Allowed

Punjab National Bank v. M/s Shyam Food Products

DRT6 Sept 2023OA/175/2022

Case brief

AI extract

What is this about?

In this TBDI matter, the applicant bank sought a Recovery Certificate for an outstanding sum of 41,76,609.36 against defendants who failed to repay term loans and cash credit facilities. The tribunal found the documents established liability, the application was within limitation, and granted the certificate for joint and several recovery from the parties.

What did the court decide?

Issued a Recovery Certificate for Rs. 41,76,609.36 with interest and costs, directing proceeds against hypothecated properties and personal assets.

Punjab National Bank versus M/s Shyam Food Products — Pension and Retirement Benefits | DRT (2023)

¶1

O.A. 175/2022yDRT-Guwahati

¶2

IN THE DEBTS RECOVERY TRIBUNAL, GUWAHATI

¶3

(North Eastern Region)

¶4

(Tribunal of Assam, Nagaland, Meghalaya, Manipur, Mizoram, Arunachal Pradesh & Tripura)

¶5

Before Shri Shiv Sharan Dubev. Presidinq Officer

¶6

O.A. No. 17512022

¶7

ln the matter of - Punjab Nationa! Bank A.T.Road Branch, Guwahati-781 001, Assam

¶8

.Applicant

¶9

Vs.

¶10

M/s Shyam Food Products, A proprietorship firm Village-Nizsindurighopa, Mouza- Silasundarighopa Ambari Road, Choukigate, Changsari, Pin-781 101,

¶11

District- Kamrup (R), Assam.

¶12

SMTIKAMALA PAREEK
Proprietor of M/s Shyam Food Products,
4th Floor, Block E-3, Subham Elite,
Gandhi Basti Road, Guwahati-781005,
District- Kamrup (M), Assam.

¶13

Sri Ratan Pareek 4th Floor, Block E-3, Subham Elite, Gandhi Basti Road, Guwahati-781005, District- Kamrup^(M), Assam

¶14

Defendants

¶15

Presence of the Counsel^:

¶16

Sri Manoj Kumar Roy, Advocate

¶17

For the Defendants^: Mr. R. Chetri, Mr. N. Mili, Smt. R. Malakar, Advocate (Right to file WS cum EA closed)

¶18

Dated :06.09.2023

¶19

JUOGMENT

¶20

This is an application under section^{19 of the Recoveryof Debts Due to Banks} and Financial lnstitutions Act, 1993^{filed by the Punjab National Bank'A.T'Road} Branch, Guwahati-781001,^{Assam,with a prayer to issue Recovery Certificatefor} the sum of Rs.41,76,609.36^{(Rupees Forty One Lacs Seventy Six Thoueand Six} Hundred Nine and Paisa Thirty^{six) only as on 30.04.2022 against the defendants}

¶21

sh"d"aw^ ,r".,orn#3r1fi DRT, Guwahati

¶22

¶23

0.A. 175r2022lDRT4uflehati

¶24

with pendentelite and future interest at contractual rate till realizationalong w1h cost and other relief.

¶25

A few facts giving rise to the present application are as under.

¶26

The Defendant no. 2 as the proprietor of the defendant no.1 firm had approached the Applicant Bank and applied for financial assistance for Litchi Juice manufacturing unit by submitting a Letter daled 26.'11.2019 along with a Loan Application dated 26.'11.2018 and after considering the said application, the Applicant Bank vide its sanction Letter dated 10.12.2019 had sanctioned a Term Loan (TL) of Rs. 35.00 Lacs only to the Defendants with interest charged at 11.600/o per annum with monthly rests along withpenal interest at applicable rate in case of default. The Term Loan was to be repaid in 57 equal monthly installments of Rs. 61,404.00 each starting from last working day of April 2019 and interest will have to be serviced at monthly rests as and when falls due. The applicant bank had also sanctioned a cash credit limit of Rs.30.00 Lacs (Rupees Thirty Lacs) only to the defendants with interest charged at 11.60 % per annum with monthly rests.

