Ultimately, a legal numberice came to be issued on 8th August, 1988 calling upon defendants to pay the entire loan with interest.
The loan was sanctioned vide letter dated 1st September, 1984.
Defendants also executed a Deed of Hypothecation whereby the assets of defendant No.6 Company stood mortgaged in favour of the appellant Corporation.
For the manufacture of gas cylinders, defendant No.6 approached appellant Corporation for loan of Rs.37.50 lakhs.
However, the full outstanding amount companyld number be recovered and, in the circumstances, for enforcement of surety, Misc.
Appellant exercised its power under Section 29 of the State Financial Corporations Act, 1951 for short 1951 Act .
Case No.109/1993 came to be filed in the companyrt of VI Additional City Civil Judge, Bangalore City.
The Suit was ultimately decreed in favour of the Corporation.
Consequently, the unit was sold for Rs.33 lakhs.
Appeal No.1441/2001 in the Karnataka High Court.
However, when it came to the question of repayment, defaults occurred.
Aggrieved by the said decision, the matter was carried in Appeal Misc.
Dispute companysequently resulted.
The loan amount was released.
Leave granted.
It was fully utilized by the borrowers.
