INDIAN BANK vs M/s. MURUGANATHAN MILLS LTD on 28 February 2024

O R D E R

1. This Original Application is filed by the Applicant Bank, under Section 19 of the RDDB & FI Act, 1993,

a. to pass a Final Decree against the Defendants 1 & 2 for a sum of Rs.2,77,20,541/- with future contractual rate of interest at 19.89% per annum with quarterly rests from the date of application, till the date of realization, 3 TA No.334/2002

b. to pass a Final Decree against the 3rd Defendant for a sum of Rs.1,37,41,513/- [being the total amount standing in respect of Open Cash Credit and Packing Credit Facility for which he has stood as a guarantor] with future contractual rate of interest at 19.89% per annum with quarterly rests from the date of application, till the date of realization,

c. to pass a Final Decree against the 2 to 10 Defendants for a sum of Rs.1,66,72,282/- [being the total amount standing in respect of Open Cash Credit and Packing Credit Facility ad Deferred Payment Guarantee Facility for which he has stood as a guarantor] with future contractual rate of interest at 19.89% per annum with quarterly rests from the date of application, till the date of realization, and direct them to pay the above said amount from out of the estate left behind by the deceased guarantor Govindasamy Chettiar, who stood as Guarantor for the above loan facilities,

d. to pass an Order for sale of the hypothecated assets and mortgaged properties more fully described in the Schedules “A” to “E” hereunder for a sum of Rs.2,77,20,541/- with future contractual interest at the rate of 19.89% per annum with quarterly rests till the date of realization,

e. to issue a Recovery Certificate for a sum of Rs.2,77,20,541/- with future contractual interest at the rate of 19.89% per annum with quarterly rests till the date of realization, and with costs of this OA.

BRIEF FACTS

2. The Averments made by the Applicant Bank in the Amended Application are stated as follows:

2.1. The 1st Defendant Company is Limited Company incorporated under the Provisions of the Indian Companies Act, 1956, engaged in 4 TA No.334/2002 the manufacture of Yarn, Staple Fiber Yarn, Cotton Yarn etc., The Defendants 2, 3 & 4 along with the Father of Govindasamy were Directors of the 1st Defendant Company. The 1st Defendant Company availed various credit facilities from the Applicant Bank.

2.2. On 06.06.1980, the Applicant Bank sanctioned Open Cash Credit Limit of Rs.2,00,000/- to the 1st Defendant Company for the purpose of working capital requirements of their business. On 12.06.1980, the 1st Defendant Company availed the above said facility of Rs.2,00,000/- promising to pay the loan amount with interest at 9% per annum over the Official Rate of the Reserve Bank of India with a minimum of 18% per annum with quarterly rests. On 12.06.1980, the 1st Defendant executed a Letter of Continuity in favour of the Applicant Bank, and as security for due repayment of the loan availed, the 1st Defendant and its Directors executed an Agreement for Demand Cash Credit and hypothecated the stocks which are kept in Schedule – A Property.

2.3. Thereafter, on 16.08.1980 at the request of the Defendants, the Limit was enhanced to Rs.4,00,000/- from Rs.2,00,000/-. On 25.08.1980, the 1st Defendant Company and its Directors executed a Demand Promissory Note for Rs.4,00,000/- together with interest at 9% p.a. over the Official Rate of the Reserve Bank of India with a minimum at 18% per annum with quarterly rests, the 1st Defendant Company & its Directors also executed a Covering Letter for Renewal of the debt, a Letter of Continuity and an Agreement for Demand Cash Credit in favour of the Applicant Bank and hypothecated the stocks kept in Schedule – A Property in favour of the Applicant Bank.

2.4. Thereafter, on 13.01.1981 at the request of the Defendants, the Limit was enhanced to Rs.5,00,000/- from Rs.4,00,000/-. On 22.01.1981, the 1st Defendant Company and its Directors executed a 5 TA No.334/2002 Demand Promissory Note for Rs.5,00,000/- together with interest at 9.35% p.a. over the Official Rate of the Reserve Bank of India with a minimum at 18.35% per annum with quarterly rests, the 1st Defendant Company & its Directors also executed a Covering Letter for Renewal of the debt, a Letter of Continuity and an Agreement for Demand Cash Credit in favour of the Applicant Bank and hypothecated the stocks kept in Schedule – A Property in favour of the Applicant Bank.

2.5. Subsequently, on 26.11.1982, the 1st Defendant renewed the debt and executed a Demand Promissory Note for Rs.5,00,000/- together with interest at 9.5% p.a. over the Official Rate of the Reserve Bank of India with a minimum at 19.5% per annum with quarterly rests, the 1st Defendant Company & its Directors also executed a Covering Letter for Renewal of the Debt, a Letter of Continuity and an Agreement for Demand Cash Credit in favour of the Applicant Bank and hypothecated the stocks kept in Schedule – A Prop`erty in favour of the Applicant Bank. Thereafter, on 06.05.2018, and the1st Defendant and its Directors executed a Letter of Acknowledgement of Debt in favour of the Applicant where under acknowledge their liability in writing to repay the debt and also confirmed the balance due in writing.

2.6. Thereafter, on 09.12.1985, at the request of the Defendants, the limit was further enhanced to Rs.6,00,000/- from Rs.5,00,000/- and in evidence thereof and for due and proper consideration received, the 1st Defendant Company and its Directors executed a Demand Promissory Note in favour of Applicant on 09.12.1985 for Rs.6,00,000/- promising to apply Applicant or their Order, the said sum together with interest at 7.5% per annum over Official Rate of Reserve Bank of India with a minimum of 17.5% per annum with 6 TA No.334/2002 quarterly rests. The 1st Defendant Company and it Directors also executed an Agreement for increase of Cash Credit Facility and a Covering Letter for renewal of the debt and also a Letter of Continuity and also an Agreement for Demand Cash Credit in favour of the Bank on 09.12.1985. where under the hypothecated and hypothecated the stocks of cotton, sampled fiber, staple fiber, yarn, cotton yarn and other stock in progress more fully described in the Schedule – A mentioned hereunder in favour of the Applicant.

2.7. Further, on 28.10.1988 at the request of the Defendants, the Limit was enhanced to Rs.10,00,000/- from Rs.6,00,000/-. On 28.10.1988, the 1st Defendant Company and its Directors executed a Demand Promissory Note for Rs.10,00,000/- together with interest at 6.5% p.a. over the Official Rate of the Reserve Bank of India with a minimum at 16.5% per annum with quarterly rests, the 1st Defendant Company & its Directors also executed an Agreement for Demand Cash Credit in favour of the Applicant Bank on 28.10.1998 and hypothecated the stocks of cotton, sampled fiber, staple fiber, yarn, cotton yarn and other stock in progress more fully described in the Schedule – A mentioned hereunder in favour of the Applicant.

