CANARA BANK Vs. FEROSAN FRICTION MATERIALS

JUDGEMENT

(1.) ON defendants filing their appearance the plaintiffs have taken out this Summons for Judgment. The plaintiffs have filed an affidavit in support of the Summons for Judgment. On behalf of the defendants there is an affidavit filed by the defendant No.3. The defendant No.1 is a partnership firm of which Defendant Nos.2 to 5 are the partners. Defendant No.6 is a guarantor pursuant to the agreement for guarantee dated 15th February, 1992.

(2.) IT is the case of the plaintiffs that the defendant No.1 was allowed cash credit facility. The defendant No.1 by acknowledgment dated 9th April, 1990 acknowledged the liability in an amount of Rs.11,52,697.83 paise, which included interest upto 31st March, 1990 and all charges, expenses, etc. Another letter of acknowledgment of debt has been given on the same day signed by some other partner of Defendant No.1. In terms of the request for Overdraft Facility dated 3rd January, 1985 the defendants had agreed that the moneys advanced would carry interest at 6% p.a. above the R.B.I. rate with the minimum of 16% or at such other enhanced revised rate or rates as may be specified from time to time pursuant to the directives issued by Reserved Bank of India. The plaintiffs in para 21 have set out the rates of interest for the said period. In para 22 they have set out the rates of interest chargeable in terms of the directives of the R.B.I. from 8th February, 1991 to 17th February, 1993. In para 24 the plaintiffs have set out that the defendants under the open cash credit facility with further interest on the same amount at the rate of 21.25% per annum compounded at quarterly rests from the date of filing of the suit till payment or realisation. The principal amount, however, is Rs.12.00 lacs.

(3.) I have heard the learned Counsel for the plaintiffs and defendants. The first question, therefore, that has to be decided is whether the suit as filed can be tried as a summary suit. It is true that summary suit cannot be based on the amounts at the foot of the account. In the instant case, however, that is not the case. The defendants by their acknowledgement dated 9th April, 1990 have agreed to the amount at the foot of the account. Thus the suit is not merely based on amounts at the foot of the account, but on the amounts agreed to by the defendants at the foot of the account. This acknowledgment to my mind is sufficient to hold that it would tantamount to an agreement based on which a summary suit is maintainable.