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High Court Of Calcutta
Bimal Chandra Basak
ORIENTAL BANK OF COMMERCE LTD. - Appellant
Versus
PASHOK TEA CO.LTD. - Respondent
Matter 6 Of 1975
Decided On : 03/12/1975
TRANSFER OF SUIT - O. C Suit No. 48 of 1974 (Oriental Bank of Commerce Limited v. Pashok Tea Co. Ltd. and Ors.) - Order XXXIV Rule 4 of the Code of Civil Procedure - Bankers' Books Evidence Act - Whether the suit should be transferred from Darjeeling Court to the High Court.
Fact of the Case:
Oriental Bank of Commerce Limited filed a suit against Pashok Tea Co. Ltd. and others in the Darjeeling Court for recovery of a loan amount of Rs. 35,71,047.91 paise. The plaintiff bank applied for the transfer of the suit to the High Court on the grounds that the defendants had submitted to the jurisdiction of the High Court by filing an application under Article 227 of the Constitution of India and Section 115 of the Code of Civil Procedure, that all the defendants reside and carry on business within the Original Jurisdiction of the High Court, and that the suit is for money lent and advanced and all transactions took place within the Original Jurisdiction of the High Court.
Finding of the Court:
The High Court held that the grounds put forward for the transfer of the suit were neither sufficient nor cogent. The fact that the defendant company had filed an application in the High Court in its revisional jurisdiction cannot be a ground for transfer of the suit to the High Court. The fact that all the defendants in the suit reside and carry on business within the original jurisdiction of the High Court by itself cannot decide the matter. The records of the borrower may be within the jurisdiction of the High Court but that by itself is not sufficient. The suit has been filed by the plaintiff Bank itself in Darjeeling Court. It has chosen a forum. It has not merely relied on a personal decree but has asked for a mortgage decree. Further it may not be necessary to carry all the records from the Bank's Calcutta Office to Darjeeling Court in view of the provisions of Bankers' Books Evidence Act. This is also not a pure simple suit for money lent and advance. From the nature of the defence sought to be set up, it is quite clear that it cannot be said that the respondents will not be required to produce any evidence from its tea gardens. The manner in which the agents of the plaintiff ran the tea estates, what sales were effected by them, what amount should have been credited to the account of the defendant company would be very much relevant and for this reason the evidence of the employees of the tea estates and the records of the said tea estates would be very much relevant during the hearing of the suit. It is also to be remembered that the plaintiff is also relying on the activities of its agent. According to the plaintiff bank the defendant company prevented the said agent from performing his duties and thereby committed breach of the contractual obligations. This is also not a "commercial Suit" as it is known in this Court.
Issues: 1. Whether the suit should be transferred from Darjeeling Court to the High Court? 2. Whether the grounds put forward for the transfer of the suit are sufficient and cogent?
Ratio Decidendi: The High Court held that the grounds put forward for the transfer of the suit were neither sufficient nor cogent. The fact that the defendant company had filed an application in the High Court in its revisional jurisdiction cannot be a ground for transfer of the suit to the High Court. The fact that all the defendants in the suit reside and carry on business within the original jurisdiction of the High Court by itself cannot decide the matter. The records of the borrower may be within the jurisdiction of the High Court but that by itself is not sufficient. The suit has been filed by the plaintiff Bank itself in Darjeeling Court. It has chosen a forum. It has not merely relied on a personal decree but has asked for a mortgage decree. Further it may not be necessary to carry all the records from the Bank's Calcutta Office to Darjeeling Court in view of the provisions of Bankers' Books Evidence Act. This is also not a pure simple suit for money lent and advance. From the nature of the defence sought to be set up, it is quite clear that it cannot be said that the respondents will not be required to produce any evidence from its tea gardens. The manner in which the agents of the plaintiff ran the tea estates, what sales were effected by them, what amount should have been credited to the account of the defendant company would be very much relevant and for this reason the evidence of the employees of the tea estates and the records of the said tea estates would be very much relevant during the hearing of the suit. It is also to be remembered that the plaintiff is also relying on the activities of its agent. According to the plaintiff bank the defendant company prevented the said agent from performing his duties and thereby committed breach of the contractual obligations. This is also not a "commercial Suit" as it is known in this Court.
