Allowed

State Bank of India v. Sh. Rishi Pal

DRT26 Dec 2023OA/1181/2023

Case brief

AI extract

What is this about?

The DRT allowed the Original Application filed by State Bank of India for recovery of Rs. 22.25 lakh against the defendant. The court modified the claimed interest rate from 11.60% to 8% per annum, considering pandemic impacts and agricultural context, and issued a Recovery Certificate.

What did the court decide?

Payment of Rs. 22,25,723 with simple interest at 8% p.a. w.e.f. 14.08.2023; issuance of Recovery Certificate; liberty to recover via sale of mortgaged property or attachment of personal assets.

State Bank of India versus Sh. Rishi Pal — 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. 1181/2023 DATE OF INSTITUTION: 14.08.2023

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

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State Bank of India , a body corporate, constituted under the State Bank of India Act, 1955, having its Corporate Office at Madame Cama Road, Nariman Point, Mumbai and one of its Local Head Offices at Sector 17-A, Chandigarh and Branches all over India and one of its Branches at Ranwar, Tehsil and District, Karnal, through its Branch Manager and Principal Officer, Sh. Arpan Kamboj

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…..Applicant

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Versus

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Sh. Rishi Pal s/o Sh. Ram Kishan r/o Village and Post Office, Sheikhpura, Tehsil and District, Karnal, Haryana

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....Defendant

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Argued by: Sh. V.K. Sharma counsel for the applicant bank Defendant ex parte vide order dated 30.09.2023

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FINAL ORDER

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Present Original Application was instituted by the applicant bank

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under Section 19(1) of the Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), a gainst the defendant for recovery of Rs.22,25,723/- (Rupees Twenty Two Lac Twenty Five Thousand Seven Hundred and Twenty Three Only) . It has been filed through Sh. Arpan Kamboj, Branch Manager and Principal Officer of the applicant bank stated to be competent to institute the Original Application.

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OA/1181/2023 STATE BANK OF INDIA VS RISHI PAL 2

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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. 20 lac vide loan application dated 28.05.2015, Annexure-A1 (copy).

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The applicant bank sanctioned aforesaid facility to the defendant vide sanction letter dated 15.06.2015, Annexure-A2 (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 hypothecation agreement dated 15.06.2015, Annexure-A3 (copy).

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The aforesaid loan was further secured by creation of mortgage by the defendant in respect of agricultural land measuring 28 Kanal 10 Marla situated in the revenue estate of Sheikhpura, Tehsil and District, Karnal, Haryana, fully detailed in para No. 5.8 of the Original Application.

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The documents relating to the mortgage are as under:

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i. Registered mortgage deed dated 28.05.2015, Annexure-A4 (copy).

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ii. Request letter dated 08.06.2015 to the Tehsildar, Karnal, for entry/mutation of the mortgaged property, Annexure-A5 (copy).

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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 leading to the loan account becoming irregular and it being classified as NPA on 31.08.2022. The defendant executed revival letters dated 18.04.2018 and 15.04.2021, Annexures-A6 and A7 (copy). The applicant bank recalled entire

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OA/1181/2023 STATE BANK OF INDIA VS RISHI PAL 3

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outstanding amount vide demand notice dated 05.07.2023 along with its postal receipt, Annexure-A8 (colly) (copy), but to no avail.

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It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.22,25,723/(Rupees Twenty Two Lac Twenty Five Thousand Seven Hundred and Twenty Three Only) , is recoverable against the defendant as per statement of account, duly certified under Bankers’ Books Evidence Act,

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1891, Annexure-A9 (colly) (copy).

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

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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 30.09.2023 .

¶28

In support of contents of the OA, affidavit of evidence of Sh. Arpan Kamboj, Branch Manager of the applicant bank was filed.

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

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It was argued by the learned counsel 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 A9 , 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

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OA/1181/2023 STATE BANK OF INDIA VS RISHI PAL 4

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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.22,25,723/- (Rupees Twenty Two Lac Twenty Five Thousand

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Seven Hundred and Twenty Three Only) from the defendant.

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In so far as pendente lite and future interest is concerned, the applicant bank in relief clause, has claimed rate of interest @10.95% per annum with half yearly rests. In sanction letter dated 15.06.2015, Annexure-A2 (copy), the rate of interest has been mentioned @11.60% per annum.

¶35

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. agricultural , present conditions of economy based on agriculture, quantum of loan, 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 @8% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

¶36

In the result, the Original Application is allowed with costs holding that the defendant is liable to pay to the applicant bank a sum of Rs.22,25,723/- (Rupees Twenty Two Lac Twenty Five Thousand Seven Hundred and Twenty Three Only) with current and future simple interest @8% per annum w.e.f. 14.08.2023 , till the date of realisation of the amount. Accordingly, the applicant bank

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OA/1181/2023 STATE BANK OF INDIA VS RISHI PAL 5

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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. However, the applicant bank is at liberty to enforce the claim through due process of law.

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 19.02.2024.

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

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

State Bank of India v. Sh. Rishi Pal

Case brief

What is this about?

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State Bank of India v. Sh. Rishi Pal

Case brief

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