LAKSHMI VILAS BANK LIMITED Vs. SHREECHAKRA ENTERPRISES

JUDGEMENT

(1.) This suit has been filed for a direction to the defendants to pay to the plaintiff a sum of Rs. 1,90,325.50 together with contractual rate of interest at 21% per annum with quarterly rests from the date of plaint till realisation, for a charge decree in case of default, for a personal decree and for costs.

(2.) Plaint averments are as follows : On behalf of the first defendant, its partners viz. defendants 2 and 3 have approached the plaintiff for Packing Credit Loan. Accordingly, the plaintiff sanctioned the said loan to the tune of Rs.1,50,000/-. The defendants 2 and 3 have borrowed the said loan on 16-2-1990 and jointly executed a promissory note in favour of the plaintiff agreeing to repay the loan together with interest at the contractual rate of 7.58 per annum with quarterly rests. The defendants 2 and 3 have also executed Packing Credit Loan Agreement. They have executed a letter of hypothecation on 16-2-1990. Guaranteeing the due repayment of the loan amount, the 4th defendant has executed a letter of guarantee on 16-2-1990. In respect of the said loan, the defendants are liable to pay interest at the rate of 21% per annum, since the loan availed by them was for the purpose of export business and they misutilised the concession granted by the R. B. I with quarterly rests. In spite of several requests and demands, the defendants are irregular in the repayment of the said loan. Though the second defendant had confirmed the debit balance on 25-4-1991 and promised to repay the loan amount within a short period, he failed and neglected to pay. The 4th defendant executed a letter on 7-3-1990, evidencing the deposit of the title deeds in respect of his immovable property with an intention to create and equitable mortgage for the due repayment of the sum borrowed by the defendants 1 to 3 together with all interests, costs and other incidental charges. On 6-3-1990 the fourth defendant deposited the title deeds at Madras, and thus create an equitable mortgage on 7-3-1990 at Madras. The plaintiff caused a search to be made for 13 years in the Registrar of Assurances of the Sub-District, in which the mortgaged properties are situated, and they are not aware of any encumbrances on the said property. Hence, the suit has been filed for the above stated reliefs.

(3.) The defendants 1 to 3 have not filed the written statement. They were called absent and set ex parte.