SYNDICATE BANK Vs. GENERAL EXPERTS COMBINATIONS

JUDGEMENT

(1.) Plaintiff Bank has filed a suit against the Defendants for recovery of Rs. 9,87,535.72 with interest thereon @ 21% per annum compounded quarterly from the dale of the suit till realisation and costs of the suit. It is alleged that the plaintiff is a nationalised bank and a corporate body constituted under the Banking Companies (Acquisition & Transfer of Undertaking) Act, 1980 having its one branch at B-J2, Green Park Extension, New Delhi; defendant No. 1 was a partnership firm, which was engaged in the business of automobile spare parts and were enjoying various credit facilities from the bank from lime to time. Defendants 2 to 4 were the partners of Defendant No.1. On 6th November, 1991, defendants were granted packing credit limit (PCL) of Rs.7 lacs and FDBP facility of Rs. 10 lacs. Defendant No. 1 availed of PCL limit of Rs.4.50 lacs on 6.11.1991 and executed the documents in favour of the Bank namely, promissory note, for the said amount promising to pay the above amount along with the interest @ 3% per annum, above the RBI rates Subject to minimum of 15% per annum compounded monthly for the value received, letter dated 6.11.1991 agreeing to pay the over due interest on the toan amount of Rs. 4.50 lacs @ 21% per annum compounded quarterly. Defendant Nos. 2 to 4 also stood surely in their individual capacity in lieu of credit facility of PCL and FDBL granted to defendant No.1, and guaranteed the obligations of defendant No.1 arc in the nature of a continuing guarantee for all monies payable by defendant No.1, in full. It was further pleaded that alter availing the advance of the packing credit defendants never submitted the export document in respect of the goods on which the packing credit limit was taken. When the defendants failed to pay the packing credit toan, on 6.4.92 the bank wrote letter to the defendants calling upon them to liquidate the liability to and to explain as to whether the export order was still pending or cancelled. The defendants vide letter dated 17.7.92, while acknowledging their liabilities staled that they were exploring possibility of disposing of the goods, in some other country and sought six months lime to liquidate the same. The defendants again vide letter dated 22.2.93 asked the bunk to reschedule the payments and allowing them to make part payment and also to consider concession on interest, ultimately legal notice dated 25.1.95 was served upon the defendants calling upon them to pay jointly and severally a sum of Rs. 7,15,359.00 outstanding in the PCL account and Rs. 6,928.71 being the overdue in the current accoun, along with the interest and costs. It was pleaded that the total amount of Rs. 9,87,535.72 was due and payable to the plaintiff by the defendants towards the loan amount inclusive of interest. As noticed above it was inter-alia also pleaded that vide letter dated 17.7.1992, defendants had requested the Bank for rescheduling the packing credit for six months, which was allowed. This period expired on 10th January, 1993, on which date the defendants were called upon to pay the amount within 10 days, giving rise to a cause of action on 17th January, 1993. It was also pleaded that defendant No.2 was abroad for quite substantial period of time, therefore, the period during which he was abroad has to be excluded under section 15(5) of the Limitation Act, 1963 (for short the Act) while computing the period ot Limitation for filing the present suit.

(2.) The suit was registered summons were issued through ordinary process as well as registered AD post, in the first instance, but they could not he served. Thereafter, service on defendant Nos. 1 to 4 effected by publication. None appeared on behalf of the defendants therefore, they were proceeded ex-parte on 5th Oct. 1998, and the plaintiff was asked to file affidavits by way of evidence. The Plaintiff placed on record documents Exhibits P-1 to P-16 in support of their case.

(3.) Exhibit P-1 is original application dated 6.11.91 for grant of packing credit facility of Rs.7 lacs, Exhibit P-2, Original Export Credit agreement dated 6.11.91 in favour of the plaintiff, for the grant of the said PCL limit, Exhibit P-3 is a demand promissory note dated 6.11.91 for Rs.4.50 lacs whereby the defendants promised to pay the amount with interest @ 3% above the RBI rate or any rate to he fixed by the Bank with minimum 15% per annum. Exhibit P-4 is a letter of delivery dated 6.11.91 inclusive of promote for Rs. 4.50 lacs and securities. Exhibit P-5 is stock statment of the goods as on 6.11.1991. Exhibit P-6 is original letter by the defendants agreed to pay overdue intereset @ 25%. Exhibits P-1 to P-6 are duly signed by all the defendants. Exhibit P-7 is guarantee deed of defendant No. 2. Exhibit P-8 is guarantee deed of defendant No.3. Exhibit P-9 is guarantee deed of defendant No.4. Exhibit P-10 is a letter dated 6.4.92 written to the defendants by the bank pointing out that the packing credit had become overdue and called upon the defendants to liquidate the liability and to produce documentary evidence as to whether export order was still pending or cancelled. Exhibit P-11 in the letter dated 17.7.92 written by defendants to the Bank, by which the defendants acknowledged the debt. By this letter defendants also sought lime for submitting the bills and to clear outstanding dues under PCL account equivalent to Rs. 4.50 lacs, Exhibit P-13 is the letter dated 10.1.93 by which the bank called upon the defendants to pay the entire amount upto date with interest within a period of 10 days. Exhibit P-14 is the letter dated 22.2.93 defendants to the bank seeking reschedulement of the advance. Exhibit P-15 is the notice dated 24.1.95 calling upon the defendants to pay the amount due with interest. Exhibit P-16 is statement of account. Exhibit P-17 is a copy of the power of attorney, executed by the bank in favour of Mr. Venkata Krishna, who has signed and verified the plaint..