Allowed

Punjab National Bank v. M/S Public Home Solutions

DRT13 Dec 2023OA/1031/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the Original Application filed by Punjab National Bank against three respondents. The court ordered recovery of the outstanding loan amount along with a reduced future interest rate of 9% per annum, considering pandemic impact and market rates, and held the liability to be joint and several.

What did the court decide?

Recovery Certificate issued for Rs. 1,11,96,332.03/- plus future simple interest at 9% p.a. w.e.f. 27.05.2022.

Punjab National Bank versus M/S Public Home Solutions — Execution and Attachment | DRT (2023)

¶1

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

¶2

ORIGINAL APPLICATION NO. 1031/2022

¶3

DATE OF INSTITUTION: 27.05.2022

¶4

DATE OF DECISION: 13^th DAY OF DECEMBER, 2023

¶5

Punjab National Bank , a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Plot No. 4, Sector 10, Dwarka, New Delhi-110075 and amongst many branches in India, one at Jharsanthly, Faridabad, through Sh. Deepak Kumar, its Principal Officer and Power of Attorney holder

¶6

…..Applicant

¶7

Versus

¶8

M/s Public Home Solutions having address at 18/1 Mile Stone, Sector-15A, Mathura Road, Faridabad-121001, through its Proprietor, Smt. Cheshtaa Sood

¶9

Smt. Cheshtaa Sood w/o Sh. Kamal Sood, Proprietor, M/s Public Home Solutions having address at 18/1 Mile Stone, Sector-15A, Mathura Road, Faridabad-121001

¶10

Sh. Kamal Sood s/o Sh. Om Parkash Sood having address at 18/1 Mile Stone, Sector-15A, Mathura Road, Faridabad-121001

¶11

…..Defendants

¶12

Argued by: Sh. Gaurav Thakur proxy counsel for Sh. Rajan Chawla counsel for the applicant bank Defendants ex parte vide order dated 04.09.2023

¶13

OA/1031/2022 PUNJAB NATIONAL BANK Vs M/S PUBLIC HOME SOLUTIONS AND OTHERS 2

¶14

FINAL ORDER

¶15

Present Original Application was instituted by the applicant bank under Section 19(1) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as ‘the

¶16

Act’ for brevity), against the defendants for recovery of Rs.1,11,96,332.03/- (Rupees One Crore Eleven Lac Ninety Six Thousand Three Hundred Thirty Two and Three Paisa Only) . It has been filed through Sh. Deepak Kumar, Principal Officer of the applicant bank stated to be competent to institute the Original Application vide General Power of Attorney, Annexure-A1 (copy).

¶17

The brief facts of the case of the applicant as per Original Application are that defendant No. 1 through defendant No. 2 had approached the applicant bank for grant of CC limit of Rs. 80,00,000/- vide loan application Form dated 05.03.2018 for stand up India scheme, Annexure-A2 (copy). Defendant No. 3 stood as a guarantor for repayment of loan.

¶18

The applicant bank sanctioned aforesaid facility to the defendants vide sanction letter dated 20.04.2018, Annexure-A3 (copy), as per terms and conditions which were duly accepted by the defendants.

¶19

In order to secure the aforementioned credit facility, the defendants executed hypothecation of goods and book debts dated 20.04.2018 to secure cash credit facility, Annexure-A4 (copy) and agreement of guarantee dated 20.04.2018, Annexure-A5 (copy).

¶20

The aforesaid loan was further secured by creation of equitable mortgage by defendant No. 3 in respect of Plot No. 18/1

¶21

OA/1031/2022 PUNJAB NATIONAL BANK Vs M/S PUBLIC HOME SOLUTIONS AND OTHERS 3

¶22

situated in the revenue estate of Ajrounda, Tehsil Badkhal, District Faridabad, Haryana, fully detailed in para No. 5.8 of the Original Application.

¶23

The documents related to mortgage deed are as under:

¶24

i. Title deed dated 26.08.1986 is Annexure-A6 (copy).

