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6. Resisting the same, the defendant filed a written statement http://www.judis.nic.in stating that the plaintiff approached the defendant Corporation for sanction of a loan to set up an industrial unit. The defendant sanctioned a term loan to the tune of Rs.15,00,000/- on 27.02.1963. The plaintiff mortgaged the property by the registered Mortgage Deed dated 20.01.1964 and also hypothecated the plaint and machinery. But due to various factors, the plaintiff could not be operated well and started incurring loss. Therefore, the defendant also sanctioned an additional term loan to the tune of Rs.35,00,000/- on 26.05.1970. Further, an additional loan of Rs.25.20 lakhs was also sanctioned on 25.03.1974 towards purchase of land and machinery. There was an arrangement of Paripassu on 30.04.1984 among the defendant, SIPCOT and Canara Bank for sharing recovery.

8. The defendant also issued notice for recovery of a sum of Rs.19,62,242.77 on 30.06.2003. As per the loan agreement dated 19.03.1991, the plaintiff was liable to repay the outstanding principal of Rs.27,72,271.41 with interest at the rate of 10% and additional interest at the rate of 2% for defaulted amount for defaulted period. Then the accrued interest of Rs.59,92,897/- is liable to be paid with interest at the rate of 6% with the additional interest at the rate of 2% per annum. http://www.judis.nic.in Therefore, the calculation of balance amount by the plaintiff is wrong and misleading. The Appellate Authority by its order dated 28.06.2001 observed that the rehabilitation scheme has failed. Therefore, the plaintiff is not entitled to the proceedings of the BIFR and the plaintiff is a chronic and willful defaulter. As per the Paripassu arrangement dated 30.04.1981, the plaintiff is in due of Rs.34,48,023.77/- as on 31.12.2009. As such, the demand for “No Due Certificate” is unjustified and illegal and prayed for dismissal of the suit.

11. The learned counsel for the appellant would submit that the suit itself is not maintainable as against the appellant and it is clearly barred under Section 34 of the SARFAESI Act. No suit is maintainable as against the financial institution before the Civil Court. The plaintiff failed to pay the entire dues and the defendant over ride to initiate the proceedings as against the plaintiff. The cause of action for initiating the recovery proceedings is well within time and continues the cause of action, the defendant has right to initiate recovery proceedings at any time within the prescribed time limit. Therefore, no necessity to decide the limitation for initiating the recovery proceedings. There is a Paripassu agreement between the appellant, SIPCOT and Canara Bank, which was marked as Ex.B7.

12. Accordingly, the defendant is entitled to collect original documents from the Canara Bank by virtue of Paripassu agreement dated 30.04.1981. Therefore, the defendant cannot be restrained from collecting the original document from the Canara Bank without paying the dues. Therefore, a due of Rs.34,48,023.77/- as on 31.12.2009 and http://www.judis.nic.in without paying the said dues, the suit is not maintainable and it is liable to be dismissed. The plaintiff failed to comply the scheme of BIFR and as such, the plaintiff is not entitled for any relief under the BIFR proceedings.