Tamilnadu Industrialinvestment v. M/S.P.K.N.Powerloom Factory
Case brief
What is this about?
The court determined liability under the State Financial Corporation Act 1951. Petitioner recovered loan of Rs 2.5 lakh with interest from respondents 1-3 holding liable for default in repayment. Petition dismissed against fourth respondent who was set apart.
What did the court decide?
Respondents 1 to 3 directed to pay Rs 37,20,763 with 17.50% interest and sale of property ordered; dismissed against fourth respondent.
What the court decided
O.P.NO.263 OF 2011
O.P.NO.263 OF 2011
N.SATHISH KUMAR, J.
This Original Petition has been filed under Section 31(a), 31(aa) and 32 of the State Financial Corporation's Act, 1951 with a prayer to determine the liability and direct the respondents 1 to 4 herein to pay jointly and severally a sum of Rs.37,20,763/- (Rupees Thirty Seven Lakhs Twenty Thousand Seven Hundred and Sixty Three Only) to the petitioner Corporation with interest at the rate of 17.50% per annum from the date of the petition till the date of realization in full and to order sale of “A” Schedule property towards realization of the above sum.
2.It is the case of the petitioner that the petitioner has sanctioned a Term Loan of Rs.2,50,000/- (Rupees Two Lakhs Fifty Thousand Only) to the first respondent on 14.09.1994 towards purchase and erection of machinery. As per the terms and conditions, the Term Loan is to be repaid in 20 quarterly instalments with interest @ 17.50 % per annum. The first respondent has hypothecated the machinery by the Deed of Hypothecation dated 14.03.1995 for a sum of Rs.2,50,000/-. Besides, the fourth respondent created equitable mortgage on the same day in “A” Schedule property for the
O.P.NO.263 OF 2011
loan amount and deposited all the title deeds with the petitioner Corporation.
Issues for consideration
2 issues framed by the court
Whether the petitioner is entitled to recover the loan amount with interest from the borrowers and guarantors.
Whether the prayer for sale of Schedule property should be granted against the fourth respondent.
Parties & counsel
- petitioner
State Financial Corporation
- respondent
First Respondent
- respondent
Second Respondent
- respondent
Third Respondent
- respondent
Fourth Respondent
Case details
As recorded by the court registry
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