Allowed

Punjab National Bank v. Ms Vinayak Engineering Works

DRT23 Sept 2022OA/142/2022

Case brief

AI extract

What is this about?

This Debt Recovery Tribunal allowed an Original Application filed by Punjab National Bank for recovery of Rs. 52,29,143.09. The court held the defendants jointly and severally liable for loan dues, granted them two months to pay, and directed issuance of a Recovery Certificate.

What did the court decide?

Defendants to pay dues within two months; Recovery Certificate issued to the extent of Rs. 52,29,143.09 + 2% penalty + interest + costs.

Punjab National Bank versus Ms Vinayak Engineering Works — Banking and Recovery | DRT (2022)

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INTHE DEBTS RECOVERY TRIBUNAL AT LUCKNOW

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Present: A.H. Khan, Presiding Officer

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Case No. Original Application No.142 of 2022

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Dated:23.9.2022

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Punjab National Bank, a Nationalized Bank constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act 1970, having Branch atHazratgail, situated at MG Marg, Lucknow UP.

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......Applicant Bank

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Versus

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l. lWs. Vinayak Engineering Works, through its proprietor Mr. Ajay Kumar Srivastava, S/o Ram Chand Srivastava, Office at C-15, Dhawa, Chinhat Industrial Area, Luckno w-226028.

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Mr. Ajay Kumar Srivastava, S/o Ram Chand Srivastava, R/o M- 1 I , Janpath Road, Chandralok Aliganj, Llcknow-226024.

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....... ..Defbndants

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counsel for the applicant-Bank : Mr. Rajanish Kumar Tiwari, Advocate. Counsel for the defendants : None.

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JUDGMBNT

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l. This Original Application has been filed by the applicant Bank under Section 19 of the Recovery of Debts & Bankruptcy Act, 1993, against defendants for the recovery of Rs.52,29,143.09/- (Rupees Fifty Two Lac, Twenty Nine Thousand, One Hundred Forty Three and paisa Nine only) together with pendentelite and future interest. c.sts and other reliefs etc.

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The brief facts of the case are that the defendant No.l is proprietorship firm, of which, the defendant No.2 is propridor. On the) /., //

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O.A. No.l42 of 2022

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request ofthe defendants, the applicant-bank sanctioned Cash Credit of Rs.30.00 lac and Term Loan of Rs.19.00 lac vide its sanction letter dated 12.8.2016 and later on renewed by the bank from time to time on certain terms and conditions (Exhibit No.A-2 to Exhibit No.A-7) t9 this original application.

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To secure the credit facilities of Total Rs.49.00 lac, the defendants had executed and signed various security documents in favour of the bank on 12.8.2016 & 08.6.2020 like Agreement of Working Capital Term Loan, D.P. Note, Master Agreement and Agreement of Term Loan (Exhibit No.A-8 to Exhibit No.A-13) to this original application.

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The defendants had accepted the debts by executing Balance and Security Confirmation Letters dated 16.5.2018 & 19.12.2019^(Exhibit No.A-13 & Exhibit No.A-14) to this original application.

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For availing the aforesaid credit facilities, the applicant Bank had opened two loan accounts in the names of defendant No.l/firm in order to maintain the account of the said loan facilities.

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After availing the aforesaid credit facilities, the defendants failed to maintain financial discipline and also failed to comply^with the^terms and conditions, consequently, both the loan^accounts of^defendant No.l/firm were classified as NPA by the bank as^per RBI^guidelines, therefore, the applicant-bank issued Legal notice dated^{I l.Ol.2O22} (Exhibit No.A-15) to the defendants, but they did not considered^the same and both the loan accounts of^{defendantNo.l/firmare still un-} liquidated, hence, this Original Application has been instituted.

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As per books of the bank maintained in the usual and ordinary

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course of banking business, an outstanding of Rs.52,29,143.091-^(RuVeesrr, /1^-

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al ,/

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O.A. No.l42 of 2022

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Fifty Two Lac, Twenty Nine Thousand,.One Hundred Folty Three and Paisa Nine Only) including interest upto 05.01.2022 were lying due for payment, for which, the defendants are jointly and severally liable to repay the same, which they did not pay despite repeated requests and demands. The appliiant-bank has filed the copy of Statement of Accounts (Exhibit No.A-16) to this original application.

