IMPORTANT POINT
The rejection of an application under Order VII Rule 11(d) of the Code must be justified by the absence of a cause of action, and the plaint must proceed as a whole, as established in the judgment of the Supreme Court in Madhav Prasad Aggarwal and Another Vs. Axis Bank Ltd. and Another (2019) 7 SCC 158.

JUDGMENT :

Heard Mr. K. Bhattacharjee, the learned counsel appearing on behalf of the Petitioner and Mr. J. Sharma, the learned counsel appearing on behalf of the Respondents.

2. This is an application under Article 227 of the Constitution challenging the order dated 11.11.2021 passed in Misc. (J) Case No.78/2020 arising out of Title Suit No.306/2018 whereby the learned Trial Court i.e. the Court of the learned Civil Judge (Senior Division) No.3, Kamrup (M) at Guwahati had rejected the application filed for rejection of the plaint in terms with Order VII Rule 11(d) read with Section 18 of the Recovery of Debt due to Banks and Financial Institutions Act, 1993 (for short “the Act of 1993”)

3. For the purpose of deciding an application under Order VII Rule 11(d) of the Code of Civil Procedure, 1908 (for short “the Code”) the requirement of the law is to see as to whether from the statements made in the plaint, the suit is barred by any law. Therefore, this Court constricts itself to the averments made in the plaint as well as the documents enclosed therewith.

4. From a perusal of the copy of the plaint, it reveals that the Plaintiff Nos. 1 and 2 were admittedly Directors of the Defendant No.2. In the course of business, the Defendant No.2 had taken a loan of Rs.1.8 crores from the Defendant No.1 (the Petitioner herein) which was sanctioned vide sanction letter No.HUDCO/ZO-NE/LANDMARK/18725/2005/1987 dated 09.09.2005 by keeping the Schedule-A land to be the primary security and Schedule-B land and others as collateral securities as per the agreement executed between the Defendant Nos. 1 and 2 as well as the proforma Defendant No.3.

5. It was alleged in the plaint that at the time of taking the loan from the Defendant No.1, various printed documents were required to be signed by the Plaintiffs as Directors of the Defendant No.2. There were also some documents for creation of mortgage of the Schedule-A land which were signed by the Plaintiffs as Directors of the Defendant No.2 and the proforma Defendant No.3 as land owner of the land. Besides, there was also a collateral security created in respect to the plot measuring 1 Bigha as described in Schedule-B to the plaint. The Schedule-B land belonged to the plaintiffs who were the Directors of the Defendant No.2. It was also stated that the Defendant No.1 insisted that the plaintiffs to sign a typed and printed paper containing the personal guarantee by the plaintiffs. The plaintiffs on good faith signed the printed document of the Defendant No.1 which contained personal guarantee of the plaintiffs in respect of the loans so sanctioned in favour of the Defendant No.2 on 25.04.2007. It was further stated that the Plaintiff No.2 retired on 11.04.2007 and thereafter, the Plaintiff No.1 retired on 28.06.2016 and accordingly, their names were deleted from the records of the Registrar of Companies and at the time of filing of the suit, the Defendant No.2 had been doing business with the Directors Shri Debishankar Kar and Smti Mary Das. It was further mentioned that the Defendant No.2 till the date of retirement of the plaintiffs owned an amount of Rs.3 crores and the plaintiffs were to receive the said amount from the Defendant No.2.

6. Be that as it may, although the plaintiffs had retired from the Directorship, the property described in Schedule-B land was not freed from the collateral security created in favour of the Defendant No.1 and as such the said property was charged by the Defendant No.1 as a collateral security for sanctioning the term loan in favour of the Defendant No.2. It was further mentioned that the plaintiffs on their retirement from the Defendant No.2 demanded Rs.3 crores being the value of the plots of land as mentioned in Schedule-B but the defendant No.2 avoided the request on one plea or the another and ultimately on delivery of the judgment dated 28.06.2017 passed in OA No.63/2012 by the learned DRT, Guwahati, the Defendant No.2 on 11.04.2018 refused to pay the same