Rajendra Nath Mittal, J.
1. Briefly the facts are that the State Bank of India is a statutory corporation incorporated under the State Bank of India Act, 1955. Shri S. K. Kalia was the branch manager and principal officer of the plaintiff at Bahalgarh branch and was authorised to sign and verify plaints and file suit on its behalf. Defendant No. 1, Haryana Rubber Industries P. Ltd. (hereinafter referred to as ' the company '), was carrying on the business of manufacturing cycle tyres and tubes, etc., at Bahalgarh. The company opened various accounts with the plaintiff and took loans from it as detailed in annexure ' A '. Defendants Nos 3, 4 and 7 and Gian Singh, A. D, Aggarwal and Harnarain Singh, now represented by defendants Nos. 2, 5, and 6, respectively, were guarantors of the amounts as detailed in annexure ' A ' and they were jointly and severally liable to pay the amount advanced to the company. Defendant No. 1 mortgaged the properties given in schedule A & B(l) of the plaint for the loan mentioned at serial No. 2 in annexure ' A ' and properties given in schedule A & B(2) for the loans mentioned at serial Nos. 3 and 4 in the said annexure.
2. On October 26, 1979, all the outstanding amounts in the various loan accounts were transferred to the branch protested bills account. The total of the said amounts comes to Rs. 21,34,247.83. Out of that amount, an amount of Rs. 93,600 was received by the plaintiff from the company. After deducting the said amount, the total amount due from the defendants comes to Rs. 20,40,647.83. The interest on the said amount from October 26, 1979, to September 13, 1980, the date of filing of the suit, at the contractual rate, comes to Rs. 2,56,742.12. Thus, the total amount which was due from the defendants to the plaintiff comes to Rs. 22,97,389.95. Gian Singh, A. D. Aggarwal and Harnarain Singh have since died and their legal representatives have been impleaded at serial Nos. 2, 5 and 6 respectively as parties. The plaintiff instituted a suit for recovery of the aforesaid amount on the basis of various mortgages and charges as mentioned above with future interest at the rate of 18 per cent, per annum from the date of institution of the suit till realisation.
3. The suit was contested by the official liquidator on behalf of the company and by defendants Nos. 6(a) and 6(b), the legal representatives of Harnarain Singh, guarantor, by filing two separate written statements. The official liquidator in the written statement, inter alia, pleaded that Shri S. K. Kalia was not competent to file the suit and that the petitioner did not get their charges registered with the Registrar of Companies under Section 125 of the Companies Act. The defendants at serial No. 6 controverted the allegations of the plaintiff and denied their liability to pay the amount. They further pleaded that the plaint did not disclose any cause of action, that the suit was barred by limitation and that the suit was bad for misjoinder of parties and causes of action. They denied their liability to pay future interest.
4. On the pleadings of the parties, the following issues were framed :
1. Whether Mr. S. K. Kalia is competent to file the suit OPP.
2. Whether the petitioner's charges were got registered with the Registrar of Companies under Section 125 of the Companies Act. If not, with what effect OPP.
3. Whether the plaintiff advanced the loans as enumerated in paragraph 24 of the plaint to defendant No. 1 OPP.
4. Whether defendants Nos. 3, 4 and 7 and Gian Singh, A.D. Aggarwal and Harnarain Singh (now represented by respondents Nos. 2, 5 and 6 respectively) were guarantors of the amount advanced by the plaintiff to defendant No. 1, if so, with what effect OPP.
5. Whether the plaint does not disclose any cause of action OPD6-AB.
6. Whether the suit is barred by limitation OPD6-AB.
7. Whether the suit is bad for non-joinder and misjoinder of necessary parties? OPD6-AB.
8. Whether the suit is bad for misjoinder of causes of action OPD6-AB.
9. Whether the petitioner is entitled to future interest. If so, at what rate OPP.
5. Issue No. 1 : The bank has came into existence under the State Bank of India Act, 1955. Under Sub-section (3) of Section 50, regulations could be framed by the Reserve Bank of India with the previous sanction of the Central Government. The Reserve Bank, under the aforesaid provision, framed the State Bank of India General Regulations, 1955.