2.8. Further, on 01.02.1989 at the request of the 1st Defendant renewed the Debt and executed a Demand Promissory Note in favour Applicant on 01.12.1989 Rs.10,00,000/- promising to pay to the Applicant on their Order, the said sum together with interest at 6.5% per annum over Official Rate of Reserve Bank of India with a minimum of 16.5% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a Covering Letter for renewal of the debt and also a letter of continuity and also an agreement for Demand Cash Credit in favour of the Bank on 01.02.1989, and hypothecated and stocked of cotton, sampled fiber, staple fiber, yarn, cotton yarn and

7 TA No.334/2002 other stock in progress more fully described in the Schedule – A mentioned hereunder in favour of the Applicant.

2.9. On 09.01.1992 and 07.01.1995, the 1st Defendant and its Directors executed a Letter of Acknowledgement of Debt in favour of the Applicant where under they acknowledge their liability in writing to repay the debt and also confirmed the balance due in writing.

2.10. Further, on 19.04.1996 the 1st Defendant renewed the Debt and executed a Demand Promissory Note in favour Applicant on 01.12.1989 Rs.25,65,000/- promising to pay to the Applicant on their Order, the said sum together with interest at 9.75% per annum over Official Rate of Reserve Bank of India with a minimum of 21.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a Covering Letter for renewal of the debt and also a letter of continuity and also an agreement for Demand Cash Credit in favour of the Bank on 19.04.1996, where under the hypothecated and stocked of cotton, sampled fiber, staple fiber, yarn, cotton yarn and other stock in progress more fully described in the Schedule – A mentioned hereunder in favour of the Applicant.

2.11. On 25.07.1996, finally the 1st Defendant renewed the debt and executed Demand Promissory Note in favour of the Applicant on 25.07.1996 for the amount outstanding viz., Rs.18.52,827/- promising to pay the Applicant or their Order, the said sum together with interest at 5.25% p.a. over the Bank’s prime lending Rate with minimum of 21.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a Covering Letter for renewal of the debt and also an agreement for Hypothecation of movables in favour of the Applicant Bank 25.07.1996, where under the Hypothecation of stocks of cotton, sampled fiber, staple fiber, yarn, 8 TA No.334/2002 cotton yarn and other stock in progress more fully described in the Schedule – A mentioned hereunder in favour of the Applicant.

2.12. On 03.03.1984, the Applicant Bank sanctioned Packing Credit Limit of Rs.10,00,000/- to the 1st Defendant Company. Accordingly, on 07.03.1984, the 1st Defendant Company availed Packing Credit Facility of Rs.10,00,000/- and the 1st Defendant Company and its Directors executed a Demand Promissory Note in favour of the Applicant Bank on 07.03.1984 for Rs.10,00,000/- together with interest at 2% per annum Official Rate of the Reserve Bank of India with a minimum at 12% per annum with quarterly rests, and the 1st Defendant Company & its Directors also executed an Agreement for Demand Cash Credit in favour of the Applicant on 07.03.1984 and hypothecated the stocks of cotton, sampled fiber, staple fiber, yarn, cotton yarn and other stock in progress more fully described in the Schedule – B mentioned hereunder in favour of the Applicant.

2.13. On 06.05.1985, the 1st Defendant and its Directors executed a Letter of Acknowledgement of Debt in favour of the Applicant Bank and acknowledgement their liability in writing to repay the debt and also confirmed the balance due in writing. Subsequently, on 09.12.1985, the 1st Defendant renewed the Debt and the 1st Defendant Company and its Directors executed a Demand Promissory Note in favour of the Applicant Bank. The 1st Defendant Company and its Directors also executed Agreement for Packing Credit and an Agreement for Demand Cash Credit in favour of the Applicant Bank on 01.01.1987 and hypothecated the Stocks of Cotton, Stock in process in the Schedule – B hereunder in favour of Applicant Bank.

2.14. Further, on 01.02.1989, the 1st Defendant renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on 9 TA No.334/2002 01.02.1989 for Rs.20,00,000/- together with interest at 9.5% per annum over Official Rates and the 1st Defendant Company and its Directors also executed two Agreement for Packing Company Credit for Rs.5,00,000/- and Rs.15,00,000/- and also an agreement for Demand Cash Credit for Rs.5,00,000/- and Rs.15,00,000/- and an Agreement for demand cash credit in favour of the Bank on the same dare and hypothecated the Stocks of Cotton, Stock in process in the Schedule – B hereunder in favour of Applicant Bank.

2.15. On 09.01.1992 and 07.01.1995, the 1st Defendant and its Directors executed a Letter of Acknowledgement of Debt in favour of the Applicant where under they acknowledge their liability in writing to repay the debt and also confirmed the balance due in writing.

2.16. On 19.04.1996, the 1st Defendant renewed the Debt and executed a Demand Promissory Note in favour of the Applicant for Rs.33,17,000/- promising to pay to the Applicant on their Order, with interest at 9.75% p.a. Over Official Rates of the Reserve Bank of India with a minimum of 21.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed two Agreements for packing company credit in favour of the Applicant Bank on 19.04.1996 and hypothecated the Stocks of Cotton, Stock in process in the Schedule – B hereunder in favour of Applicant Bank.

2.17. On 25.07.1996, the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on for Rs.39,37,927/- together with interest at 5.25% per annum over the Bank’s prime lending Rate with a minimum of 21.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a covering letter for renewal of the Debt and also an Agreement for Hypothecation of movables in favour of the Applicant Bank on 25.07.1996 and Hypothecation of the Stocks of Cotton, Yarn 10 TA No.334/2002 and other stock – in – progress more fully described in the Schedule – B hereunder in favour of Applicant Bank.

2.18. During August 1991, the 1st Defendant Company represented to the Applicant Bank that they were purchasing Cotton from M/s. The Maharashtra State Co-Operative Cotton grower marketing Federation Ltd,. The Applicant considered the request of the 1st Defendant and accordingly issued a Bank Guarantee for Rs. 6,00,000/- in favour of M/s. The Maharashtra State Co-Operative Cotton grower marketing Federation Ltd., on 07.08.1991. The 1st Defendant in turn executed Counter Guarantee in favour of all the sums of money that may be paid by the Applicant Bank in respect of Guarantee issued in favour of The Maharashtra State Co-Operative Cotton grower marketing Federation Ltd., The 1st Defendant Company defaulted to pay the value of the Cotton purchased to The Maharashtra State Co-Operative Cotton grower marketing Federation Ltd., who in turn invoked the Bank Guarantee issue by the Applicant. The Maharashtra State Co-Operative Cotton grower marketing Federation Ltd,. accordingly debited the amount to paid to the account of the 1st Defendant under defaulted Guarantee Account.

2.19. On 09.01.1992 and 07.01.1995, the 1st Defendant and its Directors executed a Letter of Acknowledgement of Debt in favour of the Applicant where under they acknowledge their liability in writing to repay the debt and also confirmed the balance due in writing.

