The High Court · 2025

... RespondenURespondenUplaintiff

2. Atla Ram Reddv S/o Rayanna 1-86, Wadyat Vitrage. Adriabao o,iti,"i sb7i"os""" 1\Oe_ SZ years. Occ_ Business, R/o. H.No. 3. K. Ganqa Reddv. S/o Gopat Reddy, Age_ 72 years, Occ_ Business, R/o. 4. Rathod Vilas. S/o. Rath6d J3y313ry1. Age. 39 years Occ_ Business, R/o. H. No. 246, Ma6 ipet vi lta gie Kni niir,' ir, rrn-ri bj"iii"r a, Ashepeily virrrg"l Rrrnrn;,i i;,";::","oor Mandar, Adlabad B,ll;"., ...Respondents/Appellants No.2 to 4/Defendants No.2 to 4 t/ IA NO: 10F PetitionunderSectionl5lCPCprayingthatinthecircumstancesstatedin the affidavit filed in support of the petition' itre nign Court may be pleased to grant interim stay of all further proceedings pursuant to the^order and decree passed by i'n" pii""p"i Junior Civit Judge it 'Aditabad in O S NO 93 of 201 8, dated \ilOiZ,Oii as confirmed in the-appeat vide A.s.No.27 of 2023, dated 1411012024 on 6Jt" of principal District Judge at Adilabad in the interest of justice pending disposal of the above Second Appeal' Counsel for the Appellant : SRI S SURENDER REDOY Counsel for the ResPondents: - - - The Court delivered the following: Judgment i I HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY SEC OND A PPEA I. No 525 ol'2024 JUD MENT: This Second Appeal is filed questioning the judgment and decree, dated 14.10-2024, passed by the Principal District Judge' Adilabad, in A.S.No.27 of 2023, whereunder and whereby the judgmentanddecree,datedl2.l0.2023.passedbytlrePrincipalJunior Civil Judge, Adilabad, in O.S.No'91 of 20ltt was confirrned' 2. The appellant is defendant No. I' respondent No't is plaintiff bankandrespondentNos.2to4areclelcndantNos.2to4respectively, in the suit. For convenience, hereinafier the pa(ies are referred to as they are arrayed in the suit.

3. The brief facts of the case, which led to filing of the present Second Appeal, are that in the plaint' thc plaintill- averred that on an application of defendant No.l lbr providing lbr bank guarantee for Rs.l3lakhsforaperiodoflTnronthsandanotherbankguaranteefor Rs.l3lakhsforaperiodof2lmonthsinlavourof'Prohibitionand Excise Superintendent, Adilabad, the satne was sanctioned by the plaintiff bank 06.10.2015 on cxecutiotr ot'required documents by l \ \ \ 2 LNA. J .9A.No.525 of2024 defendant No. I defendant No.l; that defendant No.l agreed to repay the amount with interest (@r I 8% per annum with quarterly rests; that on 0l .05.2017, on the intimation of prohibition and Excise Superintendent, rhe bank guarantee ol Rs.5,90,000/_ was invoked and the said amount was paid to Excise Department, Nirmal, in the form of Demand drati; that delendant No. I failed to repay the balance amount as per the tenns of the agreement; that on repeated requests of the plaintiff bank, paid a sum of Rs.4,50,000/_ on 26.09.2017. but defaulted in repayment of balance amount and thereFore, the suit was filed lor recovery of Rs.2,01,107l_ along with interesr f4 lg%" per annurn from the date of suit till the date ofrealization. 4. Defendant Nos. I to 4 filed written statement denying the clairn of rhe plaintiff bank and admitted that the plainrifl bank provided bank guarantees to defendant No.l, but the plaintitTbank in collusion witlr the Excise Department, paid the bank guarantee amount evcn beiore lapse of 17 months and that no prior notice was given to the defendant, thereforq the suit is not maintainablc and the same is liable to be dism.ssed.

5. gn thc basis of the above pleadings ofboth the parries. rhc rrial Court fiamed the following issues for trial:_ .' I ' ,r r.rrrrllhl "(l) llthether the plaintilf is entitletl .lbr recovery <;l' Rs.2,0l,107/- with future interest @ I 8'l per annnm.from the date of institution of the suit till rhe dare of decree and further, from the date of decree to till realization o.f the suit amount with costs from the de.ferulants? (2) To what relieJ? "

6. On behalf of the plaintiff, PW I was examined and Exs.A- l to A-10 were marked. On behalf of the def'endants, DW.l r.vas exarnined, but no documents were marked.

