BANK OF MAHARASHTRA Vs. RACMANN AUTO PRIVATE LIMITED

JUDGEMENT

(1.) This is a suit for recovery of Rs. 3,29,193.61 p. The case of the plaintiff, in brief, is that the defendant on April 28, 1976, had requested the plaintiff's Branch at Faridabad to sanction Cash Credit Facility (Pledge) to the limit of Rs. 2,00,000.00 and on the same date, the defendant had executed by way of collateral security a demand promissory note for the said amount and continuing security and agreement of pledge of goods. The said Cash Credit Facility was sanctioned and it was agreed that the defendant shall pay interest @ 7% per annum over the bank rate with a minimum of 16% per annum. It is the case of the plaintiff that on August 12, 1977, the defendant executed acknowledgment of balance due on that date to the tune of Rs. 2,03,441.40 p. and as defendant still failed to clear the debit a letter dated August 4,1980 was issued by the plaintiff to the defendant for paying the amount due which the defendant failed to pay and hence, the present suit has been filed. It is also pleaded in the plaint that the plaintiff has become entitled to sell the goods pledged with the plaintiff-bank.

(2.) The defendant has contested the suit and has taken certain preliminary objections pleading that the plaint is not signed, verified and instituted by a duly authorised person on behalf of the plaintiff and that the previous Managing Director of the defendant Shri Puran Singh Sethi who has allegedly executed the documents for obtaning the Cash Credit Facility is a necessary party and the suit is bad for non-joinder of necessary party. Pleas were also taken that Delhi Courts have no territorial jurisdiction to try the suit and that the plaint has not been verified in accordance with law and that the claim in the suit is barred by time.

(3.) The written statement is stated to have been signed by the present Managing Director of the defendant and a plea has been taken that he was not aware as to the execution of the documents and the grant of the aforesaid credit facility but it was admitted in the written statement that defendant had been dealing with the plaintiff-bank but it was not disclosed as to what sort of dealings defendant had with the plaintiff-bank. It is further pleaded that Puran Singh Sethi had signed some documents which were blank and that plaintiff-bank ought to have taken steps for selling the pledged goods which were of the value of Rs. 4.50 lakhs and which are lying under the lock and key of the plaintiff-bank in the godowns of the defendant. In replication it was controverted that Puran Singh Sethi is necessary or proper party or the suit is barred by limitation or the plaintiff-bank was duty bound to sell the pledged goods before filing the suit and other pleas taken in the plaint were reiterated. Following issues were framed: