Allowed

Punjab National Bank v. Sh. Krishan Kumar

DRT18 Sept 2023OA/1692/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed applicant bank's application for recovery certificate against defendant who defaulted on credit facilities. Court fixed simple interest at 8% per annum and authorized sale of mortgaged or personal assets for realization.

What did the court decide?

Recovery certificate issued; defendant liable to pay Rs.23,45,549.62 with 8% simple interest p.a. from filing date till realization.

Punjab National Bank versus Sh. Krishan Kumar — Contract and Commercial Disputes | DRT (2023)

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

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ORIGINAL APPLICATION NO. 1692/2022

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DATE OF INSTITUTION: 13.09.2022

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DATE OF DECISION: 18^th DAY OF SEPTEMBER, 2023

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Punjab National Bank , a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act of 1970, having its Head Office at Plot No. 4, Sector-10 Dwarka, New Delhi and its Branches at Punjab National Bank, Village Padha, District Karnal, through its Authorised Representative, Mr. Vinod, Senior Manager

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…..Applicant Bank

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Versus

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Sh. Krishan Kumar s/o Sh. Dulia @ Duli Chand r/o VPO Kurlan, Near Shiv Mandir, Tehsil Assandh, District Karnal, Haryana-132046

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....Defendant

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Argued by: Ms Arpita Sonkar, Manager Law for the applicant bank Defendant ex parte vide order dated 11.04.2023

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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 defendant for recovery of Rs.23,45,549.62/- (Rupees Twenty Three Lac Forty Five Thousand Five Hundred Forty Nine and Sixty Two Paisa Only) . It has been filed through Mr. Vinod, Senior Manager of the applicant

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bank stated to be competent to institute the Original Application vide General Power of Attorney dated 30.11.2015, Annexure-A1 (copy).

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OA/1692/2022 PUNJAB NATIONAL BANK VS KRISHAN KUMAR 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. 1,50,000/- which was enhanced to Rs. 14,60,000/- and a Term Loan of Rs. 1,00,000/- vide loan applications dated 14.08.2003 and 18.06.2013, Annexures-A2 and A5 (copy).

¶16

The applicant bank sanctioned aforesaid facilities to the defendant vide sanction letters dated 07.10.2003 and 20.06.2013, Annexures-A3 and A6 (copy), as per terms and conditions which were duly accepted by the defendant. 4. In order to secure the aforementioned credit facilities, the defendant executed hypothecation agreements dated 16.10.2003 and 29.06.2013, Annexures-A4 and A7 (copy). 5. The aforesaid limits were further secured by creation of equitable mortgage by defendant in respect of agricultural land measuring 119 Kanals 19 Marlas situated in the revenue estate of Kurlan, Sub-Tehsil Ballah, District Karnal, Haryana.

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The documents related to mortgage are as under:

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i. Registered supplementary mortgage deed dated 27.06.2013, Annexure-A8 (copy).

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ii. Copy of ‘Jamabandi’ of the year 2013-2014, Annexure-A9

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(copy).

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It is further the case of the applicant bank that the loan facilities were 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 31.03.2022. The defendant executed balance and security

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OA/1692/2022 PUNJAB NATIONAL BANK VS KRISHAN KUMAR 3

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confirmation letter dated 21.12.2021, Annexure-A10 (copy). The applicant bank recalled entire outstanding amount vide notice dated 12.08.2022 along with postal receipt, Annexure-A11 (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 accounts, a sum of Rs.23,45,549.62/- (Rupees Twenty Three Lac Forty Five Thousand Five Hundred Forty Nine and Sixty Two Paisa Only) is recoverable against the defendant as per statements of accounts duly certified under Bankers’ Books Evidence Act, 1891, AnnexureA12 (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 11.04.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Vinod, 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 for the applicant bank that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against

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OA/1692/2022 PUNJAB NATIONAL BANK VS KRISHAN KUMAR 4

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the defendant for recovery of the amount sought. From perusal of Annexures-A1 to A12 , it is clear that the defendant had approached the applicant bank for availing of the loan facilities which were 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.23,45,549.62/- (Rupees Twenty Three Lac Forty Five Thousand Five Hundred Forty Nine and Sixty Two Paisa Only) from the defendant.

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In so far as pendente lite and future interest is concerned, the applicant bank has claimed rate of interest @9.80% per annum plus penal interest @2% per annum. In sanction letter dated 20.06.2013, Annexure-A6 (copy), the rate of interest has been mentioned @14.75% 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, purpose of loan, i.e. agricultural, present conditions of economy based on agriculture, 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 @8% per annum from the date of filing

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OA/1692/2022 PUNJAB NATIONAL BANK VS KRISHAN KUMAR 5

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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 holding that the defendant is liable to pay to the applicant bank a sum of Rs.23,45,549.62/- (Rupees Twenty Three Lac Forty Five Thousand Five Hundred Forty Nine and Sixty Two Paisa Only) with current and future simple interest @8% per annum w.e.f. 13.09.2022 , 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.

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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 16.10.2023.

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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.

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

Punjab National Bank v. Sh. Krishan Kumar

Case brief

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Punjab National Bank v. Sh. Krishan Kumar

Case brief

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