A.K. Mitra, J.@mdashChallenging the judgment and decree passed in Title Appeal No. 68/89 on 24.9.1993 and 7.10.1993 respectively by the learned 2nd Assistant District Judge, Hooghly affirming the judgment and decree dated 22.2.1989 and 10.3.1989 respectively passed in Title Suit No. 87 of 1988 (T.S. No. 184/85) by the learned Additional Munsif, Chandernagore, this second appeal has been preferred. The Title Suit concerned here is a suit for declaration and injunction. The case as has been made out by the plaintiff/appellant herein in the plaint is, Inter alia, as follows:
2. The plaintiff Ramnath Mukherjee had his business of manufacturing spectacle frames, which was running under the name and style "Neolite Eye-line Corporation" hereinafter termed as "said business". According to the plaintiff this business had been running since 1965 and it was located in the ground floor of his residential building and the plaintiff was the sole proprietor of the business.
3. For the expansion and development of the said business and/or factory the plaintiff was in need of money. The defendant No. 1, West Bengal Financial Corporation announced to help and to assist the establishments of industrial concern for their development. The plaintiff approached the defendant No. 1 that is the financial corporation for loan to develop or expand small scale industry dealing with the manufacturing of spectacles frames. The business of the plaintiff was duly registered as a small scale industry unit with the Directorate of Cottage and Small Scale Industries of West Bengal. The plaintiff submitted a scheme before the defendant No. 1 which was duly accepted by the defendant and the plaintiff was asked to execute an agreement with the defendant No. 1. According to the plaintiff, he was assured by the defendant No. 1 that term loan would be granted to the plaintiff and he was asked to communicate the defendant No. 2 for the working capital for smooth running and the development and expansion of the factory and the business. The defendant No. 2 is United Bank of India, Khalisani Branch. The plaintiff performed all the formalities as directed by the defendant Nos. 1 and 2 to obtain term loan and working capital by several communications. The defendants Nos. 1 and 2 approved the scheme and proposal of the plaintiff. As per their direction the plaintiff constructed separate pucca room for the proposed expansion and the plaintiff had to expend Rs. 46,000.00. It was agreed and settled by defendant No. 1 that they would grant Term Loan of Rs. 71,300.00 out of which Rs. 15,000.00 was settled to be on account of margin for working capital. The defendant No. 1 by a letter dated 14.7.1983 sanctioned the aforesaid amount of Term Loan. The plaintiff has annexed this letter as annexure No. 1 and he has made annexure No. 2 being the Utilisation Chart. The said Utilisation Chart will show the actual amount of Term Loan, State subsidy, own stake and Bank loan to act as per the scheme and proposal.
4. The plaintiff has averred that he was in the belief that the defendant No. 1 as well as State and the Bank authority would contribute the amount of money to the plaintiff as per the Utilisation Chart. The Bank loan of Rs. 1,32,000.00 was approved as per the Utilization Chart and State subsidy was settled at Rs. 11,700.00 and the Term Loan of Rs. 71,300.00 was also sanctioned as per the said Chart. The plaintiff accordingly made contract and arrangement with the defendant No. 2, Bank. The defendant No. 2 also sanctioned the scheme and agreed to advance loan for working capital to the plaintiff. The defendant No. 2 by a letter sanctioned first phase of loan of Rs. 35,000.00 out of the aforesaid amount of Rs. 1,32,000.00. But actually no payment was made by the defendant No. 2 and no reason was cited and even if the defendant No. ''2 did not withdraw or call back the sanction. The defendant No. 2 was legally bound to pay the sanctioned loan as well as the loan approved by the defendant No. 1 amounting to Rs. 1,32,000.00 inasmuch as in absence of the said loan the proposed business was to suffer and it was not possible for him to develop the scheme or expand the project as per his plan. The plaintiff took all attempts but ultimately for want of working capital loan which was to be advanced by the defendant No. 2, the plaintiff was compelled to take loan from private individuals related of him and to sell all the ornaments of his wife to meet up the financial crisis for running his business and to maintain his good will. According to the plaintiff, the defendant No. 1 as well as the defendant No. 2 are jointly and severally liable to make payment of the Term Loan as well as the working capital loan to materialise the scheme. The plaintiff made several communications and requests to the defendant No. 1 and 2 to follow the obligations on their part but all were in vain. The plaintiff paid Interest to the defendant No. 1 for the amount paid to the supplier of generating set and other machinery and to the plaintiff for completion of building and shed. Actually the plaintiff was paid Rs. 24,000/- directly only for the completion of the building and Rs. 3,000/- only for preparative expenses. The defendant No. 1 is bound to advance amounting to Rs. 15,300.00. The plaintiff paid Rs. 3630/- as interest upto June, 1984 and no instalment was due or payable at the relevant time. Some ill motivated persons influenced the administration and pressure was being created on the plaintiff. Police enquired the matter and it was revealed that the allegations against the plaintiff was false, concocted, baseless and harassing. Even then the defendant No. 1 