Allowed

Union Bank of India v. Messrs Krishan Gopal and Sons and Others

DRT26 Dec 2023OA/1294/2022

Case brief

AI extract

What is this about?

The Tribunal allowed ex-parte application by Union Bank of India for recovery of Rs.43,97,325.49 p from defendants who failed to repay sanctioned loans. The court fixed the interest rate at 10% p.a. and ordered issuance of a Recovery Certificate.

What did the court decide?

Order for recovery of Rs.43,97,325.49 p jointly and severally with interest at 10% p.a. from date of application till realization; Recovery Certificate issued.

Union Bank of India versus Messrs Krishan Gopal and Sons and… — Banking and Recovery | DRT (2023)

¶1

DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

¶2

ORIGINAL APPLICATION NO.1294/2022

¶3

PRESIDED OVER BY MRIDULESH KUMAR SINGH

¶4

DATE OF INSTITUTION: 02.07.2022

¶5

DATE OF DECISION: 26.12.2023

¶6

Union Bank of India, a body corporate, constituted under Banking Companies (Acquisition & Transfer of Undertakings) Act 1970 having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai and having a Branch office inter-alia at Village Phullanwal, Tehsil and district Ludhiana, through duly authorized person and attorney holder Sh.Pradeep Kumar, Branch Manager

¶7

……..Applicant

¶8

Versus

¶9

M/S Krishan Gopal and Sons, B-XXVIII-730/1A, Punjab Mata Nagar, Pakhowal Road, Ludhiana through its proprietor, Sh. Varun Bhogal

¶10

Sh. Varun Bhogal S/o late Sh. Krishan Gopal, resident of 727/2, Street no.5, Punjab Mata Nagar, Pakhowal Road, Ludhiana (proprietor of M/s Krishan Gopal and Sons) and legal heir of late Sh. Krishan Gopal S/o Sh. Nathi Ram

¶11

Sh. Arun Bhogal S/o late Sh. Krishan Gopal, resident of 727/2, street no. 5, Punjab Mata Nagar, Pakhowal Road, Ludhiana - Legal heir of late Sh. Krishan Gopal S/o Sh. Nathi Ram

¶12

Smt. Santosh Rani W/o late Sh. Krishan Gopal, resident of 727/2, street no. 5, Punjab Mata Nagar, Pakhowal Road, Ludhiana - Legal heir of late Sh. Krishan Gopal S/o Sh. Nathi Ram

¶13

Ms. Neeru Bhagol D/o late Sh. Krishan Gopal, resident of 727/2, street no. 5, Punjab Mata Nagar, Pakhowal Road, Ludhiana - Legal heir of late Sh. Krishan Gopal S/o Sh. Nathi Ram

………Defendants

Advocates:

Argued by Sh. Amod Kumar Thakur, Advocate proxy for Sh. R.K. Chauhan, Advocate for the applicant Defendants are ex-parte

¶18

FINAL ORDER

¶19

Present Original Application was instituted by the applicant under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.43,97,325.49p (Rupees Forty Three Lacs Ninety Seven Thousand Three Hundred Twenty Five and Paisa Forty Nine only). The Original Application has been filed through Sh. Pradeep Kumar, Branch Manager of the applicant bank, who is competent to institute the Original Application vide Authority Letter dated 21.10.2021, which is Annexure A1 to this OA.

¶20

The brief facts of the OA are that the defendant No.1 through its proprietor i.e. defendant no.2 had approached the applicant bank for the grant of Cash Credit Limit of Rs.50.00 Lacs vide Loan Application dated 16.06.2012, which is Annexure A2 to this OA and later on for the grant of Term Loan of Rs.12.00 Lacs.

¶21

The applicant Bank sanctioned the Cash Credit Limit of Rs.40.00 Lacs vide Sanction by Credit Approval Committee dated 03.08.2012, which is Annexure A3 to this OA and Sanction Letter dated 07.08.2012, which is Annexure A4 to this OA and Term Loan of Rs.12.00 Lacs vide Sanction Letter dated 28.07.2017, which is Annexure A29 to this OA and renewed the CC Limit with fresh term loan vide Renewal Letter dated 29.07.2017, which is Annexure A30 to this OA and the terms and conditions were duly accepted by the defendants.

¶22

¶23

Late Sh. Krishan Gopal S/o Sh. Nathi Ram (Mortgagor/Guarantor) had mortgaged his immovable property through equitable mortgage of land measuring 200 square yards comprised in Khata No.742/807, Khasra No.571 situated at Village Jawaddi, Punjab Mata Nagar, H.B. No.160, Pakhowal Road, Ludhiana, Punjab v ide Memorandum of Deposit of Title Deeds dated 07.08.2012, which is Annexure A15 to this OA, Title Deed bearing vasika no.7028 dated 20.06.2005 along with its translation, which is Annexure A16 to this OA and Jamabandi for the year 2008-09 dated 19.05.2013 along with its translations, which is Annexure A17 to this OA and Jamabandi for the year 2008-09 dated 13.09.2017 along with its translations, which is Annexure A46 to this OA.