2.20. Thereafter, on 19.04.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on for Rs.11,52,000/- together with interest at 11.75% per annum over the Bank’s prime lending Rate with a minimum of 23.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a covering letter for renewal of the Debt, a covering letter 11 TA No.334/2002 for advance and there is no special agreement along with an Agreement for Hypothecation of movables in favour of the Applicant Bank on 19.04.1996 and they hypothecated all the movable Plant and Machinery in their business, more fully described Schedule – C hereunder in favour of Applicant Bank.

2.21. Finally, on 25.07.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on 25.07.1996 for Rs.13,68,727/- together with interest at 7.25% per annum over the Bank’s prime lending Rate with a minimum of 23.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a covering letter for renewal of the Debt, a covering letter for advance and there is no special agreement along with an Agreement for Hypothecation of movables in favour of the Applicant Bank on 25.07.1996.

2.22. On 07.11.1990, the 1st Defendant Company availed Short Term Loan I of Rs.2,22,000/- from the Applicant Bank and for due and proper consideration received, the 1st Defendant Company and its Directors executed a Demand Promissory Note in favour of the Applicant Bank on 07.11.1990 for Rs.2,22,000/- together with interest at 12.75% per annum over the Official Rate of Reserve Bank of India with a minimum of 23.75% per annum with quarterly rests. The 1st Defendant Company and its Directors also executed an Agreement of Extension of Hypothecation of Movable in favour of the Applicant on 07.11.1990 and they extended the Hypothecation of the stocks of cotton, cotton yarn, staple fibre, staple fibre yarn and stock in process more fully described in the Schedule – A, hereunder, to cover this facility also.

2.23. On 09.01.1992 and 07.01.1995, the 1st Defendant and its Directors executed a Letter of Acknowledgement of Debt in favour of

12 TA No.334/2002 the Applicant where under they acknowledge their liability in writing to repay the debt and also confirmed the balance due in writing.

2.24. Thereafter, on 19.04.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on for Rs.3,82,000/- together with interest at 11.75% per annum over the Bank’s prime lending Rate with a minimum of 23.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a covering letter for renewal of the Debt along with an agreement of extension of letter for Hypothecation of Movable and extended the Hypothecation of the Movables more fully described in the Schedule – A hereunder in favour of Applicant Bank.

2.25. Finally, on 25.07.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on 25.07.1996 for Rs.4,49,280/- together with interest at 7.25% per annum over the Bank’s prime lending Rate with a minimum of 23.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a letter for renewal of the Debt, and an Agreement for Hypothecation of movables in favour of the Applicant Bank on 25.07.1996.

2.26. The 1st Defendant Company also availed Financial Assistance from M/s. SIPCOT Ltd., for the purpose of their business. The 1st Defendant Company and its Directors resolved to avail a Short Term Loan – II of Rs.15,00,000/- from the Applicant Bank to repay the dues to M/s. SIPCOT Ltd., and accordingly requested the Applicant Bank to sanction of Rs.15,00,000/-. On 30.11.1991, the 1st Defendant Company availed a Short Term Loan – II of Rs.15,00,000/- from the Applicant and the 1st Defendant Company and its Directors executed a Demand Promissory Note in favour of the Applicant on 30.11.1991 together with interest at 12.75% per annum over the Official Rate of 13 TA No.334/2002 Reserve Bank of India with a minimum of 24.75% per annum with quarterly rests. The 1st Defendant Company also executed a Consent Letter in favour of the Applicant Bank.

2.27. On 09.01.1992, the 1st Defendant and its Director executed Letters of Acknowledgement of Debt in favour of the Applicant Bank, they acknowledged their liability in writing to repay the debt and also confirmed the balance due in writing. The 1st Defendant also executed an Agreement for extension of Hypothecation of Movables on the same day and they extended the earlier hypothecation of the Stocks and Movables, more fully described in Schedule – A hereunder to cover this facility also. On 07.01.1995, the 1st Defendant and its Directors executed a Letter of Acknowledgement their liability in writing and have also confirmed the balance due in writing.

2.28. Thereafter, on 19.04.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on for Rs.35,77,000/- together with interest at11.75% per annum over the Bank’s prime lending Rate with a minimum of 23.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a covering letter for renewal of the Debt, a covering letter for advance and there is no special agreement along with an Agreement for Hypothecation of movables and they extended the hypothecation of the movables, more fully described in the Schedule – A hereunder in favour of Applicant Bank.

2.29. Finally, on 25.07.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on 25.07.1996 for Rs.42,03,857/- together with interest at 7.25% per annum over the Bank’s prime lending Rate with a minimum of 23.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed a covering letter for renewal of the Debt and 14 TA No.334/2002 an Agreement for Hypothecation of movables in favour of the Applicant Bank on 25.07.1996.

2.30. On 07.03.1992, the 1st Defendant availed Trust Receipt Facility to the tune of Rs.3,15,000/- from the Applicant Bank for the purpose of purchasing received, the 1st Defendant executed an Inland Trust Receipt in favour of the Applicant Bank on 07.03.1992 and also agreeing to pay the sale proceeds of the said stocked to the Applicant soon as they were sold. On 07.01.1995, the 1st Defendant Company and its Directors executed letters of Acknowledgement of Debt in favour of the Applicant Bank and they acknowledged their liability in writing to repay the debt and also confirmed the balance due in writing.

2.31. Finally, on 25.07.1996 the 1st Defendant Company renewed the Debt and executed a Demand Promissory Note in favour of the Applicant on 25.07.1996 for Rs.6,52,524/- together with interest at 5.25% per annum over the Bank’s prime lending Rate with a minimum of 21.75% p.a. with quarterly rests. The 1st Defendant Company and its Directors also executed an Instrument or pledge in favour of the Applicant Bank on 25.07.1996 and hypothecated the Fibre Yarn more fully described in the Schedule – D hereunder in favour of the Applicant Bank.

2.32. 2nd & 3rd Defendants along with their Father R. Govindasamy Chettiar, apart from being Directors of the 1st Defendant Company, are the Guarantors for the above loan facilities availed by the 1st Defendant Company. 2nd & 3rd Defendants and Govindasamy Chettiar executed Agreement of Guarantee in favour of the Applicant on 26.11.1982, 07.031984, 09.12.1985 & 02.01.1987 guaranteeing due repayment of Open Cash Credit and Packing Credit Facilities availed by the 1st Defendant Company. Thereafter, on 11.05.1990, the 15 TA No.334/2002 2nd Defendant along with R. Govindasamy Chettiar executed an Agreement of the open Cash Credit, Packing Credit and Deferred Payment Guarantee Facilities. Subsequently, on 09.01.1992 on 19.04.1996, the 2nd Defendant executed Agreements of Guarantee in favour of the Applicant Bank personally guaranteeing due repayment of all the loan facilities availed by the 1st Defendant Company. The Guarantees executed by the Defendants 2, 3 and Govindasamy Chettiar are continuing guarantees and the liability of 2nd & 3rd Defendant & Govindasamy Chettiar as Guarantors are co-extensive with that of the 1st Defendant.

