State Bank of India, Bhubaneswar Vs. Umakanta Mohanty and anr. - Court Judgment

Excerpt:
- motor vehicles act, 1988 [c.a. no. 59/1988]section 173(1) proviso; [d. biswas, amitava roy & i.a.ansari, jj] appeal without statutory deposit but within limitation/or extended period of limitation maintainability - held, if the provision of a statute speaks of entertainment of appeal, it denotes that the appeal cannot be admitted to consideration unless other requirements are complied with. the provision of sub-section (1) of section 173 permits filing of an appeal against an award within 90 days with a rider in the first proviso that such appeal filed cannot be entertained unless the statutory deposit is made. the period of limitation is applicable only to the filing of the appeal and not to the deposit to be made. it, therefore, appears that an appeal filed under section 173 cannot be entertained i.e. cannot be admitted for consideration unless the statutory deposit is made and for this purpose the court has the discretion either to grant time to make the deposit or not. no formal order condoning the delay is necessary, an order of adjournment would suffice. the provisions of limitation embodied in the substantive provision of the sub-section (1) of section 173 of the act does not extend to the provision relating to the deposit of statutory amount as embodies in the first proviso. therefore an appeal filed within the period of limitation or within the extended period of limitation, cannot be admitted for hearing on merit unless the statutory deposit is made either with the memo of appeal or on such date as may be permitted by the court. no specific order condoning any delay for the purpose of deposit under first proviso to sub-section (1) of section 173 is necessary. [new india assurance co. ltd. v md. makubur rahman, 1993 (2) glr 430 and new india assurance co. ltd. v smt rita devi, 1997(2) glt 406, approved. new india assurance co. ltd. v birendra mohan de, 1995 (2) gau lt 218 (db) and union of india v smt gita banik, 1996 (2) glt 246, are not good law]. - 1 failed to repay the term loan as stipulated and defaulted, plaintiff issued registered notices to both the defendants. this decision clearly laid down in case where the surety has guaranteed payment in case of default by the principal debtor, he is not a co-contractor and payment made by the principal debtor saves limitation against surety also. 1. in the peculiar circumstances of this case, i am inclined to hold that interest of justice would be best served in case i set aside the judgment so far as defendant no.s.c. mohapatra, j.1. plaintiff bank is appellant against dismissal of the suit for recovery of loan to defendant no. 1 as barred by limitation.2. it is not in dispute that defendant no. 1 took loan of rs. 13,500/- from the plaintiff bank on 15-5-1970. defendant no. 2 was the surety for such loan. it was stipulated that loan would be paid by instalments since it was a medium term loan advanced to defendant no. 1 for purchase of a power tiller with accessories.3. case of plaintiff is that interest was payable quarterly on or before 14th august, november, february and may each year. first payment was to commence from 14-8-1970. loan with this stipulation was guarded by defendant no. 2. on 15-5-1970, defendant no. 1 hypothecated the power tiller with accessories and defendant no. 2 joined as guarantor. when defendant no. 1 failed to repay the term loan as stipulated and defaulted, plaintiff issued registered notices to both the defendants. despite notice payment was not made. hence taking into account payments already made, suit was filed for realisation of rs. 14,466.63 including interest calculated up to 21-9-1923 (1973?) making both the defendants jointly and severally liable.4. defendant no. 1 filed written statement claiming that plaintiff committed breach of contract since it paid the loan amount to supplier of the power tiller with accessories which was found to be defective and despite notices no step was taken to rectify the defects. it was stated that suit is barred by limitation. however, during trial defendant remained ex parte.5. defendant no. 2 stated in his written statement that on receipt of information from plaintiff, he replied back that the loan with interest may be realised immediately from the hypothecated property. since plaintiff did not take immediate step, defendant no. 2 would not be liable. he also claimed that suit is barred by limitation.6. on the pleadings, trial court settled seven issues two of which are material for this appeal. they are:--(i) is the suit barred by limitation?(ii) is the defendant no. 2's liability coextensive with the liability of defendant no, 1 with regard to the suit loan,7. in the trial court, plaintiff examined one witness and proved documents marked exts. 1 to 7. defendant no. 2 examined himself and proved documents marked exts. a to d.8. trial court held that liability of defendant no. 2 is co-extensive with liability of defendant no. 1. but it held that loan having been granted on 15-5-1970 and suit having been filed on 28-9-1973, the same is barred by limitation since there is no stipulation in the contract that payment made by debtor would save limitation in the suit as against the surety too. on such finding suit was decreed against defendant no. 1 ex parte and was dismissed as against defendant no. 2.9. defendant no. 1 has filed an application for setting aside the ex parte decree which is pending. accordingly, i am not inclined to give any finding as regards his liability in case suit is dismissed on merits after ex parte decree is set aside as against defendant no. 1, the same cannot be decreed against defendant no. 2, however, question arises whether the suit is barred by limitation against defendant no. 2.10. learned trial judge relied upon a decision of punjab high court in support of his finding that in absence of stipulation in contract. limitation would not be saved by payment on behalf of defendant no. 1. decision of this court reported in ilr 1957 cut 454 : (air 1957 ori 106), v. somanath raju v. konchada ramamurthy subudhi was not cited before him. this decision clearly laid down in case where the surety has guaranteed payment in case of default by the principal debtor, he is not a co-contractor and payment made by the principal debtor saves limitation against surety also. same is the view expressed in two recent decisions reported in (1990) 1 bc 186, syndicate bank v. krishna where bombay high court held that in view of s. 20(2) of the limitation act, limitation gets extended on payment by the principal debtor in respect of claim against surety where loan was advanced for a vehicle. in the decision reported in (1991) 1 bc 26, santosh kumar jain v. bank of india, madhya pradesh high court construing the document of loan held that the same bears the signature of the guarantor and accordingly, his liability being co-extensive with that of the principal debtor, he cannot avoid his responsibility and acknowledgment by principal debtor extends limitation against surety.11. coming to the question of limitation, i find that the first instalment was to be paid on 15-5-71, other instalments were to be paid on 15-5-72, 15-5-73, 15-5-74 and 15-5-75. thus, liability of the guarantor continued till 15-5-75 itself. so far as the first three instalments are concerned, 15-5-71, 15-5-72 and 15-5-73, for each instalment a suit could have been filed within three years from the due date. therefore, for the first instalment the suit would have been filed on or before 15-5-74. even if no payment is said to have been made on behalf of defendant no. 1 towards the loan amount for acknowledging the loan as provided under section 20 of the limitation act suit could not have been barred by limitation having been filed in september, 1973. trial court has not taken note of this fact and accordingly its judgment has become vulunerable.12. i would have considered the case myself on the materials available in case an application for setting aside the ex parte decree would not have been pending filed by defendant no. 1. in the peculiar circumstances of this case, i am inclined to hold that interest of justice would be best served in case i set aside the judgment so far as defendant no. 2 is concerned and remit the suit back to the trial court for fresh consideration of the materials on records, giving liberty to both plaintiff and defendant no. 2 to adduce further evidence if they are so advised.13. in the result, the appeal is allowed. there would be no order as to costs.