus Gauhati Bank Limited, relevant paragraphs whereof stand extracted hereinafter with a clear mandate manifested therein of mere entries in books of accounts maintained by the plaintiff connotative of theirs manifesting the apposite statements of accounts qua the sums borrowed by the principal debtor besides of his liquidating the debt by depositing the loan installments also of mere copies thereof perse not constituting sufficient evidence of probative worth for charging a debtor with liability unless the principal borrower accepts correctness thereof, by inappositely gauging from the evidence on record of the defendant disputing the correctness of the entries maintained therein begetting the sequel of theirs not constituting evidence carrying probative sinew whereupon he dis-imputed credence to them besides dispelled the creditworthiness of statements of accounts comprised in Ex.PW-2/A, as a corollary concluded of the mandate of Hon’ble Supreme Court Supra standing ominously un-satiated by the plaintiff for facilitating it to decree its suit. Also non-adduction into evidence at the instance of the plaintiff-Bank of the relevant deposit withdrawal forms to succor authenticity to the statement of account comprised in Ex.PW-2/A led it to non-suit the plaintiff. “[6] The main question urged before us is that there is no evidence besides the certified copy of the account to prove that a sum of Rs. 10,000/- was advanced to the appellants and, therefore, in view of S. 34 of the Evidence Act the appellants cannot be saddled with liability for that amount. “[6] The main question urged before us is that there is no evidence besides the certified copy of the account to prove that a sum of Rs. 10,000/- was advanced to the appellants and, therefore, in view of S. 34 of the Evidence Act the appellants cannot be saddled with liability for that amount. Section 34 is in these terms:- "Entries in books of account, regularly kept in the course of business, are relevant whenever they refer to a matter into which the Court has to inquire, but such statements shall not alone be sufficient evidence to charge any person with liability." It is clear from a bare perusal of the section that no person can be charged with liability merely on the basis of entries in books of account, even where such books of account are kept in the regular course of business. There has to be further evidence to prove payment of the money which may appear in the books of account in order that a person may be charged with liability thereunder, except where the person to be charged accepts the correctness of the books of account and does not challenge them. In the present case, however, the appellants did not accept the correctness of the books of account. We have already indicated that they went to the length of saying that the accounts were not correctly kept, and were fraudulent. They also said that no money had been taken by them after March 1, 1947. This being their pleading, the trial Court rightly framed the third issue relating to the total amount due from the appellants to the bank. But unfortunately it overlooked to go into that issue specifically and we have already indicated how it made a mistake in arriving at the amount due when considering the issue relating to relief. In any case as the appellants had not admitted the correctness of the accounts filed by the bank, particularly after March 1, 1947, the bank had to prove payment of Rs. 10,000 on March 19, 1947 if it wanted to charge the appellants with liability for that amount. But all that the bank did was to produce a certified copy of account under S. 4 of the Bankers' Books Evidence Act, No. XVIII of 1891. 10,000 on March 19, 1947 if it wanted to charge the appellants with liability for that amount. But all that the bank did was to produce a certified copy of account under S. 4 of the Bankers' Books Evidence Act, No. XVIII of 1891. Section 4 of that Act reads thus:- "Subject to the provisions of this Act, a certified copy of any entry in a banker's book shall in all legal proceedings be received as prima facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions and accounts therein recorded in every case where, and to the same extent as, the original entry itself is now by law admissible, but not further or otherwise." It will be clear that S. 4 gives a special privilege to banks and allows certified copies of their accounts to be produced by them and those certified copies become prima facie evidence of the existence of the original entries in the accounts and are admitted as evidence of matters, transactions and accounts therein, but such admission is only where, and to the same extent as, the original entry itself would be admissible by law and not further or otherwise. Original entries alone under S. 34 of the Evidence Act would not be sufficient to charge any person with liability and as such copies produced under S. 4 of the Bankers' Books Evidence Act obviously cannot charge any person with liability. Therefore, where the entries are not admitted it is the duty of the bank if it relies on such entries to charge any person with liability, to produce evidence in support of the entries to show that the money was advanced as indicated therein and thereafter the entries would be of use as corroborative evidence. But no person can be charged with liability on the basis of mere entries whether the entries produced are the original entries or copies under S. 4 of the Bankers' Books Evidence Act. We cannot agree with the High Court that the mere