2.33. One of the Guarantors viz., R. Govindasamy Chettiar, who was also a Director in the 1st Defendant Company, died leaving behind 2 to 10th Defendants are his Class - I legal heirs. Defendants 2 to 10 have succeeded to the estate behind by Late Govindasamy Chettiar and they are also liable to discharge the 1st Defendant Company, which were guaranteed by Late. Govindasamy Chettiar from out of the estate left behind by the deceased Guarantor R. Govindasamy Chettiar.

2.34. During the pendency of the Original Application, the BIFR rendered an opinion for winding up of the 1st Defendant Company by Order dated 06.03.2000. The Order of BIFR was subsequently confirmed by AAIFR by

Order

dated 13.07.2000 in Appeal No.141/2000. Thereafter, the 1st Defendant Company was ordered to be Wound Up by the Hon’ble High Court of Judicature Madras by Order dated 29.09.2000 in CP No.483/2000 and consequently, the entire assets of the 1st Defendant Company including the mortgaged and hypothecated assets have been taken Charge by Official Liquidator. As such, the Proceedings before BIFR & AAIFR have terminated. The Applicant is entitled for claiming the outstanding from 16 TA No.334/2002 1st Defendant Company also for sale of mortgaged properties & hypothecated assets more fully described in Schedule hereunder. The OA is amended as per Order in IA No.1137/2007 dated 07.11.2007.

2.35. The Defendants failed and neglected to settle the Account despite repeated demands made by the Applicant Bank. The Applicant Bank sent many letters demanding settlement of account. In view of the recalcitrant attitude of the Defendants, the Applicant Bank is left with no other alternative, the Applicant Bank filed this OA for recovery of dues with interest and with costs of this OA.

3. The Averments made by the 1st Defendant in the Reply Statement are stated as follows:

3.1. The 1st Defendant does not admit that a sum of Rs.2,77,20,541/- is due from the 1st Defendant. The Statement of Accounts does not reflect the correct amounts paid by the 1st Defendant from time to time. The rate of interest compounded quarterly rests is not accepted by the 1st Defendant. The 1st Defendant is not liable to pay the interest as claimed in the OA. The Directors of the Company have not given any Personal Guarantee along with Deposit of Original Title Deeds as Collateral Security.

3.2. At the instance of the Indian Bank, the 1st Defendant Mill has been declared as sick unit and order was issued by BIFR on 14.03.2000 under Reference Case No.20/96 BIFR, New Delhi for winding up u/s.441 of the Companies Act 1956 and directing for winding up with High Court, Chennai under Provisions of Section 22 of the Sick Industries (Special Provisions) Act and also under the Provisions of Section 442 of the Companies Act. The Suit is not maintainable and the whole proceedings will have to be suspended awaiting the outcome of the liquidation proceedings. Therefore, the Suit which will have to be dismissed and to be stayed statutorily 17 TA No.334/2002 awaiting the outcome of the Winding Up Proceedings by the Hon’ble High Court of Chennai in this regard.

4. The Averments made by the Official Liquidator in the Reply Statement are stated as follows:

4.1. By an Order of the Hon’ble High Court dated 29.09.2000 in Company Petition No.483/2000, the 1st Defendant Company was ordered to be wound up and the Official Liquidator attached to this Hon’ble Tribunal has become the Liquidator of the said Company with directions to take charge of all the properties and effects of the Company.

4.2. In Compliance of the said Order, the Official Liquidator has taken possession of all the movables & immovable assets of the Company in Liquidation situated at Dindal Village, Kariamangalam, Dharmapuri District. The Hon’ble High Court through Publication Auction, has sold the movables assets for a sum of Rs.32,59,005/- and subsequently, the land and building for Rs.1.23 Crores. There are no assets left out for sale belonging to the Company in Liquidation.

4.3. The Official Liquidator has received 88 claims from workmen for a total amount of Rs.38,77,092/- and the claims were adjudicated and admitted for a total amount of Rs.38,79,320/-. The only secured Creditor of the Company is M/s. Indian Bank, ARM Branch, Coimbatore and the Applicant Bank has submitted a claim for Rs.7,85,00,052/- with the Official Liquidator.

4.4. The Official Liquidator paid the adjudicated amount as per the Hon’ble High Court’s Order in CA No.686/2007 & CA No.75 & 76/2009 at the rate of 30% and then at the rate of 6% to the Applicant Bank. The total amount paid by the Official Liquidator to the Applicant Bank is (after deducting Central Government Commission and Audit

18 TA No.334/2002 Fee and Reimbursement of Liquidation expenses incurred by Respondent Bank) Rs.1,18,65,667/- and Rs.6.78,241/- respectively. The Official Liquidator has settled the secured creditor as well as workmen dues as per the Provisions of Section 529 and 529A of the Companies Act 1956. Therefore, the Official Liquidator prays this Honourable Tribunal (a) to issue no due certificate in favour of Official Liquidator since the Official Liquidator settled the claim in favour of Applicant Bank as per the directions of Honourable High Court of Madras, and (b) to direct the Applicant Bank to reimburse the total amount incurred by Official Liquidator in connection with the Legal Proceedings before this Hon’ble Tribunal.

5. The Averments made by the 2nd Defendant in the Additional Written Statement are stated as follows:

5.1. The Applicant Bank is not entitled an interest as the Company has already referred to BIFR and therefore the Applicant Bank cannot add the interest from the date of Order of BIFR dated 02.08.1996. The Applicant Bank has claimed a huge from the Defendants by way of adding interest till date which the Applicant Bank is not entitled. The Property belong to the Company has more value than the amount due to the Bank. Therefore, there is no need to proceed against the Guarantors Properties as stated in the Application. The 2nd Defendant preferred an Appeal against the Order Attachment of the Personal Property of the 2nd Defendant before the Hon’ble Debt Recovery Appellate Tribunal, Chennai, which is still pending.

5.2. After the Order of BIFR the Applicant Bank has stated that the Company had declared as sick unit hence they are ready to proceed against the Company also. Therefore, the Applicant Bank cannot charge for interest after the Order of BIFR. After the Order of 19 TA No.334/2002 BIFR, the Official Liquidator has already taken possession of the Company’s Property and they have to settle the dues to the Applicant Bank.

5.3. The Official Liquidator has already sold the machinery for less value as the machinery values for Rs.41.85 Lakhs and the Official Liquidator has sold the above machinery for Rs.38.00 Lakhs.

