High Court of Delhi
RAJIV SAHAI ENDLAW, J.
G.R. Arya (Through Lrs)
Versus
Veena Banga & Others
RFA No. 94 of 2005
Decided On : 20-11-2013
Limitation Act - Recovery of Loan - Section 14, Limitation Act - Section 16, Provincial Insolvency Act - Section 9, Provincial Insolvency Act
Fact of the Case:
The appellant filed a suit for recovery of a loan advanced to the deceased, seeking to rely on Section 14 of the Limitation Act. The trial court dismissed the suit on the grounds of limitation, and the appeal was also dismissed.
Finding of the Court:
The court found that the appellant failed to prove the insolvency proceedings and did not establish good faith in pursuing the appeal. The court held that the suit claim was barred by time and dismissed the appeal.
Issues: The issues included the time-barred nature of the suit, the applicability of Section 14 of the Limitation Act, and the lack of good faith in pursuing the appeal.
Ratio Decidendi: The court held that the relief sought in insolvency proceedings is different from that in a suit for recovery of money, and the procedure is divergent. The appellant failed to establish good faith and did not prove the insolvency proceedings, leading to the dismissal of the appeal.
Final Decision: The appeal was dismissed, and no costs were imposed on the appellant.
Rajiv Sahai Endlaw, J.
1. The appeal impugns the judgment and decree dated 20.11.2004 of the Court of Additional District Judge (ADJ), Delhi of dismissal of suit No.74/2002 filed by the appellant / plaintiff for recovery of Rs.7,08,500/-along with interest and for permanent injunction. Notice of the appeal and of the application for interim relief was issued though no interim relief granted. The appeal was on 18.07.2006 admitted for hearing and the Trial Court record requisitioned. The appellant / plaintiff filed CM No.12139/2006 under Order 41 Rule 27 of the CPC and which was on 08.09.2006 ordered to be taken up along with the appeal. The appellant / plaintiff died during the pendency of the appeal and notice of the said application was issued to respondents / defendants. Though the said respondents / defendants filed a reply to the application but failed to appear. Vide order dated 20.12.2012 the legal representatives of the appellant / plaintiff were substituted in his place. The appeal was on 01.05.2013 dismissed in default of appearance of the appellant / plaintiff or his counsel. An application for restoration was filed when it was felt that instead of mechanically issuing notice thereof, it should be found whether there was any merit in the appeal to justify keeping it pending any longer. On going through the records, prima facie there did not appear to be any merit in the appeal. Accordingly, the counsel for the appellant / plaintiff was given an opportunity to address finally on the appeal. The counsel for the appellant / plaintiff has been heard.
2. The deceased appellant / plaintiff instituted the suit from which this appeal arises pleading:
(a) that the appellant/plaintiff had from time to time advanced a loan of Rs.7,08,500/-to Sh. Bhupinder Banga husband of the respondent /defendant No.1 and father of the respondent / defendants No.2&3 Sh. Rohit Banga and Ms. Preeti Banga;
(b) that Sh. Bhupinder Banga committed suicide on 16.03.1995 leaving the three respondents / defendants as his only legal heirs and a huge estate inter alia comprising of a three storey shop with basement at F-1/7, Madangiri, New Delhi;
(c) that after the demise of Sh. Bhupinder Banga, his legal heirs declared themselves as insolvent;
(d) that the appellant / plaintiff was one of the plaintiffs in suit No.2/1996 which was filed against the legal heirs of Sh. Bhupinder Banga; however the said suit was dismissed and RCA No.5/2000 preferred against the judgment of dismissal was also dismissed by the learned ADJ on 03.04.2001; RSA No.164/2001 preferred against the same was also dismissed with the observation:
“In case, the legal heirs have inherited any part of the estate of the debtor, the only remedy available to the appellants, in my view, is to file appropriate proceedings for recovery of the debt but the provisions of the Provincial Insolvency Act cannot be resorted to against the said persons”.
(e) hence, the suit from which this appeal arises, was being filed;
(f) that the appellant / plaintiff has been pursuing his case from the very beginning and Section 14 of the Limitation Act was quoted;
(g) that the appellant / plaintiff had lent monies to Sh. Bhupinder Banga vide cheques dated 15.09.1989, 28.01.1991, 26.09.1992 (two), 08.06.1994 (three), 21.02.1995 (two) and by cash on 15.02.1989, 01.02.1990 and 20.02.1995;
(h) that amounts had accrued to the appellant / plaintiff on maturity of the committees on 15.09.1992, 10.01.1993, 16.04.1994, 11.08.1994 and 01.01.1995 but the same were also retained by Sh. Bhupinder Banga as loan;
(i) that the respondents / defendants being the legal heirs of Sh. Bhupinder Banga were liable to repay the said total loan amount of Rs.7,08,500/- to the appellant / plaintiff;
(j) that the respondents / defendants had agreed to sell the shop of Sh. Bhupinder Banga and of which complaint had been made to the police;
(k) that the cause of action for the suit had accrued to the appellant / plaintif
Yeswant Deorao Deshmukh Vs. Walchand Ramchand Kothari AIR 1951 SC 16
Binodilal Vs. Satyendra Singh AIR 1956 MP 57
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Alliance Paints & Varnish Works Pvt. Ltd. Vs. Hari Kishan Gupta 168 (2010) DLT 591
Debjyoti Gupta Vs. Indiabulls Securities Ltd. 202 (2013) DLT 563
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