PUNJAB NATIONAL BANK Vs. K L MALHOTRA

JUDGEMENT

(1.) THIS is plaintiffs regular second appeal against the judgment and decree of the Courts below whereby the suit filed by the plaintiff for recovery of Rs. 2,10,883.65 was dismissed by the trial Court and appeal therefrom also met the same fate.

(2.) THE plaintiff -bank brought forth suit for recovery of Rs. 2,10,883.65 due upto 14.2.1983 on the allegations that on the request of defendant/respondent Kishan Lai Malhotra and Smt. Mangla Devi who are partners of the defendant/respondent No.l were sanctioned packing credit facilities for Rs. 1,50,000/ - F.O.B.P. Rs. 4,00,000/ - C.C. hypothecation limit of Rs. 1,00,000/ - clean D.D. limit Rs. 50,000/ - and FAUBC - Rs. 50,000/ - on 4.10.1979. These limits were changed subsequently vide Bank orders dated 22.6.1980 and various requisite documents were executed by the defendant/respondents afresh. The old partnership of which Swaran Lai Malhotra and Sunil Malhotra were also partners was dissolved on 4.9.1980 and the new partnership consisting of defendant/respondent No. 2 and 3 confirmed the liability to pay a sum of Rs. 99619.10 in C.C. Hypothecation Account and another sum of Rs. 1,16,744.28 in Export Loan Account vide separate confirmation letter dated 23.8.1980 and thus a total sum of Rs. 2,10,883.65 was due from the defendant/respondents. According to the further allegations made in the plaint, the outstanding amount of Rs. 1,16 -T44.28 related to Export Bills bearing FABC No. 79146 -P dated 18.12.1978 for U.S.A.$.3284 -15 equivalent to Indian currency of Rs. 32000/ - and FABC No. 79189 -P dated 23.1.1978 for U.S.$ 4032.25 equivalent to Indian currency of Rs. 40,000/ -, which was drawn at M/s. Pineer Sports Manufacturing Company, Ghanna, and stood paid in the local currency of Ghanna by the drawee on 11.7.1979 but they were still outstanding in the ledger book of the plaintiff -bank as the amount of these bills could not be repatriated in foreign currency and the defendant/respondents failed to adjust the outstanding amount despite executing balance confirmation letters.

(3.) ON the pleadings of the parties, following issues were framed: -