sent several letters and demanded frivolous amounts. The plaintiff denied all the allegations but the defendant No. 1 was determined and the plaintiff was compelled to close his business. The defendant No. 1 served a notice dated 27.11.1984. The plaintiff to get rid of the situation took shelter of the Hon''ble High Court and obtained rule in his favour. According to the plaintiff, when the matter came up for hearing the proposal from the side of the defendant No. 1 came to settle the matter mutually and the learned advocate for the defendant No. 1 also assured that there will be no injustice and the defendant No. 1 would try to make an arrangement so that the balance amount of Term Loan from the defendant No. 1 is provided expeditiously and the working capital loan from the defendant No. 2 also. The plaintiff on such belief paid Rs. 25000/- as first instalment on 15.3.1985. But when the plaintiff went to the defendant No. 1 for payment of second instalment the defendant No. 1 refused to accept the same and demanded an amount on incorrect calculation. The plaintiff was ready to pay the Instalment but on all occasions he was refused. On the other hand the defendant No. 1 sent a letter dated 16.6.1985 demanding an amount in excess of actual dues. The plaintiff sent letter dated 27.6.1985. The defendant No. 1 again sent another letter dated 7.7.1985. The plaintiff replied on 17.7.1985. According to the plaintiff, the amount demanded by the defendant No. 1 is wrong. Calculation is incorrect and the said notice is illegal. The defendant No. 1 again sent a notice dated 19.8.1985 threatening to take possession of the factory on 29.8.1985 with the help of security guard. But as on 29.8.1985 the strike was called by a political party, the defendant No. 2 could not fulfill their illegal attempt.
5. At this juncture making the date of cause of action as on 29.8.1985, the plaintiff filed the suit praying for declaration that the plaintiff is the owner and the plaintiff is the sole proprietor of the business, factory mentioned in the Schedule. The plaintiff prayed for a decree for further declaration that the defendants did not act as per the agreement, settlement and discussion and that they are guilty of misconduct by violating the terms and conditions of the agreement, by not providing the plaintiff with the assured amount of working capital and the Term Loan without any fault or laches on the part of the plaintiff. The plaintiff prayed for a declaration that the plaintiff suffered loss and injury due to non-compliance and non-performance of the duties, and obligations on the part of the defendants and due to non-payment of loan and other facilities due to business and for making arrangements for ''pari passu'' charges by the defendants. The plaintiff also prayed for a declaration that the defendants are not entitled to claim the amount sanctioned in its letter dated 18.7.1985 and not to take possession of the factory mentioned in the Schedule. The defendant prayed for a further declaration that the notice dated 18.7.1985 and 19.8.1985 sent by defendant No. 1 are illegal, defective, inoperative and not binding upon the plaintiff. The plaintiff also prayed for declaration that the defendants acted illegally and violating the principles of justice and equity depriving the plaintiff from the loans approved and sanctioned for materialisation of scheme or project for the expansion of the plaintiffs factory and business. Along with the above declarations the plaintiff prayed for a permanent injunction restraining the defendants from disturbing the plaintiff''s peaceful possession of the property in the Schedule and the factory and the business concerned therein and from disturbing smooth running of the same by the plaintiff and from taking forceful possession thereof by the defendants. The plaintiff prayed for other reliefs which he is entitled.
6. Subsequently, the plaintiff filed an application under Order 6, Rule 17 of the CPC and made certain amendments in the plaint which are as follows:
"In Cause Title the word Rs. 45/- be deleted and in its place Rs. 50/-be inserted. At the end of para 3 of the plaint the following lines may be inserted. "Be it mentioned here that prior to plaintiffs application with defendant No. 1 on 27.5.1983 plaintiff was verbally told by defendants that until and unless a construction upon the Schedule property is raised upto plinth level, they would not entertain plaintiffs application or for that matter they would not sanction the proposed scheme or disburse any amount. The plaintiff then and there opened an account being No. C/D No. 48 with defendant No. 2''s Bank and deposited Rs. 500/- and continued to deposit money therein in that account that is the plaintiff in order to raise a construction of plinth level had no other alternative than to mortgage his wife''s ornament with defendant No. 2''s Bank weighing 62 grams whose present mortgage value is more than Rs. 24,000/- in order to raise a loan of Rs. 7000/- which money was also deposited with the Bank on 18.5.1983 in the same account after deducting the commission charge and the same amount was spent for plaintiffs factory shed. Initially defendant No. 2 agreed to take a 21/2% Interest against the gold loan No. G/L. 37 which instrument was subsequently manipulated and raised to 4% unilaterally by the Bank and it has been done without the knowledge and consent of plaintiff or his wife. That the expenses for the factory shed was spent through the superannuation of defendant No. 2 who got it by means of cheque from defendant No. 1. The Bank verified the money spent and vouchers were stamped and duly verified."
