Vijay Kumar Gupta vs Canara Bank

Ranjit Singh, J

The prayer made by the appellant for conducting cross-examination of two witnesses of the bank AW-1, Mr. KC. Gupta and AW-2, Mr. N. Raja Ram is declined by the Tribunal below. The appellant, therefore, has come in appeal against this order.

The appellant is a guarantor for a loan obtained by one of his close relatives. The request for cross-examination has primarily been made to show negligence on the party of the bank's official in not taking proper action while the loan obtained was being utilized improperly by the principal borrower. In this regard, the counsel for the appellant has referred to a large number of issues and letters which he initiated to the bank to take note of the conduct of the principal borrower. The submissions made before the Tribunal below are also found noticed in the impugned order.

As is recorded, the principal borrower had withdrawn a sum of Rs. 21 lacs on 4.12.2002 when the loan admittedly was sanctioned on 30.11.2002. The Tribunal below has noticed that the appellant/guarantor, defendant No. 4, and the principal borrower/defendant NO. 2 are closely related and as such the pleas now been raised ought to have been raised by the defendant NO. 2 himself.

The learned counsel for the appellant has also invited my attention to the grounds of taken in defence by appellant where reference to the defences is found mentioned. As per the counsel, officials of the applicant bank had sanctioned and disbursed the credit facilities to unknown party with whom the appellant did not have any prior relation, without bothering to go into the contemporary worth and commercial viability of defendants 1 to 3. It was also pleaded that the relevant financial record and details pertaining to the defendants 2 and 3 was neither insisted nor taken. The credit facilities were afforded in violation of debt-equity-ratio. The plea of negligence in ensuring the disbursement under the credit facility were in commensuration with the availability of primary security viz. hypothecated goods and stocks is also raised and so also the fact that the applicant bank did not keep a strict vigil on the outflow of the money from the loan account.

I have considered the submission made by the counsel for the parties. Counsel for the respondent submits that none of the grounds as urged would lead to a need for cross-examination and can easily be proved on the basis of document or material which obviously would be in possession of the appellant. In addition, the counsel has also referred to a letter written by the appellant to the Chairman of the bank where he had raised no dispute about his liability as a guarantor though he had made an attempt to explain under what circumstances he happened to furnish guarantee and stand as guarantor to secure this loan.

Counsel for the appellant has also referred to some precedent like A.E.G. Carapiet vs. A.Y. Derderian, AIR 1961 CAL 359, Abdul Rasheed vs. The State Bank of Travancore, 2003 (2) KLT 557 and another judgment of the Hon'ble Supreme Court in Union of India & Anr. vs. Delhi High Court Bar Association & Ors., AIR 2002 SC 1479, In A.E.G. Carapiet (supra) the Court has observed that where ever the opponent has declined to avail himself of opportunity to put his essential and material case in cross examination, it must follow that he believed that the testimony given could not be disputed at all. The Court has further observed that it is wrong to think that this is merely a technical rule of evidence. It is a rule of essential justice. These observations, relived upon by counsel in my view, would have no application to the facts of the case. Obviously, when a person exercises his right of cross-examination and in that process he fails to put his essential case when given opportunity of cross-examination, the inference that can be drawn is that he believed the testimony given which, he did not be dispute. No such situation arises in the present case. Here the appellant has not conducted any cross-examination where he has failed to put his case. No such inference is likely to be taken in this case where he has made a prayer for cross-examining the witness which prayer the Tribunal in its wisdom thought it proper not to allow. This denial of the request obviously is in terms of the law laid down by the Hon'ble Supreme Court where cross-examination in such cases has not been held to be always essential. The obvious reason is that such proceedings before the DRTs cannot be permitted to turn into a ordinary civil trial case where protracted and detailed cross-examination take place. The reasons which weighted will the Hon'ble Supreme Court to so hold is that the cases before the Tribunals under the RDDBFI Act are generally based on the documents furnished by the banks and is said there is hardly a scope of any dispute. In this case also the appellant has not disputed the documents which are being relied upon by the bank.

The other judgments relied upon by the counsel for the appellant in the cases of A.E.G. Carapiet and Abdul Rasheed are not relevant. The general principal, which are applicable for cross-examination of witness cannot directly be applied to the case being tried under the RDDBFI Act.

Otherwise also, I have considered the issues raised by the appellant in his application to seek cross-examination of the rank's witnesses. The aspect of negligence and other reasons, can be very well proved by the appellant by leading evidence.

I do not find any infirmity in the view taken by the Tribunal below and, therefore, would dismiss the appeal.

Copy of this order be furnished to the parties as per law.