SAT PAL ( 1 ) THIS is a suit for recovery of a sum of Rs. 3,72,297. 15 together with pendente lite and future interest @ 16% p. a. with quarterly rest and inclusive of 2% of penal interest from the date of suit till realisation of the amount ( 2 ) THE facts of the case briefly stated are that the plaintiff is a Banking Company constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its branches spread all over India. Shri B. K. Shekar Shetty is one of the principal officers of the plaintiff bank and Senior Manager of a Branch of the Bank situated at F-19, Connaught Circus, New Delhi. He is duly authorised to sign and verify the plaint and to institute the present suit and in this regard he holds a power of attorney from the plaintiff Bank. ( 3 ) AS per averments made in the plaint, defendant No. 2 representing himself as Sole Proprietor of defendant No. l approached the plaintiff Bank for grant of open Cash Credit limit to meet its working capital requirements. Defendant No. 3 who is the father of the defendant No. 2 offered to and stood personal guarantee for the repayment of the entire loan amount advanced or to be advanced to the defendants 1 and 2 besides interest and other charges. ( 4 ) IT is further stated in the plaint that pursuant to the request of the defendants, the plaintiff Bank sanctioned to the defendants 1 and 2 the open cash credit limit of Rs. 1. 00 lac and the said limit was secured by hypothecation of the machineries described in schedule a of the hypothecation deed dated 10. 7. 84 and erected, installed or stored at A-32, Street 4, New Rohtak Road, New Delhi. The defendant No. 2 further assigned two Life Insurance Policies in his name bearing No. 74725224 and 74725225 each for Rs. 25,000. 00, as a collateral security. for the said credit limit. It is further alleged in the plaint that the defendants executed and delivered to the plaintiff Bank various documents including request letter for overdraft facilities dated 10. 7. 84, agreement for the grant of open cash credit limit of Rs. 1. 00 lac dated 10. 7. 84, deed of hypothecation dated 10. 7. for the said credit limit. It is further alleged in the plaint that the defendants executed and delivered to the plaintiff Bank various documents including request letter for overdraft facilities dated 10. 7. 84, agreement for the grant of open cash credit limit of Rs. 1. 00 lac dated 10. 7. 84, deed of hypothecation dated 10. 7. 84, letter of undertaking not to avail open cash credit facility somewhere else dated 10. 7. 84, Pronote dated 10. 7. 89 for Rs. 1. 00 lac and carrying interest @ 4% p. a. above the Reserve Bank of India rate with a minimum of 14% per annum compounded quarterly and guarantee covering letter dated 10. 7. 84 enclosing agreement of guarantee dated 10. 7. 84 duly executed by defendant No. 3. ( 5 ) IT is further alleged in the plaint that in or about January, 1985 defendants approached the plaintiff Bank and requested for continuation of the above mentioned limit of Rs. 1. 00 lac and further requested for grant/sanction of Rs. 60,000. 00 limit in addition to the then existing limit of Rs. 1. 00 lac. The plaintiff Bank agreed to this request and granted the additional/enhanced limit of Rs. 60,000. 00 in addition to the already existing limit of Rs. 1. 00 lacs. In consideration of the enhanced limit, the defendants executed and delivered various documents including the letter of renewal dated 10. 1. 85, letter dated 10. 1. 85 enclosing demand promissory note, Pronote dated 10. 1. 85 for Rs. 60,000. 00- carrying interest @ 4% p. a. above the Reserve Bank of India rate with a minimum of 14% p. a. compounded quarterly and request letter for over draft facilities dated 10. 1. 85. ( 6 ) IT is further alleged in the plaint that defendants failed to clear the outstanding dues on account of all the credit facilities mentioned hereinabove and consequently their said A/c. showed a sum of Rs. 2,67,458. 65 which included the amount of interest Upto 31. 12. 86 as due and payable by them and this liability was duly acknowledged and confirmed by the defendants vide acknowledgement of debt and security dated 17. 1. 87. The liability for a sum of Rs. 2,79,876. 65 including the amount of interest Upto 31. 3. 87 was acknowledged and confirmed by the defendants vide acknowledgement of debt and security dated 8. 4. 87. 1. 87. The liability for a sum of Rs. 2,79,876. 65 including the amount of interest Upto 31. 3. 87 was acknowledged and confirmed by the defendants vide acknowledgement of debt and security dated 8. 4. 87. It is further alleged that the defendants failed to keep up their commitments to liquidate the outstanding dues and their admitted liability despite repeated request and demands from the plaintiff Bank including notices dated 31. 8. 87 and 7. 12. 88 issued by the counsel of the plaintiff. It has been alleged that as on 20. 12. 88 a sum of Rs. 3,72,297. 