Regular Second Appeal No.1012 of 1988 -1- IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH Regular Second Appeal No.1012 of 1988 Date of decision: 16.7.2010 1. The State of Punjab through the Collector, Ludhiana. 2. The Excise and Taxation Officer, Jagraon, exercising the powers of Assistant Collector, Ist Grade, Jagraon. ..... Appellants. Versus 1. Madan Lal son of late Phole Ram, r/o H.No.573, Dana Mandi, Jagraon, District Ludhiana. 2. M/s Babu Ram Pawan Kumar, Jagraon, through Shri Pawan Kumar and Smt. Bimla Rani, partners, 3. Shri Pawan Kumar son of Shri Babu Ram, 4. Smt. Bimla Rani, wife of Shri Babu Ram, both residents of Mohalla Shastri Nagar, Jagraon, District Ludhiana. ..... Respondents. CORAM: HON'BLE MR. JUSTICE SHAM SUNDER Present:- Mr. Kirat Singh Sidhu, DAG, Punjab for the appellants. Respondent nos . 1 to 4 ex-parte. --- Sham Sunder, J. This Regular Second Appeal is directed against the judgment and decree dated 18.9.1985, rendered by the Court of Additional Senior Sub Judge, Ludhiana, vide which it Regular Second Appeal No.1012 of 1988 -2- decreed the suit of the plaintiff(now respondent no.1) and the judgment and decree dated 19.11.1987, rendered by the Court of Additional District Judge, Ludhiana, vide which it dismissed the appeal. 2. The facts, in brief, are that, M/s Babu Ram Pawan Kumar moved an application for registration as Dealer on 4.4.1975, under Section 9 of the Punjab General Sales Tax Act, 1948 to the Excise & Taxation Officer, Jagraon. The application was entertained and without imposition of any condition of furnishing security/surety, 'Registration Certificate' was issued in their favour. A show cause notice was issued to the plaintiff by the Excise & Taxation Officer, Jagraon, exercising the power of Collector Ist Grade, Jagraon, requiring him to appear before him on 22.09.1979, failing which, penalty to the tune of Rs.50,000/- shall be imposed upon him, as he stood surety of M/s Babu Ram Pawan Kumar. It was further stated that the plaintiff appeared before the Assistant Collector, Jagraon and contested his liability to pay a sum of Rs.50,000/- on various grounds. Ultimately, a certificate for recovery of Rs.50,000/- from the plaintiff was issued as against M/s Babu Ram Pawan Kumar, Commission Agents, which were carrying on the business as Commission Agents under Punjab Regular Second Appeal No.1012 of 1988 -3- General Sales Tax Licence No.LUD/IV/24378 tax had been assessed in the sum of Rs.24,777 and penalty had been assessed in the sum of Rs.31,990/-, but they failed to pay the same. The order dated 12.10.1979 passed by the Assistant Collector Ist Grade, Jagraon holding the plaintiff (now respondent) to pay a sum of Rs.50,000/- out of the total dues of tax and penalty outstanding against M/s Babu Ram Pawan Kumar, was challenged as illegal, void, ultra-vires, without jurisdiction and inoperative against his rights, on the grounds that he (plaintiff) had not furnished any security bonds/surety bonds in pursuance of any order, passed under Section 9 of the Punjab General Sales Tax Act, 1948; that the Excise and Taxation Officer, Jagraon, while granting a certificate of Registration to M/s Babu Ram Pawan Kumar, Commission Agents, on the basis of application, did not impose any condition for furnishing of security bonds/surety bonds; that the recovery certificate was issued without affording any opportunity of being heard to the plaintiff; that no effort was made to recover the amount from M/s Babu Ram Pawan Kumar, dealers; that the recovery could be effected from the alleged surety, only after the dealer failed to pay the same; that the alleged surety bonds furnished by the plaintiff had been altered and interpolated and not signed by Regular Second Appeal No.1012 of 1988 -4- him ; and that no liability could be imposed upon the plaintiff even under the provisions of law, on the basis of the alleged surety bonds. The defendants were many a time asked, to withdraw the illegal order/certificate of recovery, but to no avail. On their final refusal, left with no alternative, a suit for permanent injunction was filed. 