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The cause of action for filing the present application arose firstly when the aforesaid credit facilities were sanctioned by the applicantBank and the same were availed by defendants and necessay docurirents were executed. The cause of action further arose again on 11.01.2022 when the applicant bank had issued Legal Notice to the defendants recalling the entire outstanding dues and they failed to pay the same. 9. The summons were served upon defendants through registered post, but, the defendants did not appeared before this Tribunal to contest the case, hence, the matter proceeded ex-parte against the defendants. 10. In support of t}re case, Shri. Mukesh Arora, Matager of the applicant Bank has filed affidavit (As per this original application). 11. On a careful scrutiny of the evidence on affidavit and Exhibit marked as (Exhibit No.A-l to Exhibit No.A-16 to this original application), it is proved that defendants had availed the abovementioned credit facilities from the applicant bank by executing loan and security documents detailed as above^.in favour of the applicant-Bank. A perusal ofthe application, evidence and documents relied upon clearly show that defendants had utilized the credit facilities as granted to them. The applicant-bank had maintained the Books of accounts in the ordinary course of banking business showing disbursal of the loan amount. It

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O.A. No.l42 of2022

further shows that bank had regularly credited the amount^paid by^the defendants in the books of account. The Bank had also^{chnrged interest} from time to time and the entries are relevant u/s⁴ of^{the ElarkersBooks} of Evidence Act. It is also^proved that the applicant bark's^{claim is} within limitation from execution of Balance and Security Confirmation Letter. Therefore, the defendants are^jointly and severally^{liable to pay} the dues.

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Accordingly, the defendants are^{directedto pay the balance dues to} the applicant bank within a^period of 2 months^from the^{dateofjudgment} failing which the applicant bank will be^entitled to^{sell the personal} assets/properties of defendants.

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The applicant-bank has claimed^interest @2.00%^{penal interest in} both loan accounts together with^{pendent-lite and futureinteresttill the} date of its realization and costs. The^{contestbetween the applicant-bank} and the defendants corires to an end and^{after filingof the OiA. as per the} provisions of Section l9(2) of the Recovery of Debts and Bankruptcy Act, 1993 (as amended from time to time)^{which is analogousto Section} 34 to the CPC, the Tribunal/Court^{has discretion in awarding pendet-lite} and future interest. I am also supported^{in my view by Hon'bleSupreme} Court in a case titled Central bank of India^{vs. Ravindraand others} rtiported in AIR 2001 SC^page 3095. On^{the basis of the foregoing} discussion, interest of^justice will be served^{interestis granted} @2.00% penal in the Loan Accounts with monthly rate on reducing balance^from the date of frling of the O.A. till the date^{of realization with costs.}

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In the result, the Original Application^{succeedsexparte against the} defendants, with costs. The bank has^proved the loan execution of loay,z^{'^}

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-r/^,' ,/

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O.A. No.l42 of2022

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documents in favour of the bank. The liabilities of the defendants are joint and several and the hypothecated assets as well as personai property/properties ofthe defendants are liable to be sold.

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It is, therefore, ordered:-

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(i) That the Original Application No.142 of 2022 of the applicant bank for issuance ofRecovery Certificate to the tune of Rs.52,29,143.091- (Rupees Fifty Two Lac,^'Iwenty Nine Thousand, One Hundred Forty Three and Paisa Nine Only) with penal interest @2I0% in the loan accounts with rnonthly rest from the date of filing of the Original Application i.e. 02.02.2022 till the loan is fully liquidated and costs succeeds and is hereby allowed exparte against defendarrl Nos. I & 2 jointly and severally.

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(ii) The defendants are directed to pay the dues within a period of two months from the date of judgment, failing which the applicant-bank will be entitled to recover the stune lrom the personal movables and immovable assets of the defendants. (iiD The applicant-Bank is entitled to recover aforesaid amount by the sale of hypothecated assets (lf not sold earlier under the provisions of the S.A.R.F.A.E.S.I. Act,2002) the, amount, if any recovered by sale of hypothecated assets or otherwise shall be adjusted rowards the debt and only the balance amount shall be recoverable. If the dues of the applicant bank still remain unsatisfied, the same be recovered by the

/ //

/^)

O.A. No.l42 of 2022

attachment'and sale of the personal movable immovable assets of the defendants^jointly and severally. (iv) The defendants are hereby restrained by of injunction from depleting, transferrirg, encumbering, ali ,ing or in any way dealing with their properties/estates without first paying the claim of the applicant bank. (v) Let Recovery Certificate be issued immediatel luls 19(22) of I the Recovery of Debts Due to Banks and Fi Institution ,^Lucknow. 16. The applicant bank is directed to file a memo of preparing Recovery Certificate u/s 19(22) of the Recovery of Debts Bankruptcy Act, 1993.

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Judgment is pronounced in the open

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Dated:23.9.2022

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. Khan) Officer

Punjab National Bank v. Ms Vinayak Engineering Works

Case brief

What is this about?

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Punjab National Bank v. Ms Vinayak Engineering Works

Case brief

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