( 1 ) THIS is a defendants first appeal arising out of a suit for recovery of money brought by the plaintiff-despondent, a company styled as J. K. Jute Mills Company Limited, Kanpur against the defendant appellant also a company known as Lakshmi Ratan Cotton Mills Limited, Kanpur. Both the companies are limited liability companies, and have their registered offices at Kanpur. The plaintiff company is one of the concerns owned by the family of Juggilal Kamlapat. Sir padampat Singhania is the head of the said family. The defendant company belongs to another group of industries known as Beharilal Ram Charan group. Sri Ram Ratan Gupta is the head of that group. The defendant company was sued through two persons, namely, Sri Ram Prasad gupta and Sri Gulab Chand Jain both of whom are the directors of the defendant company.

( 2 ) THE plaintiffs case was that the plaintiff company had advanced a loan of Rs. 1,50,000/-to the defendant company on the understanding that the loan advanced would carry interest 1% higher than the current Bank rate, and would be repaid together with interest within six months. Sri gulab Chand Jain, one of the Directors of the defendant company, sent a let