SYNDICATE BANK Vs. KUMAR INDUSTRIES AND OTHERS

JUDGEMENT

(1.) Syndicate Bank, through Shri N.S. Karjagi, the Principal Officer and attorney of the plaintiff has instituted the suit against M/s. Kumar Industries, through its proprietor Shri S.C. Gupta and also against guarartor Smt. Suman Gupta for the recovery of Rs. 1,24,613.89 P.

(2.) According to the plaintiff, defendant No.1 through defendant No. 2 approached the plaintiff Bank for the grant of over-draft limit of Rs. 27,000/and loan of Rs. 20,000/-, for purchase of machinery and a loan of Rs. 13,000/-, for which defendant No. 2 executed the documents as borrower and defendant No. 3 executed the documents as guarantor. The agreed rate of interest to be charged for the over draft limit was 4-1/2% per annum above bank rate with a minimum of 13-1/2% per annum compounded quarterly. Defendants had been jointly and severally liable to repay these loans. They had acknowledged their liability upto 19th July, 1979, but have failed to repay the outstanding amounts in spite of notice, hence the suit.

(3.) Summons in the suit were issued to the defendants who filed the written statement taking the plea inter alia that the suit is barred by time and that the documents for the overdraft limit and for the loans were got signed by the plaintiff Bank when they were blank. The signatures of the defendants have been utilized by the bank for fabricating the documents. The rate of interest was never agreed with quarterly rest. The loan for the purchase of machinery and the other loan had to carry simple interest at the rate of 13-/ 1 /2% per annum.