KAILASH CHANDRA GAUR Vs. CENTRAL BANK OF INDIA AND ORS.
DEBTS RECOVERY APPELLATE TRIBUNAL
Kailash Chandra Gaur
Central Bank of India And Ors.
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K.Gnanaprakasam, J. (Chairperson) -
(1.) AGGRIEVED by the order dated 21.11.2003, passed by the DRT at Bangalore, in OA No. 382/1998, the 6th defendant alone has preferred this appeal,
(2.) M /s. Movers Ltd., the 1st defendant in the OA, had the benefit of various credit facilities by way of Cash Credit Open Loan, Overdraft against Supply Bills and three Term Loans in respect of which, it had executed Promissory Notes, Letter of Continuity and also Hypothecation Agreements in respect of stocks and trade and machinery and also the letter of acknowledgement of debts. Defendants 2 to 7, who were the Directors of the said company at the relevant point of time stood surety for repayment of the amounts due, for which they have executed letters of continuing guarantee to remain in force till the entire amounts due by the 1st defendant are paid and also acknowledgement of debt and confirmation of balance executed by the 1st defendant, are binding and enforceable against the defendants 2 to 7. That in respect of the loans availed by the 1st defendant, it is totally liable to the extent of Rs. 5,10,68,100/ - payable with interest at 16.5% per annum compounded once every quarter from the date of suit till the date of realisation. The defendants have filed the written statement and contested the claim. As the 6th defendant namely, Kailash Chandra Gaur alone has preferred this appeal, I feel it would be sufficient to consider the defence of the 6th defendant alone. It is the case of the 6th defendant that he was one of the Directors of the 1st defendant company and he tendered resignation of his Directorship on 6.7.1984, and the 1st defendant company by its letter dated 6.7.1984 addressed to the plaintiff Bank informed about the resignation of the appellant/6th defendant and requested the Bank to relieve him from all the obligations as a guarantor. The 6th defendant also sent a reminder to the Bank on 15.5.1985, requesting the Bank to relieve him from the guarantorship and the Bank by its letter dated 12.6.1985 had informed the 6th defendant that the matter was taken up with their higher authorities for consideration. That thereafter, the plaintiff Bank had not sent any communication to the 6th defendant and even to the legal notice sent to him, the 6th defendant by his reply dated 10.8.1992, made his position clear that he was not liable for any amount due to the plaintiff Bank. The 6th defendant denied his liability mainly on the ground of his resignation as Director of the company and revocation of guarantee as early as on 6.7.1984.
(3.) THE DRT after taking into consideration all the facts and the documents, has held that his liability arising under Exhibits A -?3 and A -24 does not cease and the letters of confirmation and acknowledgement of debt by 1st defendant corresponding to these liabilities marked by the plaintiff Bank are binding upon the 6th defendant and held that the 6th defendant is liable but his liability is restricted only to the extent ascribable to Exhs. A -23 and A -24 only. Aggrieved by the same, the 6th defendant has preferred this appeal.;
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