VAISHALI ENTERPRISES Vs. PUNJAB NATIONAL BANK

JUDGEMENT

(1.) THIS appeal is filed against the judgment -dated 27.6.1998 and its corresponding preliminary decree dated 10.7.1998 passed by the Sub -Judge -IInd, Bokaro at Chas in Title (Mortgage) Suit No. 31 of 1996, whereby the suit filed by the plaintiff/ respondent for recovery of a sum of Rs. 5,60,346/ - was decreed in favour of the plaintiff/ respondent against the defendants / appellants. Pendente -lite and future interest charged @21. 75% per annum was also awarded in favour of the plaintiff against the defendants till full realization of the decretal amount.

(2.) THE plaintiffs case was based on the following facts: Defendants had approached the plaintiff bank for a loan of Rs. 2,35,000/ -. The loan for the said amount was sanctioned by the bank on 22.12.1988 as term loan with the stipulated rate of interest @ 13.5% per annum with quarterly rest. A separate cash credit facility was also extended to the defendants to the extent of Rs. 4.00 lakhs with interest @ 15.25% per annum with quarterly rest. By way of security against the loan advance, defendants had executed all relevant documents in favour of the plaintiff bank including the demand promissory note, letter of hypothecation of property. In addition, defendant No. 2 being the proprietor of defendant No. 1, had executed a mortgage deed of immovable property in favour of the plaintiff bank by deposit of title deeds. The defendants had availed the term loan of Rs. 2,35,000/ - and also used to operate the cash credit account. The defendants had also acknowledged their liability of the plaintiffs dues by their letters issued on 26.12.1989, 30.10.1991 and 13.6.1994. It was when the defendants became irregular in re -payment of their loan, that the bank had requested the defendants to regularize their loan account for making payments, but the defendants did not do so. The bank issued pleader's notice to the defendants demanding regularization of the loan accounts, but when the defendants had failed to pay their dues, the cause of action accrued to the bank for filing the suit. The defendants had contested the suit by taking the plea that the suit is barred by law of limitation and also on the plea that the amount claimed by the plaintiff, is not correct. Defendants denied to have executed any letter of acknowledgement of debt. The defendants had pleaded that the amount was needed for setting up a Small Scale Unit within Bokaro Industrial Area. The plaintiff bank had failed to lend the requisite finance as per financial requirements and due to this, the defendants had suffered financial constraints in making the Unit viable so as to meet the work orders from the Bokaro Steel Plant and eventually, Unit of the defendants went into loss. Defendants had further admitted that in response to the bank's demand, they had stated that it was on account of the financial difficulties, that the loan amount could not be repaid by them and they had expressed their preparedness to pay all their legitimate dues to the bank, but despite such entreaties, the bank had proceeded to file the suit. Though the defendants have acknowledged in their written statement to have taken the loan amount from the bank, but they have disputed about the maintainability of the suit as the same being hit by law of limitation.

(3.) ) Is the plaintiff entitled to get a decree as have been prayed by the plaintiff in its plaint?