P.D. Arun, S/O Damodara Prabhu; H. Damodara Prabhu, S/O Hari Prabhu; P.D. Praveen, S/O Hari Prabhu v State Bank of Travancore

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON** **TUESDAY, THE 22ND DAY OF JULY 2014/31ST ASHADHA, 1936** ## **RP.No. 906 of 2012** ## **--------------------------** **AGAINST THE JUDGMENT IN WP(C) 29389/2007 OF THIS HONOURABLE COURT, DATED 21-08-2012** **----------** ## **REVIEW PETITIONER(S)/PETITIONERS:** **-------------------------------------------------------** ## **1. P.D.ARUN,** **S/O DAMODARA PRABHU, PRABHU NIVAS, KANDAKKADAVU, ANDIKKADAVU.P.O, KOCHI TALUK, ERNAKULAM DISTRICT.** ## **2. H.DAMODARA PRABHU,** **S/O.HARI PRABHU, PRABHU NIVAS, POOMARATHINGAL, KANDAKKADAVU, ANDIKKADAVU.P.O, KOCHI TALUK, ERNAKULAM DISTRICT.** **3. P.D.PRAVEEN,** **S/O.HARI PRABHU, PRABHU NIVAS, POOMARATHINGAL KANDAKKADAVU, ANDIKKADAVU.P.O, KOCHI TALUK ERNAKULAM DISTRICT.** ## **BY ADV. SRI.DINESH R.SHENOY** **RESPONDENT(S)/RESPONDENTS:** **------------------------------------------------** **STATE BANK OF TRAVANCORE, HAVING ITS REGISTERED OFFICE AT THIRUVANANTHAPURAM AND BRANCH AMONG OTHER PLACES AT PAZHANGAD KUMBALANGHI.P.O, COCHIN-682007, ERNAKULAM DISTRICT.** ## **BY ADV. SRI.SATHISH NINAN SRI.SANTHOSH MATHEW** **THIS REVIEW PETITION HAVING BEEN FINALLY HEARD ON 04-06-2014 THE COURT ON 22-07-2014, PASSED THE FOLLOWING:** **PJ** ## **P.R. RAMACHANDRA MENON, J.** .............................................................................. ## **R.P. 906 OF 2012** ## **IN W.P.(C)No. 29389 OF 2007** ......................................................................... **Dated this the 22[nd] July, 2014** ## **O R D E R** The writ petitioners are before this Court seeking for review of the judgment dated 21.08.2012, pointing out that the specific plea of 'limitation' raised by the petitioner in the writ petition, which was all the more raised before the DRT and also before the DRAT, was not considered while passing the verdict and hence there is an 'error apparent on the face of the records', necessitating review. 2. The case of the review petitioners is that the judgment was passed by this Court mainly on the basis of the submission made by the learned Counsel for the Bank that the main dispute raised by the petitioners was with reference to the 'rate of interest' applicable under the NABARD Re-finance Scheme (as observed in paragraph 4 of the judgment). In view of the said submission, no other point, particularly the question of limitation, was considered by this Court, inspite of the specific pleadings all throughout. Some grounds are raised also with _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ **2** reference to the eligibility to have lesser rate of interest under the NABARD Re-Finance Scheme as well. 3. A statement has been filed on behalf of the respondent/State Bank of Travancore, specifically contending that the plea of limitation, though raised, was never pressed from the part of the petitioners even before the DRT as discernible from the cross examination of DW1. It is stated that the petitioner had executed A10 and A11 Revival letters (produced in O.A.), but in the proof affidavit filed before the DRT, a new contention was taken that, it related only to an extent of Rs. 73000/- under the Agrl.Cash Credit Facility and hence the claim for balance amount under the said loan was barred by limitation. The issue regarding limitation was specifically considered by the DRT under Issue No.3 (paragraph 18 and 19 of Ext.P7) and a clear finding was rendered against the challenge. 4. A reply affidavit has been filed by the review petitioners producing copies of revival letters dated 07.08.1995 as Annexure A1 to A4 and contending that the revival was only in respect of **3** ## _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ quantum limited to Rs.73000/- under the Agrl. Cash Credit Facility and not for any other amount. The basic question to be considered is whether the said plea of limitation was pressed before the DRAT or even before this Court. 