MAHARAJA MUSHROOMS Vs. PUNJAB NATITIONAL BANK

JUDGEMENT

(1.) This appeal is directed against the decree and judgment of the District Judge, Chandigarh, dated December 24, 1997, in C.A. No. 162 of 1990.

(2.) The respondent-Bank filed a suit against the appellants for recovery of a sum of Rs. 13,54,304.45 paise. According to the plaintiff a cash credit limit of Rs. 1.25 lacs, DA bills limit of Rs. 75,000/- and a Term Loan of Rs. 4.95 lacs had been sanctioned to the first defendant on 12.1.1976. The first defendant agreed to pay interest at the rate of 6 per cent in respect of cash credit limit of Rs. 1.25 lacs, over and above the Reserve Bank of India rate. The first defendant also executed necessary documents creating equitable mortgage by deposit of title deeds of his property with the plaintiff. Defendants 3 and 4 stood guarantee for the repayment of the loan. On 28.1.1978, the limit of the loan was renewed and enhanced the aforesaid limits of loans. As on the date of the suit, the first defendant became liable to pay the suit amount. As the defendant failed to pay the suit amount the plaintiff filed the suit.

(3.) In the written statement, defendants 1 and 2 admitted the facilities of cash credit limit and term loan being sanctioned by the plaintiff-Bank to the first defendant. According to them the rate of interest charged is exhorbitant and that the suit is barred by time and the plaintiff included an amount of Rupees two lacs written off by the plaintiff in the amount of the suit and that the suit is liable to be dismissed.