M P MITTAL Vs. STATE OF HARYANA

JUDGEMENT

(1.) This appeal by special leave is directed against the judgment and order of the High Court of Punjab and Haryana dismissing a writ petition in limine.

(2.) Messrs. Depro Foods Limited entered into a contract with the Haryana State Industrial Development Corporation Limited, whereby the said Corporation underwrote preference shares of Messrs. Depro Foods Limited of Rs. 100/- each for a total value of Rs. 3.6 lacs on which a dividend of 9.5% per annum was payable. The appellant who was apparently, at the relevant time, the Managing Director of Messrs. Depro Foods Limited, executed an agreement under which he guaranteed in his personal capacity the payment of the dividend income due in respect of the aforesaid shares to the said Corporation. It is not disputed that Messrs. Depro Foods Limited did not pay Rs. 1,96,961 representing the dividend payable to the said Corporation, and therefore the appellant became personally liable as guarantor to pay that amount. It seems that on the failure of the appellant to make payment, the said Corporation invoked a provision in the Guarantee agreement which declares:-

(3.) At one stage during the hearing of this appeal it appeared possible that the dispute could be resolved if even now after a lapse of six years the appellant was prepared to discharge his liability as Guarantor by making payment to the Corporation of the amount sought to be recovered, if necessary in accordance with a convenient time schedule of instalments, but Shri K. K. Jain, learned counsel for the appellant, stated frankly that in spite of repeated communications to his client he had not received any reply from him.