The court established that the bank was entitled to charge interest at the rate provided in the loan documents and that the doctrine of promissory estoppel was not applicable.

JUDGMENT - Dr. CHANDRACHUD D.Y., J.:---The proceedings in this appeal arise out of the judgment and order dated 7th October, 1985 of the learned Civil Judge, Sr. Dn., Akola. By the impugned judgment and order the suit, which was instituted by the Central Bank of India, the appellant herein, in 1983, has been decreed in part to the extent of Rs. 1,18,357/-. The bank has been allowed interest at the rate of 7% per annum from the date of institution of the suit till realization. There is a direction that the respondent, who is the original defendant, shall pay the decretal amount in six equal yearly instalments, the first of which was due to fall on 1-2-1986. The appellant/bank is aggrieved by the judgment and decree of the trial Court.

2. The appellant instituted Special Civil Suit No. 69 of 1983 in the Court of the learned Civil Judge, Sr. Dn., Akola for the recovery of an amount of Rs. 3,56,281.97 together with interest at the rate of 18% per annum. A direction was also prayed for the sale of certain goods which were hypothecated in favour of the bank. Briefly stated, the case of the appellant before the trial Court was that the defendant was conducting a business of a printing press in the name of "Shri Mudranalaya Akola" as its sole proprietor. The case of the appellant was that on the request of the respondent two credit facilities were granted by the bank, the first being an open loan of Rs. 40,000/- on 31-7-1970 and the second being a term loan in the amount of Rs. 75,000/- on 9-7-1970. The case of the appellant was that the respondent had executed various documents including a demand promissory note and a deed of hypothecation in respect of the facilities which were extended by the bank. Thereafter, according to the appellant, the respondent had acknowledged his liability in respect of the loans which were sanctioned by the bank and had executed documents within the period of limitation acknowledging his liability to the bank. Similarly, various documents were executed towards renewal of the loans including demand promissory notes and instruments of hypothecation from time to time. Para 5 of the plaint in which there is a reference to the documents executed by the respondent, refers to the execution of the demand promissory notes, hypothecation agreements, letters of declaration, letters of continuity, balance confirmation and letters admitting to the charging of interest by the bank as notified from time to time. The case of the appellant is that it extended its co-operation to the respondent and that the loans were accordingly renewed until 14-1-1982 and 4-6-1982 respectively by the execution of demand promissory notes and hypothecation agreements by which the respondent agreed to pay the principal amount due together with interest at the rate of 15% per annum. In paragraph 6 of the plaint there is a categoric averment that the respondent had utilized the amount which the bank advanced to him for the purpose of his business, but he had committed a breach of the agreement entitling the bank to recover its dues. According to the bank, the respondent had failed to pay the loans advanced despite notice. The amount which was due and, outstanding has been quantified in para 7 of the plaint as being Rs. 1,48,807.63 under the open loan facility and Rs. 1,82,183.75 under the term loan facility. There is a categoric averment in para 7 of the plaint that the balance which is due and payable up to the date of institution of the suit together with interest works out to Rs. 3,30,991.48 as per the extracts of the bank account of the borrower verified as required by the Bankers Books Evidence Act, 1891 inclusive of interest up to 30-8-1983. The total decretal claim together with notice charges was quantified at Rs. 3,56,281.97.

3. In the written statement which was filed on behalf of the respondent before the trial Court, the sanctioning and disbursement of the two loan facilities was not disputed. However, the defence that was set u

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