PL RAMANATHAN Vs. K GEETHA

JUDGEMENT

(1.) THE above Civil Revision Petition is directed against the fair and decretal order dated 1. 12. 2003 made in I. A. No. 50 of 2003 in O. S. No. 15 of 2003 by the Court of Prl. Subordinate Judge, Salem .

(2.) TRACING the history of the above Civil Revision coming to be filed before this Court, what comes to be known is that the respondent herein has filed the suit in O. S. No. 15 of 2003 before the lower Court for recovery of a sum of Rs. 6,75,225. 00 with subsequent interest at 14% per annum from the date of suit till realisation from the defendants, for a personal decree against the defendants 2 and 3 for the amount due to the plaintiff and for costs; that the respondent herein has also filed an Interlocutory application in I. A. No. 50 of 2003 praying to issue notice to the petitioners herein calling upon them to furnish security for the suit amount and failure to furnish such security, attach the properties mentioned in the petition before judgment.

(3.) IN consideration of the facts pleaded, having regard to the materials placed on record and upon hearing the learned counsel for both, it could be assessed that a loan of Rs. 5 lakhs has been obtained by the petitioners from the respondent promising to repay the same with such interest on demand and in fact, the recitals of the pronote would indicate that they are the Directors of the Jawahar Mills Limited, Salem-5 and they jointly and severally for themselves and on behalf of the Jawahar Mills Limited, each of them personally promising to pay to the respondent, have borrowed the said amount duly executing the suit pronote. The Court below, having extracted the version of the pronote in its order and discussing on the subject as to whether it is only for and on behalf of the first defendant company and for the benefit of the first defendant company, the petitioners have borrowed the amounts or have they borrowed the amounts in their individual capacity or in both, has ultimately arrived at the conclusion that these two petitioners have executed the pronote not only as the Directors of the company but also in their individual capacity; that individual interest is there for the petitioners to have borrowed the money and to have enjoyed the same and therefore it cannot solely be attributed to have been borrowed by the company or for and on behalf of the company under the company's seal and signature or in their representative capacity of the company, but these two petitioners in their individual capacity and also binding their company have executed the pronote in favour of the respondent/plaintiff and have borrowed the amount; that since there is no dispute regarding the borrowing of the amount or the manner in which the same has been borrowed, the point'whether the said pronote amount has been borrowed by only the first defendant company for its benefit without anyone having his personal interest in the same'has been answered in the negative; that the borrowers are the individual petitioners for their benefits and binding the company's interest also and they have executed the pronote on receipt of the said amount borne by the pronote and therefore Section 22 of the sick INdustrial Companies (Special Provisions) Act, 1985, which is meant to safeguard the interests of only the sick industries, will have no bearing for the amounts borrowed by the petitioners in their individual capacity. Therefore, the trial Court has every reason to arrive at its conclusion to reject the contentions of the petitioners herein who are the respondents before the trial Court. Therefore, the petitioners are not entitled to the benefits of either Section 22 of the Sick INdustrial Companies (Special Provisions) Act, 1985 or the proposition propounded by the Honourable Apex Court in the judgment cited supra.