5. It is seen from the pleadings and proceedings that, but for the case projected by the Review Petitioners that the plea of limitation was raised but not considered by the DRAT or even by this Court, there is no case that the said question was argued, but omitted to be considered by the DRAT/this Court. The learned Counsel for the respondent Bank submits that, if the review petitioners have got a case that it was argued but not considered by the DRAT, the remedy is to file a Review Petition before the DRAT and not a writ petition before this Court. Reliance is also sought to be placed on the decision in _**Bharat Petroleum Corporation Ltd. vs. Kalyanaraman**_ [ **2014 (1) KLT SN 33 (Case No. 46)]** 6. It is settled law that the question of limitation involves a substantive right. If there is no dispute with regard to the factual position, particularly the relevant dates, it more remains to be a **4** ## _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ question of law, which could be raised for the first time even before the Apex Court. Nothing is discernible from the verdict passed by the DRAT, as to whether the review petitioners had argued the question of limitation and whether the same was considered and turned down. Same is the position with regard to the judgment passed by this Court as well, as the petitioners have not pleaded that it was argued, but left out unconsidered. Anyhow, this Court does not find it necessary to probe into this aspect any further, as it is found fit and proper to hear the learned Counsel for the review petitioners with regard to the merit of plea of limitation as well. Accordingly both the sides addressed arguments on the grounds for review and also with regard to the plea of limitation. 7. Admittedly, there were two loans, one Agrl. Term Loan and the other one- Agrl. Cash Credit Facility. The Agrl. Cash Credit Facility, extended as per agreement dated 13.11.1992 was originally for a sum of Rs.73000/-, (account number with name being-ACC 13/92-P.D. Arun). The said loan was admittedly enhanced to Rs.3 lakhs on 19.01.1994, which was further _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ **5** enhanced to Rs.4.6 lakhs on 31.05.1995. The review petitioners now admit that they had executed revival letters on 07.08.1995 (as borne by Annexure - A10 and A11 before the DRT, copies of which have been produced as Annexures- A3 and A4 along with the reply affidavit dated 08.02.2013 filed in the Review Petition). The contention of the review petitioners as putforth by the learned Counsel is that, such revival letters in respect of the Agrl. Cash Credit Facility are to show acknowledgement of debt only to an extent of Rs.73000/- and nothing more. This being the position, the amount due under the Agrl. Term Loan of Rs.1,96,600/- and Agrl. Cash Credit Facility of Rs.73000/- alone are recoverable from the review petitioners and the rest is barred by limitation. Reliance is also sought to be placed on the decision rendered by the Madras High Court in _**Muhammed Sultan Rowther vs Muhammed Nurdin**_ (1963 MLJ 300) and by Patna High Court in _**Bindeswari Prasad vs. District Board, Saran**_ ( **AIR 1961 Patna 134** ) to the effect that, if the acceptance of debt was only for a lesser amount, the liability could be fastened only to such limited/accepted extent. _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ **6** 8. In view of the nature of rival contentions, the point for consideration (with regard to the limitation) comes to the actual extent of admission/acceptance of the outstanding liability under the Agrl.Cash Credit Facility, when execution of revival letters dated 07.08.1995 stands admitted. The question is whether the review petitioners had accepted the liability only to a lesser extent while executing the revival letters. On going through the contents of the revival letters (Annexure A3 and A4 produced along with the reply affidavit dated 08.02.2013), it is seen that the face sheet of both revival letters clearly refer to the particular loan No. ACC 13/92 -PD Arun. The face sheet of Annexure - A3, shows that it is addressed to the Manager of the concerned Branch with reference to the Agrl. Cash Credit for Rs.73000/while in Annexure-A4, it is addressed "With reference to Agrl.Cash Credit”. The second sheet of Annexure -A3 does not mention any amount, but refers to “Agrl. Term Loan Agreement dated 13.11.1992” and states in the following terms _" I/we acknowledge and confirm for the purpose of Section 18 of the Limitation Act, 1963 and any like limitation law in order to_ _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ **7** _preclude any question of limitation law that I am/ we are and hereby confirm to be, liable to you for the payment of all the outstandings in respect of loans granted and the said Medium Term Loan/Agricultural Term Loan Agreement shall remain in full force with all relative securities, agreements and obligations"_ 9. Similarly, in the second page of Annexure A4, (after clearly mentioning on the first page that it is with reference to Agreement Cash Credit), the amount is mentioned as Rs.73000/-. After referring to the Guarantee agreement dated 13.11.1992, it is stated as follows: " _I/we acknowledge and confirm for the purpose of Section 18 of the Limitation Act, 1963 and any like limitation law in order to preclude any question of limitation law, that I am/ we are, and hereby confirm to be, liable to you as guarantors for the payment of all the outstanding in respect of the said loans and the said guarantee agreement shall remain in full force with all relative obligations."