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2017 DIGILAW 1284 (ORI)

Andhra Bank, Cuttack v. Raghunath Tripathy

2017-11-10

A.K.RATH

body2017
JUDGMENT : DR. A.K.RATH, J. 1. This is a plaintiff’s appeal against confirming judgment. The suit was for realization of Rs.14,422/-with pendilite interest and future interest at the rate of 18.5% per annum. 2. The case of the plaintiff is that the plaintiff is a nationalized bank. Defendant no.1 through the District Industries Centre, Orissa, Cuttack applied for a loan of Rs.20,800/-to start a book-binding business under Self Employment Scheme for Educated Unemployed Youth. Defendant no.1 executed the necessary documents in favour of the bank on 27.3.1985. He agreed to repay the loan amount with interest at the rate of 12% per annum in 48 installments. As per the scheme, the money was not payable directly to defendant no.1, but through the supplier of the machinery/material etc, who in turn would supply the same to defendant no.1. Pursuant to the instructions of defendant no.1, the bank paid an amount of Rs.19,100/-to defendant no.2 to supply the machinery/material to defendant no.1. The defendant no.1 denied to have received any machinery from defendant no.2. The defendants became defaulters. The bank issued a demand notice to the defendants to pay the amount with interest. While the matter stood thus, defendant no.2 paid an amount of Rs.10,500/-. The same was credited to the loan account on 4.11.1986. A sum of Rs.14,422.25 was outstanding. With this factual scenario, the suit was filed. 3. Defendant no.1 filed written statement denying the assertions made in the plaint. He advanced the blank paper theory and contended that the plaintiff took signature from him in a blank document. He had not received any machinery from defendant no.2. The defendant no.2 was a partnership firm. The same was dissolved. Defendant no.5 paid half of the amount to the plaintiff. 4. Defendant no.5 filed a separate written statement stating, inter alia, that pay order was received by defendant no.2 for supply of machineries to defendant no.1. When the defendants failed to supply the machineries to defendant no.1, the bank demanded money. He had 50% share in the partnership. He refunded 50% of Rs.19,100/-that is Rs.8,550/-along with interest upto 5.3.1986. A total sum of Rs.10,500/-was paid by him to the bank towards his share in the partnership. The amount was deposited in the account of defendant no.1 on 5.3.1986. The firm was dissolved. He is not liable to pay any amount. 5. He had 50% share in the partnership. He refunded 50% of Rs.19,100/-that is Rs.8,550/-along with interest upto 5.3.1986. A total sum of Rs.10,500/-was paid by him to the bank towards his share in the partnership. The amount was deposited in the account of defendant no.1 on 5.3.1986. The firm was dissolved. He is not liable to pay any amount. 5. Stemming on the pleadings of the parties, the learned trial court framed six issues. The parties led evidence, both oral and documentary, to substantiate the case. The suit was dismissed. The unsuccessful plaintiff filed Money Appeal No.6 of 1992 before the learned 1st Additional District Judge, Cuttack, which was eventually dismissed. 6. The appeal was admitted on 5.5.1997 on the substantial questions of law enumerated in ground nos.III, IV and V of the appeal memo. The same are: “III. The learned lower appellate court had made out a third case in dismissing the plaintiff’s suit, inasmuch as it was not the case of any of the parties that full payment had been made to the plaintiff-bank. IV. The learned lower appellate court had confused between the credit voucher dated 5.3.1986 for Rs.10,500/-and the ledger entry dated 4.11.1986 for the self-same amount. The entry dated 4.11.1986 in the ledger account shows that there was a transfer of a sum of Rs.10,500/-from the sundry creditors account. The amount received from D.w.5 under the credit voucher dated 5.3.1986 was initially credited to the sundry creditors account and subsequently the same was given a credit in the ledger account of defendant no.1 on 4.11.1986. There was no duplication at all nor was there payment of Rs.10,500/-on two occasions. The self same amount of Rs.10,500/-was shown under the credit voucher dated 5.3.1986 and the same was shown as transferred from sundry creditors account to the ledger account of defendant no.1. Unfortunately, the learned lower appellate court got confused between the sundry creditors account and the