1 s-594-09-j IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUIT NO. 594 OF 2009. Central Bank on India, A Body Corporate Constituted under the provisions of Banking Companies (Acquisition & Transfer of Undertakings), having their Central Office at Chander Mukhi, Nariman Point, Mumbai-400 021 and having their one of the Branches at Jigna Apartment, Sion Trombay Road, Ashish Farm, Next to Sanjivani Society, Mankhurd, Mumbai-400 088. ..Plaintiffs. vs. 1. Satish Kumar Moolya, residing at RH-11, Plot No.175, Sector-16A, Phase III, Shraddha Co-op.Housing Society Limited, Nerul, Navi Mumbai-400 706. 2. Sadanand S. Shetty, residing at 102, Nishant Co-op. Housing Society Limited, Janakpuri Complex, Navghar, Vasai (E)-401 202. ..Defendants. .... Ms. Juhi Rizvi, i/b. O.A. Das, for Plaintiffs. None for Defendants. .... CORAM : S.J. KATHAWALLA, J. DATE : 1ST FEBRUARY 2011. ORAL JUDGMENT : The Plaintiffs are Central Bank of India, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970. Satish Kumar Moolya, Defendant No. 1, is the principal borrower of the term loan facility. Sadanand S. Shetty, Defendant No. 2, is the guarantor who has guaranteed the due repayment of the loan availed by the Defendant No. 1. The Plaintiffs are seeking an ex-parte decree against the Defendants for non payment of outstanding amount due with respect to a term loan facility granted by the Plaintiffs to the Defendants. By an order dated 2 s-594-09-j 6th January 2009, the Plaintiffs are granted leave under clause XII of the Letters Patent to file the present Suit before this Court. 2. The Plaintiffs have tendered affidavit of evidence of Rohidas Baburao Sonawane dated January 31, 2011, who is working as a Manager of the Plaintiffs’ Branch at Mankhurd Branch, Jigna Apartment, Sion Trombay Road, Ashish Farm, Next to Sanjivani Society, Mankhurd, Mumbai 400 088. The said evidence is taken on record and marked ‘X’ for identification. Power of Attorney dated April 29, 2004 issued by the Plaintiffs in favour of Rohidas Baburao Sonawane to file the affidavit of evidence is marked as Exhibit P-1. 3. The Plaintiffs have stated in the plaint as well as in the affidavit of evidence that:- (i) By an application dated February 6, 2003, Defendant No. 1 approached the Plaintiffs’ Mankhurd Branch for a loan of Rs.6,50,000 for the purpose of purchasing a residential premises being Row House No. 11, in the building known as Shraddha Co-operative Housing Society Limited situated at Plot No. 175, Sector No. 16, Nerul, admeasuring 400 sq. ft. (hereinafter referred to as the said Premises). The original loan application form dated February 6, 2003 is marked as Exhibit P-2. (ii) The Plaintiffs sanctioned to Defendant No. 1 the said loan of Rs. 6,50,000 on February 11, 2003 on execution of security documents and creating equitable mortgage of the said Premises in favour of the Plaintiffs. The sanction letter dated February 11, 2003 is marked as Exhibit P-3. (iii) The following documents were executed with respect to the said loan:- 3 s-594-09-j (a) Original Loan Agreement dated February 12, 2003 executed by Defendant No. 1 in favour of the Plaintiffs which is marked as Exhibit P-4. (b) Original letter dated February 11, 2003 from Shraddha Co-operative Housing Society Limited giving their no objection for mortgaging the said Premises to the Plaintiffs which is marked as Exhibit P-5. (c) Affidavit cum Indemnity dated February 12, 2003 executed by Defendant No. 1 in favour of the Plaintiffs which is marked as Exhibit P-6. (iv) Defendant No. 2 executed and delivered a Form of Guarantee for Advance and Credits Generally for Rs. 6,50,000 guaranteeing the repayment of outstanding dues of the Defendant No. 1 along with interest to the Plaintiffs. The Form of Guarantee for Advance and Credits Generally is marked as Exhibit P-7. (v) Defendant No. 1 deposited original title deeds in respect of the said Premises with an intention to create an equitable mortgage upon the said Premises which was recorded in Memorandum of Entry dated February 12, 2003. Original Deed of Assignment dated February 5, 2003 is marked as Exhibit P-8. Original Memorandum of Entry dated February 12, 2003 with visit slip dated February 12, 2003 and letter dated February 13, 2003 are marked as Exhibits P-9, P-10 and P-11 respectively. (vi) Defendant No. 1, by his letter dated March 28, 2008 admitted his liability and deposited a sum of Rs. 25,000 towards part payment of the said loan and promised to 4 s-594-09-j clear the outstanding amount before June 30, 2008. The Defendant No. 1’s letter dated March 28, 2008 is marked as Exhibit P-12. (vii) Since the Defendants failed and neglected