OMAN INTERNATIONAL BANK SAOG Vs. DAWOOD AND CO

JUDGEMENT

(1.) PLAINTIFFS have filed the suit against the present defendants based on two letters of guarantee which are Exhibit "A" and Exhibit "B" to the plaint. It is the contention of the plaintiffs that defendant Nos.1 and 2 stood as guarantors in respect of loans advanced to members of Jeevan Vikas Co-operative Cottage Leather Industries Ltd. In terms of the Letter of Guarantee the liability of the guarantors was not to exceed Rs.3.00 crores together with interest as stipulated therein. By virtue of Clause 11 on service in writing under the hand of the Manager, Sub-Assistant Manager or other Officer of the bank stating the amount at any particular time due and payable to it under the guarantee, was to be conclusive evidence of the amount dues. By virtue of Clause 13 the guarantor agreed that the demand mentioned above shall be deemed to have been made by the bank on the guarantor if it is made in writing and addressed and sent to the guarantor by Registered Post A.D. at the Guarantor's last known address. The names of the members of the Co-operative bank to whom the loans were advanced are at Exhibit "C". Exhibits "F" and "G" are the certificates setting out the amounts due and outstanding as on 28th November, 1996. The plaintiffs in the particulars of claim have claimed principal amount along with interest at 12% per annum.

(2.) ON Summons for Judgment being taken out which is supported by an affidavit the defendants have filed their reply. In the reply various defences have been raised. It is principally contended that the agreement based on which the Summary Suit is filed could not be the basis on which the Summary Suit would lie. In the guarantees, it is contended, the number of Cobblers to whom loans were to be given is set out as 1200 and loan amount as Rs.3.00 crores. In the suit filed the plaintiffs have claimed that loans were advanced to 800 cobblers and the amount advanced was Rs.2.00 crores and that the figures in the guarantee were written through inadvertence. It is contended that unless the guarantee itself is rectified on the ground of mutual mistake no summary suit would lie on the guarantee. It is also contended that in the year 1994 the defendant No.2 who has filed an affidavit on his behalf and of defendant Nos.1 and

(3.) THE principal contentions, according to the learned Counsel for the defendants, are that the guarantees could not have been enforced without they being rectified as to the mistake and in that light of the matter no Summary Suit would lie on the said bank guarantees. Secondly it is contended that prima facie material on record indicates that the signatures on the bank guarantees do not correspond to the admitted signatures of the defendants as per the report of the handwriting expert and in view of that the defendants are entitled to unconditional leave to defend.