BANK OF MAHARASHTRA Vs. POSIL ROLLING MILLS LTD

JUDGEMENT

(1.) THIS is a Transferred Application for recovery of Rs. 3,20,56,782.67 (Rupees three crores twenty lakhs fifty-six thousand seven hundred eighty-two and paisc sixty-seven only).

(2.) The applicant is constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970. The defendant No, 1 is a Company now under liquidation and is represented by the Official Liquidator appointed by the Hon'ble High Court of Judicature at Bombay, The defendant No. 3 was original guarantor whose guarantee was substituted by the guarantee of the defendant No. 2. The defendant No. 3 is no more. His legal representatives are brought on record. The defendant Nos. 4 and 5 are Financial Institution and Banks having interest in the securities.

(3.) IN pursuance of the said agreement and arrangement; the defendant No. 2 gave a guarantee to repay the then outstanding amount of Rs. 80 lakhs to the applicant-Bank. The Consent Terms were thereafter filed before the High Court in Suit No. 2337/1988 by virtue of which the suit against the defendant No. 3 came to be dismissed as withdrawn and the suit against the defendant No. 1 was allowed to be withdrawn with a liberty to file a fresh suit.