to clear the outstanding dues, the Plaintiffs, through their advocate’s letter dated October 8, 2008 recorded the aforesaid facts and called upon the Defendants to pay to the Plaintiffs, jointly and severally, a sum of Rs. 6,09,050, being the balance due as on September 30, 2008 and further interest at 9.50% per annum from October 1, 2008 till payment and/or realisation within 7 days from receipt of notice. The advocate’s letter dated October 8, 2008 is marked as Exhibit P-13. (viii) In spite of the aforesaid notice, the Defendants failed and neglected to make any payment. The Plaintiffs state that the amount now payable is Rs. 5,64,467 being the balance outstanding under the housing loan account and a sum of Rs. 98,219 being the interest at 9.50% per annum with monthly rests from June 1, 2007 to January 5, 2009 totalling to Rs. 6,62,686 and further interest on Rs. 6,62,686 at 9.50% per annum with monthly rests from the date of filing of the suit till payment and/or realisation. The statement of accounts is marked as Exhibit P-14. 4. I have gone through the averments made in the plaint and also the contents of the affidavit of evidence along with the compilation of documents filed by the Plaintiffs. From Exhibits P-2 and P-3 it is established that the Defendants applied for a housing loan to the Plaintiffs and the same was sanctioned by the Plaintiffs for a sum of Rs. 5,50,000 on terms and conditions mentioned in Exhibit P-3. From Exhibits P-4 to P-6 it is established that the Defendant No. 1 5 s-594-09-j entered into a term loan agreement with the Plaintiffs and agreed to mortgage the said Premises in favour of the Plaintiffs. From Exhibit P-7 it is established that the Defendant No. 2 stood as the guarantor for the loan taken by Defendant No. 1. From Exhibits P-8 to P-11 it is established that the Defendant No. 1 deposited the title deeds of the said Premises with the Plaintiffs in order to create an equitable mortgage in favour of the Plaintiffs. From Exhibit P-12 it is established that the Defendant No. 1 admitted his liability under the said loan and promised to pay the same before June 30, 2008 after depositing Rs. 25,000 as part payment. From Exhibit P-13 it is established that the Defendant No. 1 was called upon to repay the outstanding amount under the said loan but failed and neglected to do so. From Exhibit P-14 it is established that the balance outstanding payable by the Defendants to the Plaintiffs is Rs. 6,62,686. 5. The Plaintiffs attempted to serve the writ of summons on the Defendants. As stated in the affidavit dated June 19, 2009, the packet containing the writ of summons transmitted to Defendant No. 1 was returned with the remark “Not Known” and the packet sent to the Defendant No. 2 was returned with the remark “Unclaimed”. The writ of summons was therefore served by substituted service by publishing the same in the Free Press Journal in English Language and in Navasakhti in Marathi Language dated December 24, 2009. The Defendants have not come forward to defend the suit and have not filed their written statement. In view thereof, what is stated by the Plaintiff has gone unchallenged. There is no reason why what the Plaintiffs have stated in the plaint as well as in the affidavit of claim should not be accepted. 6. In my view, the relief sought by the Plaintiffs is required to be granted. In view thereof, I pass the following order:- 6 s-594-09-j (i) The Defendants are jointly and severally ordered and decreed to pay to the Plaintiffs a total sum of Rs. 6,62,686 at 9.50% per annum from the date of filing of the suit till the payment and / or realisation. (ii) It is declared that the said Premises, more particularly described in Exhibit P-8 is validly mortgaged in favour of the Plaintiffs as security for due repayment of the amount payable by the Defendants to the Plaintiffs under the term loan facility as set out in clause (i) above. (iii) The Court Receiver, High Court, Bombay is appointed as Receiver of the said Premises being Row House No. 11, in the building known as Shraddha Co-operative Housing Society Limited situated at Plot No. 175, Sector No. 16, Nerul, admeasuring 400 sq. ft. The Receiver, after obtaining valuation of the said Premises, is directed to sell the same by public auction and after deducting his costs, charges and expenses hand over the net sale proceeds to the Plaintiffs for appropriating the same towards the amount for which the order and decree is passed in clause (i). (iv) Defendants to pay costs to the Plaintiffs for this suit. (v) The suit is accordingly disposed of in favour of the Plaintiffs and against the Defendants. [S.J. KATHAWALLA, J.]