K.K.K. Garments Limited Vs. Islamic Bank Bangladesh Limited and others, VI ADC (2009) 181

Case No: Civil Petition for Leave to Appeal No. 723 of 2005

Judge: Mohammad Fazlul Karim ,

Court: Appellate Division ,,

Advocate: Mrs. Sufia Khatun,Md. Nawab Ali,,

Citation: VI ADC (2009) 181

Case Year: 2009

Appellant: K.K.K. Garments Limited

Respondent: Islamic Bank Bangladesh Limited and others

Subject: Banking,

Delivery Date: 2007-08-13

Supreme Court of Bangladesh
Appellate Division
(Civil)
 
Present:
Md. Ruhul Amin, CJ.
Mohammad Fazlul Karim, J.
M.M. Ruhul Amin, J.
 
K.K.K. Garments Limited
…......Petitioner
Vs
Islamic Bank Bangladesh Limited and others
........Respondents
 
Judgment
August 13, 2007
 
Code of Civil Procedure, 1908
Order XXXXI, Rule 31
The High Court Division while allowing the appeal with modification of the judgment and decree of the trial Court observed that the Court below arrived at an erroneous decision in decreeing the suit-in-part. It also appears that the trial Court made different arithmetical calculation to settle the liability for the petitioners entirely at its own accord without any nexus with the statement of accounts and several exhibits produced for proving the liabilities of the petitioners and, as such, the plaintiff bank is entitled to get a decree for the claimed amount. ……(8)
 
Lawyers Involved:
Mohammad Nawab Ali, Advocate-on-Record-For the Petitioner.
Mrs. Sufia Khatun, Advocate-on-Record-For Respondent No. 1.
None Represented- For Respondent Nos. 2-3
 
Civil Petition for Leave to Appeal No.723 of 2005
(From the judgment and order dated the 27th March, 2005 passed by the High Court Division in First Appeal No. 121 of 2000).
 
JUDGMENT
Mohammad Fazlul Karim J.
 
This is application under Article 103 of the Constitution of the People's Republic of Bangladesh is directed against the judg­ment and order dated 27.03.2005 passed by the High Court Division in First Appeal No. 121 of 2000 allowing the appeal.
 
2.         The plaintiff-respondents instituted Title Suit No. 239 of 1997 in the Court of Subordinate Judge, Artha Rin Adalat No.4, Dhaka alleging, inter alia, that the plaintiff is a public limited banking company incorporated in Bangladesh under the Companies Act, 1913 and carrying on banking business under Islamic Shariah Law with its registered head office at Motijheel, Dhaka, Defendant No.1 is a limited company and defendant No. 2 is managing Director and defendant Nos. 3 and 4 acre directors of the said company. The defendant Company opened current account No. 1418 with the plaintiff bank and the plaintiff bank sanctioned loan to defendant No.1 on Murabha investment basis for a sum of Tk. 20,14,087.00 for machinery and the defendants accepted the sanction letter which is fixed for repayment of the loan money together with profits thereof by 28.04.1988. Defendant Nos. 2 and 3 deposited the deed of the schedule property as collateral secu­rity in favour of the plaintiff bank and also executed and registered separate power of attorney. Over and above, the defendants deposited the memorandum, title deed, affidavit, power of attorney, deed of agree­ment and other connected documents together with original documents as col­lateral security. Defendants also executed promissory note, demand promissory note, letter of disbursement, letter of guar­antee and other charged documents along with hire purchase agreement. The defen­dant deposited Tk. 10,00,000.00 (ten lac) only T.D.R. to the plaintiff bank, but the defendants did not repay the Murabha investment amount which stood at Tk.28,19,149.00 on 28.04.1988 and on the prayer of the defendants the said amounts were turned into hire purchase grant on 13.08.1990. The defendants failed and neglected to pay the bank dues in time and subsequently the hire purchase grant was re-scheduled by the plaintiff bank several times, the project loan again was turned into hire purchase sirkatul mulk at the request of the defendants, the defendants executed the agreement accordingly but the defendants did not pay the said amount till 31.01.1997. The plaintiff bank would get Tk. 73, 51,363.00 as against hire pur­chase investment. The plaintiff bank granted composite investment to the defendant for Tk. 2,50,00,000.00 out of which Tk. 2,00,000,00.00 (two crores) were earmarked for L/C and Tk. 50,00,000.00 for pre-shipment investment and the loan in question was re-schedule as per prayer of the defendants. The defen­dants did not manufacture any garment but sold away the fabrics so imported and misappropriated the money. The date of repayment was fixed on 28.04.1988, but the defendants failed to repay the bank's dues, inspite of request of the defendants the business of the defendants was turned into hire purchase on 13.08.1990 and availed all the facility of composite invest­ment with re-scheduling, but the defen­dants failed to pay inspite of written notice on series of dates. Defendant No.1 is the beneficiary and the other defendants are the guarantors. So, all the defendants are individually and collectively liable to pay the bank due the profits of the principal amount and other expenses amounting to Tk. 2,56, 38,277.00. The plaintiff bank exhausted all process to realize the bank dues from the defendant respondents, but the defendant-respondents did not repay the amount due to the plaintiff bank. The cause of action for the suit arose lastly on 24.04.1997 and as such, the plaintiff bank has been forced to take the shelter of law for recovery of its good money amounting to Tk. 2,56,28,277.00 together with up-to-date interest @ 18% till realization of the decreetal amount.
 
