Case: Chandradhar Goswami &amp; Ors Vs. The Gauhati Bank Ltd

any person with liability, to produce evidence in support of the entries to show that the money was advanced as indicated therein and thereafter the entries would be of use as corroborative evidence. But no person can be charged with liability on the basis of mere entries whether the entries produced are the original entries or copies under S. 4 of the Bankers Books Evidence Act.We cannot agree with the High Court that the mere fact that the appellants did not specifically mention the sum of Rupees 10,000 as not having been advanced to them in their written statement would make any difference on the facts of the present case. We have already pointed out that the appellants did not admit the correctness of the accounts produced specially after March 1, 1947. We have also pointed out that it was stated on their behalf that nothing was borrowed after March 1, 1947. The main appellant in whose name the account was, appeared as a witness and stated that so far as he remembered he only borrowed Rs. 8,000 from the bank and nothing thereafter. He also stated that he did not remember to have borrowed any sum from the bank after the execution of the mortgage-deed. In the face of this pleading of the appellants and the statement of one of them, the bank had to prove that the sum of Rs. 10,000 was in fact advanced on March 19, 1947 and could not rely on mere entries in the books of account for that purpose. This is clear from the provision in S. 34 of the Evidence Act. No attempt was made on behalf of the bank to prove by any evidence whatsoever that a sum of Rupees 10,000 was advanced on March 19, 1947. The entry in the account books in that connection is to the effect: "To amount paid to Gauhati branch as per D/advice, dated 6th March 1947". If this amount of Rs. 10,000 was paid by the bank on the order of the appellants or any one of them that order should have been produced in support of the entry, and then the entry would have been helpful to the bank as a corroborative piece of evidence. But the bank did nothing of the kind. The only witness produced on behalf of the bank was an officer who had nothing to do with the Tezpur branch where the transactions were entered into.We are, therefore, of opinion that in view of S. 34 of the Evidence Act the appellants cannot be saddled with liability for the sum of Rs. 10,000 said to have been advanced on March 19, 1947 on the basis of a mere entry in the account. Section 34 says that such entry alone shall not be sufficient evidence, and so some independent evidence had to be given by the bank to show that this sum was advanced. What would be the nature of such independent evidence would certainly depend upon the facts of each case, but there can be no doubt that some independent evidence to show that advance had been made has to be given. Further, as in this case the dispute was with respect to one entry of Rs. 10,000, it should not have been difficult for the bank to produce evidence with respect thereto. We cannot, therefore, agree with the High Court that the advance of Rs. 10,000 on March 19, 1947 has been proved in this case.7. It is urged on behalf of the bank that we might give opportunity now to the bank to prove that the money was in fact paid. We are of opinion that it is too late now after 13 years to give a further opportunity to the bank to prove what should have been proved by it in the very beginning in view of the denial of liability for anything after March 1, 1947 in the written statement of the appellants. In this view of the matter, the appeal must be allowed with respect to this sum of Rs. 10,000.8. Then we come to the question of limitation. The suit is clearly within time insofar as the liability for sale under the mortgage-deed is concerned as it was filed within 12 years of the execution of the mortgage (see Art. 132 of the Limitation Act of 1908). As to the personal liability under this deed, that is beyond time as the suit was filed more than six years after the execution of the mortgage (see Art. 116 ibid). Nor does the entry of payment of Rs. 100 in the accounts help the bank in this behalf. That entry is of no value under S. 19 or S. 20 of the Limitation Act for neither a writing, signed by the appellants nor an acknowledgment of payment in the handwriting of the appellants or in a writing signed by them has been proved. Nor does Art. 85 of the Limitation Act of 1908 help the bank. Assuming this is a case of an open, current and mutual account, the last payment was made in November 1949. Article 85 gives limitation of three years from the close of the year in which the last item admitted or proved is entered in the accounts, (such year to be computed as in the account). The account in this case shows that the year was calendar year. The mutuality in this case came to an end in 1949 for we find from the account that thereafter there are only entries of interest due to the bank upto October 31, 1952. So the bank would get three years from the end of 1949 under Art. 85 and as the suit was filed on April 9, 1953, this entry will be of no help to the bank. We are, therefore, of opinion that the bank cannot get a decree fixing personal liability on the appellants and all that it is entitled to is a decree for sale of the mortgaged property.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]It is clear from a bare perusal of the section that no person can be charged with liability merely on the basis of entries in books of account, even where such books of account are kept in the regular course of business. There has to be further evidence to prove payment of the money which may appear in the books of account in order that a person may be charged with liability thereunder, except where the person to be charged accepts the correctness of the books of account and does not challenge them. In the present case, however, the appellants did not accept the correctness of the books of account. We have already indicated that they went to the length of saying that the accounts were not correctly kept, and were fraudulent. They also said that no money had been taken by them after March 1, 1947. This being their pleading, the trial Court rightly framed the third issue relating to the total amount due from the appellants to the bank. But