Remanded

Rajesh Kumar and Anr. v. the Debt Recovery Tribunal andOR

Patna HC16 Dec 2013CWJC/6673/2010

Case brief

AI extract

What is this about?

The Patna High Court set aside the impugned RERA Tribunal judgment due to total non-consideration of the petitioners' written argument and findings. The matter was remanded to the Tribunal for fresh consideration and a reasoned judgment.

What did the court decide?

Impugned judgment set aside and matter remitted to the Debt Recovery Tribunal for fresh consideration and reasoned judgment.

Rajesh Kumar and Anr. Vs the Debt Recovery… — Contract and Commercial Disputes | Patna HC (2013)

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IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.6673 of 2010

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====================================================== 1. Rajesh Kumar, S/O Late Shashi Ranjan @ Shashi Ranjan Sahu, R/O 197B Shrikrishnapuri, P.S.-S.K. Puri, Town & District-Patna. 2. Prabhat Kumar, S/O Late Shashi Ranjan @ Shashi Ranjan Sahu, R/O 197-B Shrikrishnapuri, P.S.-S.K. Puri, Town & District-Patna. .... .... Petitioner/s Versus 1. The Debt Recovery Tribunal, Bihar, Boring Canal Road,(East),Patna Through Its Registrar. 2. The Punjab National Bank, Having Its Branch Office At Abu Lane, Meerut Cantt. P.S.-Sadar, District- Merrut, U.P. Through Its Manager. 3. Bharat Auto Traders, A Partnership Firm Situated At 172 Abu Lane, Merrut,U.P. 4. V.M. Aggrawal, S/O U.S. Aggrawal, R/O J-1/47 Jawahar Quarters, Merrut, P.S.-Lal Kurti, District- Merrut,U.P. 5. Smt. Manju Jain, W/O Late A. Jain , R/O J-1/47, Jawahar Quarters P.S.Lal Kurti, Merrut U.P. 6. Kartik Kumar, S/O Late Shashi Ranjan @ Shashi Ranjan Sahu, R/O B- 197 Shrikrishnapuri,P.S.-Shrikrishnapuri,District-Patna. 7. Pankaj Gupta, S/O Dr. G.C. Gupta. Residing At 83 Konark Colony, Rookee Road, Merrut, U.P. 8. Mukta Gupta, W/O Dr. G.C. Gupta. Residing At 83 Konark Colony, Rookee Road, Merrut, U.P. 9. Shivanidhi Dalmia, S/O Late Ram Krishna Dalmia. Residing At Sikandra Road,New Delhi. 10. Mridula Dalmia, W/O Shivanidhi Dalmia, Residing At Sikandra Road,New Delhi. 11. Madhu Aggrawal, W/O V.M. Aggrawal, R/O 129 Sector 14, Faridabad, Harayana. 12. Mamta Sahu, W/O Jugal Kishore Sahu, R/O Puja Bazar, Motijheel, Muzaffarpur, District- Muzaffarpur. .... .... Respondent/s ====================================================== Appearance : For the Petitioner/s : Mr. Kali Das Chatterji, Adv. Mr. Amlesh Kumar Verma, Adv. For the Bank : Mr. Nilamber Prasad Verma, Adv. ====================================================== CORAM: HONOURABLE MR. JUSTICE JAYANANDAN SINGH ORAL ORDER

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4 16-12-2013 In view of the short issue raised by learned counsel for the petitioner, which apparently necessitates remand of the matter to the Debt Recovery Tribunal, this Court is not required to notice the facts in much detail. Suffice it to notice that petitioners were

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Patna High Court CWJC No.6673 of 2010 (4) dt.16-12-2013

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guarantors for opening of a cash credit account with the respondent Bank by Bharat Auto Traders a partnership firm in 1981. The firm operated smoothly till 1992. However, the Managing partner, the father of the petitioners, died. Thereafter three partners retired from the partnership of the firm. The remaining partner inducted a new person as partner and continued with the business. He opened a current account with the Bank and thereafter the sale proceeds of the business and the hypothecated stocks of the firm were deposited in the current account instead of cash credit account. Thus, in this manner, though funds were deposited in the current account and were available, the cash credit account was not maintained properly and became irregular and over drawn. In the circumstances, the Bank ultimately filed Title Mortgage Suit against the firm which was lateron transferred to the Debt Recovery Tribunal, Patna which, after protracted proceeding, passed the impugned judgment, as contained in Annexure-15.