3.         The petitioners as defendants contested the suit filing a written statement alleging, inter-alia, that the suit is not maintainable, false, fraudulent, frivolous, fictitious, malafide and concocted one and as such, the present suit is liable to be dismissed summarily. Defendants case is that the plaintiff bank sanctioned loan to the defendant No.1 on 25.07.1984 for a sum of Tk.20,14,087.00 and the defendants accepted the grant by admitting all the terms and conditions, the time was fixed on 28.04.1988 for repayment of the loan money together with the profits thereon, defendant Nos. 2 and 3 deposited title deeds, affidavit, deed of agreement and other connected documents together with the original documents in usual course of banking system. In course of whole trans­action the defendants demanded for a number of time the statement of account of the principal amount so far paid by the defendants to the plaintiff bank but until now the same was not supplied by the plaintiff bank for which the defendant could not make out his case with distinc­tive ratio and with the passing of time the machinery lost the workable capacity, the defendants requested the plaintiff bank for further importation of machinery under BMRE but the plaintiff refused the pro­posal. It is a contractual obligation in the part of the plaintiff bank to extend finan­cial assistance as and when the defendant’s factory and business is required and in the meantime the defendants mortgaged all their properties up to the last inch to the plaintiff bank. The most important aspect in the whole episode is that the plaintiff bank deliberately kept all the documents of the defendants in custody and the prop­erties mortgaged. So, all avenues for the defendants were closed to tide over the sit­uation by giving further mortgage to any other bank and thereby to keep the factory running. The suffocating situation was created by the plaintiff bank resulting at tremendous loss for which the plaintiff bank is exclusively responsible.
 
4.         Mr. Md. Nawab Ali, learned Advocate-on-Record, appearing for the petitioner submitted that the High Court Division committed error of law in allowing the appeal and thereby setting aside the judg­ment and decree passed by the trial Court without averting the findings of the trial Court as per mandatory provisions of Rule 31 of order XXXXI of Code of Civil Procedure and as such, the impugned judgment is liable to be set aside. He fur­ther submitted that the High Court Division found that "in the circumstances it appears that the Court below arrived at an erroneous decision in decreeing the suit-in-part. The trial Court made different arithmetical calculations to settle the lia­bility for the respondents entirely at his own accord without any nexus with the statement of accounts and several exhibits produced for proving the liabilities of the respondents and as such the plaintiff-appellant bank is entitled to get a decree for the claimed amount" which on the face of it, is without any reason and basis and therefore committed error of law and as such, the impugned judgment and decree is liable to be set aside.
 
