VIJAYA BANK Vs. GOLD FOOT PRIVATE LIMITED

JUDGEMENT

(1.) The plaintiff bank has instituted the suit for the recovery of a sum of Rs.1,32,962.00 against defendants 1 to 3 with interest @ 19.5% p.a. from 16.1.1986 onwards. The suit was instituted on the 31st of January, 1986. Defendants 2 & 3 had been set ex parte. The allegations in the plaint could be abridged in the following terms:

(2.) The second defendant, M/s.Dhanarjan Enterprises, was borrowing money from the plaintiff. The stocks at the defendant No.2 factory premises were hypothecated with the plaintiff bank. The first defendant was permitted to take delivery of stocks of 3,000 pairs of ladies white shoes from the factory of the second defendant vide letter dated the 25th of February, 1983. The first defendant undertook that the stocks would continue to be under the charge of the plaintiff and defendant No.1 was taking delivery of those shoes for reprocessing. The first defendant undertook that at the time when the goods were handed over to the clearing agents for export, the receipt would be issued in favour of the plaintiff and by letter dated the 9th of August, 1984, the first defendant assured that the dues due to the plaintiff would be cleared. The first defendant had taken shoes of the value of Rs.90,000.00 but the first defendant had not paid any money. By letter dated the 26th of September, 1985, the first defendant offered to pay the amount due in four monthly instalments of Rs.25,000.00 each and the first of such instalment would be paid on the 10th of October, 1985. The first defendant did not pay any amount as promised. The plaintiff issued a notice dated the 29th of August, 1985 claiming the sum of Rs.90,000.00 towards principal amount and Rs.42,962.00 towards interest @ 16.5% p.a. and the total amount claimed was Rs.1,32,962.00 .

(3.) The first defendant filed the written statement stating that the first defendant was not liable to pay the amount and this Court has no territorial jurisdiction. In paragraph 8 of the written statement,it is stated:-