The Punjab State & Anr. v. The Central Bank of India & Anr.

State and its officer appellant-defendant Nos.1 and 2 (hereinafter to be referred as “the contesting defendants”) is to the judgment and decree dated 30.4.1985, whereby, the trial Court has decreed the suit for permanent injunction filed by the Central Bank of India respondent No.1-plaintiff (hereinafter to be referred as “the plaintiff-Bank”). They have also challenged the judgment and decree dated

25.4.1986, vide which, their appeal was dismissed as well, by the Ist Appellate Court.

2. Tersenessly, the facts, culminating in the commencement, relevant for disposal of the present appeal and emanating from the record, are that originally, the plaintiff-Bank filed the present suit for a decree for permanent injunction restraining the contesting defendants from selling or otherwise disposing of seven buses of the Ambala Bus Syndicate, Ropar respondent No.2- defendant No.3 (for brevity “defendant No.3”)bearing registration Nos.PUR 5228, PUR 5889, PUR 6428, PUR 7789, PUR 8222, PUR 8224 and PUR 8503.

3. The case set up by the plaintiff-Bank, in brief, in so far as relevant, was that it had twice advanced the loan to defendant No.3, on their executing hypothecation deeds dated 24.2.1981 and 28.5.1981, thereby hypothecating 40 Regular Second Appeal No.2315 of 1986 2 buses with it (plaintiff Bank). Out of these buses, seven indicated buses have been illegally attached by the contesting defendants, to frustrate the loan advanced by the plaintiff-Bank. It was claimed that although the plaintiff-Bank has the first charge on these buses, in regard to the outstanding amount of Rs.28,72,757-30 P alongwith future interest due from defendant No.3, as per the hypothecation deeds, but they (contesting defendants) are now bent upon to auction the buses, in order to frustrate its (plaintiff-Bank) claim without any legal right.

4. Levelling a variety of allegations, in all, according to the plaintiff- Bank, it has first charge on the buses in question of defendant No.3, already hypothecated in lieu of loan and the contesting defendants have got no right to auction the same. The plaintiff-Bank asked them not to auction the buses in question, but in vain, which necessitated it, to file the present suit. On the basis of the aforesaid allegations, the plaintiff-Bank filed the suit for a decree for permanent injunction against the defendants, in the manner detailed here-in-above.

5. As defendant No.3 did not contest the suit, therefore, exparte proceedings were ordered against it. However, the defendant Nos.1 and 2 contested the suit and filed the written statement, admitting therein that the buses were hypothecated with the plaintiff-Bank, but they have denied the advancement of the loan to defendant No.3 for want of knowledge. However, it was claimed that defendant No.3 is defaulter on account of non-payment of taxes due to the State. The recovery proceedings were stated to have been started against it (defendant No.3), as arrears of land revenue. The contesting defendants have denied the first charge of the plaintiff-Bank, pertaining to the buses in question. It will not be out of place to mention here that the contesting defendants have stoutly denied all other allegations contained in the plaint and prayed for dismissal of the suit.

6. In the wake of pleadings of the parties, the trial Court framed the following issues for proper adjudication of the case:-

1. Whether the buses are hypothecated with the plaintiff Regular Second Appeal No.2315 of 1986 3 Bank by defendant No.3?OPP

2. Whether defendants No.1 and 2 are estopped from their act and conduct to deny the hypothecation of the buses with the plaintiff? OPD

3. Whether the Government amount is first charge over the property?OPD

4. Whether the plaintiff is entitled to injunction prayed for ? OPP

5. Relief.

7. The parties brought on record the oral as well as documentary evidence, in order to substantiate their respective pleas.

8. The trial Court, on ultimate analysis of the evidence on record, decreed the suit of the plaintiff-Bank, vide impugned judgment and decree dated

30.4.1985.

9. Aggrieved by the judgment and decree of the trial Court, the contesting defendants filed the appeal, which was dismissed as well by the Ist Appellate Court, vide impugned judgment and decree dated 25.4.1986.

