SATISH KUMAR MITTAL Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) This order will dispose of the application underorder6 Rule 17 Civil Procedure Code for amendment of the written statement filed by the defendant. Thefacts of the case in short are that the plaintiff had made a term deposit in the totalsum of-Rs. 6,00,000.00 with defendant No.l and three term deposit receipts each forthe value of Rs. 2,00,000.00 were issued by the defendant-Bank.The said receipts became due for payment on 8/12/1984. When theplaintiff on maturity of the said receipts went to the office of the defendant on 10thDecember, 1984, he was informed that payment cannot be made to the plaintiff onaccount of certain instructions received from the head office/regional office. Theplaintiff, therefore, filed the present suit under Order 37 of the Code of CivilProcedure for the grant of a decree for Rs. 6,27,270.00. Leave to defend the suit wasgranted to the defendants by order dated 15/01/1987 and the defendantsfiled the written statement. The case as set up in the written statement by thedefendants was that the plaintiff alongwith Mr. Rajender Bhanot, Managing Director of M/s. Indo Travels Services Private Limited approached the defendant-Bankwith a request to furnish a bank guarantee to members of lATA for payment to thesaid members of monies that might become due to them from the said M/s. IndoTravels Services Private Limited. It is the case of the defendant that it gave aguarantee for Rs. 16,59,000.00 dated 3/02/1984 unconditionally guaranteeing the payment to all and each member of IATA of all amount that may becomedue and payable by M/s. Indo Travels Services Private Limited from time to time.In consideration of the bank giving the said guarantee dated 3/02/1984, theplaintiff alongwith the said M/s. Indo Travels Services Private Limited and oneLamba Foreign Travels Private Limited executed a counter guarantee dated 3/02/1984 whereby the plaintiff undertook and agreed to pay on demand tothe State Bank of India any amount which the bank may be called upon to pay underthe said guarantee dated 3rd February, 1984. It is further stated that the plaintiffdeposited its three term deposit receipts with defendant No. 1 on 8/06/1984 and 9/06/1984 each in the sum of Rs. 2,00,000.00 and the said deposits were to matureon 8/12/1984 and 9/12/1984. IATA by a letter dated 4/09/1984 invoked the bank guarantee executed by the defendant-Bank anddemanded payment of Rs. 16,59,000.00. On such demand having been made, thedefendant duly made payment of the aforesaid amount of Rs. 16,59,000.00to IATAon 30/11/1984 and called upon the plaintiff as well as M/s. Indo TravelServices Private Limited to pay the said amount. On the failure of the plaintiff and/or either guarantors to pay the said amount or any part thereof, the bank filed SuitNo. 441/84 in this Court for recovery of the aforesaid amount and it was statedtherein that the bank had already adjusted the amount of the fixed deposit receiptsas well as five other term deposit receipts of the plaintiff as well as one term depositreceipt of M/s. Indo Travel Services Private Limited against the amount which wasdue to the bank from these persons. In the alternative it was prayed in the said suitthat a joint and several decree be passed against the present plaintiff and M/s. IndoTravel Services Private Limited and the other guarantor for the sum of Rs.15,25,359.70 paise.

(2.) The present application was filed by the defendant on 3/03/1992 foramendment of paragraph 4 of the written statement. Originally in paragraph 4 ofthe written statement, the defendant had stated that the defendant as banker of theplaintiff had general lien on the term deposit receipts and it was entitled to retainthe proceeds of the said term deposit receipts or securities as goods bailed to it assecurity for payment due from the plaintiff to the State Bank of India and/or as asecurity for a general balance of account. It is also stated that the bank had alreadyfiled a suit against the plaintiff and other guarantors for the balance amount afteradjustment of the amount of the aforesaid term deposit receipts. By the proposedamendment, the defendant wants to add the following paragraph after the existingparagraph 4 of the plaint.

(3.) Objection of the plaintiff to the proposed amendment is that the defendantcannot take the plea of set off as the plea of adjustment and set off are selfcontradictory and cannot be allowed to be taken by way of amendment andsecondly, the amendment is not only malafide but is also vague. It is also the caseof the plaintiff that the plea of set off is barred by limitation and cannot be allowedto be taken by way of the proposed amendment. The plaintiff has relied upon a FullBench Judgment of the Travancore Cochin High Court in Government of the UnitedState of Travancore and Cochin v. Bank of Cochin Limited, reported as AIR 1954TC 243 in support of the plea that the plea of adjustment and set off beingcontradictory cannot be allowed to be taken by way of amendment. Judgmentreported as Khushi Ram v. Ram Chand, AIR 1972 Punjab and Haryana 303 has alsobeen relied upon by the plaintiff to support his plea that if the defendant has not putin his claim of set off on the first hearing in the written statement, he must make outa very strong case for condonation of delay and satisfy that there was very validground for not doing so and while deciding an application under Order 6 Rule 17CPC, the Court should take into consideration the provisions of Order 8 Rule 6