DWARKA DASS NAYAR Vs. DWARKA DASS SEHGAL

JUDGEMENT

(1.) This is an appeal against the judgement and decree dated July 29, 1961, of the Subordinate Judge 1st Class, Delhi, whereby the suit for Rs. 11,978.00/4.00 filed by the respondent was decreed for Rs. 10,000.00 with proportionate costs against the appellant.

(2.) The case of the respondent was that he had an amount of Rs. 20,000.00 on fixed deposit with the Punjab National Bank Ltd., Lango Mandi Branch at Lahore on the basis of which the said bank had allowed the respondent cash credit facilities. The appellant approached the respondent for help in obtaining a loan of Rs. 10,000.00 from the said bank which was granted to the appellant on February 29, 1947, on respondent standing surety and furnishing the security of the said fixed deposit amount. On appellant's failure to repay the loan, the bank recovered Rs. 10,151/10.00 from the respondent by debiting and deducting the sum from his account on May 22, 1947. The respondent claimed that he was thus damnified on May 22, 1947, to the extent of Rs. 10,151/10.00 by reason of the default by the appellant in replying his loan to the said bank and the respondent was, therefore, entitled to and did claim the said amount in the suit together with interest at the rate of Rs. 8.00 per cent per mensem amounting to Rs. l,823/6.00 totallng Rs. 11.975.00 with costs of the suit. The suit was filed by the respondent on May 20, 1950.

(3.) In his written statement, the appellant pleaded that the respondent did not have any fixed deposit of Rs. 20,000.00 with the said bank as alleged and that the aforesaid fixed deposit was of the Firm Dwarka Dass Ram Lal of which the respondent was a pariner with Ram Lal which was carrying on Sarafa business at Dabbi Bazar and Bazar Hatta at Lahore. The said Firm had a cash credit account with the said bank and were the owners of said fixed deposit and credit account even though these were in the name of the respondent. The appellant alleged that he was the Income-tax Adviser of the said Firm at Lahore and desiring to raise the loan on the security of his immovable property situated at Lahore had requested both the partners of the said Firm, namely, the respondent and Ram Lal to help him in securing the loan. The appellant admitted that he had taken a loan of Rs. 10,000.00 on February 20, 1947, from the said bank on the security of the title deeds of his land and as further security, the said Firm had stood as surety for the appellant upon the agreement that if the said bank was not able to recover the loan from the immovable property of the appellant which had been mortgaged, the amount of the loan shall be realised out of the amount of the said fixed deposit. It was pleaded that even if the respondent had executed the surety bond, it was done on behalf of the said Firm as the amount of the fixed deposit belonged to the Firm. Liability to indemnify the respondent was denied and it was averred that such liability was only to the said Firm if it had paid the loan advanced by the said bank: to the appellant in accordance with the terms. of the guarantee and upon the appellant making a default. It was further pleaded that it was incumbent upon the said bank to make a demand for repayment of the loan upon the appellant and to first proceed against his mortgaged property and thereafter only, in the event of a shorfall, have recourse to the said fixed deposit and that as the bank failed to do so, neither the respondent nor the said Firm was entitled to claim the amount in suit from the appellant. It was urged that the respondent had filed the suit against the appellant as the latter had appeared as a witness for Ram Lal, the other partner of the said Firm, in the suit pending between the respondent and Ram Lal in the Court of another Subordinate Judge. In the additional pleas to the written statement, the appellant repeated that the amount of the Jixed deposit belonged to the said Firm; that respondent dent alone was not competent to sue and that the' bank having failed to have recourse first to the immovable property mortgaged with it and to the appellant was not entitled to recover the amount of the loan from the amount of the said fixed deposit. It was further pleaded that gold weighing 90 Tolas I Ratti belonging to the appellant's wife Brij Rani, had been sold to the said Firm for Rs. 8,596.00 which had been kept in deposit with it and that on demand being made by the said Firm, the respondent and his partner Ram Lal agreed to adjust the said amount of Rs. 8,596.00 towards the amount recovered by the 'said bank and the remaining amount was not paid as the professional fee due to the appellant had yet to be settled. A further plea was raised in the written statement that the suit was not within time and it was pleaded that neither the respondent nor the said Firm was damnified on May 22, 1947, as alleged.