DAYA NAND Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) THROUGH this appeal, the defendant has challenged the judgment and decree of the Lower Appellate Court upholding the judgment and decree dated 10.08.2006 passed by Civil Judge (Senior Division), Bhiwani, whereby suit of the plaintiff-respondent for recovery of Rs. 2,64,613/- along with pendente lite and future interest at the rate of 12% per annum with half yearly rests from the date of filing of the suit till its realization, under Order 34 of the Code of Civil Procedure has been decreed.

(2.) THE case set up by the plaintiff-Bank is that the defendant-appellant approached the plaintiff-Bank vide loan application dated 05.12.2000 with a request to sanction a loan of Rs. 1,98,000/- for purchase of Mahindra Tractor against registered mortgage of agricultural land. The plaintiff-Bank agreed to sanction a loan of Rs. 1,98,000/- for the purchase of tractor. The appellant besides the mortgage deed dated 07.12.2000 also executed various other documents including letter of authority (Ex. P-12) to make the payment to the dealer. In pursuance of this authority letter dated 08.12.2000 (Annexure P- 12), a sum of Rs. 2,52,000/- (Rs. 1,98,000/- being loan amount Rs. 54,000/- the margin money deposited by the appellant) were paid to M/s Onkar Tractors, authorized dealer of Mahindra Tractor, Bhiwani, who delivered the Mahindra Tractor Model No. 265 DI HP 30, bearing Engine and Chasis No. HDB-4809 to the defendant. The aforesaid tractor dealer issued invoice No. 188 dated 08.12.2000 in token of having sold the aforesaid tractor to the defendant. In this way, the defendant duly availed the loan facility and purchased the Mahindra Tractor in question and hypothecated the same with the plaintiff- Bank. It was further submitted that the term loan of Rs. 1,98,000/- was to bear an interest at the rate of 12% per annum with half yearly rests or at such other rate or rates as may be prevailing from time to time as per the instructions of bank/RBI. The prevailing rate of interest was @12% per annum with half yearly rests. The aforesaid loan plus interest and other charges were repayable in 18 half yearly instalments, each of Rs. 11,000/- plus interest commencing from June 2001. It was also agreed, that in case of default of making the payment of instalments as per the terms of the agreement or if the bank's interest is found adversely effected in consequence of any act or omission of the defendant, the plaintiff bank shall be entitled to recover the entire amount due in lump sum. The defendant failed to adhere to the terms and conditions of the agreement entered into with the plaintiff bank and did not make the payment of instalments. Therefore, he was contacted so many times by the field staff of the plaintiff bank, but the defendant paid no heed to it. The defendant instead of making payment got served legal notices dated 18.06.2002/19.06.2002, upon the plaintiff bank mentioning that the tractor has not been delivered by the tractor dealer. The defendant served legal notice after getting the delivery of tractor on 08.12.2000. On receipt of the notice, the field staff of the plaintiff bank visited Baliali and contacted the defendant and other inhabitants of the village, for making necessary enquiry in the matter and it revealed that the defendant had sold the tractor illegally and in contravention of the agreement. When the field officer of the plaintiff bank directed the defendant to make the payment, failing which the bank will be compelled to lodge FIR against him, the defendant sought time and undertook to clear the entire amount upto 31.08.2002, but the defendant failed to do so. Lastly the plaintiff bank also served a legal notice dated 21.01.2003, through Shri Dharam Chand Chaudhary, Advocate to make the payment of amount due within 15 days, from the receipt of the said notice, but the defendant did not make the payment. A sum of Rs. 2,64,613/- inclusive of interest up to 06.03.2003 was due and outstanding from the defendant to the plaintiff which he was liable to pay along with pendente lite and future interest @12% per annum with half yearly rests. Hence, this suit.

(3.) FROM the pleadings of the parties, following issues were framed by the trial Court for adjudication: