M VENKATESULU Vs. KANDERI FRUIT PACK PVT LTD

JUDGEMENT

(1.) The suit is filed by the plaintiff for recovery of Rs.61,74,962/- together with interest, from the defendant.

(2.) The plaintiff is a farmer cultivating mangoes in Chittoor District of Andhra Pradesh and the defendant is an export company with fruit/pulp extracting unit. The plaintiff supplies mangoes and fruits cultivated to the defendant. The defendant owed the plaintiff Rs.2 lakhs on supply of mangoes. During March 2011, the defendant approached the plaintiff for heavy loan of Rs.20 lakhs and informed the plaintiff that the previous outstanding would be cleared if the further loan of Rs.20 lakhs is advanced to the defendant-Company. Since the plaintiff is a poor farmer, he could not mobilise such huge amount and the defendant requested for arranging agricultural farm loan with Bank. The defendant assured the plaintiff that they would offer a Corporate Guarantee towards availing of such a loan . Accordingly, as instructed by the defendant, the plaintiff approached Bank of Baroda, International Business Branch at Moore Street, Chennai and sought for a farm loan for Rs.20 lakhs, which was also sanctioned by the said Bank on 16.03.2011. The entire scheme of the loan is that the defendant stood as a Corporate Guarantor. The plaintiff executed documents and the defendant was authorised remit the instalment and interest due to the Bank from and out of the sale proceeds. On receipt of the loan amount, the plaintiff transferred by RTGS a sum of Rs.18 lakhs to the defendant on 22.03.2011, after deducting Rs.2 lakhs payable by the defendant to the plaintiff. The defendant executed a tri-partite agreement with the plaintiff and 17 other similar farmers and the Bank for the loan and for the hypothecation of the receivables. No repayment whatsoever was made by the defendant in respect of the said loan instalment.

(3.) While that be so, the plaintiff received legal notice from the Bank of Baroda, on 06.11.2012, calling upon him and the defendant as borrower and guarantor respectively, to pay the Bank Rs.21,08,290/- as on 15.07.2012 together with interest @ 16.25% per annum with monthly rest within ten days from the date of such notice. As per the said legal notice from the Bank's Lawyer, the account of the plaintiff was classified as non-performing on 28.02.2012.