7. After full-fledged trial and upon considering the oral and documentary evidence and the contentions ofboth the pa(ies, the trial Court decreed the suit, vilejudgment and decree dated t2. 10.2023.

8. The trial Court categorically observed as hereunclcr:- "Coming to the documentary evklence udduc<tl lt.t' the plaintilf,, defendant Nos. l to 4 hut e not di.sputul thote documents and execution oJ-those do(un 'nts itt /itvtur of plaintilf bank. The documenlru.y evid<'ru'e addu<,tl h.r p!uintill clearly shows that deJbndant No. I hus olttuittitl buttk guarantee for an amount ofRs.26 lakh:;."

8.1. The trial Court has further observed as ltcreuntlcr:- "Upon the request of plainti/l'bank puid only Rs.'1.50.00(l'- hut he failed to pay remaining amount. 8.r..'l- l(i s/tr,'rr:r tlutt rhr 'flu' dor'ttttr<'tttttt.t ('t idL' (e Jfiance amount of Rs.l,73,565/-. I I \ I 4 LNA. J SA.No.525 of2021 untl<'r Et.A-7 adduced by plaintilf shows that defendant No l ma(lc delault in paying dt' instalment license fee for the year 20t6-17. Defendant No.l .failed to rebut Ex.A-7. There is no doctrntentaty evidence adduced by defendant No.l supporting his t t,rsiott. The plaintif.f'has been able to discharge his initial bttrrltn bv adducittg necessary oral and documenlary (,\'itlt'n('(' Dekndant No.l faited to disprove the claim o.f rhe plaitril/ hank and he.failed to discharge the burden shifted on hint regording the suit claim. Defendanl Nos.2 to 4 also failed to tuldu<'c a'idence on their behalf. "

9. -l-hc trial Court also observed that though, there is agreement showing the rate of interest to be paid by defendant, that interest was (br the total amount of Rs. 13 lakhs and the interest claimed on suit amount apl)ears to be huge and accordingly, slashed down the rate ol' interest. i c., ttt l2Yo per annum on the suit amount from the date of suit till the date of decree and @ 6 % per annum liorn the date ol declee till rcalization.

10. Orr appeal, the first Appellate Court, being the final fact- Iintlrng ('ourt. re-appreciated the entire evidence and nlaterial available ()n lecord and dismissed the Appeal, vide its judgment dated

14. 10.2014. tlrcrcby, confirming the judgment of the trial Court' 1 I . The first Appellate Court in its judgment observed as 5 LNA. J SA No.515 ol 1024 hereunder:- "As can be seen from Ex.A-3-agreement executed by delbndant No.l clause-iv clearly states that the bank is entitled v'ilhout any .further consent from the borrower to debit anv ol ltis account or accounts at any of the branches perlaining lo the plainti/f bank with the amount of any payments nnr nrukc under or in respect of the said guarantee. ln E-r.A-4- underlaking and Ex.A-5-coutner guarantee and indentttit.r' surety executed by defendant Nos.2 to 4, clause-t and vi alsrt clearly indicates thal there is no need to inform lhem ubout the inroccttion of bank guarantee in case ofdefault- " I l.l. The first Appellate Court further observed as hereundcr:- "As can be seen from Ex.A-7 letter dated 01.05.2017. n'hcrc'tn the Prohibition and Excise Superintendent asked tha Mutrugcr oJ the plaintiff bank to invoke the bank guaranlee in rcsp('t ol 6't' instalment of licencefee as deJbndant No.! /trilcd rrt 1un (it' instalmenl and requesled to remit an amou,tt o/ Rs.5.80.(10(l - b.v u,ay of DD/bankers cheque in the name of Prohihiti<trt tu Exc ise Supe r intendent, Nirmal. Ex.A-7 letter dated -01.05.2017 clearl.y indicurt's thut u.r delbndant No.l violated the provisions oJ AP E:cise .1tr. l96ti. th(' conpetent authority has canceled the lictttct' tu intokul thr bank guarantee issued by lhe plaint(J bonk. .'l.r su<h. tl,rt ' is no.lbrce in the contention of the appellanlsktclt tulants thut lh<'qe 'n'as a collusiott in befiieen pluintil/ lxutk untl tln 6 LNA. J 54.No.525 of202t Prohihition and Excise Superintendent, Nimal invoking bank quarantee much prior to the expiry of license period. ln riew of the above clauses in Exs.A_3 to A_5, there is no nt<d to the ptaintilf bank to give prior intimarion to the d"li'ntrunts be/bre invoking rhe bat* guarantee. The account .tt(tt?tn?nt /iled along utith suit clearly showing the due amounl ol Rs.).01,l0Z/_ as on the date of.filing.fo the suit.,, l]eard Sri S.Surender Reddy, learned counsel for the appellant.

