Decided on August 25,2003



K.S.Kumaran, - (1.)FIRST respondent-Oriented Bank of Commerce (hereinafter referred to as 'the Respondent - Bank') filed Suit No. 1098/2001 on the file of the Hon'ble High Court of Delhi on 5.4.2001 against seven defendants, namely, (1) M/s. Geetanjali Motors Pvt. Ltd., (2) Mr. S.S. Bedi, (3) Mrs. Moksh Bedi, (4) Col. K.S. Malik (one of the appellants herein) (5) Mr. Asha Ram, (6) Mrs. H. Malik (the other appellant herein), and (7) M/s. Richer Motors Ltd. for (1) the recovery of Rs. 4,50,395.72 with future interest till realisation against defendants 1 to 5 jointly and severally under the Cash Credit Hypothecation/Deferred Payment Guarantee/Co-acceptance Bills account; for a decree for the sale of two hypothecated Eicher Center vehicles mentioned in the plaint for realising the said amount; (2) for a decree for Rs. 11,28,613.02 with future interest jointly and severally against defendants 1 to 4, 6 and 7 under the cash-credit pledge account; (3) to direct the defendants 1 and 7 not to sell the 10 Eicher Mitsubishi vehicles and for the sale of ten Eicher Mitsubishi vehicles; and also (4) a decree respectively under these two loans against the respective defendants if the amounts are not realised by the sale of the vehicles.
(2.)The case of the respondent-Bank is as follows:
On the request of the 1st defendant-Company, offering guarantee by defendants 1 to 5, to sanction Cash Credit Hypothecation facility and Deferred Payment Guarantee/Co-acceptance of Bills facility for purchase of two Eicher Canter trucks, the respondent Bank sanctioned Cash Credit Hypothecation facility of Rs. 2.50 lakhs, and Deferred Payment Guarantee/Co-acceptance of Bills facilities to the extent of Rs. 4.50 lakhs in favour of 1st defendant in April, 1988 against the hypothecation of two Eicher Canter trucks (hereinafter referred to as 'the I loan'). The 2nd defendant was authorised to execute the documents relating to this facility, and accordingly, the documents as enumerated in the plaint were executed. The defendants 2 to 5 stood as guarantors for the due repayment of the above said amount with interest, and executed a letter of continuing guarantee on 8.4.1988 for Rs. 7 lakhs. But, the defendants 1 to 5 failed to repay the amount in spite of repeated requests. The respondent-Bank made the payment of the IDBI bills discounted and drawn on the 1st defendant, and co-accepted by the respondent-Bank to the extent mentioned in the plaint. The 1st defendant hypothecated two Canter vehicles in favour of the respondent-Bank. The defendants 1 to 5 are liable to pay Rs. 4,16,326.66 including interest up to 30.9.1990 under this head.

The 1st defendant requested the respondent-Bank for sanction of Cash Credit Pledge facility to the extent of Rs. 15 lakhs in March 1989 for purchase of ten Eicher Mitsubishi vehicles against the pledge of the said vehicles (hereinafter referred to as the II loan). The said facility was sanctioned in favour of 1st defendant, repayable with interest. The 2nd defendant as the authorided signatory executed the loan documents.

(3.)IT was agreed by the 1st defendant at the time of sanction of the II loan of Rs. 15 lakhs for the purchase of the ten Eicher Mitsubishi vehicles from the 7th defendant, that as soon as the vehicles are ready for delivery by the 7th defendant, the 1st defendant shall intimate the respondent-Bank, and not to take delivery of the vehicles directly from the 7th defendant without prior permission in writing from the respondent-Bank.

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