¶25

ii. Acknowledgement letters dated 11.07.2018 and 12.07.2018 regarding deposit of title deeds with bank, Annexures-A7 and A8 (copy).

¶26

It is further the case of the applicant bank that the loan facility was duly availed of by the defendants but they failed to maintain the financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA on 31.03.2021. The defendants executed balance and security confirmation letters dated 31.12.2020, Annexures-A9 and A10 (copy). The applicant bank recalled entire outstanding amount vide legal notice dated 04.05.2021 under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 along with postal receipts and possession notice dated 04.05.2021, Annexure-A11 (copy), but to no avail.

¶27

It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.1,11,96,332.03/- (Rupees One Crore Eleven Lac Ninety Six Thousand Three Hundred Thirty Two and Three Paisa Only) , is recoverable against the defendants as per statement of account,

¶28

OA/1031/2022 PUNJAB NATIONAL BANK Vs M/S PUBLIC HOME SOLUTIONS AND OTHERS 4

¶29

certified under Bankers’ Books Evidence Act, 1891, Annexure-A12 (copy).

¶30

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

¶31

Notices of the Original Application were duly served upon the defendants, but since none appeared on behalf of the defendants, thus, the defendants were proceeded against ex-parte vide order dated 04.09.2023 .

¶32

In support of contents of the OA, affidavit of evidence of Sh. Deepak Kumar, General Attorney and Principal Officer of the applicant bank was filed.

¶33

This Tribunal has heard ex-parte arguments advanced by the learned proxy counsel for the applicant bank and gone through the record carefully.

¶34

It was argued by the learned proxy counsel of the applicant bank that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendants for recovery of the amount sought. From perusal of Annexures-A1 to A12 , it is clear that the defendants had approached the applicant bank for availing of the loan facilities which was granted to them. It is further clear that the defendants had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendants 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

¶35

OA/1031/2022 PUNJAB NATIONAL BANK Vs M/S PUBLIC HOME SOLUTIONS AND OTHERS 5

¶36

applicant bank is entitled to recover a sum of Rs.1,11,96,332.03/(Rupees One Crore Eleven Lac Ninety Six Thousand Three Hundred Thirty Two and Three Paisa Only) from the defendants.

¶37

In so far as pendent lite and future interest is concerned, in relief clause, the applicant bank has claimed rate of interest @16.15% per annum. In sanction letter dated 20.04.2018, Annexure-A3 (copy), rate of interest has been mentioned @10.85% per annum.

¶38

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 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, prevalent market rates of interest which have gone drastically downhill in yesteryears and defendant No. 2 being a female, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @9% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

¶39

In the result, the Original Application is allowed with costs holding that the defendants are liable to pay to the applicant bank a sum of Rs.1,11,96,332.03/- (Rupees One Crore Eleven Lac Ninety Six Thousand Three Hundred Thirty Two and Three Paisa Only) with current and future simple interest @9% per annum w.e.f. 27.05.2022 , till the date of realisation of the amount. The liability of the defendants shall be joint as well as several. Accordingly,

¶40

OA/1031/2022 PUNJAB NATIONAL BANK Vs M/S PUBLIC HOME SOLUTIONS AND OTHERS 6

¶41

the applicant bank shall be at liberty to recover aforesaid amount from the sale of mortgaged/hypothecated property of the defendants 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 defendants. However, the applicant bank is at liberty to enforce the claim through due process of law.

¶42

Issue Recovery Certificate accordingly.

¶43

Parties to appear before Recovery Officer concerned on 05.02.2024 .

¶44

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

¶45

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

Punjab National Bank v. M/S Public Home Solutions

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/S Public Home Solutions

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

State Bank of India versus Tagmaxx

Sanjay Jain versus Punjab National Bank

Bank of Baroda versus M/S Kumar Tiles and Sanitary Wares

Hdfc Bank versus Shri Rajiv Kumar Singla

Icici Bank Limited versus Sh. Pankaj Kumar Singh

Sarva Haryana Gramin Bank versus Sh. Baldev Kumar