IMPORANT POINT
When a statement is made to a party and such statement is brought before the Court showing admission of liability by an application filed under Order XII Rule 6 and the other side has sufficient opportunity to explain the said admission and if such explanation is not accepted by the Court, trial Court can pass decree on basis of such an admission.

Headnote:Code of Civil Procedure, 1908-Order XII, Rule 6-Judgment upon admission-Suit by Bank against Company for recovery of money-Company in resolution passed in Board meeting admitting part of suit amount-Resolution communicated to plaintiff-Plaintiff seeking judgment on basis of admission contained in resolution of Company in its Board meeting-No explanation as to circumstances in which said admission was made-Averments in affidavit-in-opposition did not deny what was recorded in resolution-Trial Court justified in passing judgment on basis of admission in resolution.
       The object of Order XII Rule 6 is to enable the party to obtain a speedy judgment at least to the extent of the relief to which according to the admission of the defendant, the plaintiff is entitled. We should not unduly narrow down the meaning of this Rule as the object is to enable a party to obtain speedy judgment. Where other party has made a plain admission entitling the former to succeed, it should apply and also wherever there is a clear admission of facts in the face of which, it is impossible for the party making such admission to succeed. (Para 13)
       The next contention convassed is that the resolutions or minutes of meeting of the Board of Directors, resolution passed thereon and the letter sending the said resolution to the respondent bank cannot amount to a pleading or come within the scope of the Rule as such statements are not made in the course of the pleadings or otherwise. When a statement is made to a party and such statement is brought before the Court showing admission of liability by an application filed under Order XII Rule 6 and the other side has sufficient opportunity to explain the said admission and if such explanation is not accepted by the Court, we do not think the trial court is helpless in refusing to pass a decree. We have adverted to the basis of the claim and the manner in which the trial court has dealt with the same. When the trial judge states that the statement made in the proceedings of the Board of Directors meeting and the letter sent as well as the pleadings when read together, leads to unambiguous and clear admission with only the extent to which the admission is made is in dispute. And the court had a duty to decide the same and grant a decree. We think this approach is unexceptionable. (Para 14)
       Before the trial judge, there was no pleading much less an explanation as to the circumstances in which the said admission was made, so as to take it out of the category of admissions which created a liability. On the other hand, what is stated in the course of the pleadings, in answer to the application filed under Order XII Rule 6 CPC, the stand is clearly to the contrary. Statements had been made in the course of the Minutes of the Board of Directors held on 30th May, 1990 to which we have already adverted to in detail. In the pleadings raised before the Court, there is a clear statement made by the respondent as to the undisputed part of the claim made by them. In regard to this aspect of communicating the resolution dated 30th May, 1990 in the letter dated 4th June, 1990 what is stated in the affidavit-in-opposition in application under Order XII Rule 6 CPC is save, what are matters on record and save what would appear from the letter dated 30th May, 1990 all allegations to the contrary are disputed and denied. This averment would clearly mean that the petitioner does not deny a word of what was recorded therein and what is denied is the allegation to the contrary. The denial is evasive and the learned judge is perfectly justified in holding that there is an unequivocal admission of the contents of the documents and what is denied is extent of the admission but the increase in the liability is admitted. (Para 15)

JUDGMENT

Rajendra Babu, J.-This petition is filed against the judgment passed by the High Court of Calcutta affirming a decree passed by the learned Single Judge of the High Court for a sum of Rs. 1015.50 lakhs on application of the respondent for judgment upon admission as provided under Order XII, Rule 6 of the Code of Civil Procedure. The facts leading to the suit are as follows :

2. Transorient Engineering Company Ltd. subcontracted construction of students dormitories/dining hall for the University of Baghdad, Iraq. Respondent Nos. 1 to 3 functioned as consortium to finance the said project. Certain disputes having arisen petitioner filed suits against the respondent Banks that the debits raised are illegal etc. Indian Overseas Bank (IOB) filed a suit for recovery of certain sums of money and an application made therein under Chapter XIII-A of the Original Side Rules and the High Court of Calcutta rejected the same and Respondents 1 and 3 Banks and E.C.G.C. were also impleaded by an amendment in the said suit. Respondent No. 1 filed a suit for recovery of certain sum of money with certain other reliefs and in that suit, application for judgment upon admission was allowed. Appeal thereon being unsuccessful, this petition is filed.

3. The application filed by 1st respondent-Bank for judgment on admission covers only a part of the suit claim. The 1st respondent-Bank relied upon (i) Balance Sheet of the petitioner for year ending 31st March, 1989 with reference to Schedules C , D and E ; (ii) Minutes of the meeting of Board of Directors held on 30th May, 1990 which noticed the discussion at the meeting and issues that could be deemed to have been settled as result thereof, (iii) letter dated 4th June, 1990 communicating the resolution and minutes of the meeting of the Board of Directors held on May 30,1990

4. In the said minutes in the meeting held on 30th May, 1990, it was mentioned as follows :-

"IT WAS RESOLVED THAT:

In consideration of the United Bank of India, Connaught Circus Branch, New Delhi, having agreed to the continuation of the previously sanctioned aggregate credit limits amounting to Rs. 17.45 crores and in consideration of the Bank having agreed to continue the operation of the various borrowing accounts with outstanding dues, as stated hereinbelow in detail, the Company agrees to duly execute a fresh set of documents as required by the Bank there against.

That Mr. Harcharan Singh Dugal, the Managing Director of the Company be and is hereby authorised to execute the said documents and the official seal of the Company be affixed thereon.

It is also resolved that the Company disputes the amount of Rs. 3,08,01,000 debited to its Cash Credit Account on 01.08.89 which along with interest stands at Rs.3,60,62,579 as on 31.03.90.

That the company accepts its liability as per details stated hereinbelow :

Natures Present Amount Due Sanctioned

(Rs. In lakhs) (Rs. In lakhs)

Cash Limit/OD 65.00 101.16

Inland Guarantee 401.31 23.18

Baghdad Guarantee 1082.60 793.73

Jordan Guarantee 209.30 101.85

Term Loan 5.00 Nil

Loan Account Nil 16.88

1745.07 1036.80

That, also due to fluctuations in Exchange Rate there has been difference in amount due under Jordan Guarantee amounting to about Rs. 21 lakhs which is not reflected in details shown above."

5. A copy of the aforesaid resolution was sent to the plaintiff with the following note as indicated in the letter dated 4th June, 1990:

"(a) We do not confirm the debit entry of Rs. 3,60,62,579/- representing your share of the invoked guarantee with interest upto 31.3.90 which has been effected by you unauthorisedly against the illegal payment made by the Indian Overseas Bank. We are enclosing a copy of the reply given to the Legal Notice received by us from them. The reply is self-explanatory. You will agree that before effecting the said paym

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2000 Supreme(SC) 1285

Cases Referred (3)