FEDERAL BANK LIMITED Vs. SANMAC MOTOR FINANCE LIMITED

JUDGEMENT

(1.) THE applicant Bank has filed this Original Application against the defendant for recovery of a sum of Rs. 1,04,97,954/- together with interest @ 24% p.a. with quarterly rests from the date of application till the date of realization and for the cost of the suit. THE applicant Bank has also prayed for sale of the assets of the company and also prayed for coast of the proceedings and , for other relief(s) in order to tender justice.

(2.) The applicant Bank, The Federal Bank Limited is incorporated under the Companies Act, 1956 having its branches all over India and one such Funds and Investment branch at Chennai represented by Senior Manager of the applicant Bank.

(3.) THE defendent company failed to keep up the repayment schedule of interest, principal and premimium on redemption on 11.2.1998. THE defendant company vide their letter dated 10.2.1998 admitted its commitments to redeem the non-convertible debentures of Rs. 50/- lakh falling due for payment on 11.2.98 and requested the applicant five more months time for redemption. THE applicant Bank vide its letter dated 9.4.1998 requested the defendant to comply with the repayment as promised. THE defendant vide its letter dated 6.5.98 informed their regret for non-compliance of repayment schedule and send two cheques for Rs. 25,000/- each and further agreed to pay Rs. 1 lakh each during June and July, 1998. As the defendant failed to reply the amount, the applicant Bank vide its letter dated 26.6.1998 and 6.7.1998 requested the defendant to pay the amount due along with interest. Even after the above reminder, the defendant failed to adhere to the promise, the applicant Bank issued a lawyer on 23.2.1999 through its Counsel R. Sreekrishnan.