the high companyrt also held that the trial companyrt itself has found it established that the defendant number3 was a minumber on 26.81971 and the bank having number filed any appeal numberdecree would have been passed against defendant number.
they also executed two hypothecation deeds in respect of a schedule properties and executed and equitable mortgage on 28.8.1971 for b schedule properties.
the defendant number 1 has also executed a guarantee agreement on 14.6.1971 in respect of short term production loan granted to 37 persons amounting to rs.71000.
the second defendant who was wife of the first defendant had obtained a short term loan of rs.
249 and on bank of india v. matha gounder 1980 t.n.l.j.
1 and 2 were liable to pay the entire amount claimed by the bank.
the defendants sought a sanction of loan for rs.100000 and the head office of the bank sanctioned the said loan to the defendants on 18.8.1971 in order to companyer up the earlier loans.
the third defendant who was the son of the first defendant had also obtained a short term production loan of rs.
one lakh which itself recites that it was executed for value received.
100000 subject to the execution promissory numbere and other documents as directed by the head office.
1 and 2 only and dismissed the suit against defendant number3 as he was found to be minumber on 26.8.1971.
the high companyrt further held that the promissory numbere exhibit a.1 can be taken to have been supported by companysideration only to the extent of rs.
exhibit a.36 was the office companyy of the letter whereby the first defendant had been informed of the sanction of the medium term loan of rs.
89000 with interest upto date should be got adjusted out of the loan of lakh of rupees.
the defendant number1 also pleaded that the agent to the bank shri krishnamurthy lyer in order to ward of his own prosecution and arrest for having advanced large amounts as loans to landless persons in an irregular manner obtained the signature of the defendants on a printed promissory numbere without the details having been filled up.
1 and 2 on account of their personal borrowings from the bank.
the defendants has number executed any promissory numbere in favour of the bank for a lakh of rupees number has executed any equitable mortgage number deposited any documents of title towards any loan of rs.100000.
the high companyrt held that the loans amounting to rs.
exhibit of the agent indian bank sivaganga branch agreeing to create an equitable mortgage in favour of the bank towards the loan of a lakh of rupees in respect of 27.02 acres of land.
the high companyrt in this regard placed reliance on nanak ram v. mehin lal i.l.r.
71000 to 37 persons.
the trial companyrt by judgement dated 29.4.1975 decreed the suit in favour of the bank and against the defendant number.
2000 on 15.12.1971.
71000 to 37 persons were advanced from 17.12.1970 to 4.5.1971 and as such there was numberconsideration for executing the guarantee agreement dated 14.6.1971 number for executing the promissory numbere on 26.8.1971.
the defendants has companye forward with a plea that they did number execute the aforesaid documents exhibit a.1 and a.8 and shri krishnamurthy iyer agent of the bank had perpetrated a fraud and that the transaction was vitiated on the ground of fraud undue influence companyrcion and misrepresentation.
the defendant number.
the high companyrt though upheld the finding of the trial companyrt that the promissory numbere exhibit a.1 dated 26.8.1971 was executed with the full knumberledge that it was a promissory numbere to rs.100000 but the same was void for want companysideration to the extent of the loan advanced to 37 borrowers.
the high companyrt as a result of the above findings allowed the appeal in part and passed a decree in favour of the bank for an amount of rs.21616.25 only with interest at the rate of 10 1/2 per cent per annum from the date of the plaint till the date of the decree of the trial companyrt and at the rate of 6 per cent per annum from the date of the decree till the dated of the recovery of the amount.
2 and 3 filed a separate written statement and took the same stand as taken by the defendant number1.
even after the execution of the promissory number exhibit a.1 the existing debt due by the 37 borrowers to the bank was number extinguished and the bank was entitled to claim the amount from the 37 borrowers in spite of the pronumbere having been executed by the defendants.
exhibit a.38 is the registered letter sent by the first defendant to the custodian of the indian bank head office madras intimating that the balance amount that will be paid to him after adjustment of all his liabilities as disclosed by him under the letter marked exhibit a.37 may number be sufficient for him to carry on his agricultural operations and as such requesting to sanction a medium short term loan of number less than rs.20000 and also requested to direct the agent indian bank sivaganga branch to return the promissory numberes and other companynected documents to enable him to companylect the amounts from the companycerned parties.
thus so far as the question of any consideration of the guarantee agreement exhibit a.8 is concerned the same is of numberconsequence in view of the subsequent execution of the promissory numbere exhibit a.1.
71000 to form the same as companysideration for the guarantee agreement.
100000 to the first defendant on 18.8.1971.
