TATIA, J. - (1.) THESE two appeals have been preferred by the guarantors who gave guarantee for the loan availed by deceased Baldev Singh from the respondent- Rajasthan State Financial corporation (hereinafter referred to as 'corporation'). The appellants are aggrieved against the order passed by the District Judge, Sri Ganganagar on application submitted by the respondent under Section 31 (l)(aa) of the State Financial Corporation's Act, 1951 (hereinafter referred as 'the Act of 1951)The court below after rejecting the contention of the appellants that the application is barred by time, held that the respondents can proceed to recover the amount of Rs.6,15,913.50/- from the properties mortgaged with the respondents by the guarantors.
(2.) THE core question is whether the application filed by the respondent- corporation under Section 31(l)(aa) of the Act of 1951 was within the period of limitation. For the purpose of deciding the controversy, following are the relevant facts: The loan was sanctioned to the borrower Baldev Singh by the respondent-corporation on 14th Nov., 1984 of Rs.1,81,000/- which was repayable in 48 installments. The two guarantors Babu Lal and Inder Singh gave guarantee for re-payment of the entire loan amount paid to and the loan which may be found due in the borrower Baldev Singh and they mortgaged their immovable properties and executed the guarantee deed on 18th Dec, 1984. The borrower defaulted and, therefore, the respondent-corporation gave notice under Section 31 of the Act of 1951 on 30.1.1988 and by invoking powers under Section 29 of the Act of 1951 the respondent -corporation attached truck of the borrower for which finance was given to the borrower by the respondent. The truck was attached on 24.1.1990. Faced with this situation of the attachment of the truck, the borrower preferred S.B. Civil Misc. Appeal No.50/1990 before this Court. In that CMA notices were issued to the respondents and ultimately on 22nd May, 1990, this Court in borrowers S.B. Civil Misc. Appeal No.50/1990 released the truck in question i.e., Truck No.RRC 6145 on condition that the borrower shall pay Rs.15,000/- per month against the respondents' dues and shall also furnish fresh guarantee for the due amount of loan. In the interim order dated 22.5.1990 it was made clear that in a case of default in payment of any instalment, the respondents will be free to take possession of the truck in question and will be free to auction it. In pursuance of the order dated 22nd May, 1990, a guarantee was submitted by guarantor Hakam Singh, who is appellant in S.B. Civil Misc. Appeal No.1469/2007. In the guarantee submitted by Hakam Singh, was in pursuance of the order of this Court dated 22nd May, 1990 and he agreed to pay all the amount which may found due in the borrower of the respondent-RFC. The terms and conditions in the guarantee submitted by Hakam Singh (Ex.21) is almost same as of the deed of guarantee executed by the two earlier guarantors. 4. However, the borrower failed to comply the aforesaid interim order and has committed default in payment of the instalment, therefore, a notice under Section 30 of the Act of 1951 was served upon the borrower by the respondent-corporation which is dated 1/1/1996 and the same notice was served upon all three guarantors. In the notice dated 1/1/1996 the total amount due as on 1st Nov., 1995 was shown as principal amount Rs.1,70,152, interest amount Rs.2,77,742.00 and misc. charges 3456/- and total Rs.5,51,350.00. By this notice dated 1st Jan., 1996 the borrower as well as guarantors were asked to pay the amount with interest by 31.1.1996 and they were informed that in case of failure, the respondent-corporation will exercise its power under Section 29 of the Act of 1951 and may sell the properties to recover the amount. The borrower and guarantors did not pay the amount in response to the notice dated 1.1.1996 then on 1.1.1997 the truck in question was again attached and it was auctioned on 28.2.1997 for a consideration of Rs.1,49,000/-. The said amount of Rs.1 ,49,000/- was credited by the respondent in the loan account of the borrower on 31.3.1994. Thereafter, on 22nd Sept., 1997, the respondent again gave a notice to all the guarantors under Section 30 of the Act of 1951, then filed the present petition under Section 31(1) (aa) of the Act of 1951 in the court of District Judge, Sri Ganganagar on 29th March, 2000. In the proceedings under Section 31, the trial court proceeded to take evidence and, thereafter, held that the respondent-corporation entitled to sell the property mortgaged by the guarantors and the claim of the respondent is not barred by time. Learned counsel for the appellants in both the appeals vehemently submitted that the claim of the respondent was hopelessly barred by time and, therefore, the application should have been rejected by the court below on the ground of bar of limitation.