fact that the appellants did not specifically mention the sum of Rupees 10,000/- as not having been advanced to them in their written statement would make any difference on the facts of the present case. We have already pointed out that the appellants did not admit the correctness of the accounts produced specially after March 1, 1947. We have already pointed out that the appellants did not admit the correctness of the accounts produced specially after March 1, 1947. We have also pointed out that it was stated on their behalf that nothing was borrowed after March 1, 1947. The main appellant in whose name the account was, appeared as a witness and stated that so far as he remembered he only borrowed Rs. 8,000/- from the bank and nothing thereafter. He also stated that he did not remember to have borrowed any sum from the bank after the execution of the mortgage-deed. In the face of this pleading of the appellants and the statement of one of them, the bank had to prove that the sum of Rs. 10,000 was in fact advanced on March 19, 1947 and could not rely on mere entries in the books of account for that purpose. This is clear from the provision in S. 34 of the Evidence Act. No attempt was made on behalf of the bank to prove by any evidence whatsoever that a sum of Rupees 10,000 was advanced on March 19, 1947. The entry in the account books in that connection is to the effect:- "To amount paid to Gauhati branch as per D/advice, dated 6th March 1947". If this amount of Rs. 10,000 was paid by the bank on the order of the appellants or any one of them that order should have been produced in support of the entry, and then the entry would have been helpful to the bank as a corroborative piece of evidence. But the bank did nothing of the kind. The only witness produced on behalf of the bank was an officer who had nothing to do with the Tezpur branch where the transactions were entered into. We are, therefore, of opinion that in view of S. 34 of the Evidence Act the appellants cannot be saddled with liability for the sum of Rs. 10,000 said to have been advanced on March 19, 1947 on the basis of a mere entry in the account. Section 34 says that such entry alone shall not be sufficient evidence, and so some independent evidence had to be given by the bank to show that this sum was advanced. 10,000 said to have been advanced on March 19, 1947 on the basis of a mere entry in the account. Section 34 says that such entry alone shall not be sufficient evidence, and so some independent evidence had to be given by the bank to show that this sum was advanced. What would be the nature of such independent evidence would certainly depend upon the facts of each case, but there can be no doubt that some independent evidence to show that advance had been made has to be given. Further, as in this case the dispute was with respect to one entry of Rs. 10,000, it should not have been difficult for the bank to produce evidence with respect thereto. We cannot, therefore, agree with the High Court that the advance of Rs.10,000 on March 19, 1947 has been proved in this case.” 10. Be that as it may the learned trial Court has palpably overridden the effect of the admission comprised in the cross-examination of the defendant personificatory of his owing a sum of Rs.47507/- to the plaintiff/bank up to the date of institution of the suit. In case it had meted appropriate reverence thereto it would not hence have committed a legal fallacy arising from misapplication of the ratio of the judgment supra which warranted its application only in the event of the principal debtor denying the entries in the bankers books of account as maintained by the plaintiff-bank qua the debt liability fasten-able therefrom qua the defendant whereas with the defendant in his cross-examination admitting the factum of his owing to the plaintiff-bank a sum of Rs.47,507/- upto the institution of the suit rendered unwarranted the application of the ratio of the judgment supra to the factual matrix existing in the instant case. The unwarranted application of the ratio of the judgment of the Hon’ble Apex Court supra by the learned trial Court had led it to commit a manifest gross error arouse-able from the aforereferred factum of its application standing warranted only in the event of denial occurring at the instance of the defendant qua his debt liability manifested in the bankers books of accounts maintained by the plaintiff-bank whereas its application being wholly unwarranted when as in the instant case his conceding to the factum of his owing to the plaintiff-bank a sum of Rs.47507/- upto the institution of the suit rather the exception carved therein for charging the defendant with liability spurring from his admission qua his owing a sum of Rs.47507/- to the plaintiff-Bank standing evoked. In sequel when his admission falls in consonance with the entries recorded by the plaintiff-bank in its apposite bankers books of account, it was legally inappropriate for the learned trial Court to dispel the efficacy of the entries maintained by the plaintiff-bank in the apposite bankers books of account by a mere unwarranted misapplication of the ratio of the judgment supra. 11. In view of above, the present appeal is dismissed and the judgment and decree of the learned first Appellate Court is maintained and affirmed. The substantial question of law is answered accordingly. The suit of the plaintiff is decreed. Decree sheet be prepared accordingly. Records be sent back forthwith. All pending applications stand disposed of accordingly. No costs.