10. The appellants (contesting defendants) still did not feel satisfied with the impugned judgments and the decrees of the Courts below and filed the present appeal. That is how, I am seized of the matter.

11. Having heard the learned State counsel, having gone through the record with his valuable help and after bestowal of thoughts over the entire matter, to my mind, there is no merit in the appeal.

12. However, the celebrated argument of the learned State counsel that since the recovery proceedings were initiated to recover the amount of tax due to the State, under the provisions of the Punjab Land Revenue Act (hereinafter to be referred as “the Act”), so, the plaintiff-Bank did not have any right to put hurdles in this respect, is not only devoid of merit but misplaced as well. Regular Second Appeal No.2315 of 1986 4

13. As is evident from the record, defendant No.3 had hypothecated the buses including the indicated buses with the plaintiff-Bank at the time of advancement of loan, vide hypothecation deeds (Ex.P2 and Ex.P3). The registration certificate (Ex.P4) and certificate of hypothecation (Ex.P5) are clearly indicative of the fact of hypothecation and loan transactions. Not only that, the contesting defendants have categorically admitted in their written statement that the buses in question were hypothecated with the plaintiff-Bank. Ex.P5 is the certificate issued by the District Transport Officer of the State, which would reveal that all the seven buses in question stand hypothecated with the plaintiff-Bank.

14. Once, it is cogently proved and acknowledged by the contesting defendants that the above mentioned buses initially stood hypothecated with the plaintiff-Bank, in lieu of the advancement of loan amount to defendant No.3, in that eventuality, defendant No.3 cannot possibly be termed as absolute owner of the buses, free from all encumbrances, unless and until, the entire amount of loan is paid and the plaintiff-Bank would have the first charge over the buses in question. Therefore, the recovery of amount of tax from defendant No.3, being defaulter under the provisions of the Act, would not frustrate the first charge created by it (defendant No.3) in favour of the plaintiff-Bank at the time of hypothecation of the buses, in any manner. Hence, the plaintiff-Bank has first charge/right to recover the amount of loan in this relevant connection.

15. Moreover, the trial Court as well as the Ist Appellate Court has taken into consideration the observations of this Court in case Punjab National Bank, Kharar, District Ropar v. The Union of India and others 1974 P.L.R.701 and appreciated the entire relevant evidence brought on record by the parties in the right perspective. Having scanned the admissible evidence in relation to the pleadings of the parties, the trial Court as well as the Ist Appellate Court has recorded the concurrent findings of fact that defendant No.3 had hypothecated the 40 buses including the indicated buses in question at the time of advancement of Regular Second Appeal No.2315 of 1986 5 loan, vide hypothecation deeds (Ex.P2 and Ex.P3), the plaintiff Bank has first charge over the same and the contesting defendant Nos.1 and 2 cannot frustrate its charge by issuing the recovery certificate. Such pure concurrent findings of fact based on the evidence, cannot possibly be interfered with by this Court, while exercising the powers conferred under section 100 CPC, unless and until, the same are illegal and perverse. No such patent illegality or legal infirmity has been pointed out by the learned counsel for the contesting defendants, so as to take a contrary view, than that of the well reasoned decision already arrived at by the Courts below, in this regard.

16. Meaning thereby, the entire matter revolves around the re- appreciation and re-appraisal of the evidence on record, which is not legally permissible and is beyond the scope of second appeal. Since no question of law, muchless substantial, is involved in the second appeal, in view of law laid down by Hon'ble Supreme Court in case Kashmir Singh v. Harnam Singh & Anr. 2008 (2) R.C.R. (Civil) 688 : 2008 AIR (SC) 1749, so, no interference is warranted in the impugned judgments/decrees of the Courts below as contemplated under section 100 CPC in the obtaining circumstances of the instant case.

17. No other legal point, worth consideration, has either been urged or pressed by the learned counsel for the appellant-defendants.

18. In the light of the aforementioned reasons, as there is no merit, therefore, the instant appeal is hereby dismissed.

13.7.2010 AS (Mehinder Singh Sullar) Judge