Allowed

Punjab National Bank (Oriental Bank of Commerce) v. Subhash Kumar Sahu & Ors.

DRT20 Dec 2022OA/110/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal, Patna, allowed an ex-parte application by Punjab National Bank for recovery of a loan facility availed by borrowers who failed to repay dues. The court determined the debt including interest and directed the issuance of a recovery certificate.

What did the court decide?

Recovery of Rs 28,65,310.68 along with pendente-lite and future interest @ 9.30% p.a. compounded monthly with costs; issuance of recovery certificate for auction of assets.

Punjab National Bank (Oriental Bank of Commerce)… — Contract and Commercial Disputes | DRT (2022)

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OA 1100(2022 (J)

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DRT,PATNA

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Debts Recovery Tribunal, Patna

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Karpuri Thakur Sadan, AashianaDighaRoadat PATNA-80002S

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Presiding Officer : Shri KaushalendraYadav

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OA Case no. : 110 of 2022

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Punjab National Bank, at Dumraon Chowk Road Branch (Earlier known as Oriental Bank of Commerce) Manipur Kothi Block & PO Dumraon District Buxar.

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. Applicant

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Vs.

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Subhash Kumar Sahu Proprietor of MIS Bajrang Traders Son of Sona Mukhi Sahu RIO Purana Bhojpur Block Dumraon, PO- Purana Bhojpur, District- Buxar- 802133.

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Son a Mukhi Sahu S/O Late Dina Sahu RIO Purana Bhojpur Block Dumraon, PO- Purana Bhojpur District Buxar- 802133.

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...Defendants.

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Present:

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For the Applicant : Shri Nilamber Prasad Verma Advocate For the Defendants : None

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Da ted :20.12.2022

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JUDGMENT

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1- The Applicant bank has made this application U/S 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 09.02.2022 against the defendants to recover its debts from defendants of Rs 28,65,310.68 as on 31.1.2022 along with Pendente-lite and future interest @ 9.30 % per annum with monthly rests from 1.2.2022 with costs till realization.

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2- The application has been duly registered and numbered as above.

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3- The brief facts of the case of the applicant bank as stated in the application are as under-

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The applicant bank, a body corporate constituted under the Banking Companies (Acquisition and Transfer of undertaking Act No 5 of 1970) having its Registered Head Office at Plot No 4 Sector 10 Dwarka new Delhi. It has Branch Offices all over India and Abroad. Amongst the Branches in India one of its Branch office namely Punjab National Bank, Dumraon Chowk Road, Manipur Kothi, District-Buxar, Bihar.

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Defendant No 1 is a Permanent Account Card Holder the Card Dated 06.07.1991 issued by Income Tax Department Government of India. His name in the PAN Card is Subhash Kumar Sahu and his PAN

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OA 110 of 2022 [J)

DRT,PATNA

Card No is EUXPS4912N. The defendant is also a registered dealer under Goods and Services Tax where his GST Identification Number is 10EUXPS4912NIZW and the Trade Name recorded in it is Bajrang Traders. Defendant No 2 is also a Permanent Account Card Holder the card dated 04.05.1985 issued by Income Tax department Government of India. His name in the PAN Card is Sona Mukhi Sah and PAN Card no. is CTTPS1206C. The defendant No 1a Sole Proprietorship Concern approached the Bank vide Loan Application Dated 20.09.2016 for Grant of Cash Credit Limit Facility of Rs 25,00,000/for promoting his business relating to grocery items. The borrower had also signed the sole proprietorship Letter Dated 01.10.2016 and the various undertakings dated 01.10.2016 concurring to the declarations contained therein the referred Documents. After acceptance of the terms and conditions of sanction duly acknowledged by the borrower and after required cash credit limit facility of Rs 25,00,000/was sanctioned in favour of the borrower on 1.10.2016. the defendants executed the various loan documents i.e. common agreement, agreement of hypothecation, agreement of guarantee etc. The guarantor has created equitable mortgage by deposit of his registered sale deed no. 895 dated 28.1.2014 and another registered sale deed no. 905 dated 28.1.2014 details given at page 15 of ~A. After an exaptation of one year the borrower again made proposal to renew his existing CC limit facility for further period through loan application dated 20.10.2018 and inter alia declared along with the guarantor that the collateral security earlier made in favour of the bank shall remain stand by. The then bank on 26.10.2017 was further period of one year subject to the terms and conditions incorporated in the sanction letter.

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All the transactions were entered in the ledger of the loan accounts in the name of the defendant duly maintained by the applicant bank in its usual course of business. After availing the sanctioned credit facilities became irregular in repayment of their dues as per agreed terms and failed to adhere to the financial norms of the bank and avoiding the repayment of its dues to the bank, in spite of several assurances given by it to the applicant bank resulting in the account turning as NPA on 31.03.2021.