evidence of P.W.1. There is absolutely no discrepancy or any overlapping between the evidence of P.W.1 and the ledger account. Unfortunately, the learned lower appellate court got confused between the sundry creditors account and the evidence of P.W.1. There is absolutely no discrepancy or any overlapping between the evidence of P.W.1 and the ledger account. V. The learned lower appellate court having accepted the accounts filed by the plaintiff-bank as correct, there was no scope for coming to a different conclusion and further having rightly held that the defendants did not challenge the correctness of the entry in the accounts filed along with the paint, the learned lower appellate court committed a gross error in dismissing the suit on the basis that the amount was fully repaid to the bank.” 7. Heard Mr.C.A.Rao, learned Senior Advocate for the appellant-bank and Mr.Sudeep Kumar Sarangi on behalf of Mr.Santanu Sarangi, learned Advocate for respondent no.5. None appeared for respondent no.1. 8. Mr.C.A.Rao, learned Senior Advocate for the appellant-bank submitted that defendant no.1 was the loanee. Defendant no.2 was a partnership firm. Defendant nos.3 to 5 were its partner. Defendant no.1 applied for loan through D.I.C. for running a book binding business. Accordingly, loan was sanctioned. Pursuant to the instructions of defendant no.1, the bank had issued a pay order of Rs.19,100/-to defendant no.2. Admittedly, defendant no.2 had not supplied the machinery or material to defendant no.1. Defendant nos.2 to 5 are liable to pay the outstanding dues. 9. Mr.Sudeep Kumar Sarangi, learned Advocate on behalf of Mr.Santanu Kumar Sarangi, learned Advocate for respondent no.5 submitted that defendant no.2 was a partnership firm. The same was dissolved. Defendant no.5 was a partner. He had 50% share in the partnership. He paid an amount of Rs.10,500/-. Thus, he is not liable to pay any amount. 10. The stand of defendant no.1 was that materials had not been supplied to him by defendant 2. Defendant no.5 in para-19(b) of the written statement took a specific plea that when the defendants failed to supply the machineries to defendant no.1, the bank demanded money from the defendants. Defendant no.5 was not examined in the court below. But then, the learned trial court came to hold that defendant no.5 in para-3 of cross-examination has proved the credit voucher dated 5.3.1986 through the evidence of P.W.1 indicating credit of Rs.10,500/-. It further held that “the whole evidence of P.W.1 is conspicuous by the absence of any allegation that defendant nos. But then, the learned trial court came to hold that defendant no.5 in para-3 of cross-examination has proved the credit voucher dated 5.3.1986 through the evidence of P.W.1 indicating credit of Rs.10,500/-. It further held that “the whole evidence of P.W.1 is conspicuous by the absence of any allegation that defendant nos. 3 to 5 have not supplied the materials and machineries to defendant no.1. More importantly, the plaintiff-bank has failed to produce and prove a single scrap of paper showing default of supply of materials by defendant nos.3 to 5 to defendant no.1.” The defendant no.5 admits that the machineries/materials had not been supplied to defendant no.1. The findings are perverse. The judgment also suffers from internal inconsistencies. 11. Defendant no.1 was a beneficiary of self-employment scheme. His name was sponsored by the D.I.C. to the bank. Thereafter the bank issued pay order no.153/85 dated 28.3.1985 for Rs.19,100/-to defendant nos.2 to 5. Since defendant nos. 2 to 5 had not supplied any material to defendant no.1, the bank instituted the suit for realization of Rs.14,422.25 after deducting the amount, which had been paid by defendant no.5. The learned appellate court did not delve deep into the matter. The judgment suffers from non-application of mind. 12. Section 25 of the Indian Partnership Act, 1932 provides that every partner is liable, jointly with all the other partners and also severally, for all acts of the firm done while he is a partner. The liability of the partners is joint and several. In view of the same, defendants no.2 to 5 are liable to pay Rs.14,422.25 as claimed by the plaintiff with simple interest at the rate of 9% per annum from the date of institution of the suit till realization. 13. In the wake of the aforesaid, the impugned judgments are set aside. The suit is decreed to the extent indicated above. The appeal is allowed. There shall be no order as to costs.