Punjab and Sind Bank vs Ratna Apartments (P) Ltd. and Others

Usha Mehra, J.—Punjab and Sind Bank has filed this suit for recovery of Rs. 3,87,274.90 against M/s. Ratna Apartments (P) Ltd. and its Directors Smt. Sharda Aggarwal and Mrs. Vijaya Poddar.

The facts of the case are that defendant No. 1 on 14th July, 1980 sought cash credit limit of Rs. 2,50,000/ -. Mr. Vinod Jhunjhunwala and Mrs. Sharda Aggarwal were the Directors of the company. On granting the facility demand promissory note was executed in lieu of the said facility by Mr. Vinod Jhunjhunwala and Mrs. Sharda Aggarwal. They also executed other relevant documents including hypothecation deed, hypothecating construction material i.e. bricks, sand, cement, wood, angle iron, chips, sanitary fittings and also the defendant No. 1 mortgaged three plots of agricultural land. as additional security. Mr. O.P. Poddar stood guarantor. He died on 18th June, 1983. In his place Mrs. Vijaya Poddar was appointed as Director of the Company. On request of the defendant the security of land in Khasra No. 743 measuring 4 bighas and 16 biswas was given up. The documents were renewed by Mrs. Sharda Aggarwal and Mrs. Vijaya Poddar. They guaranteed the repayment of the amount. Since the defendants committed irregularity in re-payment of the loan, therefore, the demand was made on the defendants but the defendants have failed to repay the outstanding amounts. Hence this suit for recovery of the amount with costs and interest and also for directions to the defendants to pay the decretal amount and in case the defendants failed to pay the same within the time prescribed hypothecated materials and the property be allowed to be sold towards the satisfaction of the decree.

Notice of the suit was issued to the defendants who filed the written statement.

During the course of the proceedings the compromise was arrived at pursuance to which defendant No. 3 and attorney of defendant No. 2 appeared in the court and made the statement on oath admitting the claim of the plaintiff made on the basis of the promissory note executed by the defendants pursuance to which a sum of Rs. 3,67,250.02 was due and also stated that due to their financial crisis and she being widow of the deceased Director having not acquired any estate but still prepared to repay the loan and that she may be permitted to repay the loan in 36 instalments.

In view of this statement by the defendants admitting that the amount is due on account of the loan taken by the defendants after executing the promissory note, the decree is hereby passed in favour of the plaintiff and against defendants for a sum of Rs. 3,67,250.02 with costs and simple interest at the rate of 14% from the date of the suit till realization. It is further ordered that the decretal amount be paid by the defendants in 36 equal instalments. It is further ordered that in the event of any single default in payment of instalments the balance amount shall become recoverable in lump sum. It is further ordered that till the amount due from the defendants to the plaintiff is paid, the construction material i.e. bricks, sand, cement, wood, angle iron, chips, sanitary fittings, etc., and the mortgaged agricultural property bearing Khasra No. 742 measuring 4 bighas and 16 biswas and the agricultural land mortgaged with the bank bearing Khasra No. 747/1(2-4)/747(2-12), measuring 4 bighas and 16 biswas situated in Village Kapashera, Tehsil Mehrauli, New Delhi, shall remain mortgaged with the plaintiff bank and in the event of default plaintiff shall have the right to recover the amount then due by applying to the court for the sale of the mortgaged property or a sufficient part thereof and for the purpose of such sale the plaintiff shall produce before the court or such officer as it appoints all the documents in its possession and or relating to the mortgaged property and that the money realized by such sales shall be paid in the court by duly applying (after deduction therefrom of the expenses of the sale) in payment of the amount payable by said defendants to the plaintiff and that the balance, if any, shall be paid to the said defendants or other persons entitled to receive the same and that if the money realized by the sale is not sufficient for payment in full of the payment of the amounts due from the said defendants the plaintiff shall be at liberty to apply for the personal decree against the said defendants for the remaining amount.

Mr. Premwant Singh appearing for the bank had contended that this Court cannot after passing the decree allow the payment by instalments nor could change the rate of interest after the decree. I am afraid this contention of the counsel for the plaintiff has no force for two reasons because his suit is primarily a money suit and not a pure mortgaged suit and secondly even in a mortgaged suit the court has the discretionary power. In this regard I am supported by the decision of our own High Court in the case of the Lakshmi Commercial Bank Limited, New Delhi v. M/s. American Rubber Mills Co. Delhi and Ors. Execution No. 37/90 decided on 29,7.1990 (Delhi High Court). Hence I find no merits in the objection of the plaintiff in fixing the instalments.