Allowed

Punjab National Bank v. Sh. Ram Singh

DRT20 Sept 2023OA/1876/2022

Case brief

AI extract

What is this about?

The Tribunal allowed an application under Section 19(1) of the RDBFIA for recovery of Rs. 37,41,376. It reduced the claimed interest rate to a uniform 7% per annum from the filing date, considering agricultural loan context and pandemic circumstances, and ordered joint and several liability.

What did the court decide?

Order for recovery of Rs. 37,41,376 with uniform simple interest @7% per annum w.e.f. 04.10.2022, joint and several liability, and issuance of Recovery Certificate.

Punjab National Bank versus Sh. Ram Singh — 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.1876/2022

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DATE OF INSTITUTION: 04.10.2022

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DATE OF DECISION: 20^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, 1970, having its Head Office at Plot No-4, Sector-10, Dwarka, New Delhi-110075 and Branches, amongst others at Branch Bani, Tehsil Rania, District Sirsa, (Haryana). Later on, the account has been transferred to Punjab National Bank, Circle Office, Barnala Road, Bhumanshah Chowk, Solitaire Tower, Sirsa (Haryana), through its General Power of Attorney holder, Sh. Sunil Kumar Goyal posted as Chief Manager of the Applicant Bank

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…..Applicant Bank

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Versus

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Sh. Ram Singh s/o late Sh. Babu Ram r/o Village & Post Office Bani, Tehsil Rania, District Sirsa (Haryana) PAN NO. ETPPS6123E

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Smt. Santro Devi w/o Late Sh. Babu Ram, r/o Village & Post Office Bani, Tehsil Rania, District Sirsa (Haryana)

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Smt. Vimla w/o Sh. Mahipal Singh r/o Village & Post Office, Bani, Tehsil Rania, District Sirsa (Haryana)

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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 20.05.2023

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OA/1876/2022 PUNJAB NATIONAL BANK Vs SH. RAM SINGH AND OTHERS 2

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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.37,41,376/- (Rupees Thirty Seven Lac Forty One Thousand Three Hundred Seventy Six Only) . It has been filed through Sh. Sunil Kumar Goyal, Chief Manager of the applicant bank stated to be competent to institute the Original Application vide General Power of Attorney dated 24.09.2004, Annexure-A1 (copy).

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The brief facts of the case of the applicant as per the Original Application are that the defendants had approached the applicant bank for grant of Kisan cash Credit facility of Rs. 20 lac, Kisan Sathi Scheme of Rs. 1 lac and debt swap of Rs. 3,55,000/- vide loan application dated 21.10.2013, Annexure-A2 (colly) (copy).

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The applicant bank sanctioned above mentioned credit facilities to the defendants vide memorandum of sanction, Annexure-A2 (colly) (copy) as per terms and conditions which were duly accepted by the defendants.

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In order to secure the aforementioned credit facilities, the defendants executed hypothecation agreement dated 24.10.2013, Annexure-A4 (copy), undertaking dated 24.10.2013 regarding availing of credit facilities, Annexure-A5 (copy), consent letter dated 24.10.2013, Annexure-A6 (copy) and consent clause dated 24.10.2013 regarding disclosure of information to CIBIL, AnnexureA7 (copy).

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OA/1876/2022 PUNJAB NATIONAL BANK Vs SH. RAM SINGH AND OTHERS 3 5. The aforesaid loans were further secured by creation of mortgage by defendant Nos. 1 and 2 in respect of agricultural land measuring 72 Kanals 9 Marlas situated in the revenue estate of Bani, Tehsil Rania, Dsitrict Sirsa, Haryana, fully detailed in para No. 5.4 of the OA. Registered mortgage deed No. 3027 along with letter to the Tehsildar, Rania, for entry mutation of the mortgage property, Annexure-A3 (colly) (copy).

¶20

It is further the case of the applicant bank that the loan facilities were duly availed of by the defendants but they failed to maintain the financial discipline of the applicant bank leading to the loan accounts becoming irregular and those being classified as NPA on 16.04.2018. The defendants executed balance and security confirmation letters dated 08.09.2016, 16.10.2018, 29.08.2019, 21.08.2019 and 14.02.2019, Annexures-A9 (colly) (copy). The applicant bank recalled the entire outstanding amount vide notices dated 09.04.2014 and 24.06.2021, 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 accounts, a sum of Rs.37,41,376/- (Rupees Thirty Seven Lac Forty One Thousand Three Hundred Seventy Six Only) , is recoverable against the defendants as per statements of accounts, certified under Bankers’ Books Evidence Act, 1891, Annexures-A10 (colly) (copy).

¶22

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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OA/1876/2022 PUNJAB NATIONAL BANK Vs SH. RAM SINGH AND OTHERS

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¶25

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 20.05.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Narender Singh, Chief Manager of the applicant bank was filed.

¶27

This Tribunal has heard ex-parte arguments advanced by Ms Arpita Sonkar, Manager Law for 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 facilities which were 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.37,41,376/- (Rupees Thirty Seven Lac Forty One Thousand Three Hundred Seventy Six Only) from the defendants.

¶29

In so far as pendente lite and future interest is concerned, the applicant bank in relief clause has claimed rate of interest

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OA/1876/2022 PUNJAB NATIONAL BANK Vs SH. RAM SINGH AND OTHERS 5 @10.75% per annum for KCC, @11.25% per annum for KSS and @8.75% per annum for debt swap. In balance and security confirmation letters dated 08.09.2016, 16.10.2018, 29.08.2019, 21.08.2019 and 14.02.2019, Annexures-A9 (colly) (copy), rate of interest has been mentioned @11.60% per annum for KCC, MCLR plus @2.1% for KSS and Debt swap.

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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 mortgaged property, purpose of loan, i.e. agricultural, present conditions of economy based on agriculture, quantum of loan, prevalent market rates of interest which have gone drastically downhill in yesteryears and defendant Nos.2 and 3 being females, 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.

¶32

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.37,41,376/- (Rupees Thirty Seven Lac Forty One Thousand Three Hundred Seventy Six Only) with current and future simple interest @7% per annum w.e.f. 04.10.2022 , till the date of realisation of the amount. The liability of the defendants shall be joint as well as several. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of

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OA/1876/2022 PUNJAB NATIONAL BANK Vs SH. RAM SINGH AND OTHERS 6 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. 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 defendants 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. Ram Singh

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. Sh. Ram Singh

Case brief

What is this about?

What did the court decide?

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