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Stand of the petitioners is that they were guarantors to the original cash credit account. After the partnership stood reconstituted by the remaining partner in 1992 their consent was neither obtained nor were they informed of opening of the current account. Hence, for the operation of the business by the new

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Patna High Court CWJC No.6673 of 2010 (4) dt.16-12-2013

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partnership their guarantee stood discharged by operation of law. It is submitted that, in fact, remaining partners played a fraud by depositing the sale proceeds of the hypothecated stock of the business in the current account leaving the cash credit account over drawn. He submits that opportunity was allowed by the Tribunal to file written statement and, after the conclusion of the hearing, a detailed written submission was also filed by the petitioners. Grievance is that though all these issues had been raised in the written argument, but the same have not at all been considered by the Tribunal in its judgment.

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Learned counsel for the Bank submits that, in terms of the guarantors’ agreement, the liability of the petitioners towards the dues of the Bank continues. He submits that, in fact, the petitioners had full knowledge about reconstitution of the partnership as all the partners were close family members. He submits that in fact this entire partnership was a closed family business and at all point of time it constituted of family members only. Hence, the petitioners were in full know of all the developments all the time. He further submits that in case they were not in agreement with the reconstitution of the partnership and opening of the current account they were at liberty to apply for discharge certificate from the Bank which they did not do. He

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Patna High Court CWJC No.6673 of 2010 (4) dt.16-12-2013

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submits that partnership was partnership at will therefore written notice was required to be given by the outgoing partner to the Bank. However, he fairly accepts that the judgment of the Tribunal does not reflect consideration of all these issues as well as consideration of the written argument filed on behalf of the petitioners.

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This Court has perused Annexure-14, which is a copy of the written argument filed by the two petitioners before the Tribunal in the matter. From this written argument it appears that they have raised many issues and have dealt with the matter in detail referring to different provisions of the Contract Act also. But from the impugned judgment, this Court finds that the Tribunal has noticed only the written statement and evidence on affidavit filed by these petitioners and not their written argument at all. This Court also finds that the findings of the Tribunal contained in paragraph 6 to 8 does not at all deal with any issue raised by the petitioners either in their written statement, evidence on affidavit or in the written argument. Thus it is apparent that there has been total non-consideration of the case of the petitioners by the Tribunal. It also appears that there is no proper consideration of the case of the Bank also by the Tribunal.

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In the circumstances, in all propriety, the matter requires

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Patna High Court CWJC No.6673 of 2010 (4) dt.16-12-2013

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consideration by the Tribunal afresh in accordance with law. The judgment of the Tribunal, as contained in Annexure-15, is therefore set aside. The matter is remitted back to the Tribunal for fresh consideration. The parties are directed to appear before the Tribunal on or before the 17^th of January, 2014. On their appearance, the Tribunal shall fix up a firm date for hearing of the matter afresh which shall be communicated to the parties. The parties shall appear on the date fixed for hearing and shall participate in the proceeding to enable the Tribunal to pass a reasoned judgment in the matter in accordance with law.

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However, before parting with the case, it is made clear that nothing has been brought on record from which it may appear that any other party, except petitioners of the present case and of CWJC No.8585 of 2010 (Kartik Kumar), has raised any grievance against the impugned judgment of the Tribunal before any forum or in any court. Hence this order shall stand confined to the cases of petitioners of these two writ applications only. For all other parties the impugned judgment shall remain operative, subject to any order of any higher forum or of any court of competent jurisdiction issued at their instance.

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Arvind/-

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(Jayanandan Singh, J)

Rajesh Kumar and Anr. v. the Debt Recovery Tribunal andOR

Case brief

What is this about?

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Rajesh Kumar and Anr. v. the Debt Recovery Tribunal andOR

Case brief

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