The DRT allowed an application by State Bank of India to issue a recovery certificate of Rs. 41,83,064.68 against a partnership firm and its guarantors/guarantors, holding the loan documents valid, interest rates enforceable, and the claim within limitation.
Recovery certificate for Rs. 41,83,064.68 with interest and charge on mortgaged properties issued.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
O.A. 04/2022lDRT-Guwahati
IN THE DEBTS RECOVERY TRIBUNAL, GUWAHATI
(North Eastern Region)
(Tribunal of Assam, Nagaland, Meghalaya, Manipur, Mizoram, Arunachal Pradesh & Tripura)
Before Shri Shiv Sharan Dubev. Presidinq Officer
O.A. No.04/2022
ln the matter of -
State Bank of lndia
Stressed Assets Recovery Branch(SARB), Bamunimaidam, M.R.D.Road, Guwahati-21, District Kamrup (M), Assam.
....Applicant
Vs.
Defendants
Presence of the Counsel: : Mr. K K Nandi, Advocate For the Applicant For the Defendants No. 1,2& 3 : Mr.Subham Das, Mr. Kangkan Deka, Advocates Forthe Defendants No.4 & 5 : None (Ex-parte)
Dated :24.08.2023
9l;,cv%yt Presiding O{ficer DRT, Guwahati
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O.A. 04/2022yORT-Guwahati
JUDGMENT
This is an application under section19 of the Recoveryof Debts Dueto Banks and Financial lnstitutions Act, 1993 filed bythe State Bankof lndia,Stressed Assets Recovery Branch(SARB), Bamunimaidam,M.R.D.Road, Guwahati-21,District- Kamrup (M), Assam, with aprayer to issue RecoveryCertificatefor the sum of Rs.41,83,064.68 (Rupees Forty One Lakhs EightyThree ThousandSixty Four and Paise Sixty Eight) only I i.e. threeloan accounts beingA,/c No.31529028186 (CC), A/c No. 39522739788 (Term Loan GECL), A,/c No. 39606038279(FITL Covid19) taken together] as on 30.11.2021against the defendants jointly and severally with pendentelite and future interest at therate ol7 .4Oo/o per annumwith monthly rests till realization with cost alongwith other relief.
A few factsgiving rise tothe present applicationare as under.
The defendant no. 1 is apartnershipfirm which deals with concrete blocks and tiles and the defendantnos.2 and 3 are at present the partners of defendant no 1 firm. lt ispertinent to mention herein that the defendant nos 4 and 5 were the partners of the defendant no.1firm. The defendantnos 2, 4 and 5 are the guarantors of the credit facilitiesavailed by the defendantno 1 from the applicant bank. That the defendantno.1representedby its partner being defendantno.2 informed the applicantbank vide letter dated 09.03.2020that the defendant nos 4 and 5 has retiredfrom the defendantno.1 firm,and that the defendant no 3 is the incomingpartnerand in this regard Deed of Retirement-cum- Partnership dated 30.05.2019 hasbeen submittedto the applicant bank.The defendantno. 1 firm represented byit's partners beingdefendant nos.2 approachedthe applicant bank for financial assistancefor the purposeof its business by submitting an application dated 28.10.2010.The applicant bank upon considerationof the said application sanctioned cashcredit facility ofRs.15,00,000.00and term loan of Rs.45,00,000.00thus totalingof Rs.60,00,000.00 lacs to the defendantno. 1 vide letter of arrangementdaled 24.11.2010.The terms and conditions of the arrangement letterdated 24.'l'l.2o1owas duly accepted by the defendant no.1 and as a token of acceptanceof the same the defendant nos.2, 4 and 5 as partners of
Sli^tcl,a&^ e*L\ presiornsoftAf'69'ry tl ORT, Guwahati
O.A. 04/2022,DRT-Guwahati
the defendant nos.'l firm as well as in their individual capacities as guarantors have signed in the arrangement letter of having accepted the terms and conditions. It was the terms and conditions of the arrangement letter that the effective rate of interest in the cash credit account being 10.85%per annum calculated on daily balance of the loan amount at monthly rests and effective rate of interest in the term loan account being 11.05%per annum calculated on dailybalance of the loan amount at monthly rests. The defendantnos.2, 4 and 5 aspartnersof the defendant nos. 1 firm have alsoagreed torepay the term loan in 60 equated monthly installments of Rs.97,954/- each.
