Allowed

Punjab National Bank v. M/s Koshila Enterprises and Others

DRT17 Apr 2023OA/174/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application under Section 19 of the RDB Act to recover a loan debt. The court found that the defendants admitted the loan execution and failed to dispute the account statement. The Tribunal determined the dues amounting to Rs. 50,47,163.66 along with interest.

What did the court decide?

Recovery certificate issued directing the Recovery Officer to realize Rs. 50,47,163.66 plus interest from the defendants; property attached and charges endorsed.

Punjab National Bank versus M/s Koshila… — Contract and Commercial Disputes | DRT (2023)

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DRT,PATNA

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OA 1740(2022 IJI

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Debts Recovery Tribunal, Patna,

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Karpuri Thakur Sadan, Aashiana Digha Road at PATNA-800025

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Presiding Officer : Shri Kaushalendra Yadav

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OA Case no.: 174of 2022

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Punjab National Bank, Piania, P.S.-Udwandnagar, District-Bhojpur, ....... Applicant -Bank

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Vs.

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Mis Koshila Enterprises through its proprietor Sri Pramod Singh, At Ara Sasaram Road Near Zero Mile Ara, P.O.-South Ekauna, P.S.Udwantnagar, District-Bhojpur.

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Sri Pramod Singh S/o Sri Ram Laddu Singh Proprietor Mis Koshila Enterprises, Rio Village-Sabalpur Behra, P.O.-South Ekauna, P.S.Udwantnagar, District-Bhojpur.

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Sri Ashok Kumar S/o Sri Ram Laddu Singh, Rio Village-Sabalpur Behra, P.O.-South Ekauna, P.S.-Udwantnagar, District-Bhojpur.

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...Defendants.

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Present:

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For the Applicant Shri H.K. Kam, Advocate For the Defendants Shri C.S.P. Sinha, Advocate

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Dated: 17.4.2023

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JUDGMENT

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1- The Applicant bank has made this application U/S 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 22.2.2022 against the defendants to recover its debts from defendants of Rs.50,47,163.66 upto 31.1.2022 alongwith pendentelite and future interest at the contractual rate from 1.2.2022 with costs till realization.

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2- The application has been duly registered and numbered as above.

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3- The brief facts of the case of the applicant bank as stated in the application are as under-

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The applicant bank is a body corporate constituted under provisions of the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970 having its Corporate Office Plot no. 4,Sector-10,Dwarka New Delhi-l10075 and inter alia a branch Office at Piania, P.S.Udwandnagar, District-Bhojpur,

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The defendant no. 1 is proprietorship firm defendant no. 2 & 3 is proprietor and guarantor. The defendants made an application dated 7.10.2016 for grant of cash credit limit of Rs.45 lakh to run its business

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OA 174 of 2022 [J)

activities, efficiently and profitably. The bank sanctioned the cash credit facility ofRs.45 lakh on 7.10.2016. The defendants executed the various loan documents i.e. agreement, agreement of hypothecation of goods, agreement of guarantee and PDR. The defendant no. 2 & 3 deposited title deeds for creation of mortgage of land details given at page 10 ofOA.

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The bank made persistent efforts by approaching defendants in order to get the overdue amount deposited but all such efforts did not yield any result. Hence the applicant bank regularly made demands by serving demand notices on various dated to the defendants calling him to regularize the account failing which bank would be free to exercise its right in terms of agreement for recovery of due amount of loan. As the defendants failed to regularize the account hence the loan account became irregular and classified as NPA on 23.5.2021.

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As per the statement of loan account total outstanding due amount of loan is Rs.50,4 7,163.66 as on 31.1.2022 and further unapplied interest from 1.2.2022 is also due and the defendants are liable to pay the same to the bank.

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The interest /compound interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.

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Since, the defendants have failed and neglected in spite of several reminders to make payment of the dues recoverable to bank, hence this application has been filed by the bank.

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4- D/s 19 (4) of the Act & Rule of the DRT [Procedure] Rules, 1993, copies of application & paper book was sent by this Tribunal to the defendants by registered/speed post on 7.6.2022, and summons/notices issued requiring the defendants to show-cause within 30 days of the service of summons/notices as to why relief prayed for, should not be granted.

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Despite the registered summons/notices, the defe?dan:s have appeared before this Tribunal to contest the case. The sufficient time .has been given to the defendants to file the written statemnt, but they fIled to file WS, hence, the Tribunal has passed an order nght to file wntten statement of the defendants was closed on 22.9.2022.

