KARAN TRADERS Vs. PUNJAB & SIND BANK

JUDGEMENT

(1.) THIS is defendant's second appeal challenging the judgment and decrees of the Courts below whereby the suit for recovery filed by the plaintiff-respondent No. 1 has been decreed.

(2.) BRIEFLY stated, the plaintiff filed a suit for recovery of Rs. 1,72,260/- against the defendants on the basis of documents recoverable from the defendants by way of sale of hypothecated goods and mortgaged property. The case of the plaintiff-respondent No. 1 was that the defendants No. 1 and 2 applied for grant of cash credit limit or Rs. 30,000/- and agreed to pay interest at the rate of 19.50 per cent per annum compounded with quarterly rests which was subject to revision from time to time. The account of the defendants became irregular and they failed to make payment of due amount in spite of the legal notice. Hence, the suit for recovery of Rs. 1,72,260/- which included interest upto 27.10.1995 with future interest @ 19.25 per cent per annum with quarterly rests. Notice of the suit was given to the defendants. Defendants Nos. 1 and 2 contested the suit. Defendants No. 3 to 5 were proceeded against ex parte. In the written statement, defendants No. 1 and 2 took various preliminary objections. On merits, they admitted that they had made request to the plaintiff-Bank for the grant of loan but denied the agreement about the rate of interest at the rate of 19.50% per annum with compound quarterly rests. It has been stated by the defendants that grant of cash credit limit of Rs. 30,000/- was given to them and they had agreed to pay simple interest at the rate of 10% per annum. It is their case that their signatures were obtained on blank papers and they never agreed to pay interest at the rate demanded by the plaintiff. After going through the evidence produced on the record and hearing both the sides, the trial Court decreed the suit vide judgment and decree dated 31.10.2005 by passing a preliminary decree for recovery of the amount by way of sale of mortgaged property.

(3.) I have heard learned counsel for the parties and perused the record.