The defendant no.1 firm availed theabovecredit facilities fromthe applicant bank and the defendant nos 2, 4and 5 as partners of defendant no. thave executed the documentssuch as (a) Agreementof loan- cum-hypothecationdated 24.11.2010 and(b) Partnershipletter dated 24.11.2010.
The defendant no.1 firm availedthe credit facilities fromthe applicant bank and the defendant no.2,4 and 5 stood as guarantors of the creditfacilities availed by the defendant no 1from the applicant bank and have executed Guarantee Agreement on 24.11.2010 bywhich they have agreedto the terms and conditions recited therein and hasmade themselvesjointly and severally liable for the entire outstanding in the loan accountwith interest to the applicantbank.
The defendant no.1 availedthe above credit facilitiesfrom the applicant bank and as a security forrepaymentof said credit facilities defendant no.'l represented by itspartner being defendant no.2deposited with the applicant bank tifle deeds beinglease deed no.l-6193/2010 dated 25.10.2010,letter dated 06.12.2010 by Tripuralndustrial Development Corporation Limited for creation of mortgage of leasehold interest.The defendantno. 1 representedby its partner being defendant nos.2have executed Letter of confirmationdated 08.12.2010 confirming deposit of titledeeds with the applicant bank with the intentionto create an equitable mortgage.The lease hold propertymortgaged/ charged by defendant no. 1, with the applicantbank as a securityfor repaymentof creditfacilities availed by defendant no 1 ismore specifically describedin Schedule-A of the OA'
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The defendant no 1 approached the applicant bank for enhancement of the existing cash credit facility by submitting an application/ letter dated 20.0s.2013. The applicant bank on consideration of the said application/letter dated 20.0s.2013 enhanced the existing cash credit facility from Rs1S,00,000.00 to Rs 20,OO,OOO.OO and have reviewed the existing term loan at Rs.30.13 lacs and thus totaling at Rs.50,13,000.00 in favour of the defendant no. 1 firm vide arrangement letter dated 28.08.2013. The terms and conditions of the arrangement letter dated 2g.0g.2013 was duly accepted by the defendant no.1 and as a token of acceptance of the same the defendant nos.2, 4 and 5 as partners of the defendant no.1 as well as in their individual capacities have signed in the arrangement letter of having accepted the terms and conditions. lt was also the terms and conditions of the arrangement letter that the effective rate of interest in the cash credit account being 12.70% per annum calculated on daily balance of the loan amount at monthly rests and effective rate of interest in the term loan account being 12.10% per annum calculated on daily balance of the loan amount at monthly rests. The defendants No. 2,4 and 5 as partners of the defendant No. 1 firm have also agreed to repay the term loan in 33 equated monthly installments of Rs. 9't,279l- each.
The defendant no.1 availed of the enhanced credit facilities from the applicant bank and the defendant no 1 represented by itspartners being defendant no. 2, 4 and 5 have executed Agreement of loan-cum-hypothecation dated 28.08.2013 and Partnership letter dated 28.08.2013.
The defendant no.1 availed the enhanced credit facilities from the applicant bank and the defendant nos. 2, 4 and 5 stood asguarantors of the creditfacilities availed by the defendant no 1 from the applicant bank and have executed Guarantee Agreement on 28.08.2013 by which they have agreed to the terms and conditions recited therein and have made themselvesjointly and severally liable for the entire outstanding in the loan account with interest to the applicant bank.
ln respect of above enhanced credit facilities availed by the defendant no1 from the applicant bank, the defendant no 2 aspartner of defendant no 1 firm executed Letter of Confirmation for extension of mortgage dated 29.08.20'13 and
rWeb#,tuWf Presiding Offcar,- \ DRT. Guwahati
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by the said confirmation letter the defendant no. 2 confirmed and admitted to have deposited title deeds with the applicant bank on 08.12.2010 with the intention of creating equitable mortgage of land in favour of the applicant bank. The defendant no 2 confirmed that consequent upon the enhanced credit facilities, the benefit of mortgage created in favour of the applicant bank on 08.'12.2010 shall apply for, stand extended to and cover the enhanced credit limit. The property mortgaged/ created charge by the defendant no. 1 firm represented by its partner being defendant No 2 with the applicant bank as a security for repayment of loan is more specifically described in Schedule-Aof the OA.
