JUDGMENT
1. Heard counsel for the parties.
2. This F. A. F. O. is directed against the impugned award dated November 20, 1996, passed by the trial court restraining respondents Nos. 1 and 2 from realising Rs. 8,31,318 from the plaintiffs.
3. The facts are that the plaintiffs entered into an agreement for taking a term loan with defendant No. 7, namely, the U. P. Financial Corporation (U. P. F. C.), and under the agreement the U. P. F. C. had granted a term loan of Rs. 92,000 to the plaintiffs and an additional term loan of Rs. 70,000 had been granted to the plaintiffs. When the plaintiffs defaulted, the U. P. F. C. issued a notice under Section 29 of the U. P. State Financial Corporation Act on January 2, 1986, and pursuant to that made an advertisement for sale of the assets of the plaintiff's unit, Star Agro, for the establishment of which the term loan was taken. Pursuant to the advertisement, the plaintiff's unit was sold to the highest bidder, viz., San-jay Kumar Jain, for Rs. 1,60,000 and possession was delivered to the purchaser on April 9, 1988. As full recovery of the outstanding dues could not he made from the sale of the unit of the plaintiffs, the U. P. F. C. issued a personal recovery certificate against the plaintiffs.
4. Aggrieved, the plaintiffs filed a suit for injunction against the U. P. F. C. (defendant No. 7) restraining it to recover the dues outstanding against the unit (defendant No. 3) and also made an application for ad interim injunction stating that one agreement each on June 15, 1983, and June 24, 1983, was made between them and respondents Nos. 4 to 6 shifting the liability of the former to the latter. The contention of the plaintiffs is that by the said agreements they cease to be liable to pay under the original agreement, admittedly entered into between the plaintiffs and the U. P. F. C. and that the liability to repay the loan taken by the plaintiffs under the original agreement was transferred to defendants Nos. 4 to 6 by subsequent agreements entered into between the plaintiffs and defendants Nos. 4 to 6.
5. The contention of the U. P. F. C. (appellant) is that it has nothing to do with defendants Nos. 4 to 6, because there was no privity of contract between it and defendants Nos. 4 to 6 as the agreement for taking the loan was entered into between the plaintiffs and the U. P. F. C.
6. In this regard, the legal position is very clear. The plaintiffs cannot be absolved of their liability simply because they entered into fresh agreements with defendants Nos. 4 to 6. The U. P. F. C. is not supposed to take cognizance of any agreement entered into between the plaintiffs and defendants Nos. 4 to 6. Admittedly, the plaintiffs entered into agreements with the U. P. F. C. in regard to the term loan and the loan was advanced to the plaintiffs thereunder by the U. P. F. C. on these facts no ad interim injunction could have been granted against defendants Nos. 1 to 2 who proceeded at the behest of defendant No. 7 for making the recovery from the plaintiffs.
7. For these reasons, the F. A. F. O. succeeds and is allowed, the impugned order dated November 20, 1996, is quashed.