Allowed

Punjab National Bank v. M/S Jai Jawala Maa Traders

DRT4 Aug 2023OA/1830/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an original application filed by Punjab National Bank to recover ₹44,68,436.20 from defendants. The Tribunal deemed it just to grant simple interest at 7% per annum instead of the claimed rate, considering pandemic circumstances and the nature of the loan.

What did the court decide?

Recovery of ₹44,68,436.20 with simple interest at 7% p.a. from 28.09.2022; issuance of Recovery Certificate under RDBFI Act.

Punjab National Bank versus M/S Jai Jawala Maa Traders — Specific Performance | DRT (2023)

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

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ORIGINAL APPLICATION NO.1830/2022

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DATE OF INSTITUTION: 28.09.2022

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DATE OF DECISION: 4^th DAY OF AUGUST, 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, Village Siwah, Panipat, Haryana-132108, through its Authorised Representative, Sh. Subhash Chander, Senior Manager, Punjab National Bank, Circle Sastra, S.C.O. 170, Sector 13-17 Huda, Panipat-132103

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…..Applicant Bank

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Versus

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M/s Jai Jawala Maa Traders, through its Proprietor, Sh. Naresh Kumar s/o Sh. Sahi Ram R/o Bapoli Road, Village Dadhola, District Panipat-132101

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Smt. Babli w/o Naresh Kumar R/o V.P.O Dadhola, Tehsil Bapoli, District Panipat, Haryana-132108

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…..Defendants

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Argued by: Ms Arpita Sonkar, Manager Law, GPA Holder for the applicant bank Defendants ex parte vide order dated 09.02.2023

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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

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OA/1830/2022 PUNJAB NATIONAL BANK Vs M/S JAI JAWALA MAA TRADERS AND ANOTHER 2

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as ‘the Act’ for brevity), against the defendants for recovery of Rs.44,68,436.20/- (Rupees Forty Four Lacs Sixty Eight Thousand Four Hundred Thirty Six and Twenty Paisa Only) . It has been filed through Sh. Subhash Chander, Senior Manager of the applicant bank stated to be competent to institute the Original Application vide Power of Attorney dated 01.06.2007, 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 grant of Cash Credit facility of Rs. 45 lacs vide loan application dated 10.10.2019, Annexure-A2 (copy). Defendant No. 2 stood as guarantor for repayment of the loan.

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The applicant bank sanctioned aforesaid facility to the defendants vide sanction letter dated 10.10.2019, 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 hypothecation of goods and book debts to secure cash credit facility dated 10.10.2019, Annexure-A4 (copy). Defendant No. 2 executed agreement of guarantee dated 10.10.2019, Annexure-A5 (copy).

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The aforesaid loan was further secured by creation of mortgage by defendant No. 2 in respect of property measuring 1925 Square Yards situated in the revenue estate of Dahdola, Tehsil Bapoli, District Panipat, Haryana, fully detailed in para No. 5(vi) of the Original Application. Registered transfer deed No. 1754 dated 05.02.2019, Annexure-A6 (copy).

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OA/1830/2022 PUNJAB NATIONAL BANK Vs M/S JAI JAWALA MAA TRADERS AND ANOTHER 3

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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 11.01.2022. The applicant bank recalled entire outstanding amount vide notice dated 09.02.2022 along with its postal receipts, Annexure-A7 (colly) (copy) and notices dated 04.03.2022 under section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 along with its postal receipts, Annexure-A8 (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 account, a sum of Rs.44,68,436.20/- (Rupees Forty Four Lacs Sixty Eight Thousand Four Hundred Thirty Six and Twenty Paisa Only) is recoverable against the defendants as per statement of account duly certified under Bankers’ Books Evidence Act dated 10.07.2019,

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Annexure-A9 (copy).

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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, defendants were proceeded against ex-parte vide order dated 09.02.2023 .

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In support of the contents of the OA, affidavit of evidence of Sh. Subhash Chander, Senior Manager of the applicant bank was filed.

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OA/1830/2022 PUNJAB NATIONAL BANK Vs M/S JAI JAWALA MAA TRADERS AND ANOTHER 4

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This Tribunal has heard ex-parte arguments advanced by Ms Arpita Sonkar, Manager Law for the applicant bank 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 A9 , 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. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.44,68,436.20/- (Rupees Forty Four Lacs Sixty Eight

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Thousand Four Hundred Thirty Six and Twenty 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 @11.05% per annum plus penal interest @2% per annum. In sanction letter dated 10.10.2019, Annexure-A3 (copy), rate of interest has been mentioned @9.50% 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

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OA/1830/2022 PUNJAB NATIONAL BANK Vs M/S JAI JAWALA MAA TRADERS AND ANOTHER 5

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Covid-19 affecting businesses, nature of the mortgaged property, purpose of loan, i.e. agriculture, present conditions of economy based on agriculture, quantum of loan, prevalent market rates of interest which have gone drastically downhill in yesteryears and defendant No. 2 being a female, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @7% 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

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a sum of Rs.44,68,436.20/- (Rupees Forty Four Lacs Sixty Eight Thousand Four Hundred Thirty Six and Twenty Paisa Only) with current and future simple interest @7% per annum w.e.f. 28.09.2022 , 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 defendants 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. 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.

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 28.09.2023 .

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OA/1830/2022 PUNJAB NATIONAL BANK Vs M/S JAI JAWALA MAA TRADERS AND ANOTHER 6

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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. M/S Jai Jawala Maa Traders

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/S Jai Jawala Maa Traders

Case brief

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What did the court decide?

What the court decided

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