AI Overview...
Breach of Loan Repayment Obligations
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Default in Repayment - Multiple sources confirm that when an industrial concern defaults on repayment of a loan, installment, or fails to meet obligations related to guarantees, it constitutes a breach of the loan agreement. This breach triggers specific enforcement provisions under the law. Lyca Productions Private Limited, vs Vishal Krishna Reddy - Madras, Karnataka State Financial Corporation VS Sree Lakshmi Narasimha Swamy Parboiled Rice Industries - Karnataka, MOLLY JOSE VS KERALA FINANCIAL CORPORATION - Kerala, I. F. C. I. VS SIDDA SYNTEX - Delhi, Kamala Krishnamurthy VS Karnataka State Finance Corporation, Bangalore - Karnataka, Arjuna Rock Drills, a Partnership Firm by its Partner M. Ramasami, Salem-7 VS Tamil Nadu Industrial Investment Corporation Limited, by its Chairman Cum Managing Director, Chennai-35 - Madras, KARNATAKA STATE FINANCIAL CORPORATION VS SUN CANNING (P. ) LTD. - Karnataka, HIMACHAL PRADESH FINANCIAL CORPORATION VS JASWAN RESORTS - Himachal Pradesh, Orissa State Financial Corporation VS Ramesh Chandra Behera - Orissa
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Legal Provisions for Enforcement - Section 31 of the State Financial Corporations Act, 1951, and corresponding provisions under the Financial Corporation Act, outline the rights of financial institutions to enforce claims, including the sale of mortgaged property, upon default by the borrower. These laws specify that default in repayment or breach of contractual obligations grants the financial corporation the right to initiate recovery actions. Karnataka State Financial Corporation VS Sree Lakshmi Narasimha Swamy Parboiled Rice Industries - Karnataka, MOLLY JOSE VS KERALA FINANCIAL CORPORATION - Kerala, I. F. C. I. VS SIDDA SYNTEX - Delhi, Kamala Krishnamurthy VS Karnataka State Finance Corporation, Bangalore - Karnataka, HIMACHAL PRADESH FINANCIAL CORPORATION VS JASWAN RESORTS - Himachal Pradesh, Orissa State Financial Corporation VS Ramesh Chandra Behera - Orissa
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Admission of Breach - In specific cases, defendants have admitted to the existence of the loan agreement and their default, strengthening the plaintiff's case for breach. The courts have framed issues around whether the defendant breached their obligations under the agreement. Lyca Productions Private Limited, vs Vishal Krishna Reddy - Madras
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Collateral Security and Recovery - Courts have sought to prevent the borrower from disposing of collateral security after default, emphasizing the enforceability of security interests upon breach. The law provides for measures like immediate repayment demands and sale of mortgaged assets to recover dues. Arjuna Rock Drills, a Partnership Firm by its Partner M. Ramasami, Salem-7 VS Tamil Nadu Industrial Investment Corporation Limited, by its Chairman Cum Managing Director, Chennai-35 - Madras, HIMACHAL PRADESH FINANCIAL CORPORATION VS JASWAN RESORTS - Himachal Pradesh
Analysis and Conclusion
The legal framework clearly stipulates that default in repayment or breach of contractual obligations by an industrial concern under a loan agreement constitutes a breach, enabling financial corporations to enforce claims through legal remedies such as sale of collateral and immediate repayment. Courts have upheld these provisions, reinforcing the importance of compliance with repayment terms to avoid enforcement actions. The consistent reference to Section 31 of the State Financial Corporations Act and related laws underscores the statutory basis for these enforcement measures.