3. Defendant nos. 1 and 2, put in appearance, and contested the suit, by way of filing joint written statement, wherein, it was pleaded that the Civil Court had no jurisdiction to entertain and try the same. It was further pleaded that the plaintiff and Telu Ram, partner of M/s Telu Ram Darshan Kumar, Jagraon Mandi, District Ludhiana another surety for M/s Babu Ram Pawan Kumar, Jagraon, had filed a Civil Writ Petition No.3756 of 1979 in this Court, claiming the same relief, but the said Writ Petition was dismissed by the Division Bench, vide judgment dated 6.11.1979. It was further pleaded that, as such, the suit was barred by the principles of res- judicata. It was admitted that M/s Babu Ram Pawan Kumar, Commission Agents made an application for the issuance of registration certificate as dealer on 4.4.1975. It was further stated that before the issuance of registration certificate, the dealer was called upon to furnish security/surety bond. It was Regular Second Appeal No.1012 of 1988 -5- further stated that Madan Lal furnished the surety bond for M/s Babu Ram Pawan Kumar, Commission Agents. It was further stated that since M/s Babu Ram Pawan Kumar, Commission Agents were defaulters, the amount could not be recovered from them. It was further stated that notice was given to the plaintiff, who was surety and after affording full opportunity of being heard to him, the order for recovery of the amount, aforesaid, was passed. It was further stated that the recovery certificate was accordingly issued. The remaining averments, contained in the plaint, were denied, being wrong. 4. In the replication, filed by the plaintiff, he reasserted all the averments, contained in the plaint, and repudiated those, contained in the written statement, filed by respondent nos. 1 and 2. 5. From the pleadings of the parties, the following issues were framed by the trial Court :- “1- Whether the suit is not maintainable under law ? OPD 2- Whether notice u/s 80 CPC was served before the institution of the suit, if not its effect ?OPP 3- If issue no.2 is proved in the negative whether the plaintiff had already obtained exemption from notice? If so its effect ?OPD Regular Second Appeal No.1012 of 1988 -6- 4- Whether the civil Court has no jurisdiction to try the suit ?OPD 5- Whether the suit is barred by principle of resjudicata ?OPD 6- Whether the plaintiff is entitled to the injunction prayed for ?OPP 7- Whether the order of the Assistant Collector dated 12.10.1979 for the recovery of security amount from the plaintiff is illegal, ultravires for the reasons stated in the plaint ?OPP 8- Relief.” 6. The Court of Sub Judge Ist Class, Ludhiana, treated the issues with regard to jurisdiction of the Court to entertain the present suit and maintainability of the same as preliminary issues. The suit was dismissed, vide judgment dated 28.11.1981, holding that neither the Civil Court had jurisdiction to entertain and try the suit, nor the suit was maintainable. 7. Feeling aggrieved, an appeal was preferred by the plaintiff/appellant, which was accepted and the Appellate Court remanded the case with a direction to the trial Court to frame an issue whether the plaintiff executed the alleged surety/security bonds and, if so, whether the same were legal and valid, and, as such, he (plaintiff) was liable as surety Regular Second Appeal No.1012 of 1988 -7- or not. 8. After receipt of the case, the following additional issue was framed by the Court of Sub Judge Ist Class, Ludhiana:- “7(a) Whether the plaintiff had executed security bond standing surety of Babu Ram Pawan Kumar, Commission Agents Jagraon and the said security bond was valid and legal and the plaintiff was liable as surety to discharge the dues outstanding against M/s Babu Ram Pawan Kumar Gupta)?” 9. The parties led evidence, in support of their case. The trial Court after hearing the Counsel for the parties, and, on going through the evidence and record of the case, decreed the suit, on the ground that the defendants(now appellants) failed to prove the execution of the security/surety bond allegedly furnished by the plaintiff, on the basis whereof, penalty was imposed upon him. 10. Feeling aggrieved, an appeal was preferred by the appellants/ defendants, which was dismissed, by the Court of Additional District Judge, Ludhiana, vide its judgment and decree dated 19.11.1987. Regular Second Appeal No.1012 of 1988 -8- 11. Still feeling dis-satisfied, the instant Regular Second Appeal has been filed, by the appellants/ defendants. 12. I have heard the Counsel for the appellants, and have gone through the evidence and record of the case, carefully. 13. Alongwith the appeal, an application under Order 41 Rule 27 read with Section 151 CPC was filed by the appellants, on the ground that the plaintiff/respondent furnished security/surety bonds in the sum of Rs.50,000/-. It was further stated that the sole ground, on which the suit of the plaintiff was decreed was that the execution of the surety bonds, furnished by him(plaintiff), was not proved by the defendants(now appellants) as they failed to produce the marginal witnesses thereof. It was further stated that the surety bonds formed a part of the registration file of the firm, maintained by the Excise & Taxation Department. It was further stated that the documents were executed before a Public Officer and were presented in the Court by a Public Officer. It was further stated that the defendants were not advised to produce the marginal witnesses. Accordingly, a prayer was made that the appellants be allowed to examine Regular Second Appeal No.1012 of 1988 -9- the marginal witnesses of the surety bonds and also Handwriting Expert, as their evidence is essential for the just decision of case and to enable the Court to pronounce the judgment, in a satisfactory manner. 