STATE BANK OF INDIA Vs. AGENTS AND MANUFACTURES

JUDGEMENT

(1.) Plaintiff, M/s. Agents & Manufacturers (in Suit No. 224/71) is a partnership firm (hereinafter called the. claimant) and is carrying on business of manufacturing sewing machines bases, covers, tables, cabinets of wood etc. and for this purpose it purchases and maintains stocks of timber, plywood, fittings, materials and block boards and other raw materials etc. It has its office at 131, Chhota Bazaar, Shahdara, and factory and godowns inter alia at premises No. 508, Circular Road, Shahdara, 525/16, Chhota Bazaar, Shahdara, Harsharan Niwas and also at 471, Circular Road, Delhi.

(2.) For the purpose of its business it has been availing cash credit facilities against hypothecation of its stocks since 1964 from the State Bank of India, Shahdara branch, (hereinafter called the Bank) and the limits of these facilities have been increased from time to time. The credit facilities are (1) Cash Credit Facility on 'Lock and Key' basis, and (2) Cash Credit Facility of 'Factory Type Account'. In April, 1970 the limit of the facility in relation to Lock and Key (Cash Credit Account) was fixed at Rs. l,25,000.00 and in Factory Type Account in February, 1970 the facility limit was fixed for Rs. 75,000.00 .

(3.) M/s. Co-operative General Insurance Society Ltd., New Delhi (hereinafter called the Insurance Company) is an Insurance Company and the claimant in order to secure the bank loan taken against hypothecation of its stocks of material in both the facilities had obtained following fve Insurance Policies from the Insurance Company:- <FRM>JUDGEMENT_639_DRJ41_1997Html1.htm</FRM>