References: - Lyca Productions Private Limited, vs Vishal Krishna Reddy - Madras - Karnataka State Financial Corporation VS Sree Lakshmi Narasimha Swamy Parboiled Rice Industries - Karnataka - MOLLY JOSE VS KERALA FINANCIAL CORPORATION - Kerala - I. F. C. I. VS SIDDA SYNTEX - Delhi - Kamala Krishnamurthy VS Karnataka State Finance Corporation, Bangalore - Karnataka - Arjuna Rock Drills, a Partnership Firm by its Partner M. Ramasami, Salem-7 VS Tamil Nadu Industrial Investment Corporation Limited, by its Chairman Cum Managing Director, Chennai-35 - Madras - KARNATAKA STATE FINANCIAL CORPORATION VS SUN CANNING (P. ) LTD. - Karnataka - HIMACHAL PRADESH FINANCIAL CORPORATION VS JASWAN RESORTS - Himachal Pradesh - Orissa State Financial Corporation VS Ramesh Chandra Behera - Orissa
Search Results for "Breach of Loan Repayment Obligations"
2025 0 Supreme(Mad) 4594 • India - IN THE HIGH COURT OF JUDICATURE AT MADRAS
P.T. ASHA, J
1, 2, 5, 10, 72-74) ... ... (B) Breach ... Therefore, the plaintiff would submit that there is a clear breach of obligations cast upon the defendant under the loan agreement dated 21.09.2019. 38. ... The following issues have been framed by this Court: (i) Has not the defendant breached his obligations under the loan Agreement dated 21.09.2019? ... Therefore, in its first defence to the plaintiff's claim, the defendant has admitted the agreement, borrowing, repayment#HL_END....
2019 0 Supreme(Kar) 2266 • India - Karnataka
B.V.NAGARATHNA, BELLUNKE A.S.
Financial Corporation Act19510 Section 31(1)()() - Transfer of Property Act1882 - section 69 - Transfer of Property - Working capital loan ... Special provisions for enforcement of claims by Financial Corporation. (1) Where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof [or in meeting its obligations in relation to any guarantee given by the Corporation] or ... According to Section 31 of the SFC Act, where an industrial ....
1984 0 Supreme(Ker) 107 • India - Kerala
M.P.MENON, K.BASKARAN
... (1) Where an industrial concern in breach of any agreement makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise ... fails to comply with the terms of its agreement with the Financial Corporation or where the Financial Corporation requires an industrial concern to make immediate repayment of any loan or advance under S.30 and the industrial concern fails to mak....
1996 0 Supreme(Del) 331 • India - Delhi
J.K.MEHRA
Special provisions for enforcement of claims by the Corporation- (1) Where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to the guarantee given by the Corporation or otherwise ... fails to comply with the terms of its agreement with the Corporation or where the Corporation requires an industrial concern to make immediate repayment of any loan or advance under S....
2013 0 Supreme(Kar) 83 • India - Karnataka
MOHAN M.SHANTANAGOUDAR
Special provisions for enforcement of claims by Financial Corporation- (1) Where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise ... fails to comply with the terms of its agreement with the Financial Corporation or where the Financial Corporation requires an industrial concern to make immediate repayment of any loan#....
2014 0 Supreme(Mad) 4439 • India - Madras
T.MATHIVANAN
Plaintiffs sought to prevent the Financial Corporation from proceeding against collateral security after defaulting on a loan ... Special provisions for enforcement of claims by Financial Corporation.—(1) Where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise ... Rights of Financial Corporation in case of default.--(1) Where a....
1997 0 Supreme(Kar) 140 • India - Karnataka
H.N.NARAYAN
Section 31 of the State Financial Corporations Act is one such provision which reads as follows :-"where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof (or in meeting its obligations in relation to any guarantee given ... by the Corporation) or otherwise fails to comply with the terms of its agreement with the Financial Corporation or where the Financial Corporation requires an industrial concern to make immediate repayment#HL_E....
2009 0 Supreme(Del) 1274 • India - Delhi
V.K.JAIN
Electricity Act, 1910 - Section 154(5) - Court Fee Act - Section 7(1) - Section 154(5) casts an obligation ... Section 31 of that Act, to the extent it is relevant, provides as under: “31. (1) Where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation ... or otherwise fails to comply with the terms of its agreement with the Financial Corporati....
2009 0 Supreme(HP) 1186 • India - Himachal Pradesh
V.K.AHUJA
State Financial Corporations Act - Recovery of Loan - Section 31 - 32(9) - [State Financial Corporations Act, 1951, Section 31 ... Financial Corporations Act, 1951, which allows for various reliefs including the sale of mortgaged property for recovery of the loan ... of any agreement, makes any default in repayment of any loan or advance or any instalment thereof [or in meeting its obligations in relation to any guarantee given by the Corporation] or otherwise fails to comply with the terms of its agree....
2002 0 Supreme(Ori) 117 • India - Orissa
A.S.NAIDU
of any agree¬ment, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply with the terms of its agreement with the Financial Corpora¬tion or where the Financial Corporation ... requires an industrial concern to make immediate repayment of any loan or advance under Section 30 and the industrial concern fails to make such repay¬ment, then, without prejudice to the provi....
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