VIKRAMADITYA PRASAD, J. - (1.) THIS appeal has been preferred to set aside the decree passed by Sri P. Topno, 2nd Addl. Subordinate Judge, Giridih, in Title Mortgage Suit No. 13/78/32/79.
(2.) BY the impugned judgment and decree, Title Suit No. 13/77 and Mortgage Suit No._ 13/78 were heard and decided and the appellant Bank of India was decreed on contest with cost and it was declared that the appellant Bank of India was entitled to recover a sum of Rs. 3,12.432.12 only from the defendant Nos. 1,2,3,4 And 5, who were the defendants in Mortgage Suit and that no further interest would be paid to the Bank of India on any of the aforesaid sum as the interest already claimed by it (Bank) had come upto the tune of Rs. 1,47,425.12. It was further directed that the defendant K.C. Industries might pay off the aforesaid dues (Rs. 3,12,432.12) soon and it might resume business and dealings with the Bank of India. The aforesaid decretal amount was directed to be paid within nine months from the date of the judgment failing which the decretal amount was to be recovered by the sale of the properties under security and hypothecation and if the sale proceeds did riot cover the dues the remaining dues would be recovered from the persons of the defendant Nos. 2, 3 4 and 5. It was also declared that there was a valid and" subsisting charge in favour of the Bank of India on the hypothecated goods and there was a valid and subsisting mortgage on the immovable properties of the defendants. The other reliefs like injunction against the defendants restraining them from dealing with or encumbering the properties which had been hypothecated prayed for by the appellant was disallowed. M/s. Kisan Chemical Industries is a partnership firm having its place of business at Isri Bazar. Dumri. Giridih, and the other defendants -respondents are the partners of that firm. The partnership firm was a registered small scale unit with the Government of Bihar. The said firm applied for a credit facility of Rs. 3 lacs to the plaintiff -appellant for purchase of new machinery, construction of buildings -sheds and godown. The plaintiff -appellant agreed to advance money to the extent of Rs. 3 lacs on interest and on the terms and conditions conveyed to them, vide annexure -1 to the plaint. The Bank advanced altogether Rs. 1,65.0007 - out of the sanctioned amount (on 20.10.1973 Rs. 81,000/ - and on 14.12.1973 Rs. 23.0007 - for purchasing machineries and on 11.12.1073 for construction of the factory shed) and certain documents were executed in favour of the appellant -Bank tn connection with the loan and those documents were renewed subsequently on 31.3.1975. The loan agreement, vide its Clause 3 of the deed of hypothecation, provides that the defendant respondents will have to repay the loan meant for construction of factory -shed and purchase of machineries in half -yearly installments of Rs, 25,000/ -each being due in August, 1974. February 1975. August. 1975, February 1976, August, 1976. February 1977, August. 1977 and February 1978 and the rate of interest on the loans so long as it remains unpaid or any balance thereof remains unpaid shall be paid @ 4% above the Reserve Bank of India rate minimum 11% effective 11 1 /2% per annum or at such rate or rates as applicable from time to time with quarterly rests March, June, September and December each year. So liability to pay interest arose right from December, 1973, following the disbursement of loan during the quarter ended December, 1973. Then it transpires that the defendants did not pay interest and also the sum advanced which they had taken and subsequently the defendants stopped dealings with the Bank.
(3.) ALL the aforesaid circumstances compelled the appellant -Bank to file a Mortgage Suit No. 13/1978.;