¶24

Documents executed:- Demand Promissory Note, Letter of Continuity, Hypothecation agreement of goods and debts, Agreement on Rate of Interest, Annexure-I, Letter of undertaking not to alienate hypothecated goods , Declaration-cum-Undertaking, Consent for take over penalty, Letter of guarantee, Annexure-II all dated 08.08.2012, which are Annexures A5 to A14 to this OA; Debit balance confirmation and acknowledgement dated 24.09.2014 which is Annexure A18 to this OA; Demand Promissory Note, Letter of Continuity, Hypothecation agreement of goods and debts, Agreement on Rate of Interest, Annexure-I, Letter of undertaking not to alienate hypothecated goods , Declaration-cum-Undertaking, Consent for take over penalty, Letter of guarantee, Annexure-II all dated 23.07.2015, which are Annexures A19 to A28 to this OA; D.P. Note, Letter of Continuity, Hypothecation agreement, Interest agreement, AnnexureI, Letter of undertaking not to alienate hypothecated goods, Declaration-cum-undertaking, D.P. Note for Rs.52.00 Lacs, Composite Hypothecation deed, Interest agreement for CC Limit and Term Loan, Letter of Guarantee, Annexure-II, Declaration regarding extension of equtable mortgage, Letter to GTBH branch regarding extension EM,

¶25

¶26

Supplementary Memorandum (Equitable Mortgage)0 all dated 29.07.2017, which are Annexures A31 to A45 to this OA Letter of confirmation dated 23.04.2019, which is Annexure A47 to this OA; Valuation report dated 03.09.2020, which is Annexure A48 to this OA; Letter dated 12.07.2016, 18.07.2016, 05.04.2017,20.01.2018, which are Annexures A49 to A52 to this OA; Legal notice by bank dated 29.01.2018 which is Annexure A53 to this OA; Letter dated 05.02.2018, 22.02.2018 which are Annexures A54 and A55 to this OA; Letter in limit account dated 16.08.2018 which is Annexure A56 to this OA; Letter in Term Loan dated 16.08.2018 which is Annexure A57 to this OA; Letter dated 04.12.2018 which is Annexure A58 to this OA; Legal Notice by Advocate dated 06.04.2021 with postal receipts, which are Annexures A59 to A62 to this OA; Copy of notice u/s 13(2) of SARFEASI Act dated 11.04.2022 and postal receipts dated 11.04.2022 which are Annexures A63 to A66 to this OA; Certified copy of Statement of Account which is Annexure A67 to this OA and Certificate under section 65-B of Indian Evidence Act, which is Annexure A68 to this OA.

¶27

The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in loan account there was a debit of Rs.43,97,325.49p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant bank requested to accept the application and to issue Recovery Certificate accordingly. 6. The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte on 10.11.2023.

¶28

In support of the OA, affidavit of Sh. Pradeep Kumar, Branch Manager, Union Bank of India has been filed. 8. Heard ex-parte arguments and perused record.

¶29

¶30

It was argued by learned proxy counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant bank had proved its case. From the perusal of all the Annexures A1 to A68 to this OA, it is proved that the defendants approached applicant bank for availing of the loan facility which was granted to them and for that they had executed all the relevant documents in favour of the bank. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.43,97,325.49p (Rupees Forty Three Lacs Ninety Seven Thousand Three Hundred Twenty Five and Paisa Forty Nine only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the account.

¶31

In so far as pendent elite and future rate of interest is concerned, the applicant bank in relief clause has claimed interest @10.40%p.a. plus penal interest @2%p.a. with monthly rests from 29.06.2022 till the realization.

¶32

The Tribunal is of the considered opinion that sometimes in appropriate cases the prerogative of mercy is the brightest jewel in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including nature of the mortgaged property, undertaking of the defendants, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yester years, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @10.00%p.a. in the loan account from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly.

¶33

In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of

¶34

¶35

Rs.43,97,325.49p (Rupees Forty Three Lacs Ninety Seven Thousand Three Hundred Twenty Five and Paisa Forty Nine only), jointly and severally, with costs, current and future simple interest @10.00%p.a. in the loan account from the date of filing of OA till the date of realization of the amount. Accordingly, the applicant bank shall be entitled to recover aforesaid amount from the sale of hypothecated/mortgaged properties of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the bank still remain unsatisfied, it shall be entitled to recover the same by attachment and sale of personal assets of the defendants. The applicant is at liberty to enforce the claim through due process of law.

¶36

Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 10.01.2024. 15. Copy of this order be given dasti to the applicant bank and be sent to defendants through registered/speed post and this order be also uploaded on the official website of this Tribunal and record be consigned.

¶37

Pronounced by me in the Open Tribunal. Dated: 26.12.2023

¶38

(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Union Bank of India v. Messrs Krishan Gopal and Sons and Others

Case brief

What is this about?

What did the court decide?

Union Bank of India v. Messrs Krishan Gopal and Sons and Others

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

Punjab National Bank, versus Sh. Tehal Singh and Another

Indian Bank (erstwhile Allahabad Bank) versus Sh.Budha Singh and Another

Hdfc Bank Limited, versus Sh. Gurvinder Singh and Another

Punjab National Bank, versus Sh. Avtar Singh and Another

Punjab National Bank, versus Messrs Shakti Transformer Co. and Others

Punjab National Bank (Erstwhile known as Oriental Bank of Commerce), versus Sh. Amritpal Singh