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2018 Supreme(HP) 40
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
Sureshwar Thakur, J.
The Himachal Pradesh State Industrial Development corporation Limited - Plaintiff
Versus
M/s Oberoi Plastics Ltd. and others - Defendants
Civil Suit No. 86 of 1998
Decided On : 29-03-2018
Advocate Appeared:
For the Plaintiff : Mr. Balwant Kukreja
For the Defendants : Mr. Ashok Sood
The main legal point established in the judgment is the interpretation of loan agreement clauses and the validity of the plaintiff's claim for recovery.
Headnote:
Recovery Suit - Companies Act 1956 - [Issue No.1: Whether plaintiff is entitled to recover the suit amount or any other amount, if so, from whom and at what rate of interest? Yes. Issue No.2: Whether the suit is not maintainable, as alleged? No. Issue No.3: Whether the plaintiff has not approached this Hon'ble Court with clean hands, as alleged? No. Issue No.4: Whether the suit is barred by limitation, as alleged? No. Issue No.5: Whether the plaintiff has no cause of action to file the present suit, as alleged? No. Issue No.6: Whether the suit is bad for non-joinder of necessary party, as alleged? No. Issue No.7: Whether the guarantees, if any purportedly executed by the defendants are discharged, as alleged? No. Issue No.8: Whether the plaintiff is entitled for the amount as claimed for by them in the plaint, when admittedly the proceedings are pending with BIFR? No. Relief: Suit of plaintiff is decreed as per the operative portion of the judgment.
Fact of the Case:
The Himachal Pradesh State Industrial Development Corporation Limited filed a suit against defendants No. 1 to 6 for recovery of a sum of Rs.80,25,529. The defendants failed to comply with the terms and conditions of loan documents and also failed to pay the installments of principal amount and interest thereon in accordance with the repayment schedule entered into the loan documents. The plaintiff sought recovery of the outstanding amount with costs and interest at the rate of 13.5% per annum with half yearly rests from the date of the institution of the suit till the realization of the decretal amount.
Finding of the Court:
The court found in favor of the plaintiff on all issues, ruling that the plaintiff was entitled to recover the suit amount, the suit was maintainable, and the plaintiff had a cause of action to file the suit. The court also held that the suit was not barred by limitation, was not bad for non-joinder of necessary party, and the guarantees executed by the defendants were not discharged. The court decreed the suit in favor of the plaintiff for a sum of Rs.80,25,529 with future interest at the rate of 13.5% per annum with half yearly rests from the date of institution of the suit till the date of payment of the decretal amount.
Issues: The issues included the entitlement of the plaintiff to recover the suit amount, maintainability of the suit, clean hands of the plaintiff, limitation, cause of action, non-joinder of necessary party, discharge of guarantees, and entitlement of the plaintiff for the claimed amount in light of pending proceedings with BIFR.
Ratio Decidendi: The court's decision was based on the plaintiff's evidence, loan agreements, and precedents related to the interpretation of loan agreement clauses. The court found that the plaintiff had a valid claim for recovery and that the suit was not barred by limitation or non-joinder of necessary party.
Final Decision: The court decreed the suit in favor of the plaintiff for a sum of Rs.80,25,529 with future interest at the rate of 13.5% per annum with half yearly rests from the date of institution of the suit till the date of payment of the decretal amount.
Sureshwar Thakur, J.
The Himachal Pradesh State Industrial Development Corporation Limited, a Company incorporated under the Companies Act 1956, has filed the present suit through its Senior Manager (Project) against defendants No. 1 to 6 for recovery of a sum of Rs.80,25,529/-.
2. Cause of action, as disclosed in the plaint, may be summed up thus. One of the functions of the plaintiff – Corporation is to provide financial assistance to industrial units. Defendant No. 1, which is a private limited company, applied to the plaintiff for grant of term loan of Rs.53.89 lacs for construction of a building, purchase of land, plant and machinery for setting up a factory of manufacturing of HDPE/PP Woven Sacks at Village Kisanpura, Tehsil Nalagarh, District Solan, H.P.. The financial assistance of Rs.53.89 lacs to defendant No.1 company was sanctioned on 10.02.1986 and 4.1.19888 against which term loan of Rs.41.99 lacs was disbursed. The interest agreed to be paid by defendant No.1 on loan amount was 15.5.% per annum with half yearly rests with a rebate of 3% for timely payments. For securing the repayment of the said loan and interest thereon, defendant No.1 through its directors, defendant No.3 and 4 executed loan agreement on 19.5.1987 and 15.9.19888 with respect to term loan of Rs.32.50 lacs and Rs.21.39 lacs and Hypothecation agreement regarding land, building, plant and Machinery and other assets was also executed on 19.5.1987 and 15.9.1988. Apart from this equitable mortgage by deposit of title deeds of the properties of the industrial unit concern of defendant No.1 in favour plaintiff corporation was also made on 19.5.1987 and 15.9.1988 with proforma defendant No.5. Defendant No.1 also executed revised repayment agreement on 3.8.1994. Defendants No. 2 to 4 stood guarantors with respect to the loans advanced to defendant No.1 company and consequently executed deed of Guarantee on 19.5.1987, 23.5.1987 and 15.9.1988 and they being guarantors are liable to pay the outstanding loan amounts alongwith interest to the plaintiff. The liability of defendant No.2 to 4 is joint and several with defendant No.1 and it is a continuing guarantee provided by defendant No.2 to 4 in favour of plaintiff company in respect of loans advanced by the plaintiff to defendant No.1 company. It has been averred that as per loan documents executed by the defendants in favour of the plaintiff corporation, the loan together with agreed interest was to be paid in half yearly installments commencing from 10.9.1988 and the last installment payable on or before 10.03.1997. The defendants failed to comply with the terms and conditions of loan documents and also failed to pay the installments of principal amount and interest thereon in accordance with the repayment schedule entered int the loan documents. The money advanced by the plaintiff to the defendants was secured by Hypothecation, mortgage/charge on the immovable property and other assets of the defendants. It has been averred that the defendants approached for rehabilitation of its Unit and rehabilitation package was sanctioned. The repayment of principal amount outstanding i.e. 4.199 lacs was rescheduled. The interest in default was also funded. Defendant No.1 executed revised agreement for repayment schedule on 3.8.1994. As per agreement, the funded interest of Rs.17.02 lacs was to be repaid in half yearly installments commencing from 10.9.1994 and last is repayable on 10.9.2000. The principle amount of Rs.41.99 lacs together with interest @13.5% with half yearly rests and additional interest @ 4% in case of default is to be paid in half yearly installments commencing from 10.9.2000 and last installment is payable on 10.03.2004. It has been pleaded that the outstanding amount of the plaintiff against defendants as on 10.09.1998 stood at Rs.80,25,529 as under;-
(i) Principal amount - Rs.41,49,000.00
(ii) Interest - Rs.38,61,733.00
(iii) Misc. Expenses - Rs. 14,796.00
Total - Rs.80,25,529.00
It has been