14. No reply was filed to this application. 15. The Counsel for the appellants, submitted that if on account of wrong advice of the Counsel, the defendants could not produce these witnesses, in the trial Court, then they( appellants ) could not be penalized for the same. He further submitted that the additional evidence, sought to be produced, being essential for the just decision of the case, be allowed. 16. After giving my thoughtful consideration to the contentions, advanced by the Counsel for the appellants, in my considered opinion, the application is liable to be dismissed, for the reasons, to be recorded hereinafter. In Arjan Singh v. Kartak Singla, AIR 1951 (SC), 193, the principle of law, laid down, was to the effect that, Order 41 Rule 27 of the Code of Civil Procedure, is not intended to allow an unsuccessful litigant, to patch up the weak parts of his case, and fill in the lacuna, in the Appellate Court. Under sub Rule 1(b) thereof, additional evidence, can be admitted Regular Second Appeal No.1012 of 1988 -10- only when the Appellate Court requires it to enable it to pronounce the judgment or for any other substantial cause. Reception of such evidence should be the necessity of the Court for proper adjudication of the dispute, between the parties. In K.Venkataramiah V. Seetharama Reddy, AIR, 1963 (SC), 1546 the principle of law , laid down, was to the effect, that there may well be cases, in which, even though the Courts find that it is able to pronounce judgment, on the State of record, as it is, and so it cannot strictly say that it requires additional evidence, to enable it to pronounce the judgment, but it still considers that, in the interest of justice, something which remains obscure, should be filled up, so that it can pronounce its judgment in a more satisfactory manner. Such a case, will be one for allowing additional evidence for any other substantial cause under Rule 27(1) (b) of the Code of Civil Procedure. It was very much within the knowledge of the appellants that the security/surety bonds, were attested by two marginal witnesses. No doubt, they examined two departmental witnesses, but did not examine any of the marginal witnesses. They were given full opportunity to adduce their evidence but they did not show due diligence in summoning and examining these witnesses. Now they cannot Regular Second Appeal No.1012 of 1988 -11- say that only on account of wrong advice of the Counsel, they did not do so. The Civil Suit was decided in the year 1985, whereas the First Appeal was decided in the year 1987 and the Regular Second Appeal relates to the year 1988. If the application is allowed, at this stage, i.e. after a period of 25 years of the decision of trial Court that would amount to re- opening the case again thereby delaying the litigation further. The evidence, already led, in my opinion, is sufficient to enable this Court to pronounce the judgment, in a satisfactory manner. There is no substantial cause, in allowing the application, under Order 41 Rule 27 read with Section 151 of the Code of Civil Procedure. In this view of the matter, the application, being devoid of merit, must fail, and the same stands rejected. 17. The following substantial question of law, arises, in this appeal, for the determination of this Court:- “Whether the Courts below on account of mis-reading and mis-appreciation of evidence, recorded perverse findings that no legal and valid surety bond was executed by the plaintiff-respondent, Madan Lal, standing surety for M/s Babu Ram Pawan Kumar, Commission Agents, and, as such, he was not liable to discharge the liability outstanding against them?” Regular Second Appeal No.1012 of 1988 -12- 18. The Counsel for the appellants, submitted that the Courts below completely mis-read and mis-appreciated the evidence, resulting into recording perverse findings that surety bonds, copies whereof Ex.D-3 and Ex.D-4 were not executed by the plaintiff/respondent. He further submitted that from the evidence of P.S. Preet, Excise and Taxation Officer, Khanna, (DW-1), it was proved that the surety bonds were executed by Madan Lal, plaintiff/respondent. He further submitted that even the plaintiff/respondent, lateron, moved applications for withdrawal of surety bonds, which were duly proved by P.S. Preet, ETO, Khanna, (DW-1). He further submitted that the surety bonds, executed by the plaintiff, formed part of the official record and were produced therefrom by a Public Officer. He further submitted that the statement of P.S. Preet, ETO , (DW-1) with regard to the execution of the surety bonds, aforesaid, by the plaintiff remained unchallenged. He further submitted that, under these circumstances, the judgments and decrees of the Courts below, being perverse, are liable to be set aside. 