7. At para 5 of the plaint after the words declaration and injunction the following line be inserted, "and Rs. 5/- tentatively for mandatory injunction." At the end of the para 6(g) the following words may be inserted "and also for an order of permanent injunction restraining the defendant No. 2 from selling the gold ornament with reference to REF No. K.L.S.G.L./37/3097 and an ad interim order in similar term during the pendency of the suit." A new para 6(j) be added which will run as follows:
6(j) for a decree for mandatory injunction directing the defendant''s to realise/disburse the amount in favour of plaintiff which has already been sanctioned within a specified period to be fixed by the Court.
8. This amendment was made a part of the plaint under Order No. 42 dated 17.11.1988.
9. Both the defendants contested the suit by filing separate written statement and by denying the allegations made in the plaint. According to defendant No. 1 upon an application made by the plaintiff hereinabove, the defendant No. 1 by a sanction order granted a Term Loan of Rs. 71,300/- to the plaintiff who was setting up a manufacturing units under the name, and style of "Neolite Eyeline Corporation" having its office and business place at Khalisani, Bowbazar, Bhadreswar, Hooghly. The said loan of Rs. 71,300/-was furnished to the plaintiff upon execution of a deed of agreement against security to be furnished by the plaintiff by way of mortgage and/or hypothecation of its land and building and plant and machinery. It is further incorporated in the said deed of agreement executed by the plaintiff that the loan granted along with interest securing thereon would have to be repaid on the Schedule dates of payment as incorporated in the said deed of agreement. It was specifically stated in the said agreement and agreed to by and between the parties that in the event of any default being made by the plaintiff in repayment of its installments and/or any part thereof or in the event of non-compliance with any of the terms and conditions of the said agreement, the defendant No. 1 hereinabove would be entitled to exercise its legal rights as granted by the defendant under the provisions of the State Financial Corporation Act, 1951. The plaintiff duly agreed to abide by all the terms and conditions of the said deed of agreement executed by the plaintiff.
10. The defendant No. 1 denied any legal liability to provide for working capital to the plaintiff and for giving any assurance to the plaintiff. The defendant No. 1 further averred that the plaintiff is bound by the deed of agreement and the plaintiff has also agreed as per terms of the agreement that in the event of any contravention the plaintiff would be liable to be proceeded against. The defendant No. 1 also denies that there was no amount outstanding from the plaintiff at the relevant time. The defendant No. 1 also denied about any pressure exerted or harassment as alleged by the plaintiff. The defendant No. 1 also stated that they are not empowered under the Act to give any assurance. The defendant No. 1 in the Written Statement quoted the order dated 12.2.1985 passed by the Hon''ble Justice U.C. Banerjee on the writ application moved by the plaintiff as petitioner in the High Court and the said order quoted is as follows:
"Upon consideration of the facts and circumstances of the case, I direct the petitioner to pay the amount in order to by the West Bengal Financial Corporation along with accrued interest thereon by the equal monthly installments of Rs. 2,500/- each to be paid by 15th each and every month commencing month of March, 1985. In the event, however, the petitioner goes on making the aforesaid payment there will be order of injunction restraining the respondents West Bengal Financial Corporation from giving any effect to the Memo dated 27.11.1984 being Annexure ''C'' to the petition. In default of payment of any two Installments the respondent authorities would be at liberty to enforce the order dated 27.11.1984. It is however made clear that since the date of payment of interest had already been specified in the agreement, the interest would have to be paid on the duties agreed. It is however recorded that the corporation need not disburse the balance amount of the sanctioned loan. This order is made at the suggestion of Mr. P.K. Murarka."
