- (1.) THIS appeal is at the instance of the defendants and it arises out of a suit the enforcement of a mortgage and recovery of a sum of Rs. 1,93,465-4-3.
(2.) THE case of the plaintiff was that the defendant no. 1 Usha Rice Mill company Ltd. , which carried on a rice milling business had an account with the Comilla Banking Corporation Ltd. By a registered Mourashi Mokurari patta dated July 15, 1935, the land comprised in the factory of the defendant no. 1 was acquired by Sm. Usha rani Ghosh, wife of the defendant no. 2 Charu Kumar Ghosh. Certain structures were raised on the said land. On April 1, 1945, the said Usha rani Ghosh entered into an agreement for sale with the defendant no. 1 in respect of the said land with all structures, plants, tools, machineries etc. She received the entire consideration money and made over possession of the disputed property to the defendant company, but no sale deed was executed by her. In December 1945, the said comilla Banking Corporation Ltd. allowed the defendant no. 1 cash credit overdraft facilities up to a limit of Rs. 2,00,000/- at an interest of 4 1/2% per annum with monthly rents, and as security for the said overdraft the defendant no. 1, by a registered deed of hypothecation dated December 29, 1945, charged and hypothecated to the said Bank its business and goodwill and all outstanding debts, profits and monies due and all its machineries, plants, tools, implements, fixtures, stocks-in-trade etc. The defendant no. 1 also mortgaged, the land and buildings as described in schedule 'b' to the plaint by deposit of title deeds with the Bank at its office at Clive ghat Street, Calcutta. The defendant no. 2 Charu Kumar Ghosh also guaranteed payment of the sum that might be due from the defendant no. 1 up to the limit of Rs. 2,00,000/ -. The rate of interest was increased to 5% from june 1948 and to 6% from March, 1951. The defendant no. 2 executed some promotes as security for the balance. The comilla Banking Corporation Ltd. amalgamated with the plaintiff Bank. The balance in the overdraft account of the defendant no. 1 as on June 3, 1945 amounted to Rs. 1,93,465-4-3 pies. It was the plaintiff's case that both the defendants were bound and liable to pay the said sum. But as the defendants had failed to pay the same in spite of demands, the said suit was instituted by the plaintiff.
(3.) THE defendants Nos. 1 and 2 contested the suit by separate written statements. Their defence was inter alia that the defendant no. 1 had no title to the property in which the factory of the defendant no. 1 was situate it was denied by the defendant no. 1 that there was any mortgage by deposit of title deeds. It was alleged that certain documents were produced by the defendant no. 1 at the Hazra Road branch of the Bank as the bank had required production of the same for audit purposes. The defendant no. I was compelled to execute various documents under undue influence and coercion, and he was discharged from his liability as the guarantor as there was variation in the rate of interest further, their case was that no charge was created by the hypothecation bond and the plaintiff was not entitled to realise any money on the basis of the said bond. The defendant no. 2 appointed the plaintiff bank as his agent under two irrevocable powers of Attorney, and by virtue of those powers of Attorney the Bank had realised the dues of the defendants without giving credit of the same to the defendants. It was alleged that on a proper accounting it would be found that the plaintiff Bank was not entitled to any amount from the defendants. It was contended that the suit was barred by limitation and it was also bad for defect of parties.;