RAMASHRE CHANDRAKAR Vs. DENA BANK

JUDGEMENT

(1.) THIS second appeal by the principal debtor/ defendant No. 1 has been preferred against the judgment and decree dated June 13, 1985, passed by the first additional judge to the Court of District Judge, Durg, in Civil Appeal No. 12A of 1982, arising out of the judgment and decree -dated October 30, 1981, passed by the Additional Civil Judge, Class -I, Durg, in Civil Suit No. 9A of 1980,

(2.) THE plaintiff/respondent No. 1, Dena Bank, is carrying on banking business. It has its branch at Gunderdehi, Tahsil and district Durg. The appellant/defendant No. 1, Ram Ashre Chandrakar, applied to the respondent -bank for grant of loan to meet his agricultural needs, namely, for purchase of seeds and fertilizer for cultivation of his land. The respondent -bank granted a loan of Rs. 4,728.25 to the appellant/defendant No. 1 for the said purpose and advanced the said amount to the appellant on July 25, 1971, for which the appellant executed a demand promissory note dated May 25, 1971 (exhibit P -3). The said promissory note recites that the p loan amount shall carry interest at 4 1/2 per cent. per annum above the rate of interest notified by the Reserve Bank of India or at least at the rate of 11 per cent. per annum. One Heera Ram (since deceased) and respondent No. 2, Sonau Ram, stood as guarantors to the principal -debtor. The promissory note (exhibit P -3) was signed by the principal debtor and his two guarantors. The principal -debtor and his guarantors also executed a letter of continuity (exhibit P -4) on May 25, 1971, as well as deed of agreement (exhibit P -5) pledging the produce in favour of the respondent -bank which was to be raised on his agricultural land as security for repayment of the loan amount. The appellant/defendant No. 1 failed to repay the said loan amount with interest and, therefore, the respondent -bank served a notice, exhibit P -8, to the principal debtor/defendant No. 1 and his two guarantors to repay the loan amount with interest and when the principal debtor and his guarantors failed to pay the amount with interest, the respondent -bank filed a suit for recovery of Rs. 13,210 including the principal and the interest.

(3.) THE learned trial judge after recording the parties evidence, rejected all the defence pleas and decreed the plaintiff/respondent No. 1's suit for Rs. 10,995.34 with future interest at the rate of 11 per cent. per annum from the date of institution of the suit till recovery/The respondent -bank filed a photostat copy of a power of attorney in favour of Shri U. C. Koya, Development Manager, Raipur, along with an application under Order 41, Rule 27 of the Code of Civil Procedure, 1908. The said application was allowed and the judgment and decree of the trial court was affirmed with a modification that on November 10, 1980, a sum of Rs. 7,272.40 as principal amount alone was due against the appellant and, therefore, instead of a decree for Rs. 10,995.34, the lower appellate court passed a decree for Rs. 7,272.40 only with future interest at the rate of 11 per cent. per annum with effect from November 10, 1980, till recovery against which this appeal had been directed.