¶27

ln connection with the sanction of the Term Loan (TL) of Rs. 35.00 Lacs and cash credit Loan of Rs.30.00 Lacs and in total Rs.65.00 Lacs sanctioned by the Applicant Bank and availed of by the Defendants, an Agreement of rerm Loan dated 10.12.2018, Hypothecation Agreement dated^'10.12.2018 and Agreement for Term Loan and Hypothecation dated 10.12.2018 has been signed and executed by the Defendant no. 2 as the proprietor of the defendani no.1 firm in favour of the Applicant Bank as security for repayment of the loan facility, thereby agreeing to all the terms and conditions laid down in the said Agreement in favour of the Applicant Bank.

¶28

ln order to secure the repayment of the credit facilities, the defendant no. 2 as the proprietor of the defendant no. 1 firm have signed and executed a Demand Promissory Note dated 10.12.2018, Letter of Lien dated 10.12.2018 and Letter of Continuity daled 10.12.2018, thereby promising to pay the Applicant Bank the entire loan amount received together with interest @'l'l .600/o per annum with monthly rests on demand. Sf"'trfu*^

¶29

Sf"'trfu*^ fu^L"+ ,*no,"nrP-9fr(23⁰ DRT, Guwahali

¶30

¶31

0.A.^{.t7sl2o22lDRT€uwahati}

¶32

As security for repayment of the aforesaid cash credit and rerm Loan facility availed by the Defendant No. 1 firm, the Defendant Nos. 2 and 3 in their individual capacity stood as the personal guarantors to the said loan facilities by signing a Letter of Guarantee dated 10.12.2018, thereby agreeing to all the terms and conditions contained therein.

¶33

Thereafter again the defendant no.2 being the proprietor of the defendant no. 1 firm approached the applicant bank and applied for emergency fund under Guaranteed Emergency credit Line (GEcL) vide Loan application dated 01.06.2020 and after considering the said application the applicant bank vide sanction Letter dated 05.06.2020 had sanctioned a Term Loan of Rs.10.50 only to the defendant with interest @7.6s % p.a. The Term Loan is to be repaid in 36 monthly installments after a moratorium period of 12 months from the date of first disbursement of the loan i.e. Rs.29,167/- plus interest per month. The defendant no. 2 being the proprietor of the defendant no.1 firm had signed on the said sanction Letter thereby agreeing to all the terms and conditions contained therein. The defendant in connection with the fresh sanction of rerm Loan under GECL scheme had signed and executed a Term Loan Agreement dated 05.06.2020, Hypothecation ofAssets to secure Term Loan dated 05.06.2020 and Agreement of Hypothecation of Book Debts dated 05.06.2020 in of the applicant bank and also a Demand Promissory Note dated 05.06.2020, thereby promising to pay the Applicant Bank the entire loan amount together with interest @1 .65 yo per annum with monthly rests on demand.

¶34

The Defendants had availed of the said loan facilities from the Applicant Bank, but have not paid the loan amount as per the terms and conditions as agreed upon with the Applicant Bank, inspite of repeated demands and requests by the Applicant Bank. As the defendants failed and/or neglected to operate the loan accounts properly, inspite of repeated requests & reminders issued by the applicant bank and also on personal approaches made by the applicant bank from time to time, the said accounts became NPA on 05.12.2021. After the accounts became NPA the applicant bank issued notices for repayment of the due amount, but the defendants have neither

¶35

-\ftrP[o,tp^ 06ldl " Presiding Offcer \ DRT, cuwahati^w

¶36

O.A. 1 75l2022lDRT-Guwahati

¶37

chosen for repayment of the remaining installment of the term loan amount nor approached to the applicant bank for renewal of the cash credit loan account.

¶38

The applicant bank thus became constrained to file the present Original Application for the recovery of Rs. 41,76,609.36 (Rupees Fofi One Lacs Seventy Six Thousand Six Hundred Nine and Paisa Thirty Six)only as on 30.04.2022 along with interest and cost of the application.

¶39

After filing of the OA the Tribunal issued noticesupon the defendants through registered post and the applicant bank filed service report on 05.07.2022 and brought on record the postal receipts.The learned counsel for defendants had appeared on the same day i.e. on 05.07.2022 by filing Vakalatnama and sought time to file written statement cum evidence on affidavit. Thereafter, the case was listed on 21.07.2022,04.08.2022, 02.09.2022 & 08.09.2022, but the written statement cum evidence on affldavit has not been filed by the defendants. Henc€, their right of the file written statement cum evidence on affidavit was closed on 08.09.2022 and the matter was fixed for hearing.

