The plaintiff's lack of locus standi to request further loan and the defendant's right to refuse the loan were the central legal points established in the judgment.

JUDGMENT :

Ambuj Nath, J.

Appellant-Gayatri Singh has filed this appeal against the judgment and decree dated 07.06.2011, (Decree drawn on 14.06.2011) passed by Shri Arjun Modi, Sub-Judge-II-cum-Land Acquisition Judge, Bokaro in Title Suit No. 04/1993, whereby and wherein, the learned Sub-Judge-II-cum-Land Acquisition Judge, Bokaro dismissed the suit of the appellant seeking a declaration that the appellant was entitled to recover Rs. 25,50,000/- as damage, loss and compensation from the Respondent No. 1 along with the cost of the suit.

2. For the sake of convenience, parties shall be referred to in their original capacity as in Title Suit No. 04/1993.

3. Case of the plaintiff is that her brother Sanjay Kumar Singh was the proprietor of M/s Vikas Saw Mills. He had taken loan from the defendants. The plaintiff and her husband stood as a guarantor against the loan. The plaintiff had mortgaged 17 decimals of land against the loan given by the defendants to her brother. Subsequently, plaintiff became the partner in M/s Vikas Saw Mills and the aforesaid Firm was converted into a Partnership Firm on 20.02.1986. In the meantime, husband of the plaintiff namely, R.D. Singh qualified in the Bihar Judicial Services and was posted as a Probationary Munsif in Darbhanga. Plaintiff started residing with her husband at Darbhanga. In the meantime, her brother Sanjay Kumar Singh ran the business haphazardly and in irregular manner and also started misappropriating money of the Firm. Plaintiff and her husband being the guarantors, requested R.K. Rai, the then Branch Manager of Allahabad Bank, B.S. City Branch, Bokaro several times not to advance any further loan to Sanjay Kumar Singh, but R.K. Rai continued advancing him loan. Subsequently, Sanjay Kumar Singh went missing. The plaintiff took over the business of M/s Vikas Saw Mills and informed the defendants about this fact. When the defendants started demanding to return the loan amount which was taken by Sanjay Kumar Singh, the plaintiff requested the defendants that she has taken over the control of M/s Vikas Saw Mills and has started a new business under the name and style of Jai Maa Bhawani Timber. She requested the defendants to advance loan of Rs. 3,00,000/- for supplying timber to her customers. On the assurance of the defendants, she took order for supply of timber from her customers. The defendants did not honour their commitment, leading to loss to the extent of Rs. 16,45,000/-. On 16.01.1992 the plaintiff wrote a letter to the defendant no. 1 regarding the loss suffered by her due to gross violation of the assurance given for sanctioning loan to the plaintiff. The defendant no. 1 vide letter no. ADV/26/92 dated 16.01.1992 replied that the proposal for sanctioning loan in the name of the Firm M/s Jai Maa Bhawani Timber was rejected by the Regional Manager, Ranchi on 18.05.1989.. Accordingly, the present suit was filed.

4. Defendants appeared on notice and filed contesting written statement. It has been pleaded in the written statement that the suit is neither maintainable nor tenable in the eyes of law. It has also been pleaded that the suit is bad for misjoinder of cause of action and it was barred by law of limitation, estoppel, waiver and acquiescence. The suit is barred by Specific Relief Act. It has been pleaded that Section 69 of Partnership Act provides that no suit arising out of contract shall be instituted in any court, unless Firm was registered and the plaintiff has not been shown in the Register of M/s Vikas Saw Mills as a partner in the said Firm. It has further been pleaded that on 15.11.1984, loan of Rs. 1,70,000/- was sanctioned to M/s Vikas Saw Mills, Proprietorship Firm of Sanjay Kumar Singh, subject to hypothecation of stocks, Machines, tools and plants of the said Firm, Guarantors and good equitable mortgage. In token of the said loan facilities, the said Sanjay Kumar Singh on 27.11.1984 executed a letter of hypothecation by hypothecating the Machines, Tools, Plant a