5.4. The Value of the Land as per the Official Liquidator will fetch only Rs.38,575 Lakhs, but the value for the land is estimated as Rs.85.00 Lakhs as per the independent Surveyor, apart from the Plantations in the said land. The value of the building is estimated at Rs.67.742 Lakhs and the actual value assessed as Rs.140.00 Lakhs and the total value of the 1st Defendant property alone will fetch about Rs.310.00 lakhs, hence the Applicant Bank cannot a choice of proceed against the Guarantors Properties. The Guarantors have not given their personal property as security for the loans. Therefore, the liability cannot be fastened on the Guarantors.

5.5. The Applicant Bank has filed an Application against Guarantors after the 3 years from the date of Guarantee and hence the Guarantee lapsed by Limitation. No equitable mortgage of personal properties was created in favour of the Applicant Bank.

5.6. As per the Bank Books dues from the 1st Defendant is shown as Rs.78,01,878.90 and the Applicant Bank by adding interest throughout the period and shown the amount as huge as more than Rs.2.00 Crores due from the Defendants, which the Applicant Book is not entitle. As per the Applicant Banks statement dues on Account of Short Term Loan was Rs.2,39,740/- the same fully paid and the same was accepted by the Applicant Bank.

20 TA No.334/2002

5.7. The loans availed by the 1st Defendant from the Applicant Bank only on account of stocks, raw materials, finished goods, stores and other inventories. These are all already hypothecated to the Applicant Bank. Therefore, the Applicant Bank has right over the immovable property. The claim over the Guarantor is barred by limitation. The Applicant Bank though agreed for One Time Settlement for Rs.70,37,902/- with itself shows that the due to the Applicant Bank is very meager. Due to unfortunate delay of few days in payment of 1st Installment the Applicant Bank has unanimously cancelled the entire personal as agreed upon by both the parties.

5.8. The 2nd Defendant reserves their right to file Additional Counter Proof Affidavit along with the documents as and when the Orders are received from the Appellate Tribunal. There are no bonafide claims against the Defendants and not maintainable either in law of on facts. Therefore, the 2nd Defendant prays this Honourable Tribunal to dismiss the OA, to direct the Applicant Bank to produce the true and connect statements, which clearly reflect the correct statements and rate of interest charged to those accounts and the interest may be waived and to pay costs to these Defendants.

6. The Defendants (2 to 10) are called absent and set ex-parte on 18.05.2011 (D3 to D7), 13.07.2011 (D8 & D10), 26.08.2011 (D9) and 22.05.2012 (D2) in the case.

7. The Applicant Bank, in order to prove its claim, has filed Proof Affidavit executed by one Mr. G. Sudhakar, Assistant General Manager of the Applicant Bank and marked the documents as Exts.A-1 to A- 115 in support of its claim in the OA.

8. A cumulative analysis of both the Proof Affidavit and documents marked by the Applicant Bank would prove on the basis of the claim in the Proof Affidavit filed by the Applicant Bank.

21 TA No.334/2002

9. In the Proof Affidavit and the Ld. Counsel for the Applicant Bank submitted in his Written Submission had reiterated the statements made in the Original Application.

10. The 2nd Defendant having filed the Counter Proof Affidavit which is reiterated in the Reply Statement filed by the 2nd Defendant in the case is also taken on record by this Tribunal.

11. On perusal of Proceedings sheet of this OA dated 25.03.2009, the mortgaged properties of 1st Defendant Company is already sold by the Official Liquidator for a sum of Rs.155.50 Lakhs and paid Rs.103.70 Lakhs to the Applicant Bank and the Documents viz., Exs.A.93 to A.109 were also handed over to the Applicant Bank. Therefore, a sum of Rs.103.70 Lakhs (less) from the Claim of Rs.2,77,20,541/- is due from the Defendants (2 to 10) being a sum of Rs.1,73,50,541/- in terms of the Amended OA filed on behalf of the Applicant Bank on 31.12.2007.

12. The Applicant Bank having filed an ABJ Petition in IA No.2517/2007 and having allowed the same and attached the property by this Tribunal by its order dated 28.03.2008 and the said order is still in force in respect of the 2nd Defendant the said schedule of property mentioned in the IA No.2517/2007 shall be liable for the dues of the bank.

13. Therefore, in view of the observations made supra, the OA stands allowed and the Applicant Bank is entitled to recover, (a) a sum of Rs.1,73,50,541/- from the 2nd Defendant with future contractual interest @ 19.89% per annum with quarterly rests from the date of Application till the repayment as the transaction being commercial in nature.

22 TA No.334/2002

(b) the Applicant Bank is entitled to bring the Attached property for sale in terms of the order passed by this Tribunal by its order dated 28.03.2008 in IA No.2517/2007 and the sale proceeds appropriated for recovery of a sum of Rs.1,73,50,541/- with future contractual interest @ 19.89% per annum with quarterly rests from the date of Application till the repayment as the transaction being commercial in nature with Costs of this OA.

14. In the result,

(i) it is hereby directed the 2nd Defendant to pay to the Applicant Bank a sum of Rs.1,73,50,541/- with future contractual interest @ 19.89% per annum with quarterly rests from the date of Application till the repayment as the transaction being commercial in nature.

(ii) On failure to pay, the Applicant Bank is hereby directed to bring the Attached property for sale in terms of the order passed by this Tribunal by its order dated 28.03.2008 in IA No.2517/2007 and the sale proceeds appropriated for recovery of a sum of Rs.1,73,50,541/- with future contractual interest @ 19.89% per annum with quarterly rests from the date of Application till the repayment as the transaction being commercial in nature with Costs of this OA.

15. There being no personal guarantee against the loan granted by the bank to the 1st Defendant Company and the properties of the 1st Defendant Company having sold by the Official Liquidator and the bank realized a sum of Rs.1,03,70,000/- towards the dues and further the defendant 2 to 10 being the LRs of the deceased R.Govindasamy being the guarantor who was also the Director of the 1st Defendant Company died leaving behing the Defendants (2 to 10) are his legal 23 TA No.334/2002 heirs and therefore, the LRs are liable to the extent of the estate if any, inherited by them towards the loan dues of the bank.

16. There was no argument advanced by the Applicant Bank in the case. The order is passed in the case is based on the available record before this Tribunal.

17. All the pending IAs. if any, stand closed and disposed of by this Tribunal.

18. The Registry is directed to prepare DRC in terms of this Final Order. The Applicant Bank shall file memo of costs within 15 days from the date of this Order.

19. The Registry is directed to communicate the copy of this Order to both parties as provided in Rule 16 of the Debts Recovery Tribunal (Procedure) Rules, 1993 as amended in 2016. Dictated to Steno, directly typed on the Computer corrected and pronounced by me in the open Tribunal, this the 28th day of February, 2024.