(3.) LEARNED counsel for the appellant Shri B.S. Sandhu for two earlier guarantors Babu Lal and Inder Singh in SBCMA No.1394/2007 submitted that the cause of action accrued to the respondents against the borrower as well as against the guarantors immediately on committing default by the borrower in payment of instalment and if not then the cause of action accrued to the respondent on 30.1.1988 when the notice under Section 31 of the Act of 1951 was served upon the borrower and the guarantors. It is submitted that after 30.1.1988 the guarantors never acknowledged the debt nor paid any amount towards the loan amount so as to extend the limitation. It is also submitted that these two guarantors were not party in the S.B. Civil Misc. Appeal No.52/90 preferred by the borrower before this Court, therefore, any order passed in that appeal is absolutely irrelevant for extending period of limitation for the present guarantors. It is also submitted that the respondent-corporation entered into a fresh agreement by accepting the fresh guarantee from new guarantor Hakam Singh on 26th June, 1994 and, therefore, the guarantee which was given by the appellants Babu Lai and Inder Singh stands superseded by the subsequent guarantee given by Hakam Singh and, therefore, the appellants' guarantee stand discharged which they gave in the year 1984. Then it is submitted that even if the period is counted from the date when the truck was attached then that is the date starting the cause of action for recovery of the amount by the respondent from the borrower and guarantors. Originally, the truck was attached on 24.1.1990 and if it was released without the information and knowledge of the appellants then that itself a ground for exonerating the guarantors. Learned counsel for the appellants in both the appeals submitted that period of limitation for filing an application under Section 31 of the Act of 1951 is three years in view of the judgment of the Hon'ble Apex Court delivered in the case of Maharashtra State Financial Corporation vs. Ashok K. Agarwal & Ors reported in 2006 DNJ (SC) 508 and in view of the judgment of this Court delivered in the case of RFC vs. M/s. Anis Ahmed Habib Khan & Ors (S.B. Civil Misc. Appeal No.590/2008, decided on 22.9.2008) and in another judgment delivered in the case of Modern Mech. & Electrical Eng. vs. Rajasthan Financial Corporation reported in 2009 (1) DNJ (Raj.) 373. Learned counsel for the appellants in both the appeals drew my attention to the relevant provisions of the Limitation Act to show that the application is barred by time. Learned counsel for the appellant Shri R.K. Singhal appearing for the guarantor Hakam Singh also submitted that Babul Lal and Inder Singh gave guarantee in the year 1990 and borrower committed the default in the year 1990 then the cause of action created to the RFC in the year 1990, therefore, the respondent-RFC could not have sit over the matter so as to drag the appellant in such situation that he will have to pay huge amount of more than Rs.4 lacs as on 31.1.1996 and further more amount by now. It is also submitted that the borrower was under obligation to pay the instalment in view of the subsequent settlement and he committed default in the year 1990 then the limitation for filing application came to an end in the year 1993. The attachment of the truck by the respondent by exercising power under Section 29 of the Act of 1951 and its unilateral action cannot extend the limitation in view of the fact that the limitation once started can be extended when there is written acknowledgement of the debt by the borrower or his representative or there is part payment by the borrower, guarantors or their representatives against the loan amount. Admittedly, the loan amount was not paid by the borrower or guarantor after 1990 and, therefore, there arises no question of extension of limitation as provided under Section 18 and 19 of the Indian Limitation Act, 1963. It is submitted that part payment against the debt if is voluntary then only it may extend the period of limitation under Section 19 of the Indian Evidence Act. The RFC by exercise of power under Section 29 of the Act of 1951 if took over the possession of the property of the borrower and sold it then they were not agency of the borrower and, therefore, any payment received through force measure cannot be treated to be the payment against due by borrower or guarantor under Section 19 of the Act of 1963. ;