M/S. Mehta Engineering Works Thr. Its Prop.Shri Kishor Himatlal Mehta v. Offie At- Gopinath Patil Parsik Janata Sahakari Bank Limited ,Thr.Its Authorised Officer

1/2 901 WP 8 2020.doc

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 8 of 2020 M/s.Mehta Engineering Works thru its Prop.Shri Kishor Himatlal Mehta .. Petitioner

Versus

GP Parsik Bank, Gopinath Patil Parsik Janata Sahakari Bank Ltd.

.. Respondent ...

Mr. Suresh A. Malkani for the petitioner.

Mr.Kishor Patil I/b Mr.Amol P. Mhatre for respondent no.1. CORAM: PRADEEP NANDRAJOG, C.J.

AND BHARATI DANGRE, J.

DATED : 3rd JANUARY, 2020.

P.C:- We find no merit in the Writ Petition.

The singular point urged in the Writ Petition is that the amount claimed by the Bank includes penal interest; which cannot be charged. The contention is contrary to the terms of the loan sanctioned in sum of ₹ 11 crores. The sanction letter has been exhibited as Annexure A. The same shows that the loan was at a floating rate of interest which was 10.5% p.a. It was to be returned in 120 equated monthly instalments of ₹ 14,84,285/-.

Tilak

2/2 901 WP 8 2020.doc Clause 30 of the term of sanction clearly envisages that if monthly instalment was not paid on or before the due date penal interest @ 2% p.a. plus applicable tax shall be charged for the period of default on compounding basis. Additionally, the Bank was entitled to charge penal interest @ 4% p.a in addition to applicable rate on interest on outstanding loan amount if overdue amount was more than three months.

Petition is dismissed.

SMT. BHARATI DANGRE, J CHIEF JUSTICE Tilak