JUDGEMENT

The Appeal Suit is filed against the Judgement and Decree dated

31.08.2009 passed in O.S.No.8127 of 1996. The defendant is the appellant in the Appeal Suit and the respondent/plaintiff instituted a suit for recovery for a sum of Rs.5,35,797/- together with interest at 17.5% p.a. from the date of plaint till the date of realisation with quarterly rests and for costs.

2.The facts in nutshell in the plaint are that the defendant had approached the plaintiff's Bank and borrowed a sum of Rs.3,40,774/- on 22.05.1990 as vehicle loan for the purchase of two Ambassador tourist Taxis and executed Sanction Ticket, agreeing to repay the same with 48 monthly installments with interest at 8% p.a. He also executed an agreement of Hypothecation, hypothecating the 2 tourist cars bearing Reg.Nos.TN-01-A-9739 and TN-01-A-9741 and made endorsements on the R.C. books to and in favour of the plaintiff on 13.06.1990. The defendant has acknowledged his liability on 31.03.1993 by execution of acknowledgment of debts for Rs.3,03,517.92/- indebtedness as on 31.12.1992. The defendant was a defaulter and was irregular in repayment of monthly dues. Thus, the respondent/plaintiff instituted a suit for recovery of the loan amount.

3.The respondent filed a written statement denying the allegations set out in the plaint, by stating that the plaintiff did not produce a copy of the statement of account, in respect of the amount alleged to have been due by the defendant and the plaintiff did not give credit to all the payments made by the defendant. Hence, the contended that the suit claim itself is barred by limitation.

4.An additional written statement was filed by the respondent stating that the loan sanctioned to the defendant was not pleaded in the plaint and the plaint proceeds only on the basis that the defendant availed loan in his individual capacity for the purchase of two tourist cars. The defendant has availed loan under TADCO scheme implemented by the State of Tamil Nadu. The purpose of the said scheme is to benefit the down trodden schedule caste people. As per TADCO scheme, the Government also contributed Rs.1 lakh for the purchase of the 2 tourist cars. The plaintiff Bank sanctioned Rs.3,40,774/- on 22.05.1990 under vehicle loan is absolutely a false statement. It is contended that the TADCO loan was obtained by the defendant and the TADCO subsequently waived the loan and in this regard, the Government also issued G.O.(Ms)No.41, dated 09.04.2010 Adi Dravidar & Tribal Welfare (SCP) Department. When the Government issued waiver of loan sanctioned through Tamil Nadu Adi Dravidar Housing Development Corporation Limited under non-farm sector enterprises amounting to Rs.83 Crores, the respondent Indian Bank cannot institute a suit to recover the entire loan amount.

5.The Trial Court framed the issues as to whether the plaintiff is entitled to the suit claim, whether the plaintiff is entitled to interest at 17.5% p.a., whether the suit is barred by limitation, whether the suit claim is correct, whether the plaintiff is entitled to seize the vehicles and sell it and to what other relief.

6.The Trial Court basically proceeded on the pretext that the entire loan was sanctioned to the defendant by the plaintiff/Indian Bank. Thus, the very adjudication in the suit for recovery of money is erroneous, as the defendant in his additional written statement has pleaded that the loan was under a special scheme and TADCO also contributed a portion of the loan amount for a meager interest at 4% p.a. and the entire loan amount under the scheme implemented by the TADCO was waived by the Government in G.O.(Ms)No.41, dated 09.04.2010. Thus, the plaintiff/Indian Bank would be entitled to recover their portion of the loan amount and certainly not the entire loan amount. However, the Trial Court has failed to consider the nature of the loan sanctioned in favour of the defendant.

7.It is brought to the notice of this Court that the Government issued G.O.(Ms)No.41, dated 0