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3. The 2nd defendant has guaranteed the repayment of loan by executing the Deed of Guarantee on 15.12.2005 in favour of the plaintiff Bank. The 2nd defendant is liable to pay Rs.10,00,000/- together with further interest, liquidated damages, costs, charges, expenses and all other moneys payable by the 1st defendant to the plaintiff Bank. The 1st defendant by executing the Deed of Hypothecation dated.20.12.2005 hypothecated the materials and other goods and other current assets in favour of the plaintiff Bank and hypothecated major items of the materials and other goods etc., more fully described in the schedule 'A' and mortgaged along with paripassu charge with State Bank of Mysore i.e., defendant No.3. The Letter of Authority dated.19.12.2005 for paripassu charge issued by State Bank of Mysore West of Chord Branch and the Letter ceding paripassu charge dated.20.12.2005 issued by State Bank of Mysore, West of Chord Branch .

a. Sanction Communication letter b. Memorandum of Term Loan Agreement for housing loan c. Confirmation of deposit of title deeds d. Sanction communication letter e. Term loan Agreement

6. The defendant No.3 has got paripassu Agreement and the said hypothecated goods are mortgaged along with paripassu charge with the defendant No.3 bank and the same is informed to the plaintiff Bank vide letter of Authority dated.19.12.2005 for paripassu charge.

15. The defendant No.3 had sent Letter of Authority on 19.12.2005 as per Ex.P10 and also submitted financial assistance to M/s. Venugopal & Co. ceding Paripassu charge. Accordingly the defendant No.3 acting for its and acting on behalf of the plaintiff would execute Memorandum of paripassu Agreement provided, interalia, that security created/ to be created by the borrower in favour of defendant No.3 and plaintiff shall rank parri pasu charge on the security without any preference or priority of one over others and including usual provisions relating to insurance, current assets, application to realisation and proceeds of sales etc., in such forms and in such manner as may be mutually agreed upon. Defendant No.3 authorised to make a mention of pari passu charge in favour of plaintiff in the form of particulars of charge that may be filed by the plaintiff/by the borrower with Registrar of Companies pursuant tot provisions of companies Act 1956.

17. Issue No.3:- The defendant No.3 -Bank has duly admitted the loan availed by the 1st and 2nd defendant from the plaintiff Bank and the amount claimed by plaintiff with future interest as against the defendants. Defendant No.3 has also admitted that defendants 1 and 2 have hypothecated the schedule properties and the plaintiff has got right to create charge over the said hypothecated/ mortgaged properties. The 3rd defendant has sent Letter of Authority and undertaking to execute Memorandum of Paripassu subject to conditions as stipulated in Ex.P11 on 20.12.2005. Accordingly the security created/ to be created by the borrower in favour of defendant- 3 and plaintiff shall rank pari passu charge on the security without any preference or priority of one over otheres. None of the parties has executed Memorandum of Paripassu Agreement so as to take into consideration. As pleaded by the 3rd defendant, the defendants 1 and 2 have availed loan from defendant No.3 for the purpose of construction of house and mortgaged the house bearing No.1541/C/5 and executed various documents in favour of defendant No.3. The said mortgage of immovable property is nothing to do with the schedule properties as per the terms of Deed of Hypothecation. The defendants 1 and 2 are bound to clear the loan availed by them from defendant No.3. On the other hand, defendant No.3 has got every right to recover the entire amount due from the defendants 1 and 2 by sale of mortgaged immovable property but the defendant No.3 cannot create charge over the schedule property to recover its dues from the defendants 1 and 2 along with plaintiff Bank. Looking to the actual amount due to plaintiff as well as defendant No.3 from the defendants 1 and 2, the plaintiff has got every right to create charge over the schedule property. Hence without much discussion, I answer Issue No.3 in the Negative.