GULAB RAM SUBHASH CHANDER Vs. KHARAITILAL

JUDGEMENT

(1.) The appellant firm concededly obtained a loan of Rs. 1,14,000/- in two instalments of Rs. 49,000/- and Rs. 65,000/- on April 16, 1970 and July 21, 1970, respectively, from the respondent Corporation for purposes of setting up a factory at Shahabad. Since it failed to repay this amount along with the stipulated interest as per the terms of the mortgage deed dt. April 16, 1970, the Corporation filed a petition under S.31 of the State Financial Corporations Act, 1951 (for short, the Act) for the recovery of Rs. 1,44,322.20 by sale of the property belonging to the appellant and respondent No. 1, namely, Kharaiti Lal; the guarantor. The Additional District Judge has allowed this petition and ordered that the Corporation is entitled to recover the sum of Rs. 1,44,322.20 along with future interest at the rate of 8% with effect from Oct. 1, 1973 from the sale of the mortgaged properties mentioned in Exhibit P.5 and in the application of the Corporation dated June 6, 1975. This application was filed by the Corporation for the reason that since the debtor had constructed the factory with the loan amount on a plot of land different from the one he had hypothecated with it, the said construction or the property purchased with the loan amount was to be taken to have been hypothecated with the Corporation in terms of Cl.6(xiii), at page 27 of the mortgage deed, Exhibit P.5. It is in the light of this plea that the learned Judge has also entitled the Corporation to recover the amount by the sale of the property mentioned in this application. The appellant impugns this order of the Additional District Judge.

(2.) Against this very impugned order, two other appeals F.A.O. Nos. 592 and 565 of 1979 have been preferred by the Corporation and the guarantor Kharaiti Lal, respectively. In the first appeal it is claimed by the Corporation that the learned lower Court has committed a mistake in specifying the recoverable amount as Rs. 1,44,322.20 instead of Rs. 1,58,177.05, i.e., the principal amount of loan and interest thereupon up to Oct. 1, 1974. It is also the plea of the Corporation that as per the mortgage deed Exhibit P.5, the interest is recoverable at the above rate on the amount due with half yearly rest. In a nutshell the case of the Corporation is that the relief granted by the lower Court be amended to the extent that the Corporation is entitled to recover Rs. 1,58,177.05 with interest at the rate of 8% with half yearly rest with effect from Oct. 1, 1974. So far as Kharaiti Lal's appeal, i.e., No. 565 is concerned, his sole prayer is that the amount due from the debtor, i.e., the appellant firm should first be recovered from the assets of mortgagor and if anything still remains due after that, the same may be recovered from his mortgaged properties.

(3.) Since all the above noted three appeals are directed against the same order of the Additional District Judge, I propose to dispose these of through this common order.