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Thus the total liability in the loan account is Rs 28,65,310.68 with pendent-lite and future interest @ 9.30 % per annum from 1.2.2022 till the realization.

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The interest /compound interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.

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Since, the defendants have failed and neglected in spite of several reminders to make payment of the dues recoverable to bank, hence this application has been filed by the bank. 4- D/s 19 (4) of the Act & Rule of the DRT [Procedure] Rules, 1993, copies of application & paper book was sent by this Tribunal to the defendants by registered/speed post on 02.06.2022 and summons/notices

OA 110 of 2022 [J]

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issued requiring the defendants to show-cause within 30 days of the service of summons/notices as to why relief prayed for, should not be granted.

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Despite service by the registered post, which is evident from the tracking report and sufficient time has been given to the defendants to defend their case, but they failed to appear and to file WS, hence, the Tribunal has passed an order to proceed ex-parte against the defendants 13.7.2022.

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5- To prove its case, the applicant Bank has referred various certified photocopies of documents before this Tribunal. The applicant bank has also given evidence on affidavit by way of affidavit by Shri Mahesh Kumar Tiwary, Senior Manager of the applicant bank. The details of documents are as follows. :-

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SI.No	Description of photocopies Documents	Date of Execution	Amount	Signature of executant	Ex.! Ann. No.
1	copy of PAN Card	...	...	....	1
2	Loan Application	20.09.2016	Rs.251akh	defendant no. 1	2
3	Sole Proprietorship Letter	01.10.2016	...	defendant no. 1	3
4	various undertakings	1.10.2016	...	defendant no. 1	4
5	Sanction Letter	01.10.2016	Rs.251akh	bank	5
6	Common Agreement	01.10.2016	...	defendant no. 1	6
7	Agreement of Hypothecation	01.10.2016	Rs.251akh	Defendant 1	7
8	Agreement of Guarantee	01.10.2016	Rs.251akh	Defendant 2	8
9	Registered Sale Deed No 895	28.01.2014	...	defendant no. 2	9
10	Registered Sale Deed No 905	28.01.2014	...	defendant no. 2	10
11	Mutation Order	15.02.2014	...	...	11
12	Land Possession Certificate	...	...	...	12
13	Land Revenue Receipt	27.05.2016	.....	...	13
14	Application for Renewal of Loan	05.10.2017	Rs.251akh	defendant no. 1	14
15	Sanction Letter	11.10.2017	Rs.251akh	bank	15
16	Application for Renewal of Loan	20.10.2018	Rs.251akh	defendant no. 1	16
17	Sanction Letter	26.10.2018	Rs.251akh	bank	17
18	Borrower's Letter	21.11.2019	...	...	18
19	Borrower's Letter	08.10.2020	...	...	19
20	Statement of Account related with the Cash	as on 31.1.2022	Rs.28,65,310.68	bank	20

OA 1100(2022 [J]

DRT,PATNA

Credit Loan Account

6- Opportunity of hearing has been fully given to both the parties, but despite several opportunities given to defendants, the defendants have not appeared to contest the case, hence, the ex-parte arguments of learned counsel for applicant bank were heard and perused the case record.

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Ld. Counsel of applicant bank submitted that the defendants have taken the loan and utilized the same and also executed the various loan documents to secure the loan. Further, submitted that the claim of the bank has been proved by documentary evidence.

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It is further submitted by ld. Counsel of applicant bank that there is no any stay granted by any Higher Court, in respect of the proceedings of the present OA and requested to issue recovery certificate, as claimed for, inOA.

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7- It has been established that defendants are living and carrying on their business in the state of Bihar. Cause of action also arose in the State of Bihar. The said claim on the date of filing of application exceeded Rs.20 lacs. The applicant bank is functioning within jurisdiction of this tribunal. Therefore, this Tribunal has territorial as well as pecumary jurisdiction to adjudicate upon the present application.

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8- On the issue of Limitation, to prove it, the applicant bank has submitted that the applicant bank has declared the account as NPA on 31.32021, whereas the present application has been filed on 09.02.2022. Even, it is counted for the purpose of Limitation, then it is established that the applicant bank has filed the case within the limitation period. As such, it is established that present application has been filed well within the period of limitation.

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9- In the affidavit of Shri Mahesh Kumar Tiwary, Senior Manager of the applicant bank, has stated that he is well acquainted with the facts of the case and has on verification of record, sworn in the affidavit in support of contents of application and the documents as evidence and established on oath the pleadings and documents of the applicant bank as stated above.

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The documents as stated above reveal that the defendants have applied for loan and the bank'had sanctioned the loan and to secure the loan and for repayment of loan amount with interests etc., the defendants have executed various loan documents, which strength the case of the applicant bank.

