1 OF 8O.S.No.1726 OF 2012
IN THE COURT OF THE II ADDITIONAL JUNIOR CIVIL JUDGE:
WARANGAL.
Friday, this the 22nd day of January, 2016.
Present: Smt. Ch.Asha Latha, V-Additional Junior Civil Judge, FAC.II - Additional Junior Civil Judge, Warangal.
O.S.No.1726 OF 2012
B E T W E E N:
Kapil Chit Funds Private Limited, Kazipet-2 branch, represented by its Recovery Manager by name S.Nagender, S/o.Anandam, Age: 45 years, R/o.Hanamkonda, Warangal district.
… Plaintiff A N D
1. Ch.Buchi Malla Reddy, S/o.Govinda Reddy, Age: 48 years, Occu: Agriculture, R/o.Post and Village: Rajapoor, Mdl: Shankarapatnam, Karimnagar district.
2. Ch.Prabhakar Reddy, S/o.Yella Reddy, Age: 54 years, Occu: Business, R/o.Post and Village: Rajapoor, Mdl:Shankarapatnam, Karimnagar district.
3. G.Chunga Lal Naik, S/o.Deep Singh, Age: 45 years, Occu: Addl.Asst.Engineer,Empl.No.3179,O/o.DivisionalEngineer, OP/N.P.D.C.L-Karimnagar,R/o.#8-4-593,ThirumalNagar, Karimnagar.
4. Ch.Prabhakar Reddy, S/o.Narayana Reddy, Age: 55 years, Occu: Business, R/o.Post and Vill: Rajapoor, Mdl:Shankarapatnam, Dist: Karimnagar.
5. B.Mallesham, S/o.Rathnaiah, Age: 55 years, Occu: Supervisor, O/o.Agriculture, Market Committee, Huzurabad, R/o.#2-81, Bhagath Nagar, Karimnagar. … Defendants
* * *
This suit coming up for final hearing on 21-01-2016 before me in the presence of Sri P.Bala Chander Rao, Advocate for the plaintiff; and of Sri P.Muralidhar, Advocate for Defendant Nos. 1 and 2; and defendant Nos.3 to 5 are set exparte; and upon perusing the material on record, and the matter having stood over for consideration till this day, the Court delivered the following:
J U D G M E N T
1.This is a suit for recovery of a sum of Rs.96,821/- basing on
Promissory Note dt: 04-04-2009 and Agreement of Guarantee stated to have been executed by the defendant Nos. 1 to 5 in a chit transaction and for costs of the suit.
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2. The brief averments of the plaint are that:
The defendant No.1 joined as a member in the plaintiff Chit fund company in the chit series No.KZT51M with Chit No.08 by entering into the chit agreement dated:18-12-2007. The total value of chit is Rs.10,00,000/- to be subscribed @ Rs.20,000/- per month for 50 months. The plaintiff company conducted auction on 27-02-2009, in which, the defendant No.1 participated and became successful bidder having agreed to forego
Rs.4,00,000/- out of Rs.10,00,000/-. The defendant No.1 has paid
Rs.2,80,000/- and his future liability is Rs.7,20,000/-. The defendant Nos.2 to 5 stood as guarantors and executed Agreement of Guarantee dt: 04-04- 2009 and that all the defendants executed a promissory note on the same day as collateral security. Later, the defendant No.1 committed default in payment of part of the 46th installment i.e., from 10-10-2011. In spite of repeated demands made by the plaintiff, even after, the plaintiff company got issued the Legal Notice dt: 31-05-2012, the defendants did not choose to repay the amount due to the plaintiff. Hence, this suit.