19. After giving my thoughtful consideration, to the contentions, advanced by the Counsel for the appellants, in my considered opinion,the appeal deserves to be accepted,for Regular Second Appeal No.1012 of 1988 -13- the reasons to be recorded hereinafter. The sole ground, on which the suit of the plaintiff was decreed by the Courts below, was to the effect that execution of the surety bonds, copies whereof Ex.D-3 and Ex.D-4, did not stand proved. P.S. Preet, ETO, Khanna, appeared as DW-1. He brought the original surety bonds, executed by the plaintiff/respondent and Telu Ram. He stated that he was conversant with their signatures as he had been seeing them sign and write during the course of official business. He identified the signatures of Telu Ram, on original surety bonds, copies whereof are Ex.D-3 and Ex.D-4. He further stated that two applications dated 7.5.1979 for cancellation of their surety bonds were moved by Madan Lal, plaintiff/respondent and Telu Ram. He also identified the signatures of Madan Lal, on the original applications Ex.D-5 and Ex.D-6. Since P. S. Preet, ETO, (DW-1) was well conversant with the signatures of Madan Lal, plaintiff and Telu Ram, another surety, as he had been seeing them sign and write during the course of official business, he was a competent witness to prove the surety bonds and the applications, aforesaid. According to Section 47 of the Indian Evidence Act, 1872, when the Court has to form an opinion as to the person by whom any document was written or signed, the opinion of any Regular Second Appeal No.1012 of 1988 -14- person acquainted with the handwriting of the person by whom it is supposed to be written and signed that it was or was not written or signed by that person is relevant. A person is said to be acquainted with the handwriting of another person when he has seen that person write. The surety bonds were not required by law to be attested. Under these circumstances, the execution thereof, could be proved either by a person in whose presence, the plaintiff and Telu Ram signed the same or by a person, who was acquainted with their signatures in the official course of business, on the ground of having seen them sign and write. Accordingly, there was no necessity to examine the attesting witnesses, to prove the execution of the surety bonds. Even the evidence of P.S. Preet, ETO, (DW-1), on the point, that he identified the signatures of the plaintiff and Telu Ram, two sureties on the surety bonds, referred to above, as he was well conversant with the same, on the ground that he had been seeing them sign and write in the official course of business, was not challenged during the course of examination. That part of the statement of P.S. Preet, ETO, Khanna, (DW-1), thus, remained un-rebutted.Nishan Singh, Taxation Inspector, Patiala, Regular Second Appeal No.1012 of 1988 -15- (DW-2), no doubt,during the course of cross-examination stated that he had no personal knowledge regarding the execution of the surety bonds. He was given these surety bonds later on for verification. His evidence in the face of cogent and convincing evidence was of no significance. The Courts below, thus, on misreading and mis-appreciation of evidence, came to the conclusion, that the execution of the surety bonds, aforesaid, by the plaintiff, did not stand proved, by the defendants/appellants. Since the execution legality and validity of the surety bonds, referred to above, stood proved from the statement of P.S. Preet, ETO, (DW-1), at the relevant time, penalty could be imposed upon the plaintiff. The Assistant Collector Ist Grade, thus, after affording full opportunity to the plaintiff of being heard, was right in imposing the penalty. The findings of the Courts below that the execution of the surety bonds, aforesaid, did not stand proved, being perverse and illegal, on account of mis- reading and mis-appreciation of evidence, are liable to be set aside. The substantial question, of law, depicted above, is answered, in favour of the appellants. The submission of the Counsel for the appellants, carries substance and the same is accepted. Regular Second Appeal No.1012 of 1988 -16- 20. For the reasons recorded above, the appeal is accepted with costs throughout. The judgments and decrees of the Courts below, are set aside. The suit of the plaintiff shall stand dismissed. (Sham Sunder) Judge 16.07.2010 dinesh`