Defendant no 2 have created mortgage of land measuring 1 ganda 19 dhur (0.051 acres) and 2 kara 2 krant'15 dhur (0.0145 acres) covered under dag no 15924164073(old) 826870 (Hal) dag no 1947 (new) khatian No 1222, dag no '15924164015 (old) 1948 (new) 18268/306 (hal) Khatian No 991 of Tehsil Agartala East, Mouza- Agartala Sheet No 18, Revenue Circle Agartala, district West Tripura situated at Jagaharimura, Agartala, West Tripura by deposit of Sale Deed being Deed No.1-4242 dated 08.06.2012, Sale Deed No.'l-4243 dated 08.06.2012,Khatian No.1418, Khatian No.99'l with the applicant bank as a security for the credit facilities availed from the applicant bank. The mortgage created by defendant no 2 being the land as aforesaid is extended in respect of the credit facilities availed by defendant no 1 and the defendant no 2 have confirmed his intention to extend the mortgage for the credit facilities availed by the defendant no 1 by signing in the arrangement letter dated 28.08.2013. That the defendant no 2 have executed confirmation letter dated 29.08.2013 mentioned herein above wherein it is mentioned to have deposited title deeds with the intention to create mortgage.
The property mortgaged/ created charge by the defendant No 2 with the applicant bank as a security for repayment of credit facilities availed by defendant No 1 is more specially described in schedule B of the OA.
tlh ila^o- 8lq >4^r&'22 I Presiding Officer --V DRT, Gu$rahati
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The valuation of the mortgaged property (schedule B) is done by the approved valuer of the applicant bank Er. Rajesh Roy who has submitted report daled O7.06.2O21.
The defendant no 1 approached the applicant bank for enhancement of the cash credit facilities. The applicant bank on consideration of theprayer so made enhanced the existing cash credit facility from Rs.20.00 lacs to Rs.30.00 lacs in favour of the defendant no. 1 vide arrangement letter dated 16.10.2015. The applicant stated that existing term loan account of Rs. 30.13 lacs was closed by the applicant bank on liquidation by the defendantno 1.The terms and conditionsof the arrangement letter dated 16.10.2015 was duly accepted by the defendantno.1 and as a token of acceptance of the same the defendant nos.2,4 and 5 aspartners of the defendant no.1 as well asin theirindividual capacities have signed in the arrangement lefter of having acceptedthe terms and conditions.lt was alsothe terms and conditions of the arrangement letter thatthe effective rate of interest in the cash credit account being 12.70%per annum calculated on daily balance of the loan amount at monthly rests.
The defendant no.1 availed of the enhancedcash credit facility fromthe applicant bank and the defendantno 1 represented by its partners being defendant nos. 2, 4 and 5 have executedAgreement ofloan-cum-hypothecationdated 16.10.2015.
The defendant no.1 availed of theenhancedcash credit facility from the applicant bank and the defendantnos. 2,4 and 5 stood as guarantorsof the enhanced cash credit facility availedby the defendantno 1 fromthe applicant bank and have executed GuaranteeAgreementon 16.10.2015.
ln respect of above enhanced cashcreditfacilities availedby the defendant no 1 from the applicant bank, the defendantno 2 executed Letter of Confirmation for extension of mortgage dated 17.10.2015and by the said confirmation letter the defendant no. 2 confirmed andadmitted tohavedeposited title deedswiththe applicant bank on 15.03.2013 with theintention of creating equitable mortgage in favour of the applicant bank. The defendant no2 confirmedthat consequentupon
sli,rrharo-&fud Presiding Offic€r DRT, Guwahati
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o.A. o4l'2o2zo RT6uw.hati
the enhanced creditfacilities,the benefit of mortgagecreated on 15.03.2013 shall apply for, stand extendedto andcoverthe enhanced credit limit. Themortgaged/ created charge bythe defendant no.2with the applicant bank as a security for repayment of loanis more specifically describedin Schedule-Bof the OA'
ln respect of theenhancedcash credit facilities the mortgage/charge created in respect ofthe lease hold land/ interest was extended and the the defendant no 2being the partnerof defendantno t have confirmed intention to extend the mortgagefor the enhanced creditfacilities availed by the defendant no 1 by signingin the arrangement letter dated 16.10.2015.The defendant no 2 have executed conlirmationletter dated 17.10.2015mentioned hereinabovewhereinit is mentionedto have depositedtitle deedswith the intentionto create mortgageof lease hold interestand extension of mortgage for the enhanced amount'
