CANARA BANK R K PURAM NEW DELHI Vs. SANJEEV ENTERPRISES

JUDGEMENT

(1.) In this suit, the plaintiff has prayed for a decree for a sum of Rs. 13,13,622.34 jointly and severally against defendants I to 4, and to the extent of the sum of Rs. 16,843.90 p. against defendant No. 5, with interest thereon at the rate of 21.5 per cent per annum from the date of the suit till payment and with costs.

(2.) The plaintiff is a banking company, a body corporate and a nationalised Bank, constituted under the Banking Companies (Transfer and Acquisition) Undertakings Act, 1970, hereinafter referred to as the Bank. It has its head office at Bangalore and its branches are spread throughout India. The suit relates to its branch at Sector XII, R.K. Puram, New Delhi. The plaint is signed and verified by Mr. M. N. Prabhu. It is alleged that he was the Senior Manager of the said branch and that he was duly authorised by a power of attorney to institute the suit and to sign and verify the plaint on behalf of the Bank.

(3.) It is alleged in the plaint that Kuldip Singh Sawhney, defendant No. 2, is the sole proprietor of the business carried on in the name and style of M/s Sanjeev Enterprises, defendant No. 1, hereinafter referred to as the Firm; that he authorised his son Sanjeev Sawhney, defendant No. 3, to carry on arid look after the entire business, and to deal with Bank and all other parties in connection with the business; that the said defendants had business dealings with the Bank since 1976 when a current account was opened under which they enjoyed open cash credit (hereinafter called OCC) facilities upto a limit of Rs. 5 lakhs; that payments due to the Bank were guaranteed per- sonally by defendants No. 2 and 3 as well as by Reema Sawhney, defendant No. 4, and by Baljit Kaur, daughter and wife respectively of defendant No. 1. It is alleged that after the death of Baljit Kaur, defendents No. 2 to 4 are liable in their capacity as her legal representatives. It is further alleged that after the death of Baljit Kaur, defendants No. 2, 3 and 4 executed a fresh deed dated 18th March 1981, by which they independently undertook/ guaranteed to repay liability of the Firm to the extent of Rs. 15 lakhs, and, at the same time, defendants No. 3 and 4 acknowledged liability, upto that time, for Rs. 8,07,375.91 under OCC Account No. 1, for Rs. 36,731.71 under OCC Account No. 2, for Rs. 56,945.15 p. on account of supply bills, and for Rs. 5,010.50 on guarantees. It is also alleged that later, on 22nd April 1981, defendants No. I and 2 acknowledged their liability under the said four heads for a sum of Rs. 8,41,527.96, Rs. 38,235.81, Rs. 59,366.75 and Rs. 5,010.50 respectively. It is clarified in the plaint that no claim has been made in the suit for payment on account of supply bills and guarantee as the liability in respect of supply bills has been debited to the OCC Account, as agreed' by the defendants, and the preexisting liability on account of guarantees was extinguished.