3.The defendant Nos.3 to 5 are set exparte. The defendant Nos.1 and 2 entered appearance and filed their written statement by denying the contents of the plaint. The defendant Nos.1 and 2 admitted the joining of chit by defendant No.1 and participating in the chit auction conducted on 27-02- 2009, but disputing that the Branch Manager orally assured the defendant
No.1 that he will see the chit amounts and will be paid within three months and he also assured that the same will be bid in favour of defendant No.1, failed to comply the same as promised, as such the defendant No.1 sustained loss and that the defendant No.1 paid regularly bid amounts, but the payment to him was belated. It is further stated that the defendant No.1 paid
Rs.1,24,880/- on 26-11-2011 to one Srinivas and Sudhakar Naik to adjust the same for 42nd to 47th installment and issued a temporary receipt and agreed to give the original receipt, but they failed to do so, and they have 3 OF 8O.S.No.1726 OF 2012 adjusted only Rs.94,909/- towards 42nd to 46th installment and the remaining amount of Rs.29,971/- was adjusted towards recovery penalty which is objectionable and that instead of adjusting the same towards 42nd to 47th installments and to issue receipts. The employees of plaintiff have cheated the defendant No.1 and shown wrong accounts. It is further stated that the plaintiff is not entitled for any interest and that the plaintiff company failed to furnish the proper account to the Court, as such, the plaintiff is not entitled for the amount claimed under the suit and sought for dismissal of the suit with costs.
4.Basing on the above pleadings, the following issues are settled for trial:
1. Whether the plaintiff company is entitled for recovery of suit amount as prayed for?
2. If so, to what relief?
5.During the course of trial, on behalf of the plaintiff, the Legal Officer of plaintiff company is examined as PW1 and Ex.A1 to Ex.A14 are marked.
During cross examination of PW1, Ex.B1 is marked. On behalf of the defendants, DW1 and DW2 are examined and Ex.B2 is marked.
6.Heard the learned counsel for the plaintiff and the defendants.
7.Issue No.1: The plaintiff’s case is that the first defendant joined as a member in a chit value of Rs.10,00,000/- and participated in auction dated:
27-02-2009 and became a successful bidder having agreed to forego
Rs.4,00,000/- and while receiving the prize money he executed a promissory note and other documents for his future liability of Rs.7,20,000/- and on 04- 04-2009 defendant Nos. 2 to 5 stood as guarantors for the said liability by executing an agreement of guarantee. To prove its case, the Legal Officer of plaintiff company is examined as PW1 and he exhibited Ex.A1, Chit
Agreement, dt: 18-12-2007 executed by the 1st defendant in favour of the 4 OF 8O.S.No.1726 OF 2012 plaintiff; Ex.A2, Agreement of Guarantee dt: 04-04-2009 executed by the defendant No.2 to 5; Ex.A3, Original Promissory Note dt: 04-04-2009 executed by the defendant No.1 to 5; Ex.A4, Cash Voucher dt: 04-04-2009 executed by defendant No.1; Ex.A5, Office copy of legal notice dt: 31-05- 2012 got issued by the plaintiff to defendant Nos. 1 to 5; Ex.A6 to Ex.A9,
Postal Acknowledgment Card of defendant Nos.1 to 4; Ex.A10, Returned postal cover of defendant No.5; Ex.A11, Statement of Account of defendant
No.1; Ex.A12, Authorization given to S.Nagender, dated: 15-07-2008;
Ex.A13, Certified Copy of Firm Registration and Ex.A14, Certified copy of
Authorization given to PW1 to give evidence.
8.It is argued by the counsel for the plaintiff that the plaintiff filed the present suit for recovery of amount against the defendant Nos.1 to 5, since the defendant No.1 joined in the chit, participated in the auction, having receiving the prize amount, he failed to pay the monthly installments and committed default in part of 46th installment i.e., from on 10-10-2011, as such, he filed the present suit and that the documents filed by him are sufficient to establish the plaintiff's case and that the plaintiff is entitled for the suit amount. Whereas, the case of the defendant Nos.1 and 2, they are disputing that the Branch Manager of the plaintiff company assured that he will see the bid will be in favor of defendant No.1 and the chit amount will be paid to him within three months, but failed to do so, as such defendant No.1 sustained loss. It is argued by the counsel for the defendant Nos.1 and 2 that due to prize amount was not paid to defendant No.1 within time, even furnishing the guarantors and that the defendant No.1 paid Rs.1,24,880/- on 26-11-2011, for which, the plaintiff company agreed to adjust the same for 42nd to 47th installment and issued a temporary receipt and agreed to give original receipt, but they failed to do so and they have adjusted only
Rs.94,909/- towards 42nd to 46th installments and the remaining amount of
Rs.29,971/- was adjusted towards recovery penalty and that the calculations shown by the plaintiff company are wrong and the penalty appropriated by 5 OF 8O.S.No.1726 OF 2012 the plaintiff is illegal. Hence, sought for dismissal of the suit. It is further argued that the plaintiff has taken huge amounts i.e., more than
Rs.1,00,000/- from defendant No.1, hence, the collection of penalty does not arise.
