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2003 Supreme(Del) 480

High Court Of Delhi
CORPORATION BANK - Appellant
Versus
SUSHIL ENTERPRISES - Respondent
Suit 1488 of 1994
Decided On : 05/16/2003

Advocates Appeared:
NEMO K.PARASARAN, PRADIP DEVAN

Headnote:Registration Act, 1908 - Section 17(b) — Documents compulsorily registrable — Power of attorney — Non-testamentary instrument — Power of attorney authorising a person to collect rent on behalf of landlord — Not compulsorily registrable as it creates no interest in property — Said power of attorney legally enforceable also. Civil Procedure Code, 1908 - Order 34 — Suit for recovery — Deposit of title deeds — Defendants depositing documents of title of the properties in favor of plaintiff bank for loan account — Equitable mortgage created in respect of said properties in favor of the bank by way of collateral security — Plea that no mortgage created as security as the title deeds were shown only to support solvency of the defendants unsustainable.

        Order 34 - Suit for recovery — Cause of action — Limitation — Factum of defendants having availed of loan from plaintiff bank in evidence — Document acknowledging liability executed on 25.9.1991 — Suit instituted on 11.7.1994 — Within the period of limitation.

        Order 34 - Suit for recovery — Term loan — Plaintiff bank successfully proving that defendants 3 and 4 stood guarantors for any liability that may be outstanding against defendant 1 in respect of term loan — Statement of account duly maintained in book of account of the bank — Admissible in evidence under Bankers Books Evidence Act — Suit decreed With interest at the rate of 18% p.a.

J. D. KAPOOR

( 1 ) THIS is a suit for recovery of a sum of Rs. 7,59,466/- under Order 34 Code of Civil Procedure and for a decree of declaration to the effect that the defendants no. 5 and 6 have no authority to revoke the General Power of Attorney dated 7. 12. 87 executed by them authorising the plaintiff to realize the rent of premises no. ND-6, Pitampura, Vishakha Enclave, New Delhi taken on lease by defendant no. 7, Bank and appropriate the same against the loan amount till the liability of defendants no. 1 and 2 is liquidated. Apart from this , the plaintiff has also sought a decree of perpetual injunction for restraining defendants no. 5 and 6 from revoking the said GPA and also for a decree of mandatory injunction to direct defendant no. 7 to continue to pay the rent to the plaintiff till the liability of defendant no. 1 is liquidated.

( 2 ) THE case of the plaintiff in brief is that on 29. 3. 84 the plaintiff Bank granted in favour of defendant no. 1 through its proprietor defendant no. 2 a term loan against execution of documents of loan/security and on the guarantee of the defendants No. 3 and 4. Defendant no. 2 deposited the title deeds of property no. 1264, 1265 and 1265a, Fiaz Ganj, New Delhi while defendants no. 3 and 4 had already deposited the title deeds relating to property no. BL-106, Hari Nagar, New Delhi with an intention to create security thereon. The defendants no. 5 and 6 executed a Power of Attorney in favour of the plaintiff to collect rent of premises No. ND-7, Vishakha Enclave, Pitampura, Delhi under the tenancy of defendant number 7.

( 3 ) THE defendants no. 1 to 6 filed a joint Written Statement denying the claim of the plaintiff. They have alleged forgery done by the plaintiff in as much as that their signatures were obtained on blank loan documents which were later on filled up by the plaintiff. As regards the deposit of the title deeds of the properties, it is averred that the same were handed over to the Bank only to show their solvency and were never deposited with an intention to create mortgage. It is further averred that the loan amount was not disbursed and the statement of account is false. Apart from this they have also taken the plea that the Power of Attorney was not admissible being an unregistered document and moreover they had already revoked the same. The plaintiff denied the aforesaid allegations and reiterated the averments made by them in the plaint.

( 4 ) THE plaintiff examined two witnesses whereas defendants no, 2,6 and 3 appeared as their own witnesses. PW 1 V. K. Gupta has proved the Power of Attorney Ex. PW 1/1 executed in his favour by the plaintiff Bank authorising him to sign and verify the plaint and institute the suit. He has also proved acknowledgment of debt executed by defendant no. 2 to 4 from time to time as Ex. PW 1/2 to Ex. PW 1/8. This Power of Attorney was executed by defendants no. 5 and 6 in favour of the plaintiff Bank authorising the plaintiff to collect rent from defendant no. 7 as Ex. PW 1/9. He has also proved the copy of statement of Accounts certified under the Bankers Book Evidence Act as Ex. PW 1/10 and Statement of Unapplied Interest as Ex. PW 1/11.

( 5 ) PW 2 Vasudev Kamath, the Manager of the plaintiff s Bank has proved the documents of loan executed by the defendants. According to him these documents were duly filled when the defendants had signed and executed them. These documents are Ex. PW 2/1 ( loan application), Ex. PW 2/2 and Ex. PW 2/3 ( sanction letters), Ex. PW2/4 ( demand promissory notes executed by defendant no. 2 on behalf of defendant no. 1) and Ex. PW 1/5 ( the delivery letter of demand promissory notes) Ex. PW 2/6 ( the letter of guarantee signed by defendants no. 3 and 4), Ex. PW 2/7 (the term loan agreement), Ex. PW 2/8 ( original title deeds relating to property no. 1264, 1265 and 1265a, Faiz Ganj), Ex. PW 2/9 (the document through which the aforesaid title deeds were delivered), Ex. PW 2/10 ( the title deeds relating to pro






















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