JUDGMENT

S.B. SINHA, J :

1. Leave granted.

2. Interpretation and application of Section 29 of the State Financial Corporations Act, 1951 (for short "the Act") is the core question involved herein.

3. Before, however, adverting to the said question, we may notice the basic factual matrix of the matter.

Appellant No. 1 is a partnership firm. It was constituted in the year 1973. It established a factory at Kadrabad in the town of Modi Nagar, U.P. A loan of Rs. 3.96 lakhs was applied for but a sum of Rs. 3.14 lakhs was sanctioned in 1974. Appellant No. 1 was in possession of 1100 sq. yards in Khasra Plot No. 397M, Khata No. 80 situated in Village Kadrabad Pargana Jalalabad. The factory is situated on a land measuring 800 sq. yards. The schedule of the land which was the subject matter of mortgage in favour of the respondent - Corporation reads as under: "All that piece or parcel of land measuring 800 sq. yards out of Seven Biswas and Five Bigamain, bearing Khasra plot number 397 M Khata No. 80, situate in village Eadarkad, Pargana, Jalalabad, tehsil Ghaziabad district Meerut and bounded:

On the North by: remaining land of