SAVOY SOLVENT OIL EXTRACTION LTD Vs. INDIAN BANK

JUDGEMENT

(1.) These two appeals arise from the Judgement and decree dated 25-4-1988 passed in O.S.No, 36 of 1981 by the learned Subodinate Judge, Nizamabad.

(2.) The facts necessary for disposal of these appeals are that the plaintiff-Indian Bank represented by its agent and General Power of Attorney-holder and Regional Manager, Hyderabad, filed the suit against the first defendant M/S. Savoy Solvent Oil Extraction Limited represented by its Managing Director, second defendant B. Pramodkumar Reddy, third defendant B. Ganga Reddy and fourth defendant M/s. Sherif & Sons, Kakinada. The first defendant is a company with its registered office and factory at Nizamabad, carrying on business of manufacture and sale of bran-oil, deoiled bran cakes etc. Defendants 2 and 3 are Managing Director and Chairman are resectively of the first defendant company. The fourth defendant is a firm with its head office at Madras and branch office at Kakinada, with transit warehouse facilities, doing forwarding and clearing businesss at Kakinada and Madras ports.

(3.) Defendants 1 to 3 availed themselves of credit facilities from the plaintiff- Bank under open cash credit against hypothecation of coal, key cash credit against pledge of rice bran, deoiled bran etc., and packing credit against warehouse receipts. The open cash credit availed was Rs. 100,000/- by executing demand promissory note, letter of hypothecation and overdraft agreement by defendants 1 to 3 on 30-11-1977. Defendants 1 to 3 renewed the pronote on 3-11-1980. The total amount due from the defendants 1 to 3 on this account as on 14-4-1981 was Rs. 56,843-60 ps after adjustment of Rs. 71,900/- lying to the credit of the first defendant in view of the non-availability of the pledged goods and failure to repay the loan.