STATE BANK OF INDIA Vs. DHARAM KUMAR

JUDGEMENT

(1.) -The appellant, State Bank of India, Ambattur Industrial Estate, Madras, being the plaintiff, on being aggrieved over the judgment and decree passed by the lower appellate court setting aside the judgment and decree of the trial court in its favour, has presented this second appeal.

(2.) The plaintiff filed a suit for recovery of a sum of Rs. 15,981.82 with interest at the rate of 12% p.a. against the defendants.

(3.) The case of the plaintiff is as follows:- The plaintiff in the course of its business under the scheme of financial assistance to small business units, granted a loan of Rs. 8,000/- to the first defendant on his request for carrying on business in rewinding of motors As security for repayment of the loan, the first defendant executed a general agreement and an ancillary agreement dated 17.8.1978 hypothecating all the movables assets and agreeing for the prompt payment of the loan. The second defendant executed an agreement of guarantee dated 17.8.1978 for the due repayment of the loan granted to the first defendant. Since both the defendants failed to repay the loan in time in spite of the repeated demands and receipt of legal notice, the plaintiff Bank, the appellant herein filed the above suit.