9.Coming to the oral evidence, during the cross examination of PW1,
PW1 admitted that the Receipt, dated:26-11-2011 issued by the plaintiff company to the defendant No.1, which is marked as Ex.B1 in which, the defendant No.1 has paid Rs.1,24,880/-. The testimony of PW1 discloses that the plaintiff company adjusted the amount paid under Ex.B1 for five installments completely and part amount for one installment. PW1 denied the suggestion that the penalty amount payable by defendant No.1 is shown as
Rs.29,971/- in their statement of account under Ex.A11, but the same is false and that the instead of adjusting the said amount as installment amount, they wrongfully shown as penalty amount and that even though the defendant No.1 paid entire installments to the plaintiff company, but by filing a false statement of account, they have filed this suit against him by making a false claim against the defendants.
10.After closure of plaintiff's evidence, the defendant No.2 filed his chief affidavit as DW1 at first instance and exhibited Ex.B2, Courier Receipt,
dated: 15-04-2012 and stated that the amount paid by defendant No.1 under
Ex.B1, Receipt has to adjusted for 42nd to 47th installment, but the plaintiff company has adjusted the same for 42nd to 46th installments which is not proper. During the cross examination, his testimony discloses that he is guarantor, but not subscriber and that he submitted Income Tax papers to the plaintiff company prior to issuing of cheque to defendant No.1 by the plaintiff company. DW1 admitted that the plaintiff company paid bid amount to the defendant No.1 by way of cheque and no Protest Letter was issued by defendant No.1 to the plaintiff company at the time of receiving of cheque by him in respect of the bid amount and that Ex.A4, Payment Voucher contains 6 OF 8O.S.No.1726 OF 2012 the signature of defendant No.1. Even he deposed that he got issued Reply notice, but no documents filed to prove the said fact. DW1 admitted that in case of default in payment of installment amounts, the plaintiff company would charge the penal interest against the defaulting subscribers. DW1 admitted that the amount has to be paid by the defendant No.1 in the month of May, 2011 towards installment. The testimony of DW1 is clear that after
Ex.B1 Payment, the defendant No.1 has not paid any amount to the plaintiff company.
11.The defendant No.1 filed his chief affidavit as DW2 by reiterating the contents of his written statement. During the cross examination, he deposed that he admitted that he withdrawn the chit amount without any protest from the plaintiff company and that he did not receive any notice from the plaintiff company prior to filing of the suit and that he cannot say the exact date, on which, he furnished the guarantors before plaintiff company. DW2 admitted that he did not issue any reply to Ex.A5, legal notice even he received the same under Ex.A6, Acknowledgement. DW2 denied the suggestion that he paid the installment amounts with delay, as such the amount adjusted by the plaintiff company towards interest.
12.On considering the oral and documentary evidence on record, the conflict in between the plaintiff and defendants is only adjustment of amount paid by defendant No.1 under Ex.B1, Receipt stating that the plaintiff company by assuring the said amount to be adjusted from 42nd to 47th installments instead of doing so, it has adjusted the same from 42nd to 46th installments and Rs.29,971/- was adjusted towards penalty which causes loss to the defendant No.1. Moreover the plaintiff paid the prize amount with delay to the defendant No.1, which causes loss to the defendant No.1. Even though, the defendants taking such contentions during the cross examination of DW1 and DW2, they admitted that they did not protest or issue any notice to the plaintiff while receiving the prize amount by way of cheque.
