IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. R.S.A. No.4317 of 2008 (O.&M.) Date of Decision: 3.3.2009 Shakuntla Rani and others. ....... Appellants through Shri Arun Jain, Senior Advocate with Shri Vishal Goyal, Advocate. Versus Punjab National Bank and another. ....... Respondents through Nemo. CORAM: HON'BLE MR.JUSTICE MAHESH GROVER .... 1. Whether Reporters of Local Newspapers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? .... Mahesh Grover,J. C.M.No.12858-C of 2008 The application is allowed and 58 days' delay in the refiling of the appeal is condoned. R.S.A.No.4317 of 2008 This appeal is directed against judgments and decrees dated 8.4.2006 and 24.12.2007 passed respectively by the Civil Judge (Junior Division), Phillaur (hereinafter referred to as `the trial Court') and the Additional District Judge, Jalandhar (described hereinafter as `the First Appellate Court') whereby the suit and the appeal of the plaintiffs-appellants have been dismissed. R.S.A.No.4317 of 2008 -2- .... The appellants filed a suit for recovery of Rs.9,22,077/- along with future interest at the rate of 18% per annum against the defendants- respondents. It was their pleaded case that they had approached the respondents for issuance of a bank guarantee in the sum of Rs.60 lacs in favour of the Income Tax Department and offered gold bonds and FDRs as security of the value of more than the aforesaid amount. According to them, a fee of Rs.5.40 lacs was to charged by the respondents for a period of three years for which the bank guarantee was to be issued. However, the respondents created some documents and showed a loan account from which FDRs in the sum of Rs.35 lacs were created in their name for issuance of bank guarantee of Rs.60 lacs. After expiry of the said period of bank guarantee, when the appellants approached for release of gold bonds and the FDRs, the respondents calculated their liability as per the prevailing rate of interest on the loan account and charged access amount of Rs.9,22,077/- from them instead of the aforesaid amount of Rs.5.40 lacs. Upon notice, the respondents appeared and filed their written statement in which they denied the claim of the appellants. It was pleaded that the appellants never approached them for issuance of a bank guarantee and rather, Chaman Lal Shekhri had done so. Since gold bonds could not accepted as primary security for bank guarantee, on 22.6.1995, appellant nos. 1 & 2 applied for financial facility of Rs.25 lacs against security of gold bonds, whereas appellant nos. 3 and 4 made such request for Rs.10 lacs and accordingly the loan was sanctioned in their favour with interest at the rate of 17.50% per annum with quarterly rests and demand promissory note R.S.A.No.4317 of 2008 -3- .... was executed on 3.7.1997. The aforesaid amounts were accordingly transferred in the separate accounts of the appellants for creation of FDRs. Thereafter, Chaman Lal Shekhri was issued a bank guarantee of Rs.50 lacs on 5.7.1995 for a period of one year against the FDRs of Rs.50,37,977.75 and the FDR of appellant nos. 1 & 2 in the sum of Rs.25 lacs. Another bank guarantee of Rs.10 lacs was issued on 12.7.1995 at the instance of Chaman Lal Shekhri against the FDR of Rs.10 lacs which was made in the names of appellant nos. 1 & 2. Rest of the averments were denied and it was pleaded that the appellants had not approached the Court with clean hands and that they had executed the loan documents. Both the parties went to trial on the following issues:- 1. Whether the plaintiffs are entitled to recovery of Rs.9,22,077/- along with interest?OPP 2. Whether the suit is within time?OPP 3. Whether the suit is not maintainable in the present form?OPD 4. Whether the plaintiffs have got no cause of action in the present form?OPD 5. Whether the suit is bad for non-joinder of necessary parties?OPD 6. Whether the plaintiffs have not come to the court with clean hands?OPD 7. Whether the plaintiffs are estopped from filing the present suit?OPD R.S.A.No.4317 of 2008 -4- .... 8. Relief. After appraisal of the entire evidence before it, the trial Court concluded that the appellants had approached the respondents for obtaining loans by offering gold bonds and that the bank guarantees were issued against the security of the FDRs issued in their names and the other FDRs submitted by Chaman Lal. Consequently, the suit was dismissed with costs. In appeal, the findings of the trial Court were affirmed by the First Appellate Court. Hence, this Regular Second Appeal. Learned counsel for the appellants argued that the findings of the Courts below are erroneous and in fact, the gold bonds and FDRs were in the nature of security for the bank guarantees and no loan transactions ever took place. I have thoughtfully considered the argument of the learned counsel for the appellants and have perused the impugned judgments from which it is evident that the appellants had raised loans of Rs.35 lacs and offered gold bonds as security. It is further evident that Chaman Lal Shekhri had offered the FDRs made from the aforesaid loan amount along with other FDRs for issuance of bank guarantee in favour of the Income Tax Department. PW1-Subhash Chander, the attorney of the appellants, stated in his cross-examination that Exhibits D3 and D9 were executed by appellant no.3-Geeta Rani, whereas Exhibits D4 and D9 were executed by appellant no.1-Shakuntla Rani in which they had admitted the factum of loan being R.S.A.No.4317 of 2008 -5- .... raised by them against the gold bonds. These documents were written well before the controversy broke out. The other documents of the respondents also speak clearly regarding the loan transactions. It is evident that two separate transactions had taken place between the appellants and Chaman Lal Shekhri, i.e., one of raising of loan of Rs.35 lacs by the appellants and the other of issuance of bank guarantee at the instance of Chaman Lal Shekhri. Therefore, these two transactions were obviously subject to separate interest components which were attracted to them. There is, thus, no infirmity in the findings recorded by the Courts below, which cannot be termed to be perverse warranting interference in the Regular Second Appeal. No substantial question of law arises for determination in this appeal, which is held to be devoid of any merit and is dismissed. March 03,2009 ( Mahesh Grover ) “SCM” Judge