PUNJAB NATIONAL BANK Vs. ISHWAR PRASAD TIWARI

JUDGEMENT

(1.) THIS first appeal by the plaintiff Bank is directed against dismissal of the suit on the ground of limitation.

(2.) IT is not in dispute that the appellant is a nationalised Bank. On 30 -8 -1973 it had advanced a loan of Rs. 6,800/ - to the respondent No. 1 Ishwar Prasad Tiwari for purchase of a three wheeler auto rickshaw. The loan was repayable in 36 equal monthly instalments, commencing from 30 -9 -1973. It was to carry interest at the rate of 12 per cent per annum with quarterly rests. The respondent No. 2 Suresh Chandra Mishra was the guarantor for repayment of loan. The loan was not discharged and, therefore, a suit for recovery of a sum of Rs. 29,992.75 paise was filed on 28 -7 -1984. The suit was resisted by the respondents, inter alia, on the ground of limitation. All the issues, except that on the point of limitation, were decided in favour of the appellant and the suit was dismissed as barred by time. Being aggrieved, the plaintiff Bank has preferred this appeal.

(3.) IN paragraph 15 of its impugned judgment, the trial Court came to the conclusion that Article 36 of the Limitation Act, 1963, would be applicable in the present case, as there was no pleading or recital in the promissory note (Ex. P. 1) that in case of default in payment of any instalment, the whole amount of loan would become recoverable. However, in clause 3 of the Hypothecation Agreement (Ex. P. 3), it has been specifically mentioned that in case of default in payment of 'three consecutive instalments it shall be lawful for the bank to recall the entire outstanding loan' and that the debtor shall 'pay the same notwithstanding the period of instalments fixed as aforesaid.' In this view of the matter, I am of the view that Article 37 of the Limitation Act would be applicable in the present case, which provides as follows : - -Art. Description of suit Period of Limitation Time from whichperiod begins to run. - -37 On a promissory or Three years. When the default isbond payable by made unless where theinstalments. which payee or obligeeprovides that if default waives the benefit ofbe made in payment of the provision and thenone or more installments, when fresh default isthe whole shall be due. made in respect ofwhich there is no such waiver.