Final Decision: The High Court dismissed the application for transfer of the suit with costs.
( 1 ) THIS is an application for transfer of O. C Suit No. 48 of 1974 (Oriental Bank of Commerce Limited v. Pashok Tea Co. Ltd. and Ors.) now pending in Court of Subordinate Judge at Darjeeling. The plaintiff's case as made out in the said application is as follows : The plaintiff is a banking company. The defendant No. 1 is a public limited company owning tea estates, one known as Pashok Tea Estate in the District of Darjeeling and the other known as Lukan Tea Estate (also known as Mohara Tea Estate) in the District of Jalpaiguri, West Bengal. The defendant company was a constituent of the plaintiff. The defendant company was allowed to open an overdraft account with the plaintiff with effect from January, 1965 which was secured by hypothecation of the first defendant's entire tea crop already produced and to be produced in future in the aforesaid two tea estates including plant, machineries as well as stocks and stores. Initially the overdraft limit was fixed at Rs. 20,00,000 which was increased from time to time and ultimately fixed at Rs. 43,00,000. Thereafter in January, 1969 several title deeds were deposited with the plaintiff Bank to secure due repayment of the money which might be advanced by the plaintiff bank to the defendant company and might be standing in the plaintiff's credit. The defendants Nos. 2 to 4 are the Directors of the defendant Company. The defendant No. 5 has now ceased to be a director. The defendants Nos. 2 to 5 executed several deeds of guarantee and/or indemnity in favour of the plaintiff in respect of the amount or amounts which might be found due and payable by the first defendant to the plaintiff. By an agreement in writing dated 28th February, 1973 the plaintiff bank agreed to grant to defendant Bank loan overdraft and/or cash credit facilities to the extent of Rs. 43,00,000 for the purpose of cultivation, manufacture and despatch of tea during the season 1973-74 and subsequent seasons for Pashok Tea Estate and Lookan Tea Estate under certain terms and conditions. In February, 1973 by mutual agreement the said overdraft loan account was split into two accounts, namely. Fixed Loans Account and Overdraft Account. The limit in the first case was set at Rs. 16. 00,000 and that in the other Rs. 21,29,000. In or about May, 1974 the defendant No, 3 deposited several title deeds with intent to create security and for due repayment of the loans advanced by the plaintiff to the defendant company. Pursuant to above from tune to time the defendant company borrowed various sums of moneys from the plaintiff and repaid divers sums to it. After giving credit to the first defendant for receipt of such payments and after taking into account all moneys lent and advanced or paid by the plaintiff to the defendant company or for or on behalf of or on ac- count of the defendant company a sum of Rs. 35,71,047. 91. paise became due and payable as on August 7, 1974. By a resolution duly passed by the Board of Directors of the defendant company in its meeting held on 16th May, 1974 the defendant company admitted and/or acknowledged that a sum of Rs. 16. 00,000 in the Fixed Loan Account and a sum of Rupees 18,91,269,44 p. in the overdraft account was due and payable by the defendant company to the plaintiff bank as on 15th May, 1974. In view of the failure of the defendant company to repay the loan and in view of further breaches of said obligations, the plaintiff bank appointed one Sri Dugal, an officer of the plaintiff bank to supervise the working of the defendant company in terms of the agreement between the parties. It is alleged that the defendant company failed and neglected to give the sales figures and failed to act in terms of the said agreement. The defendant compahy in breach of the provisions of the said agreement sold various quantities of tea locally at an inordinate low price to the detriment of the plaintiff Bank without any consent from the plaintiff Bank and caused wrongful lo
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