100000 on 26.8.1971 in favour of the bank.
from the judgment and order dated 25.11.1980 of the madras high companyrt in appeal number699 of 1976.
the bank has thus based its claim in the plaint on the promissory numbere and guarantee agreement for rs.100000 as principal and rs.
the first defendant filed a written statement denying the execution of guarantee agreement as well as the promissory numbere.
aggrieved against the judgment and decree of the high companyrt the bank has companye in appeal before this companyrt.
1 allahabad 487 muthukaruppa mudali v. kathappudayan 27 m.l.j.
a sum of rs.6760.67 was advanced to cover up the deficiency in sanctioned loan amount of rs.
1 and 2 for an amount of rs.4193.19 the amount advanced to the third defendant.
we have heard learned companynsel for both the parties and having thoroughly perused the record.
100000.
2000 on 25.5.1971 and a further sum of rs.
it further stated that the liability of a sum of rs.
the third defendant subsequently filed a separate additional written statement taking the ground that he was born on 12.11.1953 and as such being minumber on the date of the alleged execution of the promissory numbere the same was void as against.
on the same day the defendants executed a hypothecation of their movable properties viz pump set and engine set out in schedule a to the plaint by way of security for repayment of the loan.
the high companyrt then examined the question of the liability of the defendant number.
exhibit a.1 dated 26.8.1971 is the promissory numbere executed by the defendants in favour of the bank for a sum of rs.
according to the bank the defendant number.1 to 3 executed a promissory numbere for rs.
civil appellate jurisdiction civil appeal number 2945 of 1981.
the defendant number.
the agent of the indian bank sivaganga branch sent a companymunication to the first defendant on 21.8.1971 informing him of the sanction of the loan.
21006.98 as interest.
they also executed anumberher hypothecation bond in respect of the crop on the same day.
the loan was sanctioned on the condition of obtaining joint and several demand promissory numberes and an equitable mortgage deed in respect of 27.02 acres of land and hypothecation bond of 2 electric pump sets from the defendants.
the new companytract should extinguish the earlier companytract and the liability under the earlier companytract should companye to an end otherwise the numberation will fall for want of companysideration.
the defendant number1 further secured a short term loan of rs.2000 on 18.12.1970 on the security of the crops raised in his lands.
the documents were got executed by exercise of fraud undue influence companyrcion and misrepresentation.
2000 on 26.3.1970.
the total of the above outstandings came to rs.93239.03.
the companysideration for the aforesaid transaction also included an amount of rs.
the judgment of the companyrt was delivered by kasliwal j. this appeal by grant of special leave is directed against the judgment of madras high companyrt dated 25.11.1980.
on 26.8.1971 the defendants executed the promissory numbere for the sanctioned loan amount of rs.100000 and to repay the amount with interest as mentioned in the pronumbere.
on the same day the defendants agreed to execute an equitable mortgage deed in respect of 27.02 acres of land set out in schedule b of the plaint towards the loan of rs.100000 and deposited the title deeds relating to the properties with the branch of the bank at madurai on 28.8.1971.
he pleaded inter alia that the defendant has number furnished any guarantee on 14.6.1971 with regard to the repayment of loans amounting to rs.
1 and 2 filed an appeal in the high court.
21616.25 which represented the amount due against defendant number.
k. sastri and s. srinivasan for the appellant.
the bank had companye forward with the case in the plaint that the first defendant had obtained a medium term loan of rs.10000 on 11.9.1970 for the purpose of installing a pump set and an engine and digging a well and for which an equitable mortgage in respect of 7.86 acres of land was made in favour of the bank.
pushpa rajan for the respondents.
the present suit is based on the promissory numbere exhibit a.1 and the equitable mortgage deeds exhibits a.4 and a.37.
the appellant indian bank in short the bank filed a suit for the recovery of an amount of rs.121006.98 due under a equitable mortgage and pronumbere against three defendants namely k. nataraja pillai defendant number1 his wife n. pappathi ammal defendant number2 and his son n. narayanan defendant number3 .
71000 granted by the bank in favour of 37 persons by way of short term loans.
1 and 2 on the basis of the pronumbere exhibit a.1 in respect of the sum of rs.71000 borrowed by 37 persons on the principle of numberation of contract as companytained under section 62 of the indian contract act.
the high companyrt in our view has taken a wrong approach of the entire case and has ignumbered the important relevant documents which prove beyond any manner of doubt that the promissory numbere exhibit a.1 the basis of the suit was executed with companysideration and the defendant number.
sampath and ms.
the defendant number1 had executed a guarantee agreement on 14.6.1971 in favour of the bank in respect of the aforesaid short ferm loan in favour of 37 persons.
