Gurusharan Sharma, J. - (1.) DEFENDANTS are appellants. On 20.11.1982 the plaintiffs filed Money Suit No. 203 of 1982 against the defendants for realization of Rs. 69,970.49 paise (Rs. 43,288.19 paise being the amount outstanding as per Books of account with interest calculated upto 25.3.1980, plus projected interest of Rs. 26,682.30 paise as shown in the Books of accounts accrued due, on and from 26.3.1980 to 18.11.1982).
(2.) IN the year 1974, on the request of defendants 1 to 4, a cash credit limit of Rs. 40,000/ - was sanctioned to them by the plaintiff -bank. Subsequently in the year 1975, on the request of defendant -firm limit of cash credit facility was increased from Rs. 40,000/ - to Rs. 1,00,000/ -, for which a demand promissory note dated 18.2.1975 for Rs. 1,00,000/ - payable at Jamshedpur with interest thereon @4 -1/2% over bank rate and minimum 13 -1/2% per annum was executed by the defendants 1 to 4. A letter of hypothecation of goods was also executed, whereby the defendants 1 to 4 created first charge, by way of hypothecation of goods and of raw materials and semi finished goods in the workshop of defendant No. 1. The defendants 5 and 6 became guarantors. According to the bank, defendants failed to maintain proper discipline in respect of the cash credit accounts in question and as such on 22.1.1979, it was decided that the cash credit limit should be fixed at Rs. 70,000/ -. A demand promissory note on the same day by the defendants 1 to 4 for Rs. 70,000/ -, payable with interest @3% over the Reserve Bank of India rate, minimum @12% per annum with quarterly rests was executed. Another letter of hypothecation of goods was also executed by the defendants 1 to 4 and the defendants 5 and 6 stood as guarantors.
(3.) AS the defendants failed to make proper payment as agreed, a sum of Rs. 63.288.19 paise became due in connection with cash credit accounts with interest upto 25.3.1980. Meanwhile, before filing of the suit on 20.11.1982, the defendants deposited a sum of Rs. 10,000/ - on 9.11.1982 and again Rs. 10,000/ - on 13.11.1982. Hence, on the date of filing of the suit, on adding interest for the period 26.3.1980 to 18.11.1982, the total amount to be recovered from the defendants was calculated at Rs. 69,970.49 paise and the suit was filed.;