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Ld. Counsel for the defendants argues the case without filing .of written statement and has not denied the sanction of ~oan amount, Its utilization and further to secure the loan, execution of relevant documents.

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OA 1740(2022 [J)

Arguments of ld. Counsels of the applicant bank and ld. Counsel of defendants were heard and record perused and considered.

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5- To prove its case, the applicant Bank has referred various photocopies of documents before this Tribunal. The applicant bank has also given evidence on affidavit by way of affidavit of Md. Aqveel Jawed Khan, Circle SASTRA Head Ara of the applicant bank. The details of documents are as follows. :-

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SI.No	Description of photocopies Documents	Date of Execution	Amount	Signature of executant	Ex.! Ann. No.
1	Loan application	7.10.2016	Rs.451akh	defendants	1
2	sanction letter	7.10.2016	Rs.451akh	bank	2
3	consent clause	...	...	defendants	3
4	agreement for loan for CC facility	...	Rs.451akh	defendant no. 2	4
5	Agreement of hypothecation of goods	7.10.2016	Rs.451akh	defendant no. 2	5
6	Agreement ofPDR	6.10.2016	Rs.451akh	defendant no. 2	6
7	Agreement of guarantee	7.10.2016	Rs.451akh	defendant no. 3	7
8	memo of deposit of title deeds and deed no. 10912 and deed no. 8048	3.9.2013 2.7.2012	...	...	8
9	Application	27.3.2019	...	defendant no. 2	9
10	Be letter	3.10.2019	...	defendant no. 2	10
11	Notice	18.11.2021	...	bank	11
12	Statement of account	as on 31.1.2022	Rs.50,47,163.66	bank	12

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6- It is submitted by ld. Counsel of applicant bank that the defendants no. 1 has admitted the loan facilities, granted to them and there is no any specific denial of execution of loan documents by the defendants. It is further submitted that there is no any stay granted by the Hon'ble Higher Court in the matter.

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It is further submitted that the applicant bank has filed the Original Application, for recovery of due amount, after deducting all the amounts, deposited by the defendants and by calculating the interest charged, as agreed by the defendant. It is further submitted that the defendants have not deposited any amount, after filing of the OA.

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OA 1740(2022 [J[

It is requested that the recovery certificate may be issued for the claim amount, as made in OA, as there is no any specific denial by the defendants.

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7- It has been established that defendants are living and carrying on their business in the state of Bihar. Cause of action arose in the State of Bihar. The said claim on the date of filing of application exceeded Rs.20 lacs. The applicant bank is functioning within jurisdiction of this tribunal. Therefore, this Tribunal has territorial as well as pecuniary jurisdiction to adjudicate upon the present application.

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8- On the issue of Limitation, to prove it, the applicant bank has submitted that the account was declared as NPA on 23.5.2021, whereas the present application has been filed on 22.2.2022. Even, it is counted for the purpose of Limitation, then it is established that the applicant bank has filed the case within the limitation period. As such, it is established that present application has been filed well within the period of limitation.

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9- In the affidavit of Md. Aqveel Jawed Khan, Circle SASTRA Head Ara of Applicant bank, has stated that he is well acquainted with the facts of the case and has on verification of record, sworn in the affidavit in support of contents of application and the documents as evidence and established on oath the pleadings and documents of the applicant bank as stated above.

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10On perusal of the above documents, it is clear that the applicant bank has granted loan facility to the defendants and to secure the loan, various loan documents were executed by the defendants and loan facility was availed by the defendants as stated in the application.

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11The documents as stated above reveal that the defendants have applied for loan and bank had sanctioned loans, thereafter, to secure the loan and for repayment of loan amount with interests etc., the defendants have executed various loan documents, which strength the case of the applicant bank.

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12The applicant bank has also furnished statement of account as shown above, which is not only admissible but shall be taken as correct statement of account, more so since the entries in the statement of account has not been challenged.