15p is due and payable by the defendants to the plaintiff Bank. Hence the present suit has been filed for recovery of the aforesaid amount with pendente life and future interest as stated hereinabove. ( 7 ) SINCE the defendants did not appear despite service, they were proceeded against ex-parte vide order dated 29th November, 1991. On the same date the plaintiff was directed to file ex-parte evidence by way of affidavit. Accordingly, the plaintiff Bank has filed evidence by way of affidavits duly signed and sworn by Shri Y. P. Shenoy, Senior Manager of the Branch of the Plaintiff Bank situated at Wazirpur, New Delhi who was the Branch Manger of the Plaintiff Bank situated at F-19, Connaught Circus, New Delhi during the period from 13. 5. 82 to 12. 7. 87, and by Shri B. K. S. Shetty, Senior Manger, attorney holder and principal officer of the plaintiff Bank posted at the branch of the Bank situated at F-19, Connaught Circus, New Delhi. All the averments and allegations made in the plaint have been proved through aforesaid two witnesses. ( 8 ) EX. PUBLIC Witness 1/1 is the request letter dated 10. 7. 84 for over draft facilities duly signed and executed by defendant No. 2 on behalf of himself as well as defendant No. 1. Similarly, EXS. Public Witness 1/2, Public Witness. 1/3, Public Witness. 1/4 and Public Witness. 1/5 are the agreement for grant of open cash credit of Rs. 1. 00 lac dated 10. 7. 84, deed of hypothecation dated 10. 7. 84 alongwith Schedule A and B, letter of Undertaking not to avail open cash credit facility somewhere else dated 10. 7. 84 and demand promissory note dated 10. 7. 84 respectively. 1/4 and Public Witness. 1/5 are the agreement for grant of open cash credit of Rs. 1. 00 lac dated 10. 7. 84, deed of hypothecation dated 10. 7. 84 alongwith Schedule A and B, letter of Undertaking not to avail open cash credit facility somewhere else dated 10. 7. 84 and demand promissory note dated 10. 7. 84 respectively. All these documents are duly signed and executed by the defendant No. 2 on his own behalf and on behalf of defendant No. 1. Ex. P. 1/6 is the guarantee covering letter dated" 10. 7. 84 from defendant No. 3 to the plaintiff bank aloagwith guarantee agreement/letter dated 10. 7. 84 duly signed and executed by defendant No. 3. In consideration of the credit facility having been enhanced by the plaintiff Bank from Rs. 1. 00 lac to Rs. 1. 60 lac, the defendant No. 2 on his own behalf and on behalf of defendant No. 1 executed letter of renewal dated 10. 1. 85, letter dated 10. 1. 85 enclosing demand promissory Note, request letter for overdraft facility dated 10. 1. 85 and demand promissory note dated 10. 1. 85 for Rs. 60,000. 00 and these documents are Exhs. Public Witness 1/7, Public Witness. 1/8, Public Witness. 1/9 and Public Witness 1/10 respectively. Public Witness 1/11 is the acknowledgement of debt and security dated 17. 1. 87duly signed and executed by defendant No. 2 for self and on behalf of defendant No. 1 acknowledging a sum of Rs. 2,67,458. 65 inclusive of interest upto 31. 12. 86 payableby the defendants to the plaintiff Bank. Ex. Public Witness 1/12 is the acknowledgement of debt and security duly signed and executed by defendant No. 2 for self and on behalf of defendant No. 1 for an amount of Rs. 2,79,876. 65p inclusive of interest upto 31. 3. 87. All these exhibits mentioned in this paragraph have been proved by Shri Y. V. Shenoy, Public Witness-1. ( 9 ) EXS. PUBLIC Witness. 2/1 and Public Witness. 2/2 are the photo copies of the power of attorney and supplemental power of attorney issued by the plaintiff Bank in favour of Shri B. K. S. Shetty, authorising him to institute the suit and to sign and verify the pleadings on behalf of the plaintiff Bank. Ex. Public Witness2/3 is the copy of the notice of demand dated 31. 8. Ex. Public Witness2/3 is the copy of the notice of demand dated 31. 8. 87 sent by the counsel for the plaintiff to the defendants and Ex. Public Witness2/4 is the notice of demand dated 7. 12. 88 issued by the counsel for the plaintiff to the defendants. Ex. Public Witness2/5 arc the original postal receipts of having sent the notice Ex. Public Witness 2/4. Ex. Public Witness2/6 is the duly authenticated copy under the Bankers Books Evidence Act of the Statement of A/c of the defendant No. 1 with the plaintiff bank. All the exhibits mentioned in this paragraph have been proved by Shri B. K. S. Shetty, Public Witness-2. This witness has also proved that the interest claimed by the plaintiff Bank is in terms of the agreement between the parties as well as the directives of the Reserve Bank of India issued from time to time in this respect ( 10 ) AS stated hereinabove the defendants were proceeded against ex-parte. They have neither filed any written statement controverting the averments and allegations made in (he plaint nor they have examined any witness to rebut the averments made in the plaint Hence the plaintiff Bank is entitled to succeed in this suit. Accordingly, the suit for recovery of a sum of Rs. 3,72,297. 15 is hereby decreed with costs in favour of the plaintiff and against the defendants. The plaintiff shall be entitled to pendente lite and future interest @ 16% p. a. with quarterly rests. Decree may be drawn accordingly.