Allowed

Punjab National Bank v. Sh. Jitender Kumar Palia

DRT21 Jun 2023OA/1550/2022

Case brief

AI extract

What is this about?

DRT allowed an ex-parte recovery application filed by Punjab National Bank against loan defaulters and their heirs. The court directed recovery of the principal amount plus reduced simple interest at 5% per annum, clarifying heirs' liability is limited to the deceased's inherited estate.

What did the court decide?

Recovery of Rs.77,33,124.96 plus simple interest @5% per annum w.e.f. 26.08.2022; issuance of Recovery Certificate.

Punjab National Bank versus Sh. Jitender Kumar Palia — 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.1550/2022

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DATE OF INSTITUTION: 26.08.2022

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DATE OF DECISION: 21^st DAY OF JUNE, 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, Near Police Post, Sadar Bazar, Karnal-132001, through its Authorised Representative, Sh. Gurmeet Singh Kapoor, Senior Manager, Punjab National Bank, Circle Sastra, Sector-12, Kamal-132001

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…..Applicant Bank

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Versus

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Sh. Jitender Kumar Palia S/o late Sh. Satish Kumar Palia R/o L-536, Model Town, Near Kidzee School, Karnal-132001

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Smt. Bimla Palia W/o Sh. Jitender Kumar Palia R/o L-536, Model Town, Near Kidzee School, Karnal-132001

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Sh. Sahil Palia S/o late Sh. Satish Kumar Palia R/o 1-536, Model Town, Near Kidzee School, Karnal-132001

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Smt. Niti Palia W/o Sh. Sahil Palia R/o L-536, Model Town, Near Kidzee School, Karnal-132001

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Late Smt. Shakuntala Palia Wd/o late Sh. Satish Kumar Palia R/o L- 536, Model Town, Near Kidzee School, Karnal-132001 Represented through Legal Heirs:

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5(a) Sh. Jitender Kumar Palia S/o late Sh. Satish Kumar Palia R/o

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L-536, Model Town, Near Kidzee School, Karnal-132001

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OA/1550/2022 PUNJAB NATIONAL BANK Vs JATINDER KUMAR PALIA AND OTHERS

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5(b) Sh. Sahil Palia S/o late Sh. Satish Kumar Palia R/o L-536, Model Town, Near Kidzee School, Karnal-132001

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…..Defendants

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Argued by: Ms Arpita Sonkar, Manager (Law) for the applicant bank Defendants ex parte vide order dated 27.01.2023

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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 and Financial Institutions Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), against the defendants for recovery of Rs.77,33,124.96/- (Rupees Seventy Seven lacs Thirty Three Thousand One Hundred Twenty Four and Ninety Six Paisa Only) . It has been filed through Sh. Gurmeet Singh Kapoor, Senior Manager of the applicant bank stated to be competent to institute the Original Application vide General Power of Attorney dated 23.11.2001, Annexure-A1 (copy).

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The brief facts of the case of the applicant as per Original Application are that the defendants had approached the applicant bank for takeover of term loan facility of Rs.72 lacs vide loan application dated 04.07.2017, Annexure-A2 (colly) (copy).

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The applicant bank sanctioned aforesaid credit facility to the defendants vide sanction letter dated 12.07.2017, Annexure-A3 (copy) as per terms and conditions which were duly accepted by the defendants.

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In order to secure the aforementioned credit facility, the defendants executed agreement dated 12.07.2017 of individual housing loan, Annexure-A4 (copy).

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OA/1550/2022 PUNJAB NATIONAL BANK Vs JATINDER KUMAR PALIA AND OTHERS

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The aforesaid loan was further secured by creation of mortgage by defendant No. 5 in respect of residential Plot/House No. 536 measuring 194.44 Square Yards situated at A.R Model Town, within M.C. limits, near Kidzee School, Karnal, Haryana, fully detailed in para No. 5 (vi) of the Original Application.

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The documents relating to the mortgage are as under:

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i. Letter dated 19.07.2017 by mortgagor to the bank regarding confirmation of deposit of title deeds, Annexure-A5 (copy).

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ii. Registered sale deed No. 15124/1 dated 01.02.2021, AnnexureA6 (copy).

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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 and resultantly, the loan account became irregular and it was declared NPA on 31.12.2021. The applicant bank recalled the entire outstanding amount vide legal notice dated 25.07.2022 along with original postal receipts, Annexure-A9 (colly) (copy) and notices dated 16.06.2021 and 22.02.2022 under Sections 13(2) and 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, Annexures-A7 and A8 (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.77,33,124.96/- (Rupees Seventy Seven lacs Thirty Three Thousand One Hundred Twenty Four and Ninety Six Paisa Only) is recoverable against the defendants as per statement of account, Annexure-A10 (copy), certified under Bankers’ Books Evidence Act.

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OA/1550/2022 PUNJAB NATIONAL BANK Vs JATINDER KUMAR PALIA AND OTHERS

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

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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 27.01.2023 .

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In support of the contents of the OA, affidavit of evidence of Sh. Gurmeet Singh Kapoor, Senior Manager of the applicant bank was filed.

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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.

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It was argued by Ms Arpita Sonkar, Manager (Law) 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 A10 , it is clear that the defendants had approached the applicant bank for availing of the loan facility 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. Smt. Shakuntala Palia had died, leaving behind defendant Nos. 5(a) and 5(b) as her legal heirs who have been impleaded as defendants. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.77,33,124.96/-

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OA/1550/2022 PUNJAB NATIONAL BANK Vs JATINDER KUMAR PALIA AND OTHERS

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(Rupees Seventy Seven lacs Thirty Three Thousand One Hundred Twenty Four and Ninety Six Paisa Only) from the defendants.

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In so far as pendent lite and future interest is concerned, the applicant bank in relief clause has claimed rate of interest @12.75% per annum plus @2% per annum penal interest. In sanction letter dated 12.07.2017, Annexure-A3 (copy), rate of interest has been mentioned @8.45% per annum.

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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. housing, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yesteryears, death of the borrower and defendant Nos. 2, 4 and 5 being ladies, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @5% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

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In the result, the Original Application is allowed with costs declaring that the defendants are liable to pay to the applicant bank a sum of Rs.77,33,124.96/- (Rupees Seventy Seven lacs Thirty

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Three Thousand One Hundred Twenty Four and Ninety Six Paisa

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Only) with current and future simple interest @5% per annum w.e.f. 26.08.2022 , 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 defendants in

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OA/1550/2022 PUNJAB NATIONAL BANK Vs JATINDER KUMAR PALIA AND OTHERS

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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. The applicant bank is at liberty to enforce the claim through due process of law. However, it is clarified that there should not be any ambiguity that the liability of the defendants by virtue of their being the legal heirs of the deceased borrower shall remain confined only to estate of the deceased borrower if it is inherited by them and not beyond that or otherwise. The recovery proceedings shall proceed only after the Recovery Officer is fully satisfied on the aspect of the estate being inherited by the Legal Representatives/Heirs and the liability being incurred accordingly .

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 21.08.2023 .

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

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

Punjab National Bank v. Sh. Jitender Kumar Palia

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. Sh. Jitender Kumar Palia

Case brief

What is this about?

What did the court decide?

What the court decided

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