BENARES BANK LTD Vs. DIP CHAND

JUDGEMENT

(1.) The action which has given rise to this appeal was brought by the Benares Bank, Ltd., Saharanpur, for the recovery of a sum of Rs. 6,268-4-0 due as principal and interest on a promissory note, dated 28 April 1927. The defendants to the suit were Dip Chand and Kirat Chand. The Court below has given a decree against Kirat Chand but has dismissed the plaintiff's suit against Dip Chand. The Bank has appealed and is represented by counsel. We have not had the advantage of hearing the respondent Dip Chand in this case, in the sense that counsel who appeared for him informed us that they had no instructions in the case. Mr. Dar on behalf of the appellant has taken us very fairly through the entire record and has placed the case for the appellant as well as the respondent.

(2.) The facts are that Kirat Chand was appointed a guardian to the person and property of Dip Chand minor and he acted as such guardian from 22 May, 1926, to 19 September 1928, when the natural mother, Mt. Bugli Kunwar, applied for being appointed as guardian and she was so appointed. While Kirat Chand was the guardian of the minor an application was made by him for sanction to raise a sum of Rs. 7,000 for certain purposes. The sanction was given on 25 August 1926, and it appears that a sum of Rupees 2,000 was advanced by the Benares Bank on the basis of a promissory note. This sum of Rs. 2,000 was spent and as the guardian anticipated certain other necessities he applied again on 8 March 1927, for a fresh sanction inasmuch as the Benares Bank was insisting that the name of the creditor should be specified in the sanction. On 9 March 1926 the District Judge passed the following order: Permitted to borrow Rs. 5,000 from the Benares Bank." Armed with this permission the guardian Kirat Chand went to the Bank and obtained an advance of Rs. 5,000 on 28 April 1927. On that date he executed a promissory note in favour of the Bank and he signed it as guardian of Dip Chand, minor. He also executed a receipt on the same day and there also he styled himself as guardian of the minor. There is yet another document of the same date which might be mentioned and it is a letter of guarantee by the guardian in his personal capacity to the Bank by which he made himself responsible for the due re-payment of the loan of Rs. 5,000 advanced to the estate of Dip Chand minor. The amount due under the promissory note was not paid and the Bank, therefore, on 30 August 1929, brought a suit for the recovery of the amount. Kirat Chand was absent, but Dip Chand contested the suit and he alleged that the income of the property of the minor was quite sufficient and Kirat Chand had no right to borrow the money for the defendant nor was any money borrowed from the Bank spent for the benefit of the minor. It was said that the sanction of the District Judge was obtained by misrepresenting facts. We might mention that Dip Chand was a minor even at the time of the institution of the present suit and he was impleaded under the guardianship of his mother Mt. Bugli Kunwar.

(3.) The plaintiff examined Harish Chandra, the head accountant of the Benares Bank, who stated that Kirat Chand was introduced to the Bank by Babu Anand Swarup, Vakil. He speaks of the interview and says that Kirat Chand represented that the money was required to meet the expenses of suits, to pay revenue and to meet the expenses of the minor's sister on which an enquiry was made from Babu Anand Swarup and the latter was asked to secure the order of the District Judge. It is clear from this that Babu Anand Swarup corroborated the statement of Kirat Chand regarding the necessities. It is true that in cross-examination Harish Chandra admits that no enquiry was made by the Bank about the income of the minor from his properties nor did the Bank make any enquiries as to the application of the money, but there can be no doubt that the Bank relied upon the facts that Kirat Chand was introduced by a respectable vakil and the necessity of obtaining the sanction of the District Judge was pointed out. "We might recall at this stage that the sanction of the District Judge was obtained once on 25th August 1926, and again on 8 March 1927. Kirat Chand continued as a guardian till 19 September 1928, and then Mt. Bugli Kunwar applied that she should be appointed a guardian and, Kirat Chand, the former guardian, should be discharged. In her application which is printed at p. 22 of our record she says that she had understood the accounts from Kirat Chand and obtained a number of papers from him. Kirat Chand was actually discharged by the District Judge on 19 March 1929 as appears from Ex. 2. One Abdul Rahman was produced by the plaintiff to prove the above-mentioned application of Mt. Bugli Kunwar. This witness says that the accounts were explained in the sitting room of the minor and that the lady took certain documents from Kirat Chand and affixed her thumb impression on the application. It is also clear from the statement of Dip Chand that he made an application to the District Judge after the discharge of Kirat Chand for a direction that the accounts be explained again to Dip Chand. This application was, however, rejected by the learned District Judge who presumably had passed the accounts which had been submitted by the guardian before discharge.