2. Perusetl the entire nlaterial available on record. 13. Leanred counsel for the appellant contended that the trial Court as well as lrrst appellate Court failed to take note of the fact that the plaintilI bank has nor used the cheque bearing No.42273 dated 0(t.02.107 lor an arnounr ol Rs.5,g0,000/_ given by defendant No. I in favour tr t' thc prohibition and Excise Superintendent, Adilabad; that evcn lrchrre lapsc ol l7 rnonths, as per the agr@ment, the plaintiff bank, in collusion with the prohibition and Excise Superintendent, Nirrnal. rnroketl the bank guarantee and paid an amount of Rs.5,80,000/- ro the Excisc Department from the account of the plainrilt. I{c llrther conrended rhar rhe plaintiff bank has paid the anr()ulll to rhc Excisc Departnlcnt without giving any prior notice and I l I I I I 1 : , ! I I I I i I I I I 7 LNA. J SA.No.525 o/ 2D4 without the consent of defendant No.l and the guarantors ofdefendant No. I. He further contended that the Manager of the plaintiff bank, who was examined as P.W-I, admitted that the bank has not addressed any letter to defendant No.1 even after invoking the bank guarantee by the Excise Department and that ignoring the said admission and the aforesaid facts, the trial Court erroneously decreed the suit, which was confirmed in appeal by the first appellate Court and hence, he prayed to allow this Second Appeal, thereby disallowing the suit claim of the plaintiffbank.

11. A perusal of record would disclose that the trial Court as well as the {irst Appellate Court referring to and relying upon Clause-iv of Ex.A-3-agreement, which is to the effect that the bank is entitlecl rvithout any turther consent fiom the borrower to debit any ol'his account or accounts at any of the branches pertaining to the plaintiff bank in respect ol the said guarantee and further, Clause-v r.vhich clcarly indicates that there is no need to inform the borrower atrout invocation ol bank guarantee in case of default, and basing on documenlary evidence, Ex.A-7 which shows the default contmitted bv dclendant No. I , have rightly allowed the suit claim ol the plainti tI' ban k. 1. 8 LNI. J SA.No.525 of 2024

15. ln considered view of this Court, the leamed counsel for appellant failed to raise any substantial question of law to be decided by this Court in this Second Appeal. In fact, all the grounds raised in \ this appeal are lactual in nature and do not qualify as the substantial questions of law in terms olSection 100 C.P.C. I

16. [t is rvell settled principle by a catena of decisions of the Hon'ble,\pex Court that in thc Second Appeal filed under Section 100 C.P.t'.. this Court cannot interfere with the findings on facts arrived at by the first Appellate Court, which are based on proper appreciatirx of the oral and documentary evidence on record.

17. Further. in Gurdev Kaur v. Kakit, the Apex Court held that the High Court sitting in Second Appeal cannot examine the evidence once again as a third trial Court and the power under Section 100 C.P.C is r ery Iinrited and it can lre cxercised only where a substantial question tll'larr rs raiscd and Ialls fbr consideration.

18. Having considered the entire material available on record and the findings recorcled by the tirst Appellate Court, this Court finds no ground or reason warranting interfbrencc with the said findings, under $sqllsn l{X) ( .['.C. Moreover. thc grounds raised by the appellant are t (2007) I Suprenre Court Cases 546 I I I I LNA, ,I SA.No.525 of2024 f'actual in nature and no question of [aw, much less a substantial question of law arises, for consideration in this Second Appeal.

19. Hence, the Second Appeal lails and the same is accordingly dismissed at the stage oladmission. No costs.

20. Pending miscellaneous applications, ifany, shall stand closed. //TRUE COPY// SD/- M. RAMANA KRISHNA JOINT REGISTRAR SECTION OFFICER I To, . The Principal District Judqe at The P_rincipat Junior Civiliudg One CC to SRt S SURENDER Two CD Copies 1 2 3 4 ADK/gh v Adialbad( With e at Adilabad REDDY, Advocate IoPUCj , if any) records, if any) HIGH COLIRT DATED:10 t0312025 JUDGMEN T SA.No.525 ,of 2024 1 I E 14 ,'s ,,6 _e () o \\ -r \."a 17 il]ll zffi t (. T r t c( DISMISSING THE SECOND APPEAL AT THE STATE OF ADMISSION WITHOUT COSTS .rD d