JANATA SAHAKARI BANK LTD Vs. VASUDEO RAJARAM GHANEKAR

JUDGEMENT

(1.) THE appeal is filed by the Janata Sahakari bank Ltd. , Pune, Branch Ratnagiri, against the heirs of the original defendant No. 1 and defendant No. 2 and defendant Nos. 3 and 4 who are alive. The learned trial Judge passed the impugned judgment and order on 3rd July, 1986 by which she held the original opponents 1-A to 1-G. i. e. some of the heirs of the deceased Defendant No. 1 jointly and severally liable for the payment to the appellant bank for the amount of Rs. 25,28,462. 05 with interest at the rate of 17% per annum on principal amount of Rs. 20,99,582. 15 from 1-8-1978 till full payment after giving adjustment of the sale proceeds of the hypothecated property which was sold out by order dated 20-4-1982 against the decretal amount, with no order as to costs. Since the learned Judge relieved the remaining defendants in the dispute of the liability the appeal is preferred. Cross objections were filed by the judgment debtors contending that the learned Judge failed to fasten the liability only with regards to the properties left by the deceased defendant No. 1 in the hands of the judgment debtors, for payment of the decretal amount and not to hold them personally liable. The appeal and cross objections were heard. Before appreciating the submissions of the respective Advocates for the parties it would be convenient to refer to the material facts in the dispute. They are as follows : The dispute was filed by the Ratnagiri Urban Co-operative Bank Ltd. , against one Vasudeo rajaram Ghanekar for himself and for Village Agro Industrial Service as it's proprietor, Yashwant Sripad Sardeshpande, Vishnu Purushottam Joshi and dhundiraj Narayan Athlye. This dispute was filed on 31-1-1977 stating therein that defendant No. 1 Vasudeo Rajaram Ghanekar had executed the karjarokha (Loan Bond) on 22-5-1976 for the consolidated amount of loan of Rs. 21,00,000/-in the cash credit account with the appellant bank. On 10-5-1976, he had already mortgaged and hypothecated the immovable and movable properties according to the provisions of Section 48 of the maharashtra Co-operative Societies Act, 1960. The amount of loan, admitted by him as payable, was to run interest at the rate of 17% per annum. This interest rate was also agreed for the transactions held prior to this consolidated acknowledgement of the total amount of loan. The defendants 2, 3 and 4 in the dispute were members of the plaintiff bank. They stood sureties for the repayment by the defendant No. 1. Since the amount was not repaid by 31-1-1977, the bank filed a dispute for recovery of the principal amount of Rs. 20,99. 582. 15 and past interest till 31-1-1977 rs. 4,88,879. 90 and claimed future interest at the same rate against all the defendants. All the defendants had filed the written statement denying the liability. Since after filing of the dispute the plaintiff bank was amalgamated by the order of the Commissioner for Co-operation and Registrar of Cooperative Societies, Maharashtra State, Pune, by his order dated 16-5-1978, the appellant was brought on record by amendment.

(2.) THE defendant No. 1 Vasudeo R. Ghanekar died on 18-12-1978 however, before the death of defendant No. 1 he had filed the written statement and his contentions were that the agreement dated 20-8-1975 was between the plaintiff bank, one Ghanekar and the Defendant No. 1. The agreement was for 5 years. Therefore, there was no cause of action for the bank to file a suit for recovery on the basis of that agreement. It was further contended that while the agreement was subsisting the bank had taken up the business of the defendant No. 1. That was done for the purpose of discharging the liabilities of the business and other liabilities. It is also stated that, after the business and property was taken over by the bank, the bank had appointed the defendant No. 2 as the Manager of the said business. It is said that the plaintiff bank had in pursuance of the said agreement repaid two instalments of loan payable to the Bank of India amounting to Rs. 4090/-in total. Since the plaintiff bank failed to pay further instalments, the Bank of India filed the Regular Suit bearing No. 33/77 against the defendants Nos. 1 and 2, and the Plaintiff Ratnagiri urban Bank, which was then opponent. Therefore, no liability remained for payment of loan by the defendant No. 1. He disputed the claim of interest also. He further contended that since the plaintiff bank mismanaged tie business, the defendant havily suffered losses and the plaintiff cannot claim any amount on account of the said agreement. The amounts of losses ia the business debited by the plaintiff in the account of the defendant No. 1 was, therefore, disputed as not recoverable from him. The plaintiff bank had even employed the defendant No. 1 in the business after it was taken over by it. It was alleged that the plaintiff never furnished account to him. Then it is contended that under the pressure of the plaintiff bank he had signed the Karjarokha on 22-5-1976. He was also under the employment of the bank. Therefore, he was not responsible for discharging the liability personally. Thus he claimed that the dispute be dismissed with costs. After his death the heirs filed additional written statement and they contended, adopting the written statement filed by the deceased defendant no. 1, that they were maintaining themselves from the income received out of the ancestral property of the deceased defendant No. 1 and from the assistance given by the relatives. It is alleged that because of the liberal attitude of the original plaintiff bank in advancing the loans to the deceased defendant No. 1, the deceased had become addict gambler, Therefore, the amount of loan advanced to him was not for the necessity of the family, nor they were benefitted out of it. Therefore, as heirs of the deceased they claimed that they were not liable for the repayment. It is also contended that since the deceased could not earn lakhs of rupees he had developed the attitude of gambling, in the sense of raising loans of lakhs of rupees for which the heirs of the deceased are not liable. They are not personally liable. The property of the deceased may be sold out for recovery of the dues of loan. With regards to the heirs, namely his mother, daughter and brother, they contended that no claim can be made against them for the liability of the deceased defendant. They were not concerned with the said transaction. The deceased was managing the estate of the family at the village and, therefore, the name of the deceased was recorded as holder of the said properties. However, these heirs were the sharers of the said property and without their knowledge the bank-plaintiff got the attachment of the property. Therefore, they denied the liability and asked for dismissal of the dispute. It is claimed that since the deceased defendant No. 1 had created incumberences on the ancestral property of the family without their knowledge these defendants do not become liable for the debts incurred by the deceased defendant.

(3.) THE original defendant No. 2 had also fined his separate written statement which was subsequently adopted by his heirs. He died during the pendency of the dispute. He denied to have accepted the liability as a surety of the defendant No. 1. He alleged that his signatures were obtained by the bank officers by mis-representation. He also alleged that his signatures were obtained on blank forms. He bad no knowledge about the quantum of the amount for which he was asked to stand surety. He had already written letters to the bank denying his liability as surety for the amounts payable by the defendant No. 1, but the bank did not send any reply. It is then contended that since the bank had made arrangement to take over the business of the deceased defendant No. 1 for recovery of the loan amount and this arrangement was without consent of this defendant no. 2, he stood discharged from the liability of suretyship, assuming that he was a surety. His widow has filed her say by way of argument on 21-4-1986 received by the Court on 24-4-1986 and denied the liability of the loan advanced to the deceased defendant No. 1. She also asserted that her husband did not stand surety for the loan payable by the deceased defendant No. 1.