11. According to the defendant No. 1 in terms of the said order the plaintiff duly paid the first instalment for the month of March 1985 to the June of Rs. 2500/- and thereafter defaulted in payment of other installments despite reminders and in terms of the said order of the Hon''ble High Court and as per the liberty given by the order of the Hon''ble Court the defendant No. 1 took possession of the plaintiffs unit under the provision of Section 29(1) of State Financial Corporation Act. It was also stated in the Written Statement that for violation of the said order of the Hon''ble High Court an application for contempt against the plaintiff has been filed by the defendant No. 1 also pending. Concludingly the defendant No. 1 stated that whatever they did those were in terms of the Hon''ble High Court''s order dated 12.2.1985 and in terms of the provisions of State Financial Corporation Act, 1951. The defendant No. 1 submitted in the Written Statement that the suit has been filed upon suppression of material facts and the suit should be dismissed and the defendant No. 1 also submitted that the suit should be dismissed on other ground that it has been made in violation of the order dated 12.2.1985 passed by the Hon''ble High Court.
12. The defendant No. 2 filed a separate Written Statement. In the said Written Statement the defendant No. 2 stated that the suit is not maintainable and the plaintiff has no cause of action or right to maintain this suit against the defendant No. 2. The suit is barred u/s 34 of the Specific Relief Act. The suit is not triable by the said Court for want of jurisdiction. The defendant No. 2 denied all the allegations made in the plaint against them. The defendant No. 2 stated that it is not at all true that the plaintiff followed and/or complied with all the formalities asked by the defendant No. 2. On the contrary it is submitted that the plaintiff neither accepted the sanctioned letter dated 26.3.1984 of defendant No. 2 nor complied with the terms and conditions as contained and/or stipulated in the said sanction letter of the defendant No. 2. The defendant No. 2 specifically denied that the plaintiff made the construction as per their direction. The defendant No. 2 categorically stated that it is also untrue that the defendant No. 2 sanctioned first phase was of Rs. 35,000/- out of the amount of Rs. 1,32,000/-. The defendant No. 2 stated that Rs. 35,000/-was sanctioned to the plaintiff only as per sanctioned letter dated 26.3.1984 and certain terms and conditions were imposed on the plaintiff by defendant No. 2 as per usual norms of its business of Banking including advancement of loan. In the said sanction letter dated 26.3.1984 the defendant No. 2 also reserved its right to withdraw sanction or to withhold disbursement of fund in case of defects/error/lacuna if any detected by the said defendant No. 2. Subsequently the plaintiff never accepted the said sanction nor complied with the terms and conditions as imposed by the defendant No. 2 and that is why the amount sanctioned could not be disbursed to the plaintiff. The defendant No. 2 averred that the plaintiff suppressed the fact that prior to his application for working capital loan from this defendant, he took loan from the Central Bank of India, Burabazar Branch. The Central Bank of India by a letter dated 28.3.1985 intimated the defendant No. 2 of the factum of said loan facilities enjoyed by the plaintiff. In the said letter dated 28.3.1985 Central Bank of India, Burabazar Branch also intimated that they have instituted a suit against the plaintiff for recovery of Rs. 51,370.39 for non-payment of their dues by the plaintiff and the defendant No. 2 prayed for leave to refer to the said letter. Conclusively the defendant No. 2 prayed for dismissal of the suit.
13. The defendant No. 2 filed an additional Written Statement against the amended plaint and submitted that the suit is not maintainable. The Cause Title of the amended plaint are vague. The plaintiff has changed the nature and character of the suit. The plaintiff has introduced false, fabricated, concocted and baseless allegations. The defendant No. 2 thus denied all the allegations against them made by the plaintiff.
14. On the above pleadings the learned trial Judge framed 8 (eight) issues and ultimately on contest and after hearing the parties, dismissed the suit against the defendants without any costs.
15. The plaintiff preferred appeal being Title Appeal No. 68/89 against the said judgment and decree of the learned Munsif passed in Title Suit No. 87/88 and ultimately on contest and after hearing, the first Appellate Court affirmed the judgment and decree passed by the learned Munsif and dismissed the appeal.
16. Hence this Second Appeal.
17. The Hon''ble Division Bench of this Court when hearing the matter under Order 41, Rule 11 of the Code of Criminal Procedure on 6.12.1-995 passed the following order.
"We have heard the appellant, in person. It appears, prima facie, that in construing the sanction letter and the accompanying agreement the Court of appeal below committed a substantial question of error. We, accordingly, admit the appeal. Let the Records be called for and usual notices issue."
18. In the above facts and circumstances and on the above records it is the duty of this Court at the outset to see whether there is any substantial question of law which is to be decided in this appeal in terms of the scope of Section 100 of CPC.
19. Now, the judgment under challenge is a judgment of affirmation that is the finding of the Courts below are concurrent. The Hon''ble Division Bench when heard the appeal under Order 41, Rule 11 of the CP Code at that relevant point of time Their Lordships found prima facie it appeared that the letter of sanction and the agreement have been misconstrued by the Appellate Court below. But now on the basis of the entire pleadings the evidence on record and the Judgment of the Court below it is to be found whether the ground can only be a question of law or a substantial question of law and/or whether the Courts below mainly the Appellate Court below made correct interpretation of the said two documents exhibited that is the sanction Memo and the agreement.
