RAMDAS GUPTA Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) Defendant No. 2 (guarantor of the debtor) is appellant.

(2.) PLAINTIFF -Bank advanced medium term loan of Rs. 1,00,000/ - to defendant No. 1 on the basis of a written agreement executed by defendant No. 1 on hypothecation of vehicle where the rate of interest was stipulated as follows ; '3. The Borrower shall also pay interest at the rate of 2 per cent below the State Bank Advance Rate minimum 11 percent per annum rising and falling therewith calculated respectively on the daily balance of the amount due subject to enhancement as hereinafter provided.' Appellant guaranteed the loan by executing a document' where it was stated amongst others. 'We the undersigned Ram Das Gupta S/o. late Seth Amilal hereby guarantee to the said Bank the payment on demand of all moneys at any time and from time to time hereafter due to the said Bank by the Borrower in respect of the said accommodation with interest thereon at the rate of Eleven per cent per annum from the date of demand and the due performance and observance by the Borrower of all the terms pertaining to the accommodation and the payment of all costs and expenses incurred by the said Bank in relation to the premises and we also agree to pay and make good to the said Bank on demand all losses, costs, damages and expenses occasioned to the said Bank by reason of non -payment of the said moneys costs and expenses or any part thereof or the breach, non -performance or non -observance of any of the terms aforesaid.'

(3.) ON the plaintiff filing the suit, defendant No. 1 remained exparte while defendant No. 2 contested the same. Defendant No. 2 contested the suit alleging that he is not liable for the amount.