7 OF 8O.S.No.1726 OF 2012
Even though the defendants contended that the Ex.A11 Statement of
Account is false, but they have not filed any calculation memo, showing the correct calculations. DW2 admitted that he did not issue any reply to Ex.A5, legal notice which shows that he has knowledge about his default in paying the monthly installments to the plaintiff company.
13.As seen the case of plaintiff, the defendant No.1 committed default in payment of part of 46th installments ie., from 10-10-2011. The Ex.A11, statement of account clears that the Defendant No.1 has not made payment of installments regularly. The pleadings and suggestions of defendant No.1 itself clear that defendant No.1 is not regular in payment of installments and he made payment in lumpsum for Rs. Rs.1,24,880/- on 26-11-2011 to adjust the same for 42nd to 47th installments. It is contended by the defendant
No.1, but the plaintiff has adjusted Rs.29,971/- towards penality and adjusted Rs.94,909/- towards 42 to 46th installments by showing wrong accounts. This Court is unable to accept the plea of the defendant No.1, that the plaintiff is not entitled to charge any penality on the defaulted amount of installments. As per condition No.17 of Ex.A1, Chit Agreement, “if a prized subscriber defaults consecutively for a period of 3 months, he shall loose the future dividends and benefit of paying future subscriptions in installments.
He shall pay consolidated payment of future subscriptions inclusive of defualted installments with interest @18% per anum from the date of default”. The defendant No.1 having agreed to the said condition, cannot turn around and say that the plaintiff is not entitled to charge any penality on the amount due. There is nothing on record to say that the amount claimed by the plaintiff is not true and correct. It seems that the defendants have taken such pleas for the purpose of their defence. Hence, it can be concluded that the statement of account filed by the plaintiff is true and correct. In the circumstances, this court holds that the plaintiff is entitled to recover the suit amount from the defendants 1 to 5. Thus, Issue No.1 is answered in favour of the plaintiff.
8 OF 8O.S.No.1726 OF 2012
14.Issue No.2: Since Issue No.1 is answered in favour of the plaintiff, the suit is decreed as prayed for.
In the result, the suit is decreed with costs directing the defendant
Nos. 1 to 5 to pay a sum of Rs.96,821/- to the plaintiff with interest @ 12% per annum from the date of suit till the date of decree and with further interest thereon @ 6% per annum from the date of decree till the date of realization on the principal amount of Rs.85,119/-.
(Dictated to Steno-Typist, after her transcription, corrected and
pronounced by me in open court, this the 22 nd of January, 2016)
FAC.II ADDITIONAL JUNIOR CIVIL JUDGE,
WARANGAL.
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
FOR PLAINTIFF: FOR DEFENDANTS: PW1 –P.Raju DW1: Ch.Prabhakar Reddy DW2: Ch.Buchi Malla Reddy
EXHIBITS MARKED
FOR PLAINTIFF:
Ex.A1: Chit Agreement dt: 18-12-2007 Ex.A2: Agreement of Guarantee dt: 04-04-2009 Ex.A3: Original Promissory Note dt: 04-04-2009 Ex.A4: Cash Voucher dt: 04-04-2009 Ex.A5: Office copy of legal notice dt: 31-05-2012 Ex.A6 to Ex.A9: Postal Acknowledgment Card of defendant Nos.1 to 4 Ex.A10: Returned postal cover of defendant No.5 Ex.A11: Statement of Account of defendant No.1 Ex.A12: Authorization given to S.Nagender, dated: 15-07-2008 Ex.A13: Certified Copy of Firm Registration, dated: 06-05-1998 Ex.A14: Certified copy of Authorization given to PW1 to give evidence
FOR DEFENDANTS: Ex.B1: Receipt, dated: 26-11-2011 Ex.B2: Courier Receipt, dated: 15-04-2012
FAC. II ADDITIONAL JUNIOR CIVIL JUDGE,
WARANGAL.