- (1.) IN an unusual litigation between the Bank and the State Government arising out of the quarantee deed executed by the State of Rajasthan in favour of the bank, the State has preferred this appeal against the decree passed against them on their own alleged admission for Rs. 5,04,75,826 alongwith the costs and future interest.
(2.) THE facts in brief are as below : the Original applicant referred to as Bank had advanced the loan facilities to Jaipur Spinning and Weaving Mills which was directed to be wound up with effect from 15. 12. 80 in the Company Petition No. 10/80 filed by M/s. Swadeshi Polytex Ltd. in Rajasthan High Court. Prior to it the outstanding balance due from Jaipur Spinning and weaving Mills was Rs. 2,96,12,660. 56. When the account of the Mills with the bank became irregular the Bank demanded the dues. The government of Rajasthan came forward to provide its own guarantee and requested the Bank to continue the original facilities to the Mills. The Government of Rajasthan (in short State) executed the comprehensive guarantee on 2. 3. 77 in favour of the Bank to the extent of Rs. 150 lacs together with interest, costs, charges and expenses that would be due to the Bank. In spite of it the Mills could not re-pay the loan which was accrued at Rs. 5,04,75,826/ -. The Bank has therefore filed the suit for the Recovery of the said amount in the District Court, jaipur, City of Jaipur. During the pendency of the said suit which was subsequently transferred to Debts Recovery Tribunal, Jaipur under the provisions of recovery of Debts to Banks and Financial Institutions Act, 1993, the state on the basis of the liability under the guarantee deed and also on the basis of counter Guarantee obtained from the Original Debtor filed suit bearing No. 396/88 for the recovery of Rs. 5,04,75,826/ -. The said suit was decreed oh 27. 4. 91.
(3.) IT was alleged by the bank that in view of the filing of the suit by the State and the decree in its favour, the State had admitted the claim of the Bank and as such they applied for the decree at admission.;