BANK OF BARODA Vs. RANJAN CHETIA

JUDGEMENT

(1.) IN this application under Article 227 of the Constitution of India, the petitioner, Bank of Baroda, has questioned legality and correctness of order dated 24.08.2012 passed by the learned Civil Judge, Tinsukia, in Title Suit No. 24 of 2011. By that order the learned trial court rejected application filed by the respondents under Order VII Rule 11 of the Code of Civil Procedure.

(2.) THE opposite parties No. 1 & 2, as plaintiffs, instituted Title Suit No. 24 of 2011 praying for declaration, inter alia, that creation of guarantee document dated 28.01.2011 and equitable mortgage relating to loan account of M/s. ARK Group is a fraudulent act and that it is neither binding on the plaintiffs nor is the defendant No. 1 entitled to enforce the same against the plaintiffs towards financial aid granted to M/s. ARK Group. The case of the plaintiffs in brief is that in the year 2009 the plaintiffs along with defendant No. 2 decided to establish a business of Restaurant -cum -Bar at Tinsukia. Pursuant to this, they purchased a plot of land measuring 1279.25 sq., ft. at A.T. Road, Tinsukia vide Registered Sale deed No. 1790 of 2009 at consideration of Rs. 2,50,000/ -. Then the defendant No. 2 put forward a proposal to the plaintiffs that he would arrange funds by taking financial assistance from the defendant No. 1, Bank of Baroda, as the defendants No. 3 & 4 who are the officers of the said bank at Tinsukia Branch are in good relation with him. The plaintiffs agreed in good faith. In the month of January, 2010 the defendant No. 2 informed the plaintiffs that a sum of Rs. 28,00,000/ - had been sanctioned in favour of them i.e., the plaintiffs and the defendant No. 2 by Tinsukia Branch of the defendant No. 1 and that they were required to create equitable mortgage of the premises purchased by them for executing a guarantee document. Accordingly, plaintiffs having accepted the proposal of defendant No. 2 at face value and having placed implicit confidence in him, met at defendant No. 4 who asked the plaintiffs and defendant No. 2 to come to the Bank at night on 20.01.2010. The plaintiffs complied with the instructions and thereafter, on being asked by defendant No. 4 they signed some papers which were presented before them by the defendant No. 4. On being specifically asked, the defendant No. 4 replied that plaintiffs and defendant No. 2 have been sanctioned a sum of Rs. 28,00,000/ - which would be disbursed within a short period of time. But when even after lapse of substantial period of time, they did not receive any money, the plaintiffs made queries to defendant No. 2 as well as defendant No. 3 & 4 who did not furnish any information to the plaintiffs. At that stage, the plaintiffs and the defendant No. 2 empowered the plaintiff No. 1 to establish and run the business with his own money. Accordingly, the plaintiff No. 1 established a Restaurant -cum -Bar and started business since March 2010 with his own finance. In the month of December, 2010 the plaintiff No. 1 obtained "IMFL Bar ON" licence from the Government of Assam and the bar was commissioned. In the mean time, on 10.08.2010 they received a letter from defendant No. 1 issued on 05.08.2010 and addressed to one M/s. ARK Group which revealed that a loan limit of Rs. 28,00,000/ - was sanctioned by Tinsukia Branch of the defendant No. 1 in favour of M/s. ARK Group. Smelling foul play of the defendant No. 2, the plaintiffs made enquiry with the defendant No. 2 about the existence and status of M/s. ARK Group and as to procurement and utilisation of loan amount of Rs. 28,00,000/ -. The defendant No. 2 refused to disclose the details and rather became furious. He assaulted plaintiffs and hence, finding no other alternative, plaintiffs approached defendants No. 3 & 4, who also did not disclose any information. Situated thus, plaintiffs took recourse to the provision of Right to Information Act, whereupon the defendants No. 1, 2 & 3 parted with information disclosing that loan of Rs. 28,00,000/ - was sanctioned to the defendant No. 2 as proprietor of M/s. ARK Group and that plaintiffs were shown as guarantor of the loan. According to the plaintiffs, the officials of the Tinsukia Branch of the defendant No. 1, more particularly, the defendant No. 3 & 4 being in collusion with defendant No. 2, fraudulently obtained signatures of the plaintiffs on the guarantee document and created equitable mortgage of the premises, with a pretext to sanction loan in favour of the plaintiffs and the defendant No. 2 for establishment of Restaurant -cum -Bar over the aforesaid premises but the sanctioning authority of the defendant No. 1 ultimately sanctioned entire loan in the name of M/s. AKR Group of which defendant No. 2 is the sole proprietor. The plaintiffs also alleged that the defendant No. 3 & 4 acted in collusion with the defendant No. 2 and his associates and committed a serious fraud to misappropriate and embezzle public money. In support of the allegations, the plaintiffs furnished material particulars in detail in subparagraphs A, B, C, D & E of paragraph 9 of the plaint as required under the provision of Order VI Rule 4 of the Code of Civil Procedure. Thus, having stated material facts and particulars in support of the allegations, the plaintiffs approached the learned Civil Court praying for adjudication that the fraud has been perpetrated on them by the defendants No. 1, 2, 3 & 4 in collusion with each other and thereby, the plaintiffs have been wrongly shown as guarantor of defendant No. 2.

(3.) LEARNED Court heard both sides at length and thereupon, passed order on 24.08.2012 rejecting the application. The learned Court held that since the plaintiffs have come forward with a specific case of fraud of the defendants and has sought declaratory relief on the basis of specific averments made in the body of the plaint, the jurisdiction of the Civil Court is not ousted under Section 34 of the SARFAESI Act, 2002. In so doing the learned Court placed reliance of the case of Mardia Chemicals Limited vs. Union of India reported in : (2004) 4 SCC 311. This order rejecting the application under Order VII Rule 11 of the Code of Civil Procedure has been brought under challenge in the present revision petition.