Decided on November 19,1986

Haji Mohd Sadiq Appellant
State Financial Corporation, JAndK Respondents


- (1.) THIS civil First Appeal is directed against the order of the learned District Judge, Anantnag, dated 25. 11. 1978 making absolute his order dated 14. 11. 1975 passed in terms of Section 31 of the Financial Corporation Act, and has arisen in the following circumstances of the case
(2.) THE respondent No. 1 (State Financial Corporation ) had filed an application Under Section 31 of the Financial Corporation, Act, 1951 (hereinafter referred to as Act) in the court of the learned District Judge, Anantnag, for recovery of Rs. 7, 939. 63 from respondents 2 and 3 herein, by sale of the properties and assets mortgaged by them with the said Corporation. The corporation had agreed to advance a lone of Rs. 17, OOO/ - to respondent No. 2 herein, and in this regard a mortgage deed was got executed from him. The respondent No. 3 herein, stood as guarantor for repayment of lone by respondent No. 1. The respondent No. 2. allegedly, did not comply with the terms and conditions of the loan, and, therefore, only Rs.l20O,0/ -could be advanced to him by the corporation. The appellant herein was not a party to any of the transaction entered into between the Corporation and the respondents 2 and 3. The respondent No. 2, however, has sold out to the appellant the oil expeller, the motor and a rice husker in the year, 1975, for which he had obtained the loan from the Corporation.
(3.) THE application was resisted by the appellant and the respondents 2 and 3. They had filed their objections before the learned trial court. The appellant in his objections had stated that the property purchased by him did not figure in the mortage deed and he was a bonafide purchaser of the same. He had admitted to have purchased from respondent No. 2, the rice husker, the oil expeller and a motor for Rs. 30, OOO/ - The learned trial court examined some witnessess, as were produced by the parties and then after hearing them made the order dated 14 11. 1975 absolute. The order dated 14. 11. 1975 is reproduced, as under, for ready reference: "Counsel for the applicant. I have perused the petition of the applicant u/s 31 of the state Financial Corporation Act 1951 as well as the Annexure, An ad -interim order attaching the mortgaged properties and such other properties of the respondents as would when sold raise the amount equivalent to outstanding liabilities of the respondents one and two to the applicant for the sum of Rs. 7, 838, 63 (Rupees seven thousand eight hundred and thirty eight and paisa sixty three only) the amount due and payable by respondent one to the applicant under the said Indenture of Mortgage and interest thereon from 16th September 1975 till the date of its realization and payment to the applicant together with costs and other expenses incurred by the applicant on behalf of the Respondents, as also of the costs of this application. The other side is also restrained to transfer or remove its machinery plant or equipment till further orders. A notice accompanied by copies of the order, the application and the annexures be issued to the other side to show cause why the ad -interim order of attachment should not be made absolute and injunction confirmed. Put up on 17. 12. 1975.;

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.