Theleaseholdpropertymortgaged/createdchargebythedefendantno'2 aspartner ofdefendant no 1 with the applicant bank as a securityfor repaymentof loan is more specificallydescribed in Schedule-Aof the OA'
Thedefendantno.lrepresentedbyitspartnerbeingdefendantno.2 executed RevivalLefter on 07.07.2018in respect of the documents executed by defendantno.1on16.,|0.2015inrespectofthecreditfacilitiesavailedbythe defendant no.1fromthe applicant bank
The defendantno thave made paymentsin the cash credit account no 31529028'126on24.05.2016,31'05'2016'16'06'2016'18'01'20'17'19'12'201|7' 14.06.2018,18'04.2019 amongst variousother dates and the defendant no 1 having madepayments in the cash credit account on the above mentioned dates haveacknowledgedthedebtandliabilityinrespectofthecashcreditaccountwith the applicantbankon the said dates'
The defendantno lrepresented by its partners approached the applicant bankfor renewalof the existing cash credit facility and grant of term loan'The applicantbank upon consideration of the prayer so made by the defendant no' 1 renewedthe existing cash credit facility of Rs'30'00'000'00 lacs and have granted term loan(GECL) of Rs 5'85'000'00lacs in favourof the defendant no' 1 vide letter
slird€fnfu PresidingOfficer DRT' Guwahati
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of arrangement dated '18.07.2020. The terms and conditions of the arrangement letterdated 18.07.2020 was duly accepted by the defendant no.1 and as a token of acceptance of the same the defendant nos.2 and 3 as partners of the defendant no.1 have signed in the arrangement letter of having accepted the terms and conditions. lt was also the terms and conditions of the letter that the effective rate of interest in the cash credit account being 11.35 % per annum calculated on daily balance of the loan amount at monthly rests and the effective rate of interest in the term loan is 7.40o/o per annum calculated on daily balance of the loan amount at monthly rests. The defendant no 1 agreed to repay the term loan in monthly installment of Rs 19598.00 each.
ln respect of above enhanced cash credit facility availed by the defendant no 1 from the applicant bank, the defendant no 2 executed Letter of Confirmation for extension of mortgage dated 19.07.2020 and by the said confirmation letter the defendant no. 2 confirmed and admitted to have deposited title deeds with the applicant bank with the intention of creating equitable mortgage in favour of the applicant bank. The defendant no 2 confirmed that consequent upon the renewed the cash credit facility andgrant of term loan, the benefit of mortgage created shall apply for, stand extended to and cover the enhanced credit limit. Theproperty mortgaged/ created charge by the defendant no. 2 with the applicant bank as a security for repayment of loan is more specifically described in Schedule-B of the oA.
The applicant bankgranted to the defendant no 1 FITL- Covid-19 facility of Rs.1,65,079.00 in accordance with thepolicy of the applicant bank then andin accordance to theguidelines of the ReserveBank of lndia, enabling the defendant no 1 to overcome the crisis occurred due topandemiccovid-19. The FITL Covid- 19 facility wasgiven to the defendant no1 whichthen requestedthe applicant bank to avail such facility to meet the crisis owing topandemic covid19. The saidFITL - Covid 19 facility wasgranted by the applicantbank on 01.09.2020 on whichdate an amount of Rs 1,65,079.00 was debited in the FITL accountno 39606038279of defendant nol . That the defendant no 1 availed of the said FITL- Covid 19 facility
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DRT, Guwahati
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0.A. 0412022/DRT6uwahata
from the applicant bank and having availed the said facility have made repayment in the said account.
The defendants had availed the Loan Facilities from the applicant bank but have not paid the outstanding amount as per terms and condition made with the applicant bank in spite of repeated demands and request by the applicant bank. As the loan accounts were running extremely irregular and due to non-payment of outstanding amount, the said accounts were classified as NpA on 01 .12.2020. After the accounts became NPA the applicant bank issued nolices for repayment of the due amount, the defendants have neither chosen for repayment of the remaining installments in the Term Loan Accounts nor approached to the applicant bank for settling the Term Loan Accounts nor further renewed the cash credit Accounts.
The applicant bank thus became constrained to file the present Original Application for the recovery of Rs. 41,83,064.68 (Rupees Forty One Lakhs Eighty Three Thousand sixty Four and Paise Sixty Eight)only as on 30.11.2021a|ong with interest and cost of the application.
