VINAYAK KESHAV PARANJAPE Vs. DENA BANK

JUDGEMENT

(1.) THIS appeal is preferred by the original defendant No. 2 Vinayak Keshav Paranjape in Special Civil Suit No. 67 of 1978 against a decree for Rs. 26,750/- with costs and future interest at the rate of seventeen and half per cent on the principal amount of Rs. 20,000/- against the appellant alongwith other two defendants jointly and severally.

(2.) IN order to appreciate the controversy, the following brief summary of facts is material. The parties are referred to as plaintiffs and defendants as in the trial Court. The suit was filed by Dena Bank against defendant Nos. 1 to 3. Defendant No. 1 being M/s. Surekh Chappal Company, a registered partnership firm dealing in manufacturing foot wears at Nasik of which defendant Nos. 2 and 3 were the partners, at the relevant time when loan was advanced by the plaintiff Bank to the defendant. The plaintiff Bank advanced a loan of Rs. 20,000/- to defendant Nos. 1 to 3, and defendant Nos. 2 and 3 being the partner of defendant No. 1 executed a promissory note and also deed of hypothecation in respect of stock in trade, machinery and other movable property of the firm. The defendants admitted the liability and acknowledged the dues of Rs. 23,708. 67 on 1st January 1978 by signing balance confirmation letter. However, the defendants thereafter failed to pay the balance amount found due with interest in spite of repeated demands and the suit notice, and therefore, the Bank has filed a suit for recovery of Rs. 26,750/- with interest.

(3.) DEFENDANT No. 2 (appellant) filed a separate written statement and contended that firm M/s. Surekh Chappal Company was not in existence when the suit was filed. The fact that the loan was advanced to the firm is not disputed. However, according to defendant No. 2 the business was being looked after by defendant No. 3 and so defendant No. 3 is primarily liable to repay the loan. The partnership between him and defendant No. 3 has come to an end on 31st August 1976 and he is not liable for any dealing of the firm by defendant No. 3. The document of balance confirmation letter is executed by defendant No. 3 and not by him and as such it is not binding on him, and therefore, the suit claim as against him is barred by limitation.