INDIAN OVERSEAS BANK Vs. KANDIMALLA NARSAIAH

JUDGEMENT

(1.) This Revision petition is filed against the order of the Subordinate Judge, Nalgonda in C.F.R. No. 1724/96, dated 22-11-1996 wherein the Sub-Judge held that the against defendants 2 and 3, the guarantors for the loan availed by the 1st defendant, is time barred as they did not sign revival letters.

(2.) While ordering notice on admission, I called for a report of the Sub-Judge to explain the circumstances under which he has taken the above view and the legal provision with reference to the limitation. Accordingly, he submitted his report in Dis. No. 3322/97 dated 28-2-1997. In the meantime, the notices sent were served on the parties but they did not choose to appear before this Court, when the matter is taken up for hearing. Hence I am constrained to dispose of the revision petition on merits.

(3.) It is not in dispute that the 1st defendant availed term loan facility from the plaintiff Bank on 27-1-1988 and defendants 2 and 3 stood as guarantors for prompt payment of the amount by depositing their title deeds creating an equitable mortgage on the properties which is commonly followed by the financial organisations having statutory power. It is seen from the order of the Court that while the defendant No. 1 executed a revival letter on 16-11-1990, 18-2-1993 and finally on 8-9-1994 for the amount stood undischarged and the defendants 2 and 3 have not executed revival letters. The suit was filed on 1-8-1996 it cannot be disputed that the period of limitation for mortgage suit is 12 years under Article 62 of the Limitation Act while the period of limitation for the loan advanced under pronote is 3 years under Article 36 of the Limitation Act. If the suit is based on mortgage it is not in dispute that the suit filed is within the period of limitation allowed under the Act.