_ _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ **8** 10. From the above, it is seen that the revival letters executed by the Review Petitioners were with reference to the - Agrl. Cash Credit Facility with account No. ACC 13/92 PD Arun and the loan agreement dated 13.11.1992 whereby the original loan amount of Rs. 73000/- was extended to the party concerned. The revival letters were executed on 07.08.1995, by which time the Cash Credit Facility admittedly stood enhanced to Rs.4.6 lakhs (having enhanced to Rs.3 lakhs on 19.01.1994. and to Rs.4.6 lakhs on 31.05.1995). The amount mentioned as 73000/- in Annexures- A3 and A4, was with reference to the figure as contained in the Guarantee Agreement dated 13.11.1992. There is no case for the review petitioners that the amount was never enhanced to Rs. 3 lakhs and subsequently to Rs. 4.6 lakhs and in fact, they have conceded such enhancement and acceptance of the loan amount. 11. There is nothing on Annexures- A3 and A4 to indicate that, inspite of the higher outstanding liability, the review petitioners had executed revival letters limiting the same only to the original extent/loan amount of Rs.73000/- as mentioned in **9** ## _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ the Agreement dated 13.11.1992. On the other hand, it has been categorically stated in the revival letters (Annexures- A3 and A4) that they have acknowledged and confirmed the liability for the purpose of Sec.18 of the Limitation Act and such other laws in order to preclude any question of limitation law and that they had confirmed that they were liable to the Bank for payment of " _**all the outstanding in respect of the said loan and the said Guarantee Agreement shall remain in force with all relative obligations"**_ 12. From the above, the intention was clear, that whatever be amount due under ACC 13/92-PD.Arun, it was assured and undertaken to be repaid, without raising any plea of limitation. Since the review petitioners do not have any case that the balance amount was satisfied or that any other mitigating circumstance was in existence, there was no need, necessity or occasion for the Bank to have agreed to limit the liability to any lesser extent. There was no specific plea for the review petitioners and they have not brought on record any material, which could persuade this Court to accept their version that they **10** ## _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ had accepted the liability on revival only to the limited extent of Rs.73000/- as sanctioned originally in the year 1992. This being the position, the version of the review petitioners that the loan is barred by limitation is not correct or sustainable and not liable to be entertained . This Court does not find any merit with regard to plea set up by the review petitioners/writ petitioners on the ground of limitation. _13._ The claim with regard to the eligibility of the review petitioners/writ petitioners for reduced rate of interest under the NABARD Re-finance Scheme had already been considered by this Court and all the relevant aspects have been dealt with in the judgment dated 21.08.2012, holding that no specific plea was raised before the DRT in this regard. It was also observed in paragraph 6, that despite the indulgence shown by this Court intercepting the coercive proceedings by directing the petitioners to satisfy a portion of the liability, it was not complied with and hence, it was not a fit or proper case to call for interference invoking the discretionary jurisdiction under Article 226 of the Constitution of India. This is more so, in view of the law declared **11** ## _**R.P. 906 OF 2012 IN W.P.(C)No. 29389 OF 2007**_ by the Apex Court in **Prestige Lights Ltd vs. State Bank of India (2007) 8 SCC 449** (paragraph 20 onwards), as sought to be relied on from the part of the respondent Bank. Still, the merit was considered by this Court when the judgment was passed and hence this issue, with regard to the 'rate of interest' stands already considered and decided against the petitioners. As such, there is no error apparent on the face of the records in this regard as well. The Review Petition is dismissed accordingly. ## **P.R.RAMACHANDRA MENON JUDGE** _lk_