IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. C.W.P. No. 15915 of 2006 DATE OF DECISION : 23.10.2008 Dara Singh .... PETITIONER Versus State of Punjab and others ..... RESPONDENTS CORAM :- HON'BLE MR. JUSTICE SATISH KUMAR MITTAL HON'BLE MR. JUSTICE JASWANT SINGH Present: Mr. S.S. Rangi, Advocate, for the petitioner. Mr. M.S. Sindhu, Addl. A.G., Punjab, for respondents No.1 to 3 and 10. Mr. Navdeep Singh Janjua, Advocate, for respondents No.4 and 5. Mr. Gaurave Bhayyia, Advocate, for respondent No.7. Mr. Jasjit Singh, Advocate, for respondent No.8. Mr. M.K. Singla, Advocate, for respondent No.9. * * * SATISH KUMAR MITTAL , J. The petitioner, who had taken a loan of Rs. 6.00 lacs from the Tohra Branch of the Patiala Central Cooperative Bank Limited, Patiala, respondent No.4 herein, (hereinafter referred to as `the respondent Bank'), CWP No. 15915 of 2006 -2- as a partner of the Tiwana Bus Service, Dittupur, for purchase of a bus, has filed this petition under Articles 226/227 of the Constitution of India, for setting aside the Award dated 12.8.2005 (Annexure P-2), passed by the Deputy Registrar, Cooperative Societies, Patiala, awarding an amount of Rs.5,88,215/- to the respondent bank with interest; and the orders dated 12.5.2006 (Annexure P-3) and 22.8.2006 (Annexure P-4), whereby the appeal and revision, filed by the petitioner against the aforesaid Award, have been dismissed. In this case, while taking the aforesaid loan on 6.12.1999, the bus bearing Registration No. PB-11-P-5595, which was purchased with the loan amount, was hypothecated with the respondent bank on 4.1.2000. Without discharging the full loan liability, the petitioner got removed the hypothecation of the bus from the District Transport Officer, Patiala,on 18.12.2001, by producing No Due Certificate. It is the case of the respondent bank that the said certificate was a forged and fabricated document, as the respondent bank did not issue any such certificate, because the loan amount was not cleared by the petitioner. It is admitted position that even after removing the hypothecation in the Registration Certificate, on the notices issued by the respondent bank in the months of November, 2002, March, June and October, 2003, the petitioner deposited Rs. 10,000/-, Rs. 10,000/-, Rs. 10,000/-, Rs. 15,000/-, Rs. 40,000/- and Rs. 1,72,250/-, on 6.6.2002, 4.7.2002, 17.8.2002, 18.9.2002, 17.3.2003 and 2.1.2004, respectively. When the entire amount was not cleared, the respondent bank CWP No. 15915 of 2006 -3- sought arbitration reference under Section 55/56 of the Punjab Cooperative Societies Act, 1961 and the matter was referred to the Arbitrator. The Deputy Registrar, Cooperative Societies, acting as Arbitrator, after providing opportunity to lead evidence and after hearing both the parties, passed the impugned Award, while coming to the conclusion that on 31.3.2005, principle amount of Rs. 5,37,040/- and interest of Rs. 50,925/- were recoverable from the petitioner. Before the Arbitrator, the petitioner admitted the factum of taking the loan, but did not disclose the cancellation of the hypothecation. However, the rate of interest, as was being charged, was objected. Before the Appellate Authority, it was argued by the petitioner that the entire amount was paid and thereafter, the respondent bank issued the No Due Certificate, on the basis of which hypothecation was cancelled by the District Transport Officer. This contention was not accepted, because during the hearing of the appeal, official from the District Transport Officer was also summoned, but no record could be produced by the office of the District Transport Officer showing that the respondent bank has issued the No Due Certificate. It has been found that even after the cancellation of the hypothecation on 18.12.2001, the petitioner had received the notices and made the payments to the respondent bank, nor the alleged cancellation of hypothecation was taken up before the Arbitrator. These facts prove that the alleged No Due Certificate was never issued by the respondent bank and by playing fraud, hypothecation of the bus was got cancelled from the District Transport CWP No. 15915 of 2006 -4- Officer. The said Award has been upheld by the appellate as well as the revisional authority vide their orders dated 12.5.2006 (Annexure P-3) and 22.8.2006 (Annexure P-4), respectively. Learned counsel for the petitioner submits that the petitioner did not play any fraud. However, brother of the petitioner, namely Darshan Singh (respondent No.9 herein), who was not a party either before the Arbitrator or before the Appellate Authority, had deposited the instalments of the loan amount with the respondent bank and obtained No Due Certificate, on the basis of which hypothecation of the bus was cancelled. Learned counsel submits that the petitioner alone is not liable to pay the amount and the respondent bank wrongly sought the reference only against the petitioner, whereas his brother Darshan Singh was not impleaded. Therefore, the impugned Award and the orders are liable to be set aside. During the course of hearing, it has not been disputed, as stated in the written statement by the respondent bank, that the petitioner had taken the loan by putting his signatures on all the loan documents. It is also not disputed that the petitioner did not clear the loan amount. However, it has been contended by learned counsel for the petitioner that brother of the petitioner Darshan Singh had paid the loan amount and thereafter, obtained the No Due Certificate from the respondent bank, on the basis of which hypothecation of the bus was cancelled. This contention of learned counsel for the petitioner cannot be accepted, because if on the basis of the No Due Certificate, the hypothecation was cancelled on 18.12.2001, then there was CWP No. 15915 of 2006 -5- no occasion for the petitioner or any of his family members to make various payments to the respondent bank in the year 2002 and 2003, as indicated above. Therefore, in our opinion, the Arbitrator as well as the Appellate and the revisional authorities have rightly come to the conclusion that the aforesaid No Due Certificate was never issued by the respondent bank and by playing fraud, on the basis of a forged No Due Certificate, hypothecation of the bus was got cancelled from the District Transport Officer. Even if it is taken that the petitioner is partner of the Tiwana Bus Service, Dittupur, then he is liable to pay the outstanding loan amount, because liability of a partner of a firm is joint and several. In these facts and circumstances, we do not find any ground to interfere in the impugned Award and the orders, in exercise of the writ jurisdiction of this Court under Article 226 of the Constitution of India. Dismissed. ( SATISH KUMAR MITTAL ) JUDGE October 23, 2008 ( JASWANT SINGH ) ndj JUDGE