- (1.) This appeal is directed against the judgment dated 2nd April 1992 and decree dated 3rd July 1992 (decree having been sealed and signed on 3rd July 1992) passed in Money Suit No. 12 of 1983 whereby the learned Sub Judge-II, Seraikella decreed the suit in part.
(2.) The case of the plaintiff-appellant in brief is that defendants-respondents is a small scale industrial unit within the industrial area, Adityapur and other respondents are the partners of the said industrial unit. The defendant No. 7 Bihar State Finance Corporation represented by the Branch Manager, B.S.F.C., Jamshedpur and defendant No. 8 Ashok Kumar Jha are pro forma defendant whereas defendant Nos. 2 to 6 are principal defendants and they are partners of the firm M/s. Bihar Central Trading Company. Defendant No. 1 had approached the plaintiff-bank for cash credit facilities to the extent of Rs. 2.40 lakh only for their working capital which was granted on or about 13-9-1979 on execution of necessary securities and documents under the bank's usual terms and condition. Further case of the plaintiff is that the defendants further approached the plaintiff-bank for enhancement of their credit facility limit to the tune of Rs. 3. lakh only to meet their working capital requirement as it was required for enlarged scale of operation of the unit. The plaintiff after being satisfied with the reasoning, granted cash credit facilities up to Rs. 3.00 lakh on or about 28-4-1980 with interest at the agreed rate at quarterly rests on security of pledge of goods, produce and merchandise. There was also stipulation that the sale proceeds of the pledged goods will be deposited with the plaintiff-bank towards payment of the advance with interest and the defendant Nos. 2 to 6 had stood as guarantors for the said advance made by the plaintiff bank in favour of defendant No. 1. At the time of filing of the plaint, prevailing rate of interest was 16 per cent per annum and the defendant Nos. 2 to 6 agreed at the rate of interest and executed the following documents for the advance of loan facilities by the plaintiff bank :- "(a) Demand Promissory note dated 20- 4-89 for Rs. 3,00,000/-. (b) Demand Promissory note delivery letter dated 28-4-80; (c) Agreement for Cash Credit, Pledge Form 'C' general dated 20-4-80 for Rs. 60,000/-. (d) Agreement for cash credit, pledge, form 'C' (General) dated 13-9-1979 for Rs. 2,40,000/-; (e) Supplementary letter dated 28-4-80 confirming the two cash credit, Form 'C' (General) agreement' (f) Agreement 'B' under Public Demands Act, dated 28-4-80 for Rs. 3,00,000/-; (g) Agreement 'C' under Public Demands Recovery Act, dated 28-4-80 for Rs. 3,00,000/-; (h) Guarantee Agreement Form T (Special) dated 28-4-80 for Rs. 3,00,000/-: (i) Letter dated 13-9-79 acknowledging Bank's Padlock's and Keys; (j) Letter dated 13-9-79 confirming the implications of all the agreements; (k) Equitable Mortgage by deposit of Title deeds in respect of land with construction at Rahatopara Road, Jugsalai, bearing Plot No. 1004, Holding No. 207(R) and 289 under Khata No. 39, of Mouza Jugsalai, Thana No. 1161, P.S. Jugsalai, Dist. Singhbhum area of the land approximately 7,500 Sq.feet, as collateral security for the advance made by the plaintiff-Bank."
(3.) Plaintiff-bank used to send the statement of accounts at monthly intervals to defendants and these statements of accounts were furnished to the defendants on 13-12-1982 which was acknowledged by the defendant No. 4 on the duplicate copies of the bank. Similarly, defendants also used to avail the said facilities and drew amount from time to time and the same was being debited to the said account with interest at quarterly rests. But the cause of action in the suit arose when defendants committed breach of the Agreement and failed to pay to the bank despite notice served upon them by the plaintiff-bank and they defaulted in complying with the terms and conditions of the Agreement entered into between the parties. Sometime thereafter, defendants totally stopped transaction with the bank. The plaintiff bank had alleged that the defendants obtained loan from Bihar State Financial Corporation, Jamshedpur for acquiring fixed assets and M/s. Bihar Central Trading Company stood as party against the advance made to the defendants. The current assets of the Bihar Central Trading Company (defendant No. 1) were pledged to the plaintiff-bank. The defendants closed the operation of the unit without any information to the plaintiff-bank and when plaintiff-bank made inquiry, it could learn that defendants had sold the unit to one Ashok Kumar Jha (defendant No. 8) at the instance of defendant No. 7 through the private arrangement without the concurrence of the plaintiff-bank, but nothing was done by the principal defendants to pay the due to the bank and, therefore, plaintiff-bank has filed the suit for recovery of the amount.;