ORDER

1. This appeal is against the order of the Debts Recovery Appellate Tribunal, Mumbai dated 28-10-1996.

2. Briefly stated, the facts are as follows:

The respondents were debtors of the appellant Bank. The appellant Bank filed a suit for recovery of its debt. Pending that suit, the parties arrived at an agreement dated 11-7-1983. The decision of this matter depends on the terms of the agreement. Therefore, the terms of the agreement shall be set out in detail a little later. The appellant Bank filed a second suit for enforcement of this agreement. That suit came to be transferred to the Debts Recovery Tribunal. The Debts Recovery Tribunal by its judgment dated 27-6-1996 dismissed the claim of the appellant Bank on the ground that under the agreement the appellant Bank had taken jewellery in full and final settlement of all its claims. It was also held that the first suit having been withdrawn without leave to file another suit, the second suit was barred under the provisions of Order 23 Rule 1 (4) of the Civil Procedure Code.

3. The appeal filed by the appellant Bank has been dismissed by the impugned judgment. In the impugned judgment it is recognised that a second suit would be maintainable. However, the Appellate Tribunal also comes to d the conclusion that under the agreement the precious stones were handed over in full and final settlement of all the dues of the appellant Bank and that, therefore, the second suit was not maintainable.

4. At this stage it becomes necessary to see the terms of the agreement dated 11-7-1983. The agreement first recites that a suit had already been filed. It then sets out what are the amounts due and what are the amounts paid back. Thereafter, the relevant recitals read as follows:

"AND WHEREAS, the firm admits that a sum of Rs 58.07 lakhs as per details given above is due and payable to the Bank as on the date of the agreement and whereas the parties have mutually arrived at outside-court settlement and the firm has handed over precious stones as mentioned in the schedule annexed to the Bank and the parties are desirous of recording the settlement in writing.

Now, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1. That the Bank shall allow a lump sum remission of Rs 5 lakhs towards interest charged in the account.

2. That after the execution of these presents, the Bank shall not charge any further interest in the account.

3. That the stocks of precious stones as per the schedule annexed which are free from encumbrances and lawfully owned by the firm and in respect of which the firm has absolute powers of disposal have already been got examined and valued by the approved valuer and delivered to the Bank as security towards the outstanding dues amounting to Rs 53.07 lakhs.

4. That the firm hereby undertakes to arrange disposal of the stocks so delivered to the Bank within a period of six months failing which the Bank shall have the full authority to dispose of the goods a either through private treaty or by public auction in their sole discretion and appropriate the proceeds thereof against the Banks dues amounting to Rs 53.07 lakhs.

That simultaneously with the execution of these presents and the execution and completion of all necessary documents as may be required by the Bank, the Bank and the firm shall file a compromise b deed on the lines suggested above in the court."

(emphasis supplied)

5. A plain reading of this agreement shows that the respondents have admitted that a sum of Rs 58.07 lakhs was due and payable to the appellant c Bank on the date of the agreement. It shows that some precious stones have been handed over. It then recites that the appellant Bank has allowed a lump sum remission of Rs 5 lakhs towards interest. It then recites (in clause 2) that the appellant Bank shall not charge any further interest. Clause 3 states that the precious stones have been delivered as "security towards the outstanding dues amounting to Rs 53.07 lakhs". Thus, it is clear that the precious stone