20. For the aforesaid purpose let us see first what are the views of the Hon''ble Apex Court in different judgments when deciding the scope of interference u/s 100 of the CPC and what is to be termed as substantial question of law. The impugned Judgment under challenge is to be tested in the touch-stone of the guidelines given by the Hon''ble Apex Court in various decisions and/or decision given by our High Court (Full Bench) reported in 1993 Vol. 1 CHN p. 307 (Ratanlal Bhansilal v. Kishorilal Goenka). After the amendment of the CPC in 1976 our High Court sitting in Full Bench decided the principle for the purpose of interference in the first appeal and second appeal within the scope of sections 96 and 100 of the CPC. The Hon''ble Apex Court in its decision reported in
21. It appears from the pleadings that in the plaint the plaintiff suppressed certain material facts that is the plaintiff did not disclose that there was a suit pending against them by the Central Bank of India, Burabazar Branch for recovery of money. It is also the admitted position in this High Court on the writ petition moved by the plaintiff on 12.2.1985. It also appears from the agreement and/or the sanction Memo dated 14.7.1983 of the defendant No. 1 that in its Clause 4(g) it has been stated "in case any liability other than those disclosed to WBFC at the time of consideration of this loan is revealed in future, WBFC will have right to withdraw or call back the loan at any stage." It also appears from the records that the plaintiff moved a writ petition before this High Court challenging the notice given by the defendant No. 1 calling back the amount of loan with interest from the plaintiff and on that writ petition on 12.2.1985 this High Court observed that in the event, however, the writ petitioner goes on making payment of monthly instalment of Rs. 2500/- there will be an order of injunction restraining the West Bengal Financial Corporation from giving any effect to the Memo dated 27.11.1984 being annexure ''C'' to the writ petition. In default of any two installments the respondent authority would be at liberty to enforce the order dated 27.11.1984.
22. It is also admitted that the petitioner paid one instalment and thereafter failed to pay subsequent installments and naturally in terms of the order of the Court passed on writ petition moved by the plaintiff as petitioner WBFC acted in terms of the notice dated 27.11.1984.
23. It does not appear from the records that any agreement was executed by and between the defendant No. 2 and the plaintiff that is the United Bank of India and the appellant herein. It appears from record that the plaintiff only applied for loan from United Bank of India in a prescribed Form and never the terms of the defendant No. 2 Bank was accepted by the plaintiff and there was any concluded contract.
24. Section 29(1) of the State Financial Corporation Act, 1951 provides "where any industrial concern, which is under a liability to the financial corporation under an agreement makes any default in repayment of any loan or advance or any instalment thereof or in meetings its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply with the terms of the agreement with the Financial Corporation, the Financial Corporation shall have the right to take over the management or possession or both of the industrial concern as well as the right to transfer by way of lease or sell and realise the property pledged, mortgaged, hypothecated or assigned to the Financial Corporation". Section 30 of the said Act gives power to call for repayment before agreed period if it appears to the Board that false or misleading information in material particular was given by the industrial concern in its application for the loan or advance.
25. In that view of the matter the defendant No. 1 acted in terms of the order of the High Court passed in the writ petition as well as provisions of the statute and also the term given in the sanction Memo.
26. On scanning of the judgment of the Appellate Court below it appears that both the trial Court and the Appellate Court below considered these factors and duly and properly construct the sanction Memo and the agreement with the defendant No. 1, WBFC when it appears that the Appellate Court below as well as the trial Court duly considered the evidence on record, the pleadings, scanned the evidence and came to concurrent finding and more so when the Appellate Court below construed the sanction Memo as well as the agreement in its proper light and perspective it cannot be said that there is any question of law involved in this appeal far less substantial question of law, considering the same in the touch stone of the above quoted decisions of the Hon''ble Apex Court. In my opinion, therefore, thing remains in this second appeal to be decided or there is no scope for interference of this Court within the purview of Section 100 CPC and this second appeal is, therefore, dismissed. The judgment and the decree of the Appellate Court below is affirmed. The parties are to bear their own costs. Let a decree be drawn up accordingly. Let the LCR be sent down to the Court below forthwith.
27. Stay of operation of the judgment and order passed today i.e. 28.2.2003 has been prayed for on behalf of the appellant. Considering the facts and circumstances and the nature of the dispute, stay of operation of the judgment and order is granted for three weeks.
