Allowed

Punjab National Bank v. M/S Krishna Trading Company

DRT26 Jul 2023OA/1017/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed the applicant bank's original application for recovery of Rs.36,75,101.88/-. The court issued a recovery certificate and ordered future interest at 10% p.a., permitting recovery via sale of mortgaged properties or attachment of personal assets.

What did the court decide?

Recovery Certificate issued for Rs.36,75,101.88/- with interest @10% per annum; liberty to recover via sale of mortgaged/hypothecated property or attachment of personal assets.

Punjab National Bank versus M/S Krishna Trading Company — Banking and Recovery | DRT (2023)

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DEBTS RECOVERY TRIBUNAL-2, CHANDIGARH, PRESIDED OVER BY M.M. DHONCHAK

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ORIGINAL APPLICATION NO.1017/2022

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DATE OF INSTITUTION: 20.06.2022

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DATE OF DECISION: 26^th DAY OF JULY, 2023

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Punjab National Bank, a body corporate, constituted under the Banking Companies (Acquisition & Transfer of Undertaking) Act of 1970, having its Head Office at Plot No. 4, Sector 10, Dwarka, New Delhi-110075 and its Branch at Punjab National Bank, Shop No. 24-26, Sohna Road, Sanjay Colony, Faridabad, Haryana-121005, through its Authorized Representative, Sh. Akash Deep, Senior Manager, Punjab National Bank, Circle Sastra, Neelam Chowk, Faridabad-121001

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…..Applicant Bank

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Versus

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M/s Krishna Trading Company, through its Proprietor Sh. Sunil Verma S/o Sh. Krishan Chand Verma, Registered Office 3A/131, Block A, Chimney Bay Dharamshala, NIT Faridabad, Haryana-121001

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Residential Address: FA-09, Crown Plaza, Sector 15-A, Faridabad, Haryana-121001

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…..Defendant

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Argued by: Ms Arpita Sonkar, Manager Law, GPA Holder for the applicant bank Defendant ex parte vide order dated 06.03.2023

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19(1) of the Recovery of Debts Due to Banks

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OA/1017/2022 PUNJAB NATIONAL BANK VS M/S KRISHNA TRADING COMPANY 2

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and Financial Institutions Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), against the defendant for recovery of Rs.36,75,101.88/- (Rupees Thirty Six Lacs Seventy Five Thousand One Hundred One and Eighty Eight Paisa Only) . It has been filed through Sh. Akash Deep, Senior Manager of the applicant bank stated to be competent to institute the Original Application vide Power of Attorney dated 25.09.2019, Annexure-A1 (copy).

¶16

The brief facts of the case of the applicant as per Original Application are that the defendant had approached the applicant bank for grant of KCC facility of Rs. 25 Lacs vide loan application dated 10.07.2017, Annexure-A2 (copy).

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The applicant bank sanctioned aforesaid facility to the defendant vide sanction letter dated 10.07.2017, Annexure-A3 (copy) as per terms and conditions which were duly accepted by the defendant.

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In order to secure the aforementioned credit facility, the defendant executed agreement dated 10.07.2017 of hypothecation of goods and book debts to secure cash credit facility, Annexure-A4 (copy).

¶19

The aforesaid loan was further secured by creation of mortgage by the defendant in respect of house No. 3-A/131, Mid Portion measuring 30.25 Square Yards situated at NH-3, Faridabad, Haryana, fully detailed in para No. 6(vi) of the Original Application. Relinquishment deeds vide memo Nos. 666 and 962 dated 17.04.2013 and 25.04.2013, Annexure-A5 (colly) (copy).

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OA/1017/2022 PUNJAB NATIONAL BANK VS M/S KRISHNA TRADING COMPANY 3

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It is further the case of the applicant bank that the loan facility was duly availed of by the defendant but he failed to maintain the financial discipline of the applicant bank and resultantly, the loan account became irregular and it was declared as NPA on 02.07.2019. The defendants executed balance and security confirmation letter dated 06.06.2019, Annexure-A6 (copy), notices dated 05.08.2019 and 21.01.2020 under Sections 13(2) and 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 along with its postal receipts, Annexures-A7 and A8 (copy) and legal notice dated 26.05.2022, Annexure-A9 (copy), but to no avail.