Sd/-

[M.P. BALASUBRAMANIAN] PRESIDING OFFICER

24 TA No.334/2002 DESCRIPTION OF PROPERTY (SOLD BY OFFICIAL LIQUIDATOR) SCHEDULE – A :

SCHEDULE OF MOVBALES HYPOTHECATED FOR OPEN CASH CREDIT FACILITY AND SUBSEQUENTLY EXTENDED TO SHORT TERM LOAN - I, PACKING CREDIT, DEFAULTED GUARANTEE, TRUST RECEIPT AND SHORT TERM LOAN – II FACILITIES Stocks of Cotton, Staple Fibre, Staple Fibre Yarn, Cotton Yarn and Stocks – in – process kept at the first defendant’s premises at Dindal Village (Via), Kariamangalam – 636 111, Dharmapuri District or at any such place as may be informed to the Applicant from time to time.

SCHEDULE – B : DESCRIPTION OF MOVABLES HYPOTHECATED FOR PACKING CREDIT FACILITY Stocks of Cotton, Stocks – in – process and Yarn meant for Export kept at the first defendant’s premises at Dindal Village (Via) Kariamangalam – 636 111, Dharmapuri District or at any such place as may be informed to the Applicant from time to time.

SCHEDULE – C : SCHEDULE OF PLANT AND MACHINERY HYPOTHECATED IN RESPECT OF DEFERRED PAYMENT GUARANTEE FACILITY All movable Plant and Machinery kept at the first defendant’s premises at Dindal Village (Via) Kariamanagalam – 636 111, Dharmapuri District at any such place as may be informed to the Applicant from time to time.

SCHEDULE – D : DESCRIPTION OF MOVABLE PLEDGED FOR TRUST RECEIPT FACILITY Pledge of Cotton, Cotton Yarn, Staple Fibre, Staple Fibre Yarn stored at the First defendant’s premises at Dindal Village (Via) Kariamangalam – 636 111, Dharmapuri District at any such place as may be informed to the Applicant from time to time.

25 TA No.334/2002 SCHEDULE – E : DESCRIPTION OF PROPERTIES (MORTGAGED) ITEM – 1 :

District, Palakkode Taluk, Dindal Village, in R.S.No.433/3 out of an extent of 2.72 acres, an extent of 0.45 Acres of land situate within the following boundaries : South of Morappur Road ; West of Motor Land ; East and North of Kandasamy’s lands. Within the above boundaries, an extent of 0.45 acres of land. The above property is situate within Dindal Panchayat Limits. ITEM – 2 : Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S.No.432/1 out of an extent of 2.26 acres, an extent of 0.75 Acres of land situate within the following

North of lands belonging to Tirupathi & Lakshmi Ammal ; South of Poromboke land in R.S.No.432/2 ; East of lands belonging to Kumarasamy & Neduthambi ; West of Nallan’s lands.

ITEM – 3 :

Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S.No.431 out of an extent of 4.73 Acres, an extent of 1.20 Acres of land situate within the following boundaries : South of Palani’s Lands ; North of Vediappan’s Lands ; West of Konri’s Lands ; East of Aythammal’s Lands.

26 TA No.334/2002

ITEM – 4 :

Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S.No.432/1 out of an extent of 2.26 Acres, an extent of 0.13 Acres of land situate within the following boundaries : North of Ramasamy’s lands ; South of Subramani’s land ; West of Lakshmi’s lands ; East of Naduthabi @ Konri’s lands. Within the above boundaries, an extent of 0.13 Acres of land.

Further, in Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S.No 446, out of an extent of 1.741 Acres, an extent of 0.32 Acres of land situate within the following boundaries : North of Kandammal’s lands ; South of Vediappan’s lands ; West of Lakhsmi’s lands ; East of Ramasamy’s lands.

So, a total extent of 0.45 Acres of land. The above land property is situate within Dindal Panchayat limits. ITEM – 5 :

Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S.No 447/3 out of an extent of 2.37 Acres, an extent of 0.92 Acres of land situate within the following boundaries : South of Subramaniam’s Lands ; North of Kandappan’s Lands ; West of Ramasamy’s Lands ;

27 TA No.334/2002 East of Veerappan’s Lands.

ITEM – 6 :

Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S. No.430, out of an extent of 4.55 Acres, an extent of 0.88 Acres of land situate within the following boundaries : South of Morappur Road ; West and North of Konri’s lands ; East of Ramalingam’s lands. Within the above boundaries, an extent of 0.88 acres of land. The above property is situate within Dindal Panchayat Limits. ITEM – 7 :

District, Palakkode Taluk, Dindal Village, in R.S. No.433/B, out of an extent of 2.72 Acres, an extent of 0.47 Acres of land situate within the following boundaries : South of Kandasamy’s lands ; West of Motor lands ; East of Kandasamy’s lands ; North of Kumarasamy’s lands.

Further, in Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.446, out of an extent of 1.71 Acres, an extent of 0.51 Acres of land situate within the following boundaries : North of Ayyakannu’s lands ; South of Ramasamy’s lands ; West of Tirupathi’s lands;

28 TA No.334/2002 East of Lakshmi’s lands.

Further, in Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in Rs.No.444, out of an extent of 3.67 Acres, an extent of 0.26 Acres of land situate within the following boundaries : North & South of Kandammal’s lands ; West of Motor land ; East of Kandasamy’s lands.

Further, Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S. No.432/1, out of an extent of 2.26 Acres, an extent of 0.23 Acres of land situate within the following boundaries : North & West of Ayyakannu’s lands ; South of Poromoke land in R.S.No.432/2 ; East of Konri’s lands ; Within the above boundaries, an extent of 0.23 Acres of land. So, a total extent of 1.47 Acres of land in the above Survey Fields. The above properties are situated within Dindal Panchayat Limits. ITEM – 8 :

District, Palakkode Taluk, Dindal Village, in R.S. No.447, Out of an extent of 2.37 Acres, an extent of 0.85 Acres of land situate within the following boundaries : South of Vediappan’s lands ; North of Lakshmi’s lands ; East of R.S.No.429 ;

29 TA No.334/2002 West of Kandammal’s lands.

ITEM – 9 :

Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S. No.433/B, out of an extent of 2.72 Acres, an extent of 0.40 Acres of land situate within the following boundaries : South of Morappur Road ; North & West of Kandasamy’s lands ; East of Ayyakannu’s lands.

ITEM – 10 :

Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S. No.447, out of an extent of 2.37 Acres, an extent of 0.60 Acres of land situate within the following boundaries : South of Kandammal’s lands ; North of Lakshmi’s share of lands ; East of Manickam’s lands ; West of Kandammal’s lands.

ITEM – 11 : Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S. No.432/1, out of an extent of 2.26 Acres, an extent of 0.63 Acres of land situate within the following boundaries : North of remaining lands of Lakshmi & Others ; 30 TA No.334/2002 South of Ayyakannu’s lands ; East of Ramasamy, Subramani & Tirupathi’s lands ; West of Kandasamy’s lands.

