Advocates:
['S K SINHA', '', 'RAJESH KUMAR', 'VIKASH KISHORE PRASAD', '', 'PRATYUSH KUMAR', 'R R NATH', 'PRAMOD KUMAR']

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IN THE HIGH COURT OF JHARKHAND AT RANCHI

F. A. No. 55 of 1999

State Bank of India

…. Appellant

Versus

1. M/s. Sujit & Co. Pvt. Ltd. Singhbhum East.

2. Sri Mahesh Jha

3. Sri Sujit Jha

4. The Tata Iron & Steel Co. Ltd. Singhbhum East. ….

Respondents

…...

CORAM: - HON’BLE MR. JUSTICE APARESH KUMAR SINGH

…

For the Appellant

: M/s Rajesh Kumar &Manindra Kumar Sinha, Advs.

For the Resp.

: None

…..

15/27.07.2017

Heard learned counsel for the appellant. No one appears for the

respondent today. The matter was adjourned by way of last indulgence

on the previous date taking note of the fact that the respondent had not

appeared in the matter on the previous dates also.

2.

The Appeal is directed against the judgment dated 25.06.1998 and

decree dated 12.03.1999 passed in Title (Mortgage) Suit No. 07/34 of

1991-96 by the learned Sub-Judge-V, Jamshedpur.

3.

The appellant is the plaintiff, who had preferred the Title

(Mortgage) Suit for recovery of Rs. 3,12,384.87/- together with interest

@ 16.5 % per annum with quarterly rests for the pendency of the suit

and for future period till realization. It had further prayed for a

preliminary decree for equitable mortgage to enforce the security

mortgaged to the plaintiff-Bank. Cost of litigation was also prayed for.

4.

The brief case of the plaintiff-bank as set up before the learned

Trial Court is as under :-

Defendant nos. 1 to 3 were running a business of construction in

the Swaranrekha Prject at Chandil. They had a current account in the

plaintiff-bank since 10.10.1986. The defendants had a cash credit facility

up to the limit of Rs. 1,25,000/-. The cash credit facility was approved

on 24.09.1987 and thereafter on 16.09.1987 was extended to the limit of

Rs. 3,00,000/-. To avail the facilities, defendants executed certain

documents in favour of the plaintiff-bank i.e. demand promissory note,

delivery letter, a letter of undertaking and agreement of hypothetication

of goods and permission to mortgage by M/s Tata Iron & Steel

Company Ltd. In addition to above, the defendant nos. 2 and 3 created

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an equitable mortgage of some landed property including their

residential house at Sonari, detailed in the schedule to the plaint in

favour of the plaintiff-bank. They also mortgaged a fix deposit of Rs.

1,00,000/- in favour of the plaintiff-bank. Defendant no. 4 was the

proforma defendant, who gave permission to mortgage the landed

property of the defendant. The defendants continue to enjoy cash credit

facility all along for their business, but did not repay the loan regularly

to the plaintiff-bank. Despite clear notice, they failed and neglected to

repay the loan. Legal notice was sent on 27.10.1990 making it clear that

if they failed to repay the dues, legal consequences would be resorted.

Since the defendants did not repay the amount, plaintiff-bank preferred

the instant suit for the relief prayed for.

5.

The defendants appeared and set up their case through a written

statement. According to the defendants, defendant nos. 2 and 3 are the

partner of defendant no. 1. The cash credit facility up to the limit of Rs.

3,00,000/- was also admitted. They raised an objection that the fixed

deposit of Rs. 1,00,000/- was for three years, which has been adjusted

by the plaintiff-bank without informing them. They denied the execution

of any paper for continuing guarantee. They also questioned the

maintenance of the cash credit account. The defendants also admitted

that necessary documents have been executed for creation of equitable

mortgage against the loan. According to them, BHPC, with whom they

were under contract for certain construction work, had withheld their

bills and the matter was pending in arbitration. That is why their

businesses had suffered. It was alleged that plaintiff-bank has neither

released the fixed deposit nor granted any further cash cred