B SHAMBUMAL GANGARAM Vs. STATE BANK OF MYSORE

JUDGEMENT

(1.) This appeal arises out of a suit brought by the State Bank of Mysore, represented by its General Manager, against B. Shambhumal Gangaram, a firm of Bankers, represented by its sole proprietor B. S. G. Chagganmal (1st defendant) and B. S. G. Chagganmull personally (2nd defendant) to recover Rs. 1,61,272.45 with current and future interest and costs as money due to the Bank on accounts in respect of which the second defendant on behalf of himself and the firm had executed two memoranda of deposit of title deeds, each for Rs. 1,00,000 dated 14-8-1950 and 21-8-1950, thereby mortgaging the properties shown in plaint 'A' and 'B' schedules and by sale of the schedule properties other than those released from time to time by the Bank.

(2.) In or about August 1950 the defendants approached the erstwhile Bank of Mysore Ltd., which will hereinafter be referred to as the 'Bank' for purpose of convenience and brevity for an advance up to a limit of Rs.2,00,000 offering the schedule properties as security for repayment of the advances to be made from time to time in addition to the hundies executed by third parties in favour of defendant 1. The defendants availed themselves of the facilities that were so granted and became due in a sum of Rs.1,60,375-86 as per the certified statement of accounts produced along with the plaint. Interest at 6 per cent per annum has been charged to this account. Under the Property Loan Account, the defendants became due in a sum of Es. 896-59. The defendants, therefore, became due in a sum of Rs.1,61,272-45. This is how the claim of the Bank is put forward in the plaint.

(3.) It could be gathered from the material available in this case that the defendants had. two kinds of accounts with the plaintiff, one being Local Usuance Bills Discount Account (LED. Account) and the other Overdraft (O.D.) Account. Under the overdraft account, the defendants became due in a sum of Rs. 58,879-5-0 in the year 1956. The Bank filed O.S. No. 19(56 on the file of the District Judge, Civil Station, Bangalore, and obtained a decree against the defendants. The defendants appear to have satisfied that debt by sale of certain items of mortgaged properties. In respect of the LBD. account, the defendants had offered the schedule properties as security by mortgaging them and in addition had givan hundies executed by third parties in favour of defendant 1.