Jamuna Bank Limited -Versus- X Knitting Fabrics Ltd.

IN THE ARTHA RIN ADALAT, 2ND COURT AT DHAKA

ARTHA RIN SUIT NO. ___ OF 2006

Jamuna Bank Limited

Mahakhali Branch

32, Mohakhali C/A

Dhaka-1212

PLAINTIFF

-Versus-

1. X Knitting Fabrics Ltd.

Represented by its Managing Director

Mr. Y

199/2, Kachukhet, Dhaka Cantonment

Dhaka

2. Mr. Y

Managing Director

X Knitting Fabrics Ltd.

199/2, Kachukhet, Dhaka Cantonment

Dhaka

3. Mr. Z

Director

X Knitting Fabrics Ltd.

199/2, Kachukhet, Dhaka Cantonment

Dhaka

4. Janata Bank

Dilkusha Corporate Branch

29, Dilkusha, C/A

Dhaka

DEFENDANTS

SUIT FOR RECOVERY OF MONEY SUIT VALUED AT TK. 21,42,060.00 (TAKA TWENTY ONE LAC FORTY TWO THOUSAND SIXTY) ONLY INCLUSIVE OF INTEREST AS ON 30.06.2006.

The plaintiff above-named most respectfully states as

FOLLOWS:

That the plaintiff is a banking company incorporated under the relevant Companies Act. It carries on banking business within the territory of Bangladesh through its various branches including the Mohakhali Branch, Dhaka as stated in the cause title (hereinafter referred to as the “plaintiff bank”).

That the defendant No.1 is the borrower who availed following facilities from the plaintiff as described hereunder and a limited company incorporated under the relevant Companies Act. The defendant No. 1 carries on the business of manufacturing ready-made garments and exports of the same. The defendant No. 2 and 3 are the directors and shareholders of the defendant No. 1 and stood as guarantors of the loan availed by the defendant No.1. The defendant No. 4 is a banking company incorporated under the relevant Companies Act. It carries on banking business within the territory of Bangladesh through its various branches including the Dilkusha Corporate Branch. The defendant No. 4 is included in this Artha Rin Suit as a guarantor since the defendant No. 4 assured the plaintiff bank for adjustment of the defendant No. 1’s liability and also paid part of the dues of the defendant No. 1. The defendants’ addresses in the cause title are correct to the best of the plaintiff’s knowledge.

That in the course of business, the defendant No. 1 opened an account being No. 0210002020 on 10.11.2001 with the plaintiff bank and availed various credit facilities from time to time, as stated hereunder.

That at the request of the defendant No. 1, plaintiff Bank vide Sanction Letter No. JBL/MOHA/2002/548 dated 16.02.2002 sanctioned various credit facilities in favour of the defendant No. 1 which were duly accepted by the defendant No. 1. Particulars of facilities as contained in the Sanction Letter dated 16.02.2002 have been given as follows:

Sl. Type of Facility Amount/Limit Mode of Repayment Validity Up to Remarks
1. Project Loan Tk. 12.20 lac By deducting 5% (Five Percent) from each export proceeds or from other sources of the defendant No. 1 30.11.2002 Not availed
2. Back to Back L/C Tk. 288.23 lac From export proceeds 30.11.2002 Availed
3. Packing Credit Tk. 20.00 lac From export proceeds 30.11.2002 Availed

That thereafter at the request of the defendant No.1, the plaintiff bank from time to time opened Back to Back Letters of Credit (Back to Back L/Cs) against two Export L/Cs for procurement of fabrics and accessories in order to complete the manufacturing of the readymade garments under the Export L/Cs. Accordingly, the plaintiff bank opened the following Back to Back L/Cs:

Back to Back L/C No. and date Export L/C No. Amount in US$ Beneficiaries
3035-02-04-0008

dated:10.02.2002

6005403238A

dated 01.02.2002

2,69,830.75 M/S. K & K Tops Textile Company Ltd. H#425, Road # 7, DOHS, Dhaka
3035-02-04-0009

dated:11.02.2002

6005403238A

dated 01.02.2002

32,398.00 M/S. R.R. Corporation, 174, Arambag (Ground Floor), Motijheel C/A, Dhaka
3035-02-04-0026

dated:30.03.2002

31CDI000062244

dated: 15.03.2002

29,141.19 M/S. Y Mills Limited, Factory West Alahabad, P.O. Kanchannagar, Chandanaish, Chittagong
3035-02-04-0027

dated:30.03.2002

31CDI000062244

dated: 15.03.2002

17,389.00 M/S. R.R. Corporation, 174, Arambag (Ground Floor), Motijheel C/A, Dhaka
3035-02-04-0028

