The court established that a valid power of attorney and documented interest rates are enforceable in loan recovery cases.

JUDGMENT

1. This first Appeal has been filed by the appellants-defendants assailing the judgment and decree dated 13.05.1997 whereby and where under Civil suit filed by the respondent-plaintiff- Punjab National Bank for recovery of Rs. 83,076/- has been decreed and while passing the decree for such due amount, the Trial Court directed to pay interest @ 14% p.a. quarterly on the cash credit facility amounting to Rs.29,682/- and interest @ 20.25% p.a. quarterly on the term loan of Rs.53,394/-.

2. The brief facts of the case as culled out from the record are that appellant-defendant No.2- Sohan Lal Agrawal as proprietor of appellant-defendant No.1- Firm Sohan Textiles Industries applied for term loan of Rs. 40,000/- on 30.09.1978 and again applied for cash credit facility of Rs.15,000/- on 16.12.1978 for the purpose of establishment of cottage industry. The appellant-defendant No.3 had furnished guarantee for re-payment of the said loan. It appears that though defendant Nos. 1 & 2 paid few installments of the loan, however could not pay the entire loan, therefore, the respondent-bank filed a Civil suit for recovery of due loan on 17.12.1993 through its authorised person, Senior Manager Mr. Suraj Prakash.

3. After receiving the notices of aforesaid suit, defendants submitted joint written statement and took defence that Mr. Suraj Prakash has no authority to file the present suit for and on behalf of the Bank. The defendants, in their written statement had not denied the fact of taking term loan and cash credit facility and have also not disputed the execution of the mortgage deed and other relevant documents in favor of the Bank to ensure re- payment of loan amount. However, the defendants only disputed that since defendant No.2 is not a literate man and does not know English, therefore, he made signatures on the papers of loan under ignorance. The defendants have raised specific objection with regard to the rate of interest which has been calculated and being levied by the plaintiff-bank, is too higher and against public policy.

4. On the basis of rival pleadings, learned Trial Court settled as many as six issues and recorded the evidence of both the parties. The plaintiff-bank, in support of its claim has produced one witness PW-1 Jaswant Singh and exhibited documents from Exhibit-1 to Exhibit-83. In rebuttal, from the side of defendants, only defendant No.2-Sohan appeared and deposed his statement without filing any documentary evidence.

5. The Trial Court, after appreciating the pleadings and the evidence available on record has decided all the issues independently and has passed the impugned decree against the defendants.

6. This first appeal was filed way back on 15.09.1997. This Court, vide order dated 06.05.1999, directed the appellant to furnish solvent security in the sum of Rs.90,000/- to the satisfaction of the Deputy Registrar (Judicial) under Order 41 Rule 1 (3) CPC.

7. By perusal of order-sheet dated 08.12.2000, it appears that the respondent-bank, despite service did not put in appearance and therefore, this Court directed to proceed ex-parte hearing of this first Appeal against the respondent-bank. Since thereafter, no one has appeared to oppose the first appeal for and on behalf of the respondent-bank.

8. Heard learned counsel for the appellants and perused the material available on record.

9. As far as defence of defendants about authorization of Mr. Suraj Prakash to file the Civil suit for and on behalf of the Bank is concerned, the Trial Court has framed issue No.1 and has recorded finding that power of attorney has been exhibited as Exhibit-1. By this power of attorney, bank has authorised its Senior Manager to file and to institute the Civil suit for recovery of due loan amount. The defendants have not produced any oral or documentary evidence to show that the said power of attorney is not lawful or valid in any manner, therefore this Court is not inclined to interfere in the findings of issue No.1 recorded by the Tr