Further, in Dharmapuri Registration District, Kaveripattinam Sub - Registration District, Palakkode Taluk, Dindal Village, in R.S. No.446, out of an extent of 1.71 Acres, an extent of 0.37 Acres of land situate within the following boundaries : North of Tirupathi’s lands ; South of remaining lands of Lakshmi & Others ; East of Ramasamy’s lands ; West of Kandasamy’s lands. Within the above boundaries, an extent of 0.37 Acres of land. So a total extent of 1.00 Acre of land in the above Survey Fields. The above properties are is situate within Dindal Panchayat Limits.

ITEM – 12 :

Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.446, out of an extent of 1.71 Acres, an extent of 1.71 Acres, an extent of 0.51 Acres of land situate within the following boundaries : West of Kandasamy’s lands ; East of Kandammal’s lands ; North of Ayyakannu’s lands ; South of Lakshmi Ammal’s lands.

ITEM – 13 :

Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.433/B, out of an extent

31 TA No.334/2002 of 2.72 Acres, an extent of 1.40 Acres of land situate within the following boundaries : South of Morappur Road ; West of Motor land ; North of Kandammal’s lands ; East of Lakshmi’s lands. Within the above boundaries, an extent of 1.40 Acres of land. Further, in Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.444, out of an extent of 3.67 Acres, an extent of 0.19 Acres of land situate within the following boundaries : East of Tirupathi’s lands ; North of Kandasamy’s lands ; West of Kandammal’s lands ; South of Kandasamy’s lands.

So, a total extent of 1.59 Acres of land in the above Survey Fields. The above property is situate within Dindal Panchayat Limits. ITEM – 14 :

Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.422/A, an extent of 0.31 Acres of land. The above property is situate within Dindal Panchayat Limits. ITEM – 15 :

Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.432/1, out of an extent of 2.26 Acres, an extent of 0.27 Acres of land situate within the following

North of Ramasamy’s lands ; South of Tirupathi’s lands ; West of Lakshmi’s lands ;

32 TA No.334/2002 East of Naduthambi @ Konri’s lands.

ITEM – 16 :

Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.432/1, out of an extent of 2.26 Acres, an extent of 0.25 Acres of land situate within the following boundaries : North of Subramani’s lands ; South of Ayyakannu’s lands ; West of Lakshmi’s lands ; East of Naduthambi @ Konri’s lands.

Dharmapuri Registration District, Kaveripattinam Sub – Registration District, Palakkode Taluk, Dindal Village, in R.S.No.431, out of an extent of 4.73 Acres, an extent of 3.53 Acres of land situate within the following boundaries : South of Palani Konri’s lands ; North of Vediappan’s lands ; East of Subramani’s lands ; West of Ayyakannu’s lands.

The total extent of Items 1 to 17 Properties is 15.43 Acres.

33 TA No.334/2002 DESCRIPTION OF PROPERTY (Property attached vide Order dated 28.03.2008)

Coimbatore Registration District, Coimbatore Sub Registration District, Coimbatore Taluk, within Coimbatore Corporation limits, old ward No.5, T.S.No.1/298/9, present T.S.No.1/1227, Old Door Nos.5/37, 7/2, present door No.3, Gopalapuram 1st Street, the property situate within the following boundaries:- North of the property settled by G.Sethuramalingam in favour of Radhakrishna Prabhu, South of 20 feet wide Gopalapuram Street No.1, West of property named Ashok Bhavan and now enjoyed by Coimbatore Dioscese Society, East of Cheran Palace Hotel, And having the following measurements – 78 feet east-west on the South, 75 feet east-west on the North, 92 feet North-South on the East and West, ad-measuring 7038 sq. ft. of land together with all buildings constructed thereon with all fittings, electricity and water service connection, their Security Deposits together with all easementary rights and all appurtenances attached thereto. The above property is situate within Coimbatore Corporation limits. The present value of the above property is Rs.75 Lakhs (Approx.) Sd/- [M.P. BALASUBRAMANIAN] PRESIDING OFFICER

34 TA No.334/2002 PROOF AFFIDAVIT OF THE APPLICANT BANK

1. Shri. G. Sudhakar, Assistant General Manager.

COUNTER PROOF AFFIDAVIT OF THE DEFENDANTS

1. Shri. G. Murugananthasamy (2nd Defendant) LIST OF DOCUMENTS MARKED BY THE APPLICANT BANK Sl. No. Date Description of Document Exhibits