¶22

It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.36,75,101.88/- (Rupees Thirty Six Lacs Seventy Five Thousand One Hundred One and Eighty Eight Paisa Only) is recoverable against the defendant as per statement of account, duly certified under Bankers’ Books Evidence Act, Annexure-A10 (copy).

¶23

Since the defendant did not repay the outstanding amount, therefore, the applicant bank preferred the present Original Application for issuance of Recovery Certificate.

¶24

Notice of the Original Application was duly served upon the defendant, but since none appeared on behalf of the defendant, thus, the defendant was proceeded against ex-parte vide order dated 06.03.2023 .

¶25

In support of the contents of the OA, affidavit of evidence of Sh. Akash Deep, Senior Manager of the applicant bank was filed.

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OA/1017/2022 PUNJAB NATIONAL BANK VS M/S KRISHNA TRADING COMPANY 4

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This Tribunal has heard ex-parte arguments advanced by Ms Arpita Sonkar, Manager Law of the applicant bank and gone through the record carefully.

¶28

It was argued by Ms Arpita Sonkar, Manager Law that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendant for recovery of the amount sought. From perusal of Annexures-A1 to A10 , it is clear that the defendant had approached the applicant bank for availing of the loan facility which was granted to him. It is further clear that the defendant had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendant failed to pay back the loan as per terms and conditions of the agreement executed between the parties. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.36,75,101.88/- (Rupees Thirty Six Lacs Seventy Five Thousand One Hundred One and Eighty Eight Paisa Only) from the defendant.

¶29

In so far as pendente lite and future interest is concerned, the applicant bank in relief clause has claimed rate of interest @11.05% per annum plus penal interest @2% per annum. In agreement dated 10.07.2017 of hypothecation of goods and book debts to secure cash credit facility, Annexure-A4 (copy), the rate of interest has been mentioned @11.35% per annum.

¶30

This Tribunal is of the considered opinion that sometimes in appropriate cases the prerogatives of mercy and magnanimity are the brightest jewels in the crown of the Judge. Keeping in view the

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OA/1017/2022 PUNJAB NATIONAL BANK VS M/S KRISHNA TRADING COMPANY 5

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facts and circumstances of the instant case including the Pandemic Covid-19 affecting businesses, nature of the mortgaged property, purpose of loan, i.e. business, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yesteryears, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @10% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

¶33

In the result, the Original Application is allowed with costs declaring that the defendant is liable to pay to the applicant bank a sum of Rs.36,75,101.88/- (Rupees Thirty Six Lacs Seventy Five Thousand One Hundred One and Eighty Eight Paisa Only)

¶34

with current and future simple interest @10% per annum w.e.f. 20.06.2022 , till the date of realisation of the amount. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of mortgaged/hypothecated property of the defendant in execution proceedings, if not sold earlier under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 or otherwise. If the dues of the bank still remain unsatisfied, the applicant bank shall be at liberty to recover the same by attachment and sale of personal assets of the defendant. The applicant bank is at liberty to enforce the claim through due process of law.

¶35

Issue Recovery Certificate accordingly.

¶36

Parties to appear before Recovery Officer concerned on 26.09.2023.

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OA/1017/2022 PUNJAB NATIONAL BANK VS M/S KRISHNA TRADING COMPANY 6

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Copy of this order be sent to the applicant bank and the defendant through registered/speed post. This order be also uploaded on the official website of this Tribunal.

¶39

Announced in the open Tribunal (M.M. Dhonchak) Presiding Officer DRT-2, Chandigarh

Punjab National Bank v. M/S Krishna Trading Company

Case brief

What is this about?

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Punjab National Bank v. M/S Krishna Trading Company

Case brief

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What did the court decide?

What the court decided

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