unfortunately it overlooked to go into that issue specifically and we have already indicated how it made a mistake in arriving at the amount due when considering the issue relating to relief. In any case as the appellants had not admitted the correctness of the accounts filed by the bank, particularly after March 1, 1947, the bank had to prove payment of Rs. 10,000 on March 19, 1947 if it wanted to charge the appellants with liability for thatwill be clear that S. 4 gives a special privilege to banks and allows certified copies of their accounts to be produced by them and those certified copies become prima facie evidence of the existence of the original entries in the accounts and are admitted as evidence of matters, transactions and accounts therein, but such admission is only where, and to the same extent as, the original entry itself would be admissible by law and not further or otherwise. Original entries alone under S. 34 of the Evidence Act would not be sufficient to charge any person with liability and as such copies produced under S. 4 of the Bankers Books Evidence Act obviously cannot charge any person with liability. Therefore, where the entries are not admitted it is the duty of the bank if it relies on such entries to charge any person with liability, to produce evidence in support of the entries to show that the money was advanced as indicated therein and thereafter the entries would be of use as corroborative evidence. But no person can be charged with liability on the basis of mere entries whether the entries produced are the original entries or copies under S. 4 of the Bankers Books Evidence Act.We cannot agree with the High Court that the mere fact that the appellants did not specifically mention the sum of Rupees 10,000 as not having been advanced to them in their written statement would make any difference on the facts of the present case. We have already pointed out that the appellants did not admit the correctness of the accounts produced specially after March 1, 1947. We have also pointed out that it was stated on their behalf that nothing was borrowed after March 1, 1947. The main appellant in whose name the account was, appeared as a witness and stated that so far as he remembered he only borrowed Rs. 8,000 from the bank and nothing thereafter. He also stated that he did not remember to have borrowed any sum from the bank after the execution of the mortgage-deed. In the face of this pleading of the appellants and the statement of one of them, the bank had to prove that the sum of Rs. 10,000 was in fact advanced on March 19, 1947 and could not rely on mere entries in the books of account for that purpose. This is clear from the provision in S. 34 of the Evidence Act. No attempt was made on behalf of the bank to prove by any evidence whatsoever that a sum of Rupees 10,000 was advanced on March 19, 1947. The entry in the account books in that connection is to the effect: "To amount paid to Gauhati branch as per D/advice, dated 6th March 1947". If this amount of Rs. 10,000 was paid by the bank on the order of the appellants or any one of them that order should have been produced in support of the entry, and then the entry would have been helpful to the bank as a corroborative piece of evidence. But the bank did nothing of the kind. The only witness produced on behalf of the bank was an officer who had nothing to do with the Tezpur branch where the transactions were entered into.We are, therefore, of opinion that in view of S. 34 of the Evidence Act the appellants cannot be saddled with liability for the sum of Rs. 10,000 said to have been advanced on March 19, 1947 on the basis of a mere entry in the account. Section 34 says that such entry alone shall not be sufficient evidence, and so some independent evidence had to be given by the bank to show that this sum was advanced. What would be the nature of such independent evidence would certainly depend upon the facts of each case, but there can be no doubt that some independent evidence to show that advance had been made has to be given. Further, as in this case the dispute was with respect to one entry of Rs. 10,000, it should not have been difficult for the bank to produce evidence with respect thereto. We cannot, therefore, agree with the High Court that the advance of Rs. 10,000 on March 19, 1947 has been proved in thissuit is clearly within time insofar as the liability for sale under the mortgage-deed is concerned as it was filed within 12 years of the execution of the mortgage (see Art. 132 of the Limitation Act of 1908). As to the personal liability under this deed, that is beyond time as the suit was filed more than six years after the execution of the mortgage (see Art. 116 ibid). Nor does the entry of payment of Rs. 100 in the accounts help the bank in this behalf. That entry is of no value under S. 19 or S. 20 of the Limitation Act for neither a writing, signed by the appellants nor an acknowledgment of payment in the handwriting of the appellants or in a writing signed by them has been proved. Nor does Art. 85 of the Limitation Act of 1908 help the bank. Assuming this is a case of an open, current and mutual account, the last payment was made in November 1949. Article 85 gives limitation of three years from the close of the year in which the last item admitted or proved is entered in the accounts, (such year to be computed as in the account). The account in this case shows that the year was calendar year. The mutuality in this case came to an end in 1949 for we find from the account that thereafter there are only entries of interest due to the bank upto October 31, 1952. So the bank would get three years from the end of 1949 under Art. 85 and as the suit was filed on April 9, 1953, this entry will be of no help to the bank. We are, therefore, of opinion that the bank cannot get a decree fixing personal liability on the appellants and all that it is entitled to is a decree for sale of the mortgagedare of opinion that it is too late now after 13 years to give a further opportunity to the bank to prove what should have been proved by it in the very beginning in view of the denial of liability for anything after March 1, 1947 in the written statement of the appellants.In this view of the matter, the appeal must be allowed with respect to this sum of Rs. 10,000.