AVIS MARINE ENGINEERS (P.) LTD. Vs. A.R.C.I. LTD.
DEBTS RECOVERY APPELLATE TRIBUNAL
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Allah Raham, J. (Chairperson) -
(1.) THIS Appeal impugns order dated 17th July, 2006 passed by the learned Presiding Officer, Debts Recovery Tribunal No. 11, Mumbai, whereby Original Application No. 226 of 2003 filed by State Bank of India, the Assignor of the sole respondent herein was allowed with costs against the defendant Nos. 1 and 4. A declaration of mortgage was also given. From the record it appears that defendant No. 1 is the borrower Company of which defendant Nos. 2 and 3 are Directors who are sued as Guarantors. The defendant No. 4 is a firm who is sued as Guarantor -cum -Mortgagor.
(2.) THE case of the applicant (respondent herein) is that on or about 8th June, 1999 it had sanctioned to the defendant No. 1 Bank Guarantee of Rs. 50 lacs against guarantee by the defendant Nos. 2 to 4. The security was also of mortgage by deposit of title deeds by defendant No. 4 of its property. On or about 23rd March, 2001, the applicant also sanctioned 3 facilities. The defendant No. 1 executed Demand Promissory Note and usual security documents while the defendant No. 4 continued equitable mortgage. The defendant No. 1 availed of the facilities from time -to -time. However, the said defendant did not make repayments despite repeated demands. Hence, this O.A. was filed. The defendants filed Written Statement and contended that the defendant No. 1 had given settlement proposal of Rs. 30 lacs and from out of that amount Rs. 7.50 lacs were deposited. It was also contended that the defendant Nos. 2 to 4 are not necessary parties on account of the agreement between the applicant and defendant No. 1 of Settlement. Further plea of defendants is that there is novation of the contract. It is also pleaded by the defendants that the O.A. is time -barred and the same is liable to be dismissed.
(3.) AFTER hearing the learned Counsel for the parties and perusing the record the learned P.O. held that the defendant No. 4 will be liable as Mortgagor since there is extension letter (Ext. 27) read with the letter regarding confirmation of deposit of Title Deeds (Ext. 26) of mortgage earlier created. He, therefore, allowed the O.A. against the defendant Nos. 1 and 4 and limited the liability of defendant No. 4 to the extent of the mortgaged property. It was also declared that the outstandings are secured by equitable mortgage of defendant No. 4's property being Flat No. 715 on the 7th Floor, Raheja Chambers, Plot No. 213 in Block III of Backbay Reclamation Scheme, Mumbai.;
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