5.         The learned Advocate further submitted that there are three other heads namely, bills of Tk. 97,54,730.00 (ninety seven lac fifty four thousand seven hundred thirty), PSI of Tk. 29,01,011.00 (twenty nine lac one thousand eleven) and B.B bills TK. 55,11,000.00 (fifty five lac eleven thou­sand) but there was no assertion in the plaint how these loans have been created; furthermore, from the statement of account submitted by the respondent bank it is evident that the petitioner has execut­ed export order through different L.C. amounting to Tk. 11,65,00,000.00 (eleven crore sixty five lac) and the respondent bank has paid the import dues amounting to Tk. 10,79,00,000.00 (ten crore seventy nine lac) and as all the exportation and impor­tation has been carried on through respon­dent who debted Tk. 10,73,00,000.00 (ten crore seventy three lac) from the repatriated sale proceed from the account of the petitioner and as such, only Tk. 6,00,000.00 (six lac) remained unpaid. The said specific finding of the trial Court based on statement of account submitted by the respondent bank was neither reversed by the High Court Division nor any finding was given to that effect refer­ring to the exhibit and statements of account. He further submitted that trial Court after appraisal of materials on record held that under the head of project loan the plaintiff respondent claim Tk. 62,03,387.90 (sixty two lac three thousand three hundred eighty seven and paisa nine­ty) and in three different heads Tk. 6,00,000.00 (six lac) and, as such, the peti­tioner respondent is entitled to total Tk. 68,03,387. 90 (sixty eight lac three thou­sand three hundred eighty seven and paisa ninety) P.W.1 admitted that the plaintiff repaid Tk. 28,00,000.00 (twenty eight lac) during pendency of suit and therefore the respondent is entitled to Tk. 40,03,387.90 (forty lack three thousand three hundred eighty seven and paisa ninety) and the suit was decreed to that extent but the High Court Division failed to reverse the find­ings referring to the materials on record and as such, committed error of law and therefore, liable to be set aside.
 
6.         Mrs. Sufia Khatun, learned Advocate-on-Record, appearing for the respondent No.1 submitted that the learned Subordinate Judge and Artha Rin Adalat committed a grave error of law in decree­ing the suit partially though the appellant has proved the case by sufficient evidence both oral and documentary and, as such, the appellant is legally entitled to get a decree for the entire claimed amount.
 
7.         It appears from the record that though the plaintiff bank made payment of all lia­bilities against current account of the peti­tioners being No. 1418 amounting to Tk. 20, 14,087.00 but the petitioner failed and neglected to repay the bank's loan in due time and on 28.04.1988 Murabha invest­ment amount stood at Tk. 28.19.149.00 and however, on the prayer of the petition­ers the said amounts were turned into hire purchase granted on 13.08.1990. It further appears that on the prayer of the petition­ers bank gave sanction of Tk. 2.50 crores to those for composite investment to the back to back L.C. for pre-shipment which were subsequently re-scheduled by the bank. Thereafter, the project was turned into hire purchase sirkatul mulk at the request of the petitioners and executed the agreement accordingly. Even on the request of the petitioners it was turned into hire purchase on 13.08.1990 but petition­ers failed to pay till 31.10.1997. The peti­tioners took the facility of composite investment with a re-scheduling process, as well failed to do it inspite of written notice of several dates. The petitioner No.1 is a beneficiary while the other peti­tioners are the guarantors. So, all the peti­tioners are individually and collectively liable to pay the principal amount of Tk. 3,56,3827-77/- with profits, compensation and other expenses as claimed. Considering all the facts and circum­stances it appears that the bank exhausted all process in accordance with law for realization of the bank money from the petitioners who did not repay the amount of the bank. In the circumstances the trial Court below arrived at an erroneous deci­sion in decreeing the suit-in-part.
 
8.         The High Court Division while allow­ing the appeal with modification of the judgment and decree of the trial Court observed that the Court below arrived at an erroneous decision in decreeing the suit-in-part. It also appears that the trial Court made different arithmetical calcula­tion to settle the liability for the petitioners entirely at its own accord without any nexus with the statement of accounts and several exhibits produced for proving the liabilities of the petitioners and, as such, the plaintiff bank is entitled to get a decree for the claimed amount. The trial Court came to an erroneous finding to the effect the plaintiffs' claim of Tk. 74,71,536.00 in unreasonable which has misled it to dis­miss the major claim of the Bank and anomalously the trial Court had decreed the suit-in-part.
 
9.         In view of the above, we find no merit in the submissions of the learned Advocate for the petitioner.
 
Accordingly, the leave petition is dis­missed.
 
Ed.