6. Regulation 77 provides that plaints, written statements, petitions and applications may be signed and verified on behalf of the State Bank by the chairman or by any officer or employee empowered by or under regulation 76 to sign documents for and on behalf of the State Bank. Under regulation 76, notification was issued on September 26, 1959, authorising agents to sign the documents mentioned in the said regulation 76. Subsequently, by notification dated August 26, 1972, the designation of agents was changed to that of branch managers. Thus, from the notification it is evident that the branch managers are entitled to sign plaints, petitions, etc., under regulation 77. A similar matter came up before this court in State Bank of India v. Kashmir Art Printing Press  PLR 300 ;  54 Comp Cas 56 (P & H), wherein the learned judge, after noticing all the above said provisions, held that the branch manager had the authority not only to sign the pleadings and verify them, but had the authority to sign a vakalatnama to authorise an advocate to file suit or to file the same himself. It is further held that the larger authority granted to branch managers to sign the plaints, written statements, petitions and applications and all other documents connected with legal proceedings should include the power to file suits, written statements, petitions, etc. I am in respectful agreement with the ahove observations. Shri S. K. Kalia appeared in the witness-box and deposed that he was working as the branch manager and was authorised to institute the suit. Being a branch manager, he was entitled to sign the plaints, petitions, powers of attorney and other documents as already discussed above. After taking into consideration the aforesaid facts, I am also of the view that Shri S. K. Kalia was competent to file the suit.
7. Issue No. 2: Mr. Chhibbar has pointed out that the particulars of charges in form 8 were filed with respect to the following loans :
Sl. No.in thetableannexure 'A'
Cashcredit(Factory typeandlockand key)
8. It is not disputed that the charge regarding medium term loan of Rs. 4,50,000 has been registered by the Registrar of Companies, Delhi, and Haryana, vide exhibit P-53. With regard to the other two loans, the plaintiff filed the particulars in Form 8 within time before the Registrar. Copies of the forms are exhibits P-55 and P-56. However, these were not registered. Shri R. L. Aggarwal, Upper Division Clerk, Office of the Registrar of Companies, stated that no objections regarding the particulars were sent by the Registrar to the bank. Later, he states that some objections were brought to the notice of some clerk of the bank orally. However, his statement in this regard cannot be accepted. The Registrar was duty bound to convey the objections to the bank so that the bank could have removed those objections. It is the duty of the bank to send the particulars of the charge in Form No. 8 and if the charge is not registered, then the bank cannot be held responsible for that. This matter is not res Integra. A similar case came up before me in Company Petitions Nos. 34 and 35 of 1981 (Haryana Financial Corporation v. Depro Foods P. Ltd.) decided on December 3, 1981. After noticing the relevant provisions of the Companies Act, it was observed by me that the filing of particulars of the charge together with the instrument or copy thereof within 30 days after the date of creation of the charge is necessary and not registration of the charge with the Registrar. The reason is that the registration of the charge is within the jurisdiction of the Registrar and in case he makes delay in doing so, the charge-holder cannot be held responsible. The Registrar has also been given power to allow the charge-holder to send the particulars, etc., within 7 days after the expiry of the limitation period if he satisfies that he could not file the same for a sufficient cause within the prescribed period. After the particulars, etc., have been filed, then the responsibility of the registration of the charge shifts on to the Registrar. It is further observed that thus a charge-holder is absolved of his duty as soon as he filed particulars of the charge, etc., with the Registrar. Consequently, I hold that all the above-said three loans are deemed to be registered. Regarding the loans at Nos. 3 and 4, it is not proved from exhibits P-17, P-18 and D-1 referred to by Mr. Chhibbar that they were got registered. I decide the issue accordingly.
9. Issue No. 3 : The plaintiff has been advancing loans to the company from time to time as per statements of account detailed below ;
Name of the account Cash Credit
Outstandings amount as on 31-12-1978 as per plaint (para 24)
Exhibit of the statement of account
Exhibit of balance confirmation slip
Medium term (1)
Medium term (2)
Medium term (3)
Medium term (4)
10. In the statements of account (Exhibit given in column No. 4), the balances given as on December 31, 1978, are the same as given in para 24 of the plaint. The bank has been obtaining confirmation of balances from the company from time to time. The balances on December 31, 1978, were confirmed by the company regarding the aforesaid accounts, vide exhibits P-7, P-8, P-19, P-20, P-24, P-15, P-34. P-41, P-28 and P-23, respectively, as mentioned against each item above. In the balance confirmation slips, the same amounts have been shown as mentioned in para 24 of the plaint. From the aforesaid documents, it is established that the plaintiff advanced the loans as enumerated in para 24 of the plaint to the company.
11. The suit was, however, filed by the plaintiff on September 13, 1980. The amounts on October 26, 1979, as mentioned above, were transferred to protested bills account. The amounts due on that date from the defendants as per statement of account regarding the loans at serial Nos. 1 to 10 are:
12. The total of the said amounts comes to Rs, 21,34,247.83. The details have been given in the table annexure 'A'. Out of the said amount, an amount of Rs. 93,600 is stated to have been received by the plaintiff from the company. Thus, the balance which remains as outstanding is Rs. 20,40,647.83.