dated:31.03.2002

31CDI000062244

dated: 15.03.2002

2,548.00 M/S. Q Shangstha

181/1,Shantibag, Dhaka

Back to Back L/C No. and date Export L/C No. Amount in US$ Beneficiaries
3035-02-06-0004

dated:16.04.2002

31CDI000062244

dated: 15.03.2002

7,654.50 M/S. X Co. Ltd. Taiwan

4, FL-1250, Sec 4, Chunghsiad, E. RD, Taipei, Taiwan

That as per the terms and conditions of the Sanction Letter dated 16.02.2002 the defendant No. 1 was under legal obligation to submit the export documents under theaforesaid Export L/Cs to the plaintiff bank for collection of the export proceeds from the Issuing bank. But instead of submitting the export documents to the plaintiff bank, the defendant No. 1 submitted the said export documents to the defendant No. 4 to collect the export proceeds. This is how the defendant No. 1 collected the entire export proceeds from the Issuing bank of the aforesaid Export L/Cs though and in connivance of the defendant No. 4 bank, which is in violation of the terms and condition of the Sanction Letter dated 16.02.2002.

That thereafter on vigorous persuasions by the plaintiff with the defendant No. 4 bank vide series of letters, visits and telephonic discussions, the defendant No. 4 made a total payment of US $ 3,31,410.66 in different dates from realized export of US$ 4,94,984.00 which was credited towards adjustment of the defendant No. 1’s funded BB L/C and PC liabilities with the plaintiff Bank. The defendant No. 4 by paying part liabilities and by not denying the said dues incurred obligation to pay the balance amount and became guarantor.

That so far the BB L/C No. 3035-02-04-0026 dated 30.03.2002 of US $ 29,141.19 is concerned the Negotiating Bank i.e. National Bank, Agrabad Branch, Chittagong presented discrepant documents. As such no payment has made against the said L/C. However, if the payment of the said L/C is made in future the plaintiff bank reserves the right to add the same to the suit value by way of amendment.

That the defendant No. 1 failed to fulfil its obligation to adjust the liability of the L/C No. 3035-02-06-0004 dated 16.04.2002 of US $ 5,654.50, consequently the plaintiff Bank is bound to pay to the beneficiary of the aforesaid L/Cs. Upon payment of the said amount, the plaintiff bank reserves the right to add the amount to the suit value by way of amendment.

That in addition to the aforesaid loan against the Back to Back L/Cs, the defendant No. 1 also availed Packing Credit facility for Tk. 19.70 lac (Taka nineteen lac seventy thousand) only in order to ensure timely execution of the related export orders vide Sanction letter dated 16.02.2002. The defendant No.1 availed the aforesaid facilities in full and failed to keep commitment in repayment of the loan as per terms of the Sanction Advice dated 16.02.2002.

That the said credit facilities were secured inter alia by:

a) Personal Guarantee of the defendant No. 2 and 3;

b) Execution of various charge documents (i.e. Promissory Note, Letter of arrangement, Letter of Continuity, Letter of Indemnity etc.)

That despite repeated requests and reminders vide letters dated 22.04.2002, 07.09.2002, 30.10.2002, 20.05.2004 and 27.10.2004 by the plaintiff bank, the defendant No.1 miserably failed to adjust the aforesaid liabilities with the plaintiff bank.

That in response to the reminders of the plaintiff bank, the defendant No.1 from time to time by its letters dated 18.06.2002, 30.06.2003 & 25.05.2004 acknowledged the liability with the plaintiff bank and also committed to adjust the outstanding liabilities within a short period, but to no effect.

That it is apparent from negative attitude of the defendant 1 along with other defendants that they have been evading liquidating the long outstanding dues of the defendant No.1 with the plaintiff bank in breach of their obligations under the terms and conditions of the Sanction Letter dated 16.02.2002. The plaintiff bank made repeated reminders to the defendant No. 1 to liquidate its liabilities with the plaintiff bank but the defendant No.1 continued to fail paying any attention to the requests of the plaintiff bank in this regard. Despite repeated requests and reminders by the plaintiff bank to adjust their outstanding liabilities, none of the defendants came forward to adjust the over dues.

That none of the defendants are serious at all with regard to adjustment of their outstanding liabilities with the plaintiff bank. It is evident from the conduct of the defendants that they have no intention to make repayment of their entire outstanding liabilities lying with the plaintiff bank.

That the plaintiff bank gave the defendants ample time and opportunity to clear the outstanding liabilities of the defendant No. 1 but the defendants are reluctant in this regard. It is abundantly clear that the defendants would not adjust the plaintiff bank’s dues unless compelled by law. The plaintiff bank cannot wait for an indefinite period for the defendants to adjust the outstanding liabilities of the defendant No. 1 lying with the plaintiff bank. The defendants are wilfully resorting to delaying tactics to avoid repayment of the long outstanding dues. Having no alternative the plaintiff bank is compelled to file this suit against the defendants to realize its legitimate dues. The plaintiff bank states that the defendants are severally and jointly liable to repay the outstanding dues of the defendant No.1 lying with the plaintiff bank.

