IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD WEDNESDAY, THE SEVENTEENTH DAY OF FEBRUARY TWO THOUSAND AND TEN HON’BLE SRI JUSTICE G. BHAVANI PRASAD C.C.C.A. No.70 of 1993 Between: The Government of Andhra Pradesh rep. by its Secretary, Dept. of Industries & Commerce, Hyderabad .. Appellant AND State Bank of Hyderabad rep. by its Branch Manager, Sanathnagar and others . Respondents Appeal against the judgment and decree, dated 16-04-1982 in O.S. No.242 of 1979 on the file of the IV Additional Judge, City Civil Court, Hyderabad. The appeal coming on for hearing, upon perusing the grounds of appeal and upon hearing the arguments of Smt. A.B. Lalitha Gayathri, learned Assistant Government Pleader representing the learned Government Pleader for appeals for the appellant, the Court delivered the following: JUDGMENT: The appeal by the 3rd defendant in O.S. No.242 of 1979 on the file of the IV Additional Judge, City Civil Court, Hyderabad is directed against the judgment and decree, dated 16-04-1982. The parties are referred to herein as they are arrayed in the suit. The plaintiff bank filed the suit for recovery of Rs.1,77,202- 85 ps. with interest at 15 per cent per annum from the date of the suit till the date of realization and costs from defendants 1 to 3 jointly and severally. The plaintiff bank pleaded that it sanctioned bills discount facility to the 1st defendant for supply of power looms to the 2nd defendant, a weaver’s co-operative society, for which the 3rd defendant, the Government of Andhra Pradesh, stood guarantee. The defendants executed necessary documents and the 1st and 2nd defendants acknowledged their liability in their revival letters from time to time. The suit amount remained unpaid in spite of demands. The 1st defendant contended that the liability of the 1st defendant ceased as soon as the 3rd defendant guaranteed the repayment, but the revival letters were given by the 1st defendant under economic duress. The default was committed by the society. The 2nd defendant society remained ex parte in this suit, while the 3rd defendant Government contended that the plaintiff bank rushed to Court in violation of the agreement to reschedule the repayment and the 3rd defendant is not liable for the suit amount as it was only defendants 1 and 2 that executed the revival letters. The suit is barred for want of notice under Section 80 of the Code of Civil Procedure and also as the suit is barred by time. The Court also has no territorial jurisdiction. On such pleadings, the trial Court settled the following issues for trial. 1. Whether the plaintiff is entitled for a decree as prayed for against all the defendants ? 2. Whether the suit is time-barred ? 3. Whether this Court has no jurisdiction ? 4. To what relief ? During trial, P.W.1 and D.Ws.1 and 2 were examined and Exs.A.1 to A.16 and B.1 to B.17 were marked. The trial Court in the impugned judgment noted that the execution of the loan documents by the defendants is admitted. The trial Court also noted that the plaintiff made payments only after the execution of Ex.A.1 agreement and in view of the plaintiff not accepting the rescheduling of the loan, it is entitled to recover the amount from all the defendants. In view of continuing guarantee and the revival letters, the suit was also held to be within time and as the loan was advanced and the documents were obtained at Hyderabad, the Court was considered to be having territorial jurisdiction. The trial Court also found that the 3rd defendant Government as the architect of the scheme, is bound to pay the suit amount instead of the 1st defendant, a sinking concern, or the 2nd defendant, the beneficiary, without any resources. Therefore, the trial Court while decreeing the suit with costs, directed the plaintiff to consider the advisability of choosing to proceed first against the 3rd defendant and then only against the other defendants. The State contended that there was no valid notice under Section 80 of the Code of Civil Procedure and the 3rd defendant’s contentions in the suit were reiterated as justifying grounds for reversing the impugned judgment and decree. Heard Smt. A.B. Lalitha Gayathri, learned Assistant Government Pleader representing the learned Government Pleader for appeals. It is seen from the record that the appeal against the 3rd respondent (2nd defendant) stood dismissed for default in terms of the order of this Court, dated 17-12-2007 and that no steps were taken so far by the appellant to get the appeal restored against the 2nd defendant. As the decree in question imposes a joint and several liability on all the three defendants, the appeal becomes improperly and incompletely constituted in the absence of the 2nd defendant. Even otherwise, it is seen from the material on record that Ex.A.16 legal notice was issued by the plaintiff to the defendants on 23-03-1978 and the suit was instituted only on 26-02-1979. The claim that there was no valid notice under Section 80 of the Code of Civil Procedure, therefore, appears, ex facie, unsustainable. The grounds of appeal reiterated other contentions raised before the trial Court, which were appropriately answered as per the reasons given by the trial Court needing no replication herein. While the suit was within time from the letters of revival, the Court has territorial jurisdiction in view of the cause of action for the suit arising within such jurisdiction. In view of the admitted execution of the documents and the absence of any claim of having discharged the liability, the defendants are answerable for the suit claim as decreed. In so far as the advisability of proceeding first against the 3rd defendant is concerned, the trial Court only directed the plaintiff to consider such a course of action and it is not a legal mandate to proceed against the 3rd defendant alone in the first instance and only after that against defendants 1 and 2. Under the circumstances, not only the appeal appears to be unsustainable on merits but also has to fail due to the appeal having been already dismissed for default against the 3rd respondent earlier. In the result, the appeal against respondents 1 and 2 is also dismissed without costs, while it was already dismissed for default against the 3rd respondent vide this Court’s order, dated 17-12- 2007. _____________________ G. BHAVANI PRASAD, J Date: 17-02-2010 Svv