13. The plaintiff instituted the suit on September 13, 1980. The interest from October 27, 1979, to September 12, 1980, comes to Rs. 2,56,742.12 at the contractual rate of interest. Thus, the total amount due on the date of the institution of the suit is Rs. 22,97,389.95. The plaintiff is entitled to the recovery of the said amount.
14. Issue No. 4 : I shall deal with all the guarantors separately. Gian Singh, whose legal representatives are mentioned as defendants at serial No. 2, gave guarantee regarding the following loans, vide the documents mentioned against their names :
Sl. No. inannexureA
Description of the account
Outstandingson thedate offilingof suit
Exhibitof demand promissory note
CC(F. &T.;) of Rs. 5,00,000
MTL (1) of Rs. 4,50,000
MTL (4) of Rs. 80,000
CC(Bills) of Rs. 3,00,000
C.T.L. ofRs. 3,50,000
C.T.L. ofRs. 1,50,000
CC (SC)of Rs. 30,000
E.P.C.P. of rs. 1,00,000
15. The bank got executed demand promissory notes from the company in favour of Gian Singh and other guarantors as detailed in column 5 above. Thereafter, the guarantors indorsed the pronotes in favour of the bank. Section 35 of the Negotiable Instruments Act provides that whoever indorses and delivers a negotiable instrument before maturity without such indorsement, expressly excluding or making conditional his own liability, is bound thereby to every subsequent holder, in case of dishonour by the drawee, acceptor or maker, to compensate such holder for any loss or damage caused to him by such dishonour, provided due notice of dishonour has been given to, or received by, such indorser as hereinafter provided. It has been settled by this court in Balwant Singh v. State Bank of India  79 PLR 256, that the object of the notice of dishonour is to protect a party making the endorsement from suffering any avoidable damage or loss to himself by taking appropriate steps. It is not intended to give him an unconditional and absolute discharge from liability regardless of the circumstances which may exist which render it unnecessary to give him such a notice. It is always open to an indorser when sued upon to plead that he had no notice of dishonour and that there were no circumstances making notice of dishonour unnecessary. Necessary issues will then be settled and enquired into. Rules of procedure like rules of evidence are intended to secure and not to defeat justice. It is further held that it is in that spirit that they have to be construed. It is true that in the present case, no notice has been served by the plaintiff but it was for the defendant to come and plead that he had suffered some loss on account of non-service of the notice. Defendants mentioned at serial No. 6 appeared after service of the notice but they did not plead that they suffered on account of non-receipt of notice of dishonour of the pronotes. The other defendants did not appear and contest the suit. Under the aforesaid circumstances, the non-service of the notice will not discharge the legal representatives of Gian Singh from the liability mentioned in the demand promissory notes, exhibits P-3, P-12, P-30, P-36, P-25 and P-44, They thus became liable to reimburse the plaintiff to the extent of the amounts mentioned therein. Besides the promissory notes, the plaintiff also got executed the deeds of guarantee from Gian Singh who undertook to reimburse the plaintiff in case the money was not paid by the company. From both the documents it is established that Gian Singh is liable to reimburse the 'plaintiff to the extent of the loans taken by the company in the said accounts. Even if Gian Singh did not execute any deed of guarantee regarding any loan, that does not make any difference as the demand promissory note had been indorsed by him regarding that loan in favour of the plaintiff which is as effective as a deed of guarantee. Consequently, the liability of legal representatives of Gian Singh comes to Rs. 21,87,345.87.
16. Defendant No. 3 is a signatory of the documents which were signed by defendant No. 2 as given in the table above. Therefore, his liability is the same as that of defendant No. 2.
17. Defendant No. 4 executed all the documents as given in the table above except promissory note, exhibit P-51, which relates to the medium term loan (1) of Rs. 4,50,000. Consequently, his liability comes to Rs. 20, 19,249.59.
18. A. D. Aggarwal, deceased, Harnarain Singh, deceased, and defendant No. 7 stood -guarantee for repayment of medium term loan (1) of Rs. 4,50,000, vide deed of guarantee, exhibit P-51. From the terms of the said deed, it is established that they are liable for repayment of the loan advanced to the company in the said amount. They are, therefore, liable jointly and severally to pay Rs. 1,68,095.98. I decide issue No. 4 accordingly.
19. Issue No. 5: The objection that the plaint does not disclose any cause of action was raised by the defendants mentioned at serial No. 6. Nobody appeared on their behalf either at the time of leading the evidence or at the time of arguments. In the written statement, it has not been shown as to how the plaint did not disclose cause of action. In the circumstances, I hold the issue against the defendants.