That the plaintiff bank submits that it cannot recover its dues amicably. The plaintiff bank endeavoured all its efforts to recover its dues from the defendants but to no effect. The defendants made no effort to adjust their liability.

That the present outstanding liabilities i.e. the packing credit liabilities of the defendants with the plaintiff bank stands at Tk. 21,42,060.00 (Taka twenty one lac forty two thousand sixty) only inclusive of interest as on 30.06.2006, which the defendants are liable to pay jointly and/or severally. The defendant No. 1 is liable as borrower, defendant Nos. 2, 3 and 4 are liable as guarantor, as the case may be. The plaintiff bank reserves the right to amend the plaint and include other contingent liabilities as and when required to pay to other beneficiaries under B/B L/Cs.

That the cause of action to file this suit arose on on 10.11.2001, when the defendant No. 1 opened account with the plaintiff bank, on 16.02.2002 when the Plaintiff Bank sanctioned various credit facilities, on each and every dates when the defendant Nos. 2 and 3 executed personal guarantee on each and every dates when the defendant No. 1 executed various charge documents, on various dates including 22.04.2002, 07.09.2002, 30.10.2002, 20.05.2004 and 27.10.2004 when the plaintiff bank requested the defendant No. 1 to adjust the liabilities, on 18.06.2002, 30.06.2003 & 25.05.2004 when the defendant No. 1 committed to adjust its liabilities with the plaintiff bank, on each and every date when the defendant No. 4 assured the plaintiff bank for adjustment of the defendant No. 1’s liability, on each and every dates when the defendant No. 4 paid part of the dues of the defendant No. 1 and each and every dates when the defendants acknowledged the liabilities but continued to default in repayment of the outstanding liabilities with the plaintiff bank, and the said cause of action is continuing till date.

Thatthe suit is for realisation of a decree for a sum of Tk. 21,42,060.00 (Taka twenty one lac forty two thousand sixty) only inclusive of interest as on 30.06.2006 of a commercial bank and the said suit is within the jurisdiction of this Court. For the purpose of court fees, the plaintiff bank values the suit at the said amount and pays the highest court fees on the said amount.

That the Authorised Representative of the plaintiff bank in the instant suit is Mr.Mehbub Rana, Senior Executive Officerof the plaintiff bank who is well conversant with the facts of the case.

The plaintiff bank, therefore, prays for:

(a) A decree for a sum of Tk. 21,42,060.00 (Taka twenty one lac forty two thousand sixty) only inclusive of interest as on 30.06.2006 in favour of the plaintiff bank and against the defendants jointly and/or severally;

(b) A decree for pendente lite interest at the rate stipulated in the Artha Rin Adalat Ain, 2003 from 01.07.2006 till the date of decree and from the date of decree till realization of the decretal amount;

(c) A personal decree against the defendant Nos. 2 and 3;

(d) A decree for the entire costs of the Suit;

(e) Any other relief(s) to which the plaintiff bank is entitled in law and equity.

And for this act of kindness, the plaintiff bank as in duty bound shall ever pray.

SCHEDULE ‘A’

{Schedule under section 8(2) Ka Artha Rin Adalat Ain 2003}

Description of Loan & amount outstanding

Nature of Facilities Limit

(in Tk.)

Loan amount disbursed (in Tk.) Interest

(in Tk.)

Sub-total

(Principal + Interest)

(in Tk.)

Amount repaid as on 30.06..2006

(in Tk.)

Outstanding amount as on 30.06.2006

(in Tk.)

Packing Credit 20.00 lac 19.70 lac 6,61,000.00 26,31,000.00 4,64,000.00 21,42,060.00
A F F I D A V I T

I, _______________ son of __________________ of Jamuna Bank Limited, Mohakahali Branch, having address at 32, Mohakhali C/A, Dhaka aged about 32 years, by faith Muslim, Nationality Bangladeshi by birth, profession service, do hereby solemnly affirm and declare as follows:

1. That I am the officer of the Plaintiff of this plaint and well conversant with the facts of the case and competent to swear this Affidavit.

2. That the statements of facts made in this application are true to the best of my knowledge and belief and rests are submissions before this Hon’ble Court and in witness whereof I swear this affidavit and signed below on this the 31st day of August, 2006 at _________ a.m. before the Commissioner of affidavit.

DEPONENT
The deponent is known to me and identified by me.
ADVOCATE