12.06.1980 Original – Demand Promissory Note for Rs.2,00,000/-. A.1

12.06.1980 Original – Letter of Continuity. A.2

12.06.1980 Original – Agreement of Demand Cash Credit on the Hypothecation of Movable Property. A.3

25.08.1980 Original – Demand Promissory Note for Rs.4,00,000/-. A.4

12.06.1980 Original – Declaration Letter for Open Cash Credit Facility. A.5

12.06.1980 Original – Letter given by the Managing Director and Director of the 1st Defendant Company. A.6

25.08.1980 Original – Agreement for Demand Cash Credit on Hypothecation of Movable Property. A.7

22.01.1981 Original – Demand Promissory Note for Rs.5,00,000/-. A.8

22.01.1981 Original – Letter of Continuity. A.9

26.11.1982 Original – Demand Promissory Note for Rs.5,00,000/-. A.10

26.11.1982 Original – Covering Letter of 1st Defendant Company to the Applicant Bank. A.11

26.11.1982 Original – Letter of Continuity. A.12

26.11.1982 Original – Agreement for Demand Cash Credit on Hypothecation of Movable Property. A.13

06.05.1985 Original – Letter of Acknowledgement of Debt. A.14

09.12.1985 Original – Demand Promissory Note for A.15

35 TA No.334/2002 Rs.6,00,000/-.

09.12.1985 Original – Agreement of increase of Cash Credit Facility. A.16

09.12.1985 Original – Covering Letter for renewal of Demand Promissory Note. A.17

28.10.1988 Original – Demand Promissory Note for Rs.10,00,000/-. A.18

01.02.1989 Original – Demand Promissory Note for Rs.10,00,000/-. A,19

01.02.1989 Original – Agreement for Demand Cash Credit on Hypothecation of Movable Property. A.20

07.01.1992 Original – Letter of Acknowledgement of Debt. A.21

16.11.1994 Original – Letter of Acknowledgement of Debt. A.22

19.04.1996 Original – Demand Promissory Note for Rs.25,65,000/-. A.23

19.04.1996 Original – Covering Letter for renewal of Demand Promissory Note. A.24

19.04.1996 Original – Agreement for Demand Cash Credit on Hypothecation of Movable Property. A.25

25.07.1996 Original – Demand Promissory Note for Rs.28,52,827/-. A.26

25.07.1996 Original – Covering Letter for renewal of Demand Promissory Note. A.27

25.07.1996 Original – Agreement for Hypothecation of Movables. A.28

07.03.1984 Original – Demand Promissory Note for Rs.10,00,000/-. A.29

07.03.1984 Original – Agreement for Demand Cash Credit on the Hypothecation of Movable Property. A.30

06.05.1985 Original – Letter of Acknowledgement of Debt. A.31

09.12.1985 Original - Demand Promissory Note for Rs.10,00,000/-. A.32

09.12.1985 Original – Covering Letter for renewal of Demand Promissory Note. A.33

09.12.1985 Original – Agreement for Demand Cash Credit on the Hypothecation of Movable Property. A.34

02.01.1987 Original – Demand Promissory Note for A.35

36 TA No.334/2002 Rs.20,00,000/-.

02.01.1987 Original – Agreement for Packing Credit (Pre- shipment) Advance. A.36

02.01.1987 Original – Agreement for Demand Cash Credit on the hypothecation of Movable Property. A.37

01.02.1989 Original – Demand Promissory Note for Rs.20,00,000/-. A.38

01.02.1989 Original – Agreement for Packing Credit (Pre- shipment) Advance for Rs.5,00,000/-. A.39

01.02.1989 Original – Agreement for Packing Credit (Pre- shipment) Advance for Rs.15,00,000/-. A.40

07.01.1992 Original – Agreement for Packing Credit. A.41

16.11.1994 Original – Agreement for Packing Credit. A.42

19.04.1996 Original – Demand Promissory Note for Rs.33,17,000/-. A.43

19.04.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.44

19.04.1996 Original – Agreement for Packing Credit (Pre- shipment) Advance. A.45

19.04.1996 Original - Agreement for Demand Cash Credit on the Hypothecation of Movable Property Goods. A.46

25.07.1996 Original – Demand Promissory Note for Rs.39,37,247/-. A.47

25.07.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.48

25.07.1996 Original – Agreement for Packing Credit (Pre- shipment) Advance. A.49

07.08.1991 Original – Bank Guarantee issued by the Applicant Bank in favour of Maharashtra State Co-op. Cotton Growers’ Marketing Federation Ltd., Bombay. A.50

07.01.1991 Original – Counter Guarantee executed by the 1st Defendant in favour of Applicant Bank. A.51

07.01.1992 Original – Agreement for Packing Credit Account. A.52

16.11.1994 Original – Agreement for Packing Credit Account. A.53

37 TA No.334/2002

19.04.1996 Original – Demand Promissory Note for Rs.11,52,000/-. A.54

19.04.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.55

19.04.1996 Original – Covering Letter for Advances where there is no special Agreement. A.56

19.04.1996 Original – Agreement of Hypothecation of Plant and Machinery and Other movables taken as Additional Security for KCC/OCC/PC Limits. A.57

25.07.1996 Original – Demand Promissory Note for Rs.13,68,727/-. A.58

25.07.1996 Original – Consent Letter for Rs.13,68,727/-. A.59

25.07.1996 Original - Agreement for Demand Cash Credit on the Hypothecation of Movable Property Goods. A.60

07.11.1990 Original – Demand Promissory Note for Rs.2,22,000/-. A.61

07.11.1990 Original – Agreement for Extension of Pledge/Hypothecation of Movables. A.62

07.01.1992 Original – Agreement for Packing Credit. A.63

16.11.1994 Original – Agreement for Packing Credit. A.64

19.04.1996 Original – Demand Promissory Note for Rs.3,82,000/-. A.65

19.04.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.66

19.04.1996 Original – Agreement for Extension of Pledge/Hypothecation of Movables. A.67

25.07.1996 Original – Demand Promissory Note for Rs.4,49,280/-. A.68

25.07.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.69

25.07.1996 Original - Agreement of Hypothecation of Movables. A.70

30.11.1991 Original – Demand Promissory Note for Rs.15,00,000/-. A.71

30.11.1991 Original – Consent Letter for Short Term Loan of Rs.15,00,000/-. A.72

38 TA No.334/2002

02.01.1992 Original – Agreement for Packing Credit Account. A.73

09.01.1992 Original - Agreement for Extension of Pledge/Hypothecation of Movables. A.74

16.11.1994 Original – Agreement for Packing Credit Account. A.75

19.04.1996 Original – Demand Promissory Note for Rs.35,77,000/-. A.76

19.04.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.77

19.04.1996 Original – Agreement for Extension of Pledge/Hypothecation of Movables. A.78

25.07.1996 Original – Demand Promissory Note for Rs.42,03,857/-. A.79

25.07.1996 Original - Covering Letter for renewal of Demand Promissory Note. A.80

25.07.1996 Original - Agreement of Hypothecation of Movables. A.81

07.03.1992 Original – Inland Trust Receipt. A.82

16.11.1994 Original – Agreement for Packing Credit Account. A.83

25.07.1996 Original – Demand Promissory Note for Rs.6,52,524/-. A.84

25.07.1996 Original – Instrument of Pledge of Goods to Secure – A Demand Cash Credit. A.85

26.11.1982 Original – Agreement of Guarantee for KCC, OCC & Doc.BP. A.86

07.03.1984 Original – Agreement of Guarantee for Packing Credit Limit. A.87

09.12.1985 Original – Agreement of Guarantee for KCC, OCC, Doc BP PCL & Funded Interest (KCC). A.88

02.01.1987 Original – Agreement of Guarantee for Packing Credit. A.89

11.05.1990 Original – Agreement of Guarantee for OCC, KCC, DUCBP, LC, LC DA, OMTL, Adhoc Occ. A.90

09.01.1992 Original – Agreement of Guarantee for OCC, KCC, DUCBP, FBO/FBN, LC/DB LC, LC DA, OMTL, OBTL, OSTL. A.91

39 TA No.334/2002

19.04.1996 Original – Agreement of Guarantee for OCC, PC, KCC, OSTL, OSTL. A.92

to

02.05.1979 17 Sale Deeds Registered as Document No.651/79 to Document No.667/79 were handed over to OL, since the mortgaged properties of 1st Defendant Mill has sold for a sum of Rs.155.50 Lakhs and paid a sum of Rs.103.70 Lakhs to the Applicant Bank as per Order in Proceedings Sheet in this case dated 25.03.2009. A.93 To A.109

30.07.1996 Copy of the Acknowledgement (Memorandum) Confirming Deposit of Title Deeds executed by the 1st Defendant. A.110

-- Xerox Copy of Statement of Accounts in respect of M/s. Muruganathan Mills Ltd., for OCC. A.111

-- Xerox Copy of Statement of Accounts in respect of M/s. Muruganathan Mills Ltd., for Packing Credit. A.112

-- Xerox Copy of Statement of Accounts in respect of M/s. Muruganathan Mills Ltd., for Defaulted Guarantee. A.113

-- Xerox Copy of Statement of Accounts in respect of M/s. Muruganathan Mills Ltd., for Short Term Loan No.1. A.114

-- Xerox Copy of Statement of Accounts in respect of M/s. Muruganathan Mills Ltd., for Short Term Loan No.2. A.115

Sd/- [M.P. BALASUBRAMANIAN] PRESIDING OFFICER