RSA No.1022 of 2011 (O & M) - 1 - IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No.1022 of 2011 (O & M) Date of Decision: 01.03.2011 Kuldeep Singh and others ……Appellants Versus Punjab National Bank …...Respondent Coram: HON’BLE MR. JUSTICE L. N. MITTAL. Present: Mr. V.K. Sandhir, Advocate for the appellants. L.N. MITTAL, J (ORAL) CM No.2846-C of 2011 Deficiency in Court fee is said to have been made good. The application is, therefore, allowed as prayed for. CM No.2847-C of 2011 For reasons mentioned in the application which is accompanied by affidavit, delay of 188 days in filing the appeal is condoned. RSA No.1022 of 2011 Defendants-Kuldeep Singh, Ranjit Singh and Karamjit Singh (all brothers), who were successful in the trial Court, but have been unsuccessful in the lower appellate Court, have filed the instant second appeal. Respondent-plaintiff-Punjab National Bank filed suit against defendants-appellants for recovery of Rs.3,83,178/-. Defendants applied to the bank for tractor loan of Rs.3,48,000/- and also deposited margin money of Rs.66,315/- along with processing RSA No.1022 of 2011 (O & M) - 2 - charges etc. As per defendants’ instructions and authority, the plaintiff paid Rs.4,10,500/- by way of bank draft to Tractor dealer M/s Kisan Tractor Dealer Mahindra Gujarat Tractor, on 25.02.2005. Since the defendants failed to produce the tractor in the bank for inspection and also failed to submit purchase bill of the tractor, the plaintiff bank issued letters to the defendants including legal notice dated 19.04.2005 to do the needful, but the defendants failed to do so. The plaintiff felt that defendants in connivance with the tractor dealer defrauded the plaintiff and possibly the defendants have sold the tractor without permission of the bank. The loan amount of Rs.3,48,000/- was repayable in half yearly instalments with interest. However, the defendants failed to repay the same. Accordingly, a sum of Rs.3,83,178/- was due from the defendants to the plaintiff including interest for pre-suit period. Plaintiff filed suit for recovery of the said amount. The defendants admitted that they had applied to the plaintiff-bank for tractor loan and also deposited margin money etc. for the same. The defendants, however, pleaded that bank draft was not given to them nor the tractor was delivered to them. The bank draft was given by the plaintiff to M/s Kisan Taders through Hakam Singh. Said Hakam Singh committed fraud with the defendants as also admitted by the Manager of the plaintiff, who sent letter to Hakam Singh to either return the bank draft or to deliver the tractor to the defendants. Various other pleas were also raised. Learned Additional Civil Judge (Senior Division), Samana vide judgment and decree dated 07.05.2007 dismissed the plaintiff’s suit. However first appeal preferred by the plaintiff has been allowed RSA No.1022 of 2011 (O & M) - 3 - by learned Additional District Judge, Patiala vide judgment and decree dated 29.04.2010 and thereby plaintiff’s suit stands decreed. Feeling aggrieved, defendants have preferred the instant second appeal. I have heard learned counsel for the appellants and perused the case file. Appellants have admitted that they had applied to the plaintiff bank for tractor loan. Defendants have also admitted that the plaintiff-bank gave bank draft for the loan amount along with margin money paid by the defendants, to the tractor dealer. It is also undisputed that the defendants did not repay the loan amount or interest thereon. Consequently, the plaintiff’s suit has been rightly decreed by the lower appellate Court. Learned counsel for the appellants emphatically and repeatedly contended that the plaintiff-bank in connivance with the tractor dealer committed fraud with the defendants by directly delivering the bank draft to the tractor dealer without intimation to the defendants. The contention is completely meritless being beyond pleading and not substantiated by any evidence. The plaintiff rather pleaded connivance of the defendants with the tractor dealer. Defendants nowhere pleaded any connivance of the plaintiff-bank with the tractor dealer. Learned counsel for the appellants is unable to refer to any plea raised by defendants/appellants in the written statement in support of his aforesaid contention. On the contrary, learned counsel for the appellants conceded that as per practice and condition of the bank, the loan amount was to be paid directly to the RSA No.1022 of 2011 (O & M) - 4 - tractor dealer. On pointed inquiry, learned counsel for the appellants is unable to refer to any pleading in the written statement pointing a finger towards any fault or lapse on the part of the plaintiff-bank. If the dealer committed any fraud with the defendants, the plaintiff-bank is not liable for the same nor the plaintiff can be penalized for it. The plaintiff-bank disbursed the loan amount to the tractor dealer as per authority and instructions given by the defendants. If the tractor dealer did not deliver the tractor to the defendants, the plaintiff-bank cannot be said to be at fault. On the contrary, it was arrangement between the defendants and the tractor dealer that the defendants were to purchase the tractor from the aforesaid tractor dealer. The plaintiff-bank did not come into picture for the same. There was no privity of contract between the plaintiff and the tractor dealer. On the contrary, there was privity of contract between the defendants and the plaintiff-bank on the one hand and between the defendants and the tractor dealer on the other hand. Consequently, for non delivery of tractor by the tractor dealer to the defendants, recovery of loan amount advanced by the plaintiff-bank to the defendants cannot be denied to the plaintiff-bank. It is also worth mentioning that the plaintiff-bank sent various letters to the defendants to produce the tractor and the purchase bill of the tractor, but the defendants did not respond to the same. Even legal notices sent by the bank evoked no response from the defendants. It is also significant to notice that defendants had filed a suit against the tractor dealer as well as against the bank (plaintiff herein) for directing them to deliver the possession of the tractor, but soon after the instant suit filed by the plaintiff-bank was dismissed by RSA No.1022 of 2011 (O & M) - 5 - the trial Court on 07.05.2007, the defendants withdrew their aforesaid suit for mandatory injunction or got it dismissed in default on 20.07.2007. There is no explanation for this course of conduct adopted by the defendants for exonerating the tractor dealer, who appeared to be the main culprit as per pleadings of both the parties in the instant case. For the reasons aforesaid, I find no illegality or perversity in the impugned judgment of the lower appellate Court. Plaintiff’s suit has been rightly decreed. Even on the basis of admitted or established facts, the defendants have no case. Defendants are liable to repay the loan amount (with interest thereon) raised from the plaintiff-bank. It is unfortunate that the defendants appear to have been duped by the tractor dealer for which the Court has sympathy with the defendants, but the defendants are to blame themselves for the situation in which they find themselves. They remained completely silent when the plaintiff was asking the defendants to take necessary action. The defendants also withdrew their suit filed against the tractor dealer or got the said suit dismissed in default. Be that as it may, the defendants have to repay the suit amount to the plaintiff-bank. No question of law, much less substantial question of law, arises for determination in the instant second appeal. The appeal is devoid of any merit and is accordingly dismissed in limine. (L. N. MITTAL) JUDGE 01.03.2011. A.kaundal