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13Defendants have neither denied the utilization of funds advanced by applicant bank nor have pointed out any specific error and discrepancy in the Statement of Account, which is kept in due course of business, evidence on affidavit, which has supported the claim of the applicant bank, established to have fully correct and believable. Provisions contained in Rule 9(2) of Debt Recovery Tribunal (Procedure) Rules, 1993 provide that the documents referred in the application shall be

/ / ~« 'l~ <,

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OA 174 of2022 [J]

duly stated by senior officer of the bank, or financial institution as the case may be and numbered accordingly. The rule 12 (10) provides that the provisions contained in section 4 of the Banker's Books evidence that Act, 1891 (18 of 1891) shall applied to certified copy of an entry in a Banker's Books furnished alongwith application filed under sub section 1 of section 19 by the applicant.

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14On consideration of the arguments and on perusal of the application, documents, affidavit, it is proved that the applicant bank has granted the loan facilities to the defendants and to secure the loan, various loan documents were executed by the defendants and facilities were availed by the defendants as stated in the application.

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15-The Section 58 of the Indian Evidence Act, 1872 reads as under-

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"58. Facts admitted need not be proved.- No fact need to be proved in any proceeding which the parties thereto or their agents agree to admit at the hearing, or which, before the hearing, they agree to admit by any writing under their hands, or which by any rule of pleading in force at the time they are deemed to have admitted by their pleadings: Provided that the Court may, in its discretion, require the facts admitted to be proved otherwise than by such admissions.

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16In Indian Bank Vs. Blue Jaggers Estates Limited and others [2010] 8 SCC 129,the Hon'ble Supreme Court of India has observed as under-

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"The Court cannot lose sight of the fact that the bank is a trustee of public fund. It cannot compromise the public interest for benefiting private individuals. Those who take loan and avail financial facilities from the bank are duty bound to repay the amount strictly in accordance with the terms of the contract. Any lapse in such matters has to be viewed seriously and the bank is not only entitled but duty bound to recover the amount by adopting all legally permissible methods. Parliament enacted the act because it was found that legal mechanism available till then was wholly insufficient for recovery of the outstanding dues of the banks and Financial Institutions."

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17Facts of the case, in my view, are well proved by evidence of the applicant bank as well as admission of defendants . The applicant bank is entitled to receive from defendants jointly and severally of Rs.50,47,163.66 together with pendentelite and future interest @8.90% p.a. compounded monthly rests from 22.2.2022 (The date of filing of this O.A.) till realization. So the final order may be passed accordingly, to meet the ends ofjustice. ORDER In the result, the application of the applicant bank, is allowed and debt is determined with costs against the defendants and it is, hereby jointly and severally, ordered that the applicant bank is entitled to receive from sole defendants, it's debts with interest, amounting to Rs.50,47,163.66 together with pendentelite and future interest @8.90%

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OA 174 of 2022 [J)

p.a. compounded monthly rests from 22.2.2022 (The date of filing of this O.A.) till realization of the entire sum due and recoverable with costs. .

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It is further made clear that any amount deposited by the defendants, be deducted in the claim amount, if not deducted.

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Defendants are debarred from transferring, alienating encumbering or otherwise dealing with or disposing of the mortgaged or hypothecated or any other properties and assets without paying the aforesaid adjudicated dues to the applicant bank to secure the ends of justice. The mortgaged or hypothecated assets to secure the loan in question are hereby attached and shall be subject to the final order under the recovery proceedings in pursuance of the Recovery certificate issued under Section 19(22) of Recovery of Debts and Bankruptcy Act 1993. The applicant may submit the certified copy of this Judgment and the Recovery Certificate before the Registrar/ Sub- registrar to endorse the charge over the secured assets.

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Let a certificate of recovery be drawn up forthwith and put up for signatures in terms of provisions contained in Section 19(22)of the Act to be issued, on the basis of the order of the Tribunal to the Recovery Officer. The Recovery Officer shall realise the amount as per the certificate in the manner and mode prescribed under the Act from the defendants, by sale of mortgaged! hypothecated assets as well as other personal movable/immovable assets of the defendants.

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Parties are directed to appear before the Recovery Officer, DRT, Patna on 31.5.2023. The order be communicated accordingly.

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Judgment signed, sealed, dated and pronounced in the open ort. on this 1 ih Day of April, 2023. _?-?- v \ C v ..

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_?-?- v \ C v .. L, l'c'/ ..." . . -7'-\1 \ ~C'-~~

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Dictated & Corrected by me

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[Kaushalendra Yadav] Presiding Officer Debts Recovery Tribunal, Patna

Punjab National Bank v. M/s Koshila Enterprises and Others

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/s Koshila Enterprises and Others

Case brief

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What did the court decide?

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