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2007 Supreme(Del) 402
IN THE HIGH COURT OF DELHI
Honble Judge: A.K. Sikri, J.
Banwari Lal Behl (Dead through LRs.) – Appellants
Vs.
Devinder Kumar Singari and Ors. – Respondent
CS (OS) No. 204 of 2004
Decided On: 26.02.2007
For Appellant/Petitioner/Plaintiff: Rishikesh, Adv.
For Respondents/Defendant: Nemo
The court established that the plaintiff was entitled to the principal amount of the loan and adjusted the interest rate, demonstrating the enforceability of loan agreements and the legal consequences of dishonored cheques.
Headnote:
Loan Recovery - Negotiable Instruments Act - [Section 138 of the Negotiable Instruments Act] - The court discussed the plaintiff's claim for recovery of a loan amount along with interest and damages. The defendants had issued post-dated cheques and created an equitable mortgage as security for the loan. The court found in favor of the plaintiff, granting a decree for the principal amount and adjusted the interest rate from 30% to 12% per annum.
Fact of the Case:
The plaintiff sought to recover a loan amount along with interest and damages from the defendants, who had issued post-dated cheques and created an equitable mortgage as security for the loan. The defendants failed to repay the loan, leading to the plaintiff filing a suit for recovery.
Finding of the Court:
The court found in favor of the plaintiff, granting a decree for the principal amount of the loan and adjusted the interest rate from 30% to 12% per annum.
Issues: Recovery of loan amount, interest, and damages, dishonor of post-dated cheques, creation of equitable mortgage as security.
Ratio Decidendi: The court held that the plaintiff was entitled to the principal amount of the loan and adjusted the interest rate from 30% to 12% per annum.
Final Decision: The court granted a decree in favor of the plaintiff for the principal amount of the loan and passed a preliminary decree in respect of the mortgage of the property, allowing for the sale of the mortgaged property if the amount is not paid within six months.
A.K. Sikri, J.
.1. By means of this suit the plaintiff seeks to recover a sum of Rs. 20,17,000/-from the defendants. Defendant No. 1 is stated to be the sole proprietor of defendant No. 2. As per the plaintiff, defendant No. 1 is his cousin. He had approached the plaintiff on 26.2.2001 with a request to give him some loan as he was facing financial stress and had to meet various business commitments. The plaintiff agreed to give the loan and gave a sum of Rs. 7,00,000/- vide cheque No. 211075 dated 26.2.2001 drawn on Punjab National Bank, Gandhi Nagar, Delhi-31. This cheque was duly encased by the defendant No. 1 and, thus, amount was received by them. The defendants also executed and delivered the following documents to the plaintiff:
.(a) Demand Promissory Note dated 26.2.2001 for Rs. 7,00.000/-.
.(b) Receipt dated 26.2.2001 for Rs. 7,00,000/-.
.(c) Post-dated Cheque No. 049577 dated 26.2.2002 for Rs. 7,00,000/- drawn on Vijaya Bank, Bhikaji Cama Place, New Delhi-66 in favor of the plaintiff.
.(d) Mortgaged Deed dated 26.2.2001 by deposit of title deeds.
2. As a security for repayment of the amount the defendants also deposited title deeds of immovable property, i.e. land measuring 1 Bigha 5 bids was in Khasra No. 40/10, situated at Abadi village Mundka, Delhi, creating equitable mortgage in favor of the plaintiff over the said property. The particulars of this property are as
3. The defendants also confirmed that these properties shall remain mortgaged with the plaintiff by way of security and the plaintiff will hold the same for clearance of entire liability of the defendants towards the plaintiff. The loan was to be paid back within one year and for that purpose the defendants had issued postdated cheque No. 049577 dated 26.2.2002 for Rs. 7,00,000/- drawn on Punjab National Bank, Bhikaji Cama Place, New Delhi in favor of the plaintiff. Another cheque of Rs. 50,000/- was also issued towards part payment of interest. However, both these cheques were dishonoured and when in spite of notice given under Section 138 of the Negotiable Instruments Act payment was not made, the plaintiff filed complaints against the defendants, which are pending before the learned Metropolitan Magistrate, Delhi. During the pendency of these proceedings, the defendants have made payment of Rs. 20,000/-. The plaintiff has, thus, filed this suit for recovery of Rs. 7,00,000/- along with interest claimed at 30% per annum from 27.2.2001 to 27.1.2004 when the suit is filed. After giving adjustment of Rs. 20,000/- paid by the defendants against the interest due, the interest amount claimed is Rs. 8,17,000/-. The plaintiff has also claimed damages/compensation in the sum of Rs. 5,00,000/ and in this manner, total claim of Rs. 20,17,000/- is preferred. The plaintiff has prayed for decree in the aforesaid amount along with 30% interest from 28.1.2004 till the date of decree as well as future interest at the same rate. Mortgage decree of the property in question is also prayed for as per Order 34, CPC.
4. The defendants were duly served with the summons and they appeared through Counsel. However, the plaintiff died during the proceedings. Application was filed for bringing his LRs on record. The plaintiff died leaving behind his widow, two sons and four daughters. However, the LRs agreed that name of one of the sons, under:
Date of MortgageName of Mortgagor Name of MortgageeSum secured : 26.2.2001 : D.S. Trading Co. through prop. Davinder Kumar Singari : Banwari Lal Behl : Suit amount
Rate of interest Property mortgaged Amount due : 2 1/2 per cent i.e. 30% p.a. : Land measuring 1 Bigha 5 bids was out of Khasra No. 40/10, situated at Abadi Village Mundka, Delhi State, Delhi. : Rs. 20,17,000.00 namely, Sh. Dev Kumar Behl alone be substituted in place of the plaintiff. However, order dated 2.3.2005 was passed impleading all the seven LRs as the plain