¶40

Supporting the claim of the applicant bank Sri Guru Prasad Talukdar, Chief Manager of the Applicant Bank has filed evidence on afftdavit coupled with the security documents marked as Exhibit - P & Q, Exhibit AW-1 to Exhibit AW- 24 supporting the claim of the applicant bank.

¶41

Heard the leamed counsel for the applicant bank who^prayed for issuance of Recovery Certificate against the defendants as^{per pleadings made in the Application,} supported by evidence on affidavit of their witness who affirmed on^{oath the execution} of the security and other documents by the defendants and also^{execution of their own} documents relied upon, which have been marked^exhibits.

¶42

Considering the facts and circumstances^{of the case, I am of the considered} view that the documents filed by the applicant bank are^{supportingthe claim of the} applicant bank and establishing the^{liability of the defendants. lt is provedthat the} defendants are liable to^pay to the applicant^bank the^{claim made in the Original} Application. The loans were obtained^{and documentshave beenexecutedon} 10j2.2018 & 05.06.2020. The account became^{NPA on 05.12.2021 and the OA has}

¶43

s)uda,,u^W* ,,".'o"noffif'9'P3 (J DRT, Guwahati^t

¶44

O.A. 1 75/2022yORT-Guwahati

¶45

been filed on 17.05.2022. Hence, the OA is filed well within the^period of limitation and this Tribunal having a^jurisdiction to adjudicate the Original Application.

¶46

Considering the unchallenged/unrebutted version of Sri Guru Prasad Talukdar, the applicant's witness and all the documents marked as exhibits, including duly certified copy of the statement of account along with interest calculation sheet maintained by the applicant Bank in it's regular course of business, I hold that the applicant is entitled to^get the Recovery Certificate as^prayed for.

¶47

ln the result, the present Original Application No. 175 ot 2022 is allowed with cost as under :-

¶48

i) The defendants No. 1, 2 & 3 are^jointly and severally liable to^pay to the applicant bank a sum of Rs.41,76,609.36^(Rupees Forty One Lacs Seventy Six Thousand Six Hundred Nine and Paisa Thirty Six) only with pendentelite and future interest @1'l .600/o p.a. with monthly rests from 01.05.2022, till the date of full^{paymenUrealization} and also cost of the application.

¶49

ii) The charge of the certificated amount be kept alive on hypothecated properties, as described in 3A of the OA till the amount is realized in full.

¶50

iii) The applicant bank is entitled to^proceed against the secured items towards recovery of the debts.

¶51

iv) The applicant bank is also entitled to^proceed against the^personal assets and properties of the defendants towards recovery of the dues.

¶52

v) The applicant bank is entitled to the costs of the O.A. which includes the advocate fees of the applicant bank. Applicant is directed to file the cost memo within 2 weeks from today.

¶53

vi) lssue Recovery Certificate accordingly for a sum Rs.^{41,76,609.36 (Rupees} Forty One Lacs Seventy Six Thousand Six Hundred Nine and Paisa Thirty Six) only in favour of the applicant bank against the defendants^{No. 1,} 2 &3.

¶54

vii) Communicate copy of this order to the concerned^parties.

¶55

slilpUo4o^, hrl',, ,r"",O,ngOt$|4 tyl DRT, Guwahati^'

¶56

O.A.'l 7s/2o2ZDRTGuwahati

¶57

This order is dictated and corrected by the undersigned.

¶58

Judgment dated 6th September 2023, signed and pronounced in the Tribunal

¶59

today under my signature.

¶60

Copy of the JudgmenUFinal Order be uploaded in the Tribunal's Website and

¶61

file be consigned to Record Room.

¶62

sbilWh^tr (Shiv Sharan Dubdy)^"' U Presiding Officer DRT, Guwahati.

Punjab National Bank v. M/s Shyam Food Products

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/s Shyam Food Products

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

Icici Bank Limited versus Bhaskar

Punjab National Bank versus Sh. Swaran Singh

Mr Shabeer Sheik Abdulla versus Canara Bank

Bank of India versus M/S. Kavitha Constructions

Hdfc Bank Ltd. versus Sai Sravan Health Care Private Limited

Canara Bank versus Raghavan Naik Karamthod