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The applicant bank has also furnished statement of account as above, which is not only admissible but shall be taken as correct statement of account, more so since the entries in the statement of account has not been challenged.

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DRT,PATNA

10Since, the case was proceeded ex-parte against defendants, all contentions raised and documents produced by plaintiff remained unrebutted and the tribunal may act upon the affidavit of the applicant as per law. Defendants have neither denied the utilization of funds advanced by applicant bank nor have pointed out any specific error and discrepancy in the Statement of Account, which is kept in due course of business, evidence on affidavit, which has supported the claim of the applicant bank, established to have fully correct and believable. Provisions contained in Rule 9(2) of Debt Recovery Tribunal (Procedure) Rules, 1993 provide that the documents referred in the application shall be duly stated by senior officer of the bank, or financial institution as the case may be and numbered accordingly. The rule 12 (10) provides that the provisions contained in section 4 of the Banker's Books evidence that Act, 1891 (18 of 1891) shall applied to certified copy of an entry in a Banker's Books furnished along with application filed under sub section 1 of section 19 by the applicant.

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11On consideration of the arguments and on perusal of the application, documents and affidavit, it is proved that the applicant bank has granted the loan facility, documents were executed by the defendants and facility was availed by the defendants as stated in the application.

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12The applicant bank has sought for recovery of a sum of Rs.28,65,310.68 with cost and further interest at the contractual rate from 01.02.2022 till realization.

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13Learned Advocate appearing for applicant bank submits that the applicant bank has charged interest in terms of the agreements and that interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.

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14On consideration of the arguments and on perusal of the pleadings, documents and affidavit, it is proved that the applicant has charged interest against defendants in terms of documents and as per directives of RBI.

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15None of the defendants appeared before the tribunal to contest the claim made by the applicant, therefore, it necessarily goes to establish that the claim made by the applicant bank is genuine and true. It is manifest that the defendants have not disputed the claim, therefore, the claim referred to the tribunal is recoverable till full and final realization of the claim.

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16In Indian Bank Vs. Blue Jaggers Estates Limited and others [2010] 8 SCC 129,the Hon'ble Supreme Court of India has observed as under-

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"The Court cannot lose sight of the fact that the bank is a trustee of public fund. It cannot compromise the public interest for benefiting private individuals. Those who take loan and avail financial facilities from the bank are duty bound to repay the amount strictly in accordance with the terms of the contract. Anyv;, such matters has to be viewed . ~\rj

OA 110of 2022 [J]

DRT,PATNA

seriously and the bank is not only entitled but duty bound to recover the amount by adopting all legally permissible methods. Parliament enacted the act because it was found that legal mechanism available till then was wholly insufficient for recovery of the outstanding dues of the banks and Financial Institutions."

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17In my view, Facts of the case stand proved by evidence of the applicant bank ex-parte. Accordingly, The applicant bank is entitled to recover from defendants jointly and severally ofRs 28,65,310.68/- along with pendente-lite and future interest @ 9.30 % p.a. with compounded monthly rests from 09.02.2022 (The date of filing of this O.A.) till realization. So the [mal order may be passed accordingly, to meet the ends of justice.

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ORDER

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In the result, the application of the applicant bank is, allowed exparte and debt is determined with costs against the defendants. The defendants are hereby jointly and severally, ordered to pay the applicant bank it's debts amounting to Rs 28,65,310.68/along with pendente-lite and future interest @ 9.30 % p.a. with compounded monthly rests from 09.02.2022 (The date of filing of this O.A.) till realization of the entire sum due and recoverable with costs.

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It is made clear that any amount deposited by the defendants, be deducted in the claim amount, if not deducted.

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Defendants are debarred from transferring, alienating encumbering or otherwise dealing with or disposing of the mortgaged or hypothecated or any other properties and assets without paying the aforesaid adjudicated dues to the applicant bank to secure the ends of justice. Let a certificate of recovery be drawn up forthwith and put up for signatures in terms of provisions contained in Section 19(22) of the Act to be issued, on the basis of the order of the Tribunal to the Recovery Officer. The Recovery Officer shall realize the amount as per the certificate in the manner and mode prescribed under the Act from the defendants, by sale of mortgaged! hypothecated assets as well as other personal movable/immovable assets of the defendants.

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Parties are directed to appear before the Recovery Officer, DRT, Patna on 3.2.2023. The order be communicated accordingly.

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Judgment signed, sealed, dated and pronounced in the open court on 20thday of December, 2022

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Dictated &corrected by me.

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i [Kau endraYadav] Presiding Officer Debts Recovery Tribunal, Patna

Punjab National Bank (Oriental Bank of Commerce) v. Subhash Kumar Sahu & Ors.

Case brief

What is this about?

What did the court decide?

Punjab National Bank (Oriental Bank of Commerce) v. Subhash Kumar Sahu & Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

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