Bank loan

Toni S. Sachdevani (Querist) 17 March 2014 This query is : Resolved
Suppose A (a Partnership having 2 partners P & Q) obtains loan of X amount From B Bank and mortgages one property in year 2002. R & S stand guarantors to the transaction. Again P in personal capacity along with some third party obtains loan of Y amount From B Bank in the same year. And again R & S stand guarantors to the transaction. Bank settles first matter in the year 2005 and issues settlement letter and releases mortgaged property in favour new purchaser. Both loans were for 12 months. Till 2005 major payments were made in second transaction. After 2005 nothing transpired. Now in year 2011, B Bank had filed application u/s. 101 of Maharashtra Co-operative Society Act. against P, R, S and that third party. Now in 2014, B Bank has issued recovery notice and making huge claims. B Bank is scheduled & Cooperative Bank. what is law of limitation in this regard??
what provisions??

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R.V.RAO (Expert) 18 March 2014
law of limitation is 3 years and the bank is a scheduled bank under banking companies act schedule.

every year banks obtain confirmation of debt from borrowers and even guarantors,or at the time of first loan disbursement obtains signatures of borrowers and guarantors on blank and unfilled documents.
during bank audit also the concurrent or internal/rbi auditors insist borrowers to renew the loan documents it is called R.L (revival of loans) register where the loan documents are renewed for legal safety and legal recourse at a future date.

recollect your loan documentations.we can't ignore the lenders so easily.

Sudhir Kumar, Advocate (Expert) 18 March 2014
perhaps you could be clear of the facts.

Rajendra K Goyal (Expert) 18 March 2014
Limitation is of three years from the date its payment / installment was due.

The loan would stand revived for further 3 years if any amount is deposited in the account by the borrower.

If any of the borrower signed any revival letter / acknowledgement of debt the loan stands revived.

All the documents has to be scrutinized.