KURI LAL RUNGTA Vs. BANARSI DEVI

JUDGEMENT

(1.) This First Appeal under S. 96 of the Code of Civil Procedure (for short the Code) is directed against the judgment and decree dated 24-8-1978 passed by Civil Judge, Gonda decreeing the plaintiff's suit with costs.

(2.) Briefly stated, the facts of the case are that the plaintiffs filed a suit for recovery of Rs. 50,000/- with interest, pendente lite and future, till the date of recovery. It was averred that the defendant Koori Lal Rungta had taken a sum of Rs. 30,000/- as loan from one deceased Baij Nath Rajgariya at place Seksaria Sugar Mills Private Limited, Babhanan Bhabhinpur, Tahsil Utraul, District Gonda at the rate of interest of 9 per cent per annum. The interest was payable at every three months. It was averred in para 1 of the plaint that the defendant had pledged certain shares to Sri Baij Nath Rajgariya as security for the payment of the loan amount. An agreement is said to have been executed in respect of the said loan transaction on 27th July, 1959. The plaintiffs, who are heirs and successors of the creditor deceased Baij Nath Rajgariya, have given the details of payment made by the defendant in para 4 of the plaint and it is stated that the interest up-till 31st October, 1965 has been paid. The defendant had issued cheque No. 002766 of Rs. 2,700/-dated 15-12-1967 and cheque No. 002792 of Rs. 2,700/- dated 31-12-1967 drawn on State Bank of India, but the same were dishonoured. The defendant had, however, in his letter dated 3-2-1968 had assured the husband of the plaintiff No. 5 that he will send a bank draft. But no bank draft was sent by the defendant as was promised. The defendant had written another letter dated 9-3-1969 in which he had assured to send money by 15th April, 1969 and again wrote several letters about the debt but no money was paid according to the promise. The defendant had, however, paid on 6-7-1972 a sum of Rs. 1000/-towards payment of interest on the above-mentioned debt and had further assured to get the above-mentioned shares, on the security of which said loan of Rs. 30,000/- was taken, transferred in the name of the plaintiffs otherwise the amount was promised to be paid. The defendant is said to have given this in writing (paper No. Ga 1/35), but since the defendant had neither transferred the shares nor he had made any payment, and, as such, the plaintiffs filed the present suit against the defendant for recovery of said amount within three years from the date of the payment of Rs. 1,000/- towards interest on the loan amount, which was paid on 6-7-1972 and evidenced by paper No. Ga-1/35- Ext. 9. The defendant-appellant contested the suit alleging that the said loan amount was advanced to him at Basti and not at the aforesaid place in district Gonda. It was, thus, pleaded that the Court at Gonda has no jurisdiction to try the suit. It was further pleaded that the aforesaid loan is not recoverable personally from the defendant since in lieu of the loan taken by the defendant he had handed over the shares and blank transfer was duly executed in respect of his shares in the Seksaria Sugar Mills Private Limited and it was agreed between the parties that the plaintiff will get the shares duly transferred in lieu of the debt and the defendant will have no liability to pay it in cash. The facts regarding payment of the amount by the defendant towards the debt, as detailed in the plaint, were not disputed by the defendant and in the written statement it was asserted that the payments shown in the plaint were all made to the plaintiffs. It was, however, asserted that the suit is not within limitation and is not maintainable and the defendant is not personally liable to make payment of the aforesaid debt as the shares were handed over to the plaintiff for transfer by executing blank transfer form in favour of the plaintiff and it was the responsibility of the plaintiff to have got those shares transferred in his name. It was, thus, asserted that the suit deserves to be dismissed with costs. In the replication it was asserted by the plaintiffs that the shares have no market value and the defendant had not signed the transfer form nor he had taken any permission from the Directors for transferring the shares. It was asserted that the defendant is personally liable to pay the loan amount together with interest thereon and the shares were only given as security for the loan taken by the defendant. It was further averred by the plaintiffs in the replication that the sum of Rs. 30,000/- was paid by the plaintiff through cheque at Seksaria Sugar Mills Private Limited, Babhanan Bhabhinpur, Tahsil Utraula, District Gonda and the agreement was also written and executed at said place hence the suit is maintainable in Civil Court at Gonda.

(3.) On the pleadings of the parties, the following issues were framed :-