KANCHANLAL CHANDULAL PARIKH Vs. BANK OF INDIA

JUDGEMENT

(1.) The appeal is directed against the judgment and order of Pendse, J., decreeing the suit filed by first respondent.

(2.) The facts that gave rise to the file the suit shortly stated are these.

(3.) The Ahmedabad Jupiter Spinning, Weaving & Manufacturing Co. Ltd. ( the 1st defendant) applied for a loan of Rs. 25,000,00/- to the Bank of India Ltd. in April 1968. An advance was made in this sum on 26th April, 1968 in what was called Account No. 1 repayable on demand with interest as stated. On the same day the following documents were executed. A demand promissory note was executed by the 1st defendant in favour of its directors---the 2nd, 3rd and 4th defendants in the sum of Rs. 25,000,00/- with interest as stated and the 2nd, 3rd and 4th defendants endorsed the promissory note in favour of the Bank of India Ltd. Letters of continuing security and of lien and set off were executed. The 2nd, 3rd and 4th defendants executed a deed of guarantee in favour of the said Bank. The 5th defendant, the State of Maharashtra, also executed a deed of guarantee in favour of the said Bank. The said Account No.1 was operated upon from to time.