Court decrees Rs. 65,00,000 in favor of plaintiff with 12.5% interest. Defendants jointly liable. No further adjournments.

The court dismissed the applications for leave to defend by both defendants and decreed the suit in favor of the plaintiff for Rs. 65,00,000/- with interest at 12.5% per annum. Defendants were held jointly and severally liable for the entire amount. The court clarified that no further adjournment would be granted and disposed of all pending applications.

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Issues Involved:
1. Adjournment Request
2. Maintainability of the Suit Against a Sick Company Under Section 22 of SICA
3. Leave to Defend by Defendant No.1
4. Leave to Defend by Defendant No.2
5. Interest Rate Applicability
6. Joint and Several Liability

Detailed Analysis:

1. Adjournment Request:
The court noted that there was no ground for adjournment in the present suit, where the application for leave to defend was listed. Despite the counsel for the defendant being unwell, the court scheduled the next hearing for 11th October 2012 and made it clear that no further adjournment would be granted.

2. Maintainability of the Suit Against a Sick Company Under Section 22 of SICA:
The defendant argued that the principal borrower was a sick company and thus, the suit could not proceed under Section 22 of SICA. However, the court referred to the Division Bench judgment in Sakethh India Ltd. Vs. W. Diamond and the Supreme Court judgment in Raheja Universal Ltd. Vs. NRC Ltd., which clarified that no permission under Section 22 of SICA was required unless the dues were admitted by the sick company in a sanctioned scheme or before the court. The court emphasized that Section 22 applies only to proceedings in the nature of "execution, distress or the like." Since the present suit was a simple recovery suit and not in the nature of execution or distress, it was maintainable without permission under Section 22 of SICA.

3. Leave to Defend by Defendant No.1:
Defendant No.1 filed an application seeking leave to defend, primarily arguing that it was a sick company. The court dismissed this application, stating that the only defense was the company's sickness, which was not a credible denial of the dues. The court noted that the defendant did not deny the merits of the plaintiff's claim and that the defense was merely a moonshine. Consequently, the suit was decreed against Defendant No.1, with the court clarifying that prior permission under Section 22 of SICA would be required for execution of the decree.

4. Leave to Defend by Defendant No.2:
Defendant No.2 also sought leave to defend, arguing that no personal guarantee had been executed. The court referred to Clause 4 of the agreement dated 17.11.1998, which clearly stated that Defendant No.2, in his personal capacity, guaranteed the repayment of the principal amount. The court found the language of the agreement unambiguous and dismissed the application for leave to defend, concluding that Defendant No.2 was liable as a guarantor. The court also noted that the defenses raised were mere technicalities and did not constitute bona fide triable issues.

5. Interest Rate Applicability:
The plaintiff claimed an interest rate of 25% per annum, which the court found to be excessively high. The court referred to the Usurious Loans Act, 1918, as amended by the Punjab Relief of Indebtedness Act, 1934, which caps interest rates at 12.5% per annum for unsecured debts. Consequently, the court decreed the suit amount along with interest at 12.5% per annum from 17.11.1998 until the date of filing the suit, as well as pendente lite and future interest at the same rate until realization.

6. Joint and Several Liability:
The court decreed the suit for a sum of Rs. 65,00,000/- along with interest at 12.5% per annum against both Defendant No.1 and Defendant No.2, holding them jointly and severally liable for the entire decretal amount. The decree sheet was ordered to be prepared accordingly.

Conclusion:
The court dismissed the applications for leave to defend filed by both defendants and decreed the suit in favor of the plaintiff for a sum of Rs. 65,00,000/- with interest at 12.5% per annum. The liability of the defendants was held to be joint and several, and the suit was disposed of with all pending applications also being disposed of.

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