B B PATEL Vs. NEXIM EXPORTS PRIVATE LIMITED

JUDGEMENT

(1.) This is an application filed by the plaintiff under Order 37 Rule 3 sub rule (6)(b) of the Code of Civil Procedure, 1908 (for short CPC), seeking judgment and decree forthwith inter-alia on the ground that defendants have failed to pay Rs. 15 lacs in cash to plaintiff as per the Supreme Court order dated 14.2.2000 pasted in Civil Appeal (Nos. 1119-11120/2000). The defendants are opposing this application.

(2.) Brief facts necessary for the disposal of the application are: that the plaintiff filed a suit under Order 37 Civil Procedure Code for recovery of Rs. 24,20,000.00 against the defendants along with interest @ 21% from the date of filing of the suit till realisation and costs. On 3rd May, 1993 the defendants were granted leave to defend the suit subject, to the conditions that they shall furnish a bank guarantee for Rs. 12.10. lacs which shall be kept alive till the disposal of the suit and that they shall deposit Rs. 12.10 lakh in the Court to be kept in the Fixed deposit receipt. These two conditions were to be complied with within two months. The defendants initially failed to comply with these conditions within two months. Consequently on 15th October, 1993 the suit was decreed in favour of the plaintiff. The defendants filed an appeal, RFA (OS) 6/94, and the appellate court vide orders dated 16th May, 1994, set aside the decree and granted further two months time to the defendants to comply with the said order dated 3rd May, 1993, granting leave to defend the suit.

(3.) The defendants in compliance with the abovesaid order the deposited Rs. 12.10 lacs (Twelve Lacs Ten Thousand only) in the Court, which is lying in the fixed deposit. They also furnished a bank guarantee No. 25/94 for Rs. 12.10 lacs (for short BG), issued Indian Bank (Overseas Branch), Kasturba Gandhi Marg, New Delhi (for short the bank). Statement of Sh. T. Ramaswami, Chief Manager of the bank was recorded, who confirmed the execution of the bank guarantee (Ex. PI) and stated that the bank shall remain bound by the terms of the BG and shall like steps to renew the same from time to time, till it is finally discharged by the Court. However, concluding Clause of the BG provided that it shall remain valid up to 28th April, 1995. Therefore, it had to renewed after its expiry period which has given rise to controversy between the parties. There is no dispute with regard to first extension of the BG uptill 28.4.97. On 6.1.1998 the plaintiff moved an application (IA. 115/98), claiming that the BG was no logner valid and pressed for a decree forthwith under sub-rule (6)(b) of Rule 3 of Order 37, CPC; The application was rejected on 28th January, 1998, and the parties were directed to appear before the Registrar on 9th February, 1998 for completion of necessary formalities for renewal of the BG and the FDR. Consequently, on 9th February, 1998 Senior Manager of the bank appeared before the Registrar and brought the letter extending BG for a further period of two years commencing from 29th April, 1997. However the letter was not taken on record and he was directed to bring his power of attorney on the next date.