20. Issue No. 6: The objection on which the issue was framed was also raised by the defendants mentioned at serial No. 6. It is not clear from the written statement as to how the suit is barred by limitation. It may be highlighted that even on December 31, 1978, the balances were acknowledged by the company. The present suit was filed on September 13, 1980. Therefore, it cannot be held that the suit is barred by limitation.
21. Issue Nos. 7 and 8 : Again, both the issues were framed on the objection taken in the written statement of the defendants mentioned at serial No. 6. As already mentioned above, the defendants did not appear either at the time of evidence or at the time of arguments. On the facts as stated above, it cannot be held that the suit is bad either for non-joinder or misjoinder of parties or for misjoinder of causes of action.
22. Issue No. 9 : The plaintiff has prayed that a money decree be passed against the defendants with future interest at the rate of 18 per cent. per annum with effect from the date of filing of the suit till the date of payment. In order to prove the rate of interest, the plaintiff had made reference to the agreements executed at the time of extending the loans and the pronotes. In both the documents it is stated that the plaintiff shall be entitled to interest at 1 per cent above State Bank advance rate with a minimum of 15 per cent per annum. Nothing has been brought to my notice in which the State Bank advance rate of interest is mentioned. Even the manager of the plaintiff did not state what was the State Bank advance rate of interest on that date. On the other hand, it is admitted by Mr. Chhibbar that the plaintiff has charged interest from the company at the rate of 14% per annum on all the accounts. In these circumstances, I consider it proper to grant to the plaintiff future interest at the rate of 14 per cent per annum. Mr. Chhibbar brought to my notice two cases, namely, Punjab Supply Corporation v. State Bank of India, Regular Second Appeal No. 2647 of 1983, decided on August 16, 1984, and State Bank of India v. Neeru Plastics  86 PLR 382 ; AIR 1984 P & H 209. In both the cases, the agreed rate of interest was 18 per cent per annum. Therefore, the ratio in those cases is not applicable to the facts of the present case.
23. In the present case, it is not necessary to pass a preliminary decree as is required to be done in the case of mortgages as the company has gone into liquidation and it is not possible for the official liquidator to pay the amount. Ultimately, for recovery of the decretal amount, the property mortgaged has to be sold. Consequently, I am passing a final decree. .
24. It has already been mentioned above, that an amount of Rs. 93,600 has been paid by the company to the plaintiff. Out of that amount, an amount of Rs. 85,000 has been paid by the company to the plaintiff in the medium term loan account of Rs. 4,50,000, mentioned at serial No. 2 of annexure ' A ' and the amount of Rs. 8,600 towards cash credit (bills) account of Rs. 3,00,000. mentioned at serial No, 6 thereof. While granting relief, the said amounts have been adjusted towards payment of the aforesaid loans.
25. Before parting with the judgment, I may mention that the plaint has not been properly drafted and the learned counsel for the plaintiff has also very fairly admitted it.
26. Issue No. 10 : Consequently, I pass decree for recovery of :
(a) Rs. 6,79,087.11 (amount at serial No. 1 in annexure 'A') against defendant No. 1 along with defendants Nos. 2, 3 and 4 ;
(b) Rs. 1,68,095.98 (amount at serial No. 2 in annexure 'A' minus Rs. 85,000) against defendant No. 1 along with defendants Nos. 2, 3, 5, 6 and 7 ;
(c) Rs. 1,10,044.08 (amount at serial Nos. 3 and 4 in annexure ' A ' against defendant No. 1 .
(d) Rs. 12,02,611.46 (amount at serial Nos. 5 to 9 in annexure' A' minus Rs. 8,600) against defendant No. I along with defendants Nos. 2, 3 and 4 ; and
(e) Rs. 1,37,551.32 (amount at serial No. 10 in annexure 'A') against defendant No. 1 along with defendants Nos. 2, 3 and 4,
with costs and future interest at the rate of 14 per cent per annum. It is further ordered and decreed that for recovery of the amounts mentioned at serial Nos. (a), (b) and (e) above, the mortgaged property given in Schedule A, B(1) and B(2) be sold and that for the purpose of such sale, the plaintiff shall produce before the court or such officer or as appoints all documents in his possession or power relating to the mortgaged property.
27. It is also ordered and decreed that the money realised by such sale shall be paid into the court and shall be duly applied (after deduction therefrom of the expenses of sale) in payment of the amount payable to the plaintiff under the decree and in payment of any amount which the court may have adjudged due to the plaintiff for such costs of the suit including the costs, charges and expenses as may be payable under Rule 10 together with such subsequent interest as may be payable under Rule 11 of Order 34 of the First Schedule to the Code of Civil Procedure, 1908, and that the balance, if any, shall be paid to the official liquidator.