H D F C Vs. GAUTAM KUMAR NAG

JUDGEMENT

(1.) This appeal is directed against the judgment and order dated August 9, 2005, of the Delhi High Court by which it allowed the appeals of the two respondents (defendant Nos.2 and 3 respectively before the trial court), set aside the judgment and decree passed by the trial court and permitted the appellants to file their written statements within four weeks from the date of the judgment, directing further that the trial court would then proceed with the suit and dispose it of in accordance with law.

(2.) The appellant M/s. Housing Development and Finance Corporation (in short "HDFC") instituted a suit under Order XXXVII of the Code of Civil Procedure, 1908, for realisation of its dues against defendant No.1 (the borrower; not before this Court) and the two respondents (defendant Nos.2 & 3) who were the guarantors to the loan. According to the case of the appellant-plaintiff, defendant No.1 who was the owner of a plot of land approached the appellant-plaintiff for a loan for constructing a house on the plot. The loan was sanctioned on October 29, 1997, and on December 9, 1997, defendant No.1 executed the Loan Agreement and a promissory note in favour of the appellant. In addition, defendant No.1 also created an equitable mortgage in favour of the plaintiff by depositing the title deeds of the plot in question. The other two defendants, respondents before this Court, stood guarantee for repayment of the loan and executed the letters of guarantee on December 9, 1997. On the execution of the necessary documents the loan was disbursed to defendant No.1 in two instalments.

(3.) The loan amount, along with interest at the rate of 15% per annum was to be repaid in equalised monthly instalments over a period of 180 months and in case of default, according to the terms of the loan, the outstanding would attract additional interest @ 18% per annum.