DHANLAXMI BANK LTD. Vs. ANANTH OIL EXTRACTIONS LTD

JUDGEMENT

(1.) The defendant in a suit for money is the appellant. The parties are referred to by their status in the suit.

(2.) The plaintiff is a Limited Company. M/s. Sree Ananth Refineries Ltd. is a sister concern of the plaintiff. The plaintiff had availed an open cash credit facility and a vehicle loan from the defendant Bank. M/s. Sree Ananth Refineries Ltd. had availed an open cash credit facility and a term loan from the defendant. There were defaults in the repayment of the loan accounts. The plaintiff owned 9.869 cents in Sy.No.2307, with a three-storeyed building in Ernakulam Village. An agreement was entered into between the plaintiff and the defendant on 31/1/2000, for the sale of the property to the defendant. The time fixed for completion of the sale was 6 months. The 1st and 2nd floors of the building were in possession of the State Bank of Travancore, who wanted time till the end of the year 2000 to vacate the building. The time for completion of the sale was extended to 31/12/2000, and the same was endorsed in the agreement. The sale consideration fixed was Rs.220.00 lakhs. According to the plaintiff, Rs.170.00 lakhs out of the said amount were agreed to be adjusted towards the liability of the plaintiff, and the balance Rs.50.00 lakhs was agreed to be credited towards the liability of M/s.Sree Ananth Refineries Ltd. The sale deed executed on 28/12/2000 contains a recital to that effect.

(3.) The plaintiff availed a loan of Rs.224.00 lakhs from the KFC. One of the conditions of the loan was that the liabilities of the defendant would be wiped off. According to the plaintiff, just before the registration of the sale deed, the defendant insisted that an additional sum of Rs.5.00 lakhs should be paid to close the loan account of the plaintiff. M/s. Sree Ananth Refineries had mortgaged by deposit of title deed, an extent of 65.435 cents in Sy.No.136/4 in Maradu Village, as security for the loan granted to them, and the said property was also to be mortgaged with the KFC for a working capital loan of Rs.150.00 lakhs to be granted to M/s. Sree Ananth Refineries. The plaintiff's case is that the defendant had by coercion extracted an additional sum of Rs.5.00lakhs, since the plaintiff had to complete the sale by 31/12/2000, by which date the time granted by the Income Tax Department will end and the title deeds were also to be handed over to KFC towards security for the loan availed from them. It is also contended that the defendant had, against the stipulation in the sale deed, adjusted Rs.175.00 lakhs towards the loan account of the plaintiff, and only Rs.45.00 lakhs was credited towards the loan account of M/s.Sree Ananth Refineries Ltd. The suit was filed for recovery of Rs.7,44,791.00 with interest at the rate of 22.75% on Rs.5.00 lakhs from the date of the suit till the date of realisation, with costs.