After filing of the OA the Tribunal issued notices upon the defendants through registered post and the applicant bank filed service report on 18.05.2022 and brought on record the postal receipts. The learned counsel for defendants No. 1, 2 & 3 had appeared on the same day i.e. on 18.05.2022 and filed their written statement as well as evidence on affidavit on 30.05.2022, to which the learned counsel for the applicant bank filed their rejoinder on 28.09.2022. lt is observed from the record that even after publication of notice in the four newspapers namely "Arthik Lipi", "The Echo of lndia", "Active Times' and "Mumbai Lakshadeep" all dated 11.06.2022 there is no representation on behalf of the defendants No 4 & 5 either through any counsel or in person and hence the defendants No 4 & 5 were set ex-parte on 17.08.2022 and their right to file written statement cum evidence on affidavit was closed. Thereafter the matter was posted for hearing.
Supporting the claim of the applicant bank Sri Dilip Kumar Bordoloi, Chief Manager of the Applicant Bank has filed evidence on affidavit coupled with copy of the security documents marked as Exhibit A-1 to A-3T,supporting the claim of the applicant bank, detaits of which are :- SI.t,
SI.t,S/O/a/ &^L+ e'esioins##;t9'2) { DRT, cuwahati
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O.A. 04/2022,/DRT€uwahati
| sl. | Nameofthe documents | Exhibit |
|---|---|---|
| No. | No. | |
| 1 | Letter dated 09.03.2020 | A-1 |
| 2 | DeedofRetirement-cum-Partnershipdated30.05.2019 | A-2 |
| J | Loanapplication dated 28.10.2010 | A-3 |
| 4 |
LetterofArrangementdated24.11.2010 | A4 |
| t | Agreementof loan- cum-hypothecation dated24.11.2010 |
A-5 |
| b | PartnershpLetter dated24.11.201 0 | A-6 |
| 7 | GuaranteeAgreementdated24.1 1.2010 | A-7 |
| 8 | Lease Deed No. l-6193/2010dated 25.10.2010 | A-8 |
| o | Letterdated 06.12.2010 | A-9 |
| 10 | Letter of Confirmationdated08.12.2010bydefendantNo.1 | A-10 |
| 11 | Loanapplication dated 20.05.2013 |
A-1'1 |
| 12 | LetterrcfArrangementdated28.08.201 3 | A-12 |
| 13 | Agreemento!oan-cum-hypothecation dated28.08.2013 |
A-13 |
| 14 | PartnershipLetter dated28.08.20'13 | A-14 |
| 15 | GuarAltee Agreement dated 28.08.2013 | A-15 |
| 16 | SaleDeedbeing DeedNo.14242dated 08.06.2012 |
A-16 |
| 17 | SaleDeedNo. l-4243dated08.06.2012 | A-17 |
| 18 | KhatianNo,1418 | A-18 |
| 19 | Khatian No.991 |
A-19 |
| 20 | LetterofConfirmationforextensionofmortgagedated 29.08.2013. |
A-20 |
| 21 | ValuationReportdated07.06.2021 | A-21 |
| 22 | LetterofArrangement dated'16.10.2015 | A-22 |
| 23 | Agreementof loan- cum-hypothecationdated16.10.2015 | A-23 |
| 24 | GuaranteeAgreement dated16.10.2015 |
A-24 |
| 25 | LetterofConfirmationforextensionofmortgagedated 17.10.2015. |
A-25 |
| 26 | Revival Letterdated07.07.2018 | A-26 |
| 27 | LetterofArrangement dated18.07.2020 |
A-27 |
| 28 | LetterofConfirmationforextensionofmortgagedated 19.O7.2020. |
A-28 |
| 29 | Statement ofAccountNo.31529028186 | A-29 |
| 30 | PenallnterestCalculation | A-30 |
| 31 | Unapplied interestfrom01.12.2020lo30.11.2021 | A-31 |
| 32 | Statement ofAccount No. 39522739788 |
A-32 |
| 33 | Unapplied interestfrom01 .01.2021lo30.1I.2021 | A-33 |
| 34 | Certificateof Penal lnterest |
A-3/ |
| 35 | Statement ofAccountNo. 39606038279 | A-35 |
| 36 | Unapplied interestfrom0'1.04.2021to30.11.2O21 | A-36 |
| 37 | Certificateof Penal lnterest | A-37 |
The defendants No. 1,2 & 3 have appeared and contested the claim ofthe applicant bank by filing written statement cum evidence on affidavit stating interalia that the Original Application is not at all maintainable in its present form. The valuation of the mortgaged property was not done as per law and it is required to be done from a registered Valuer. Therefore, the estimated value of the propefi which is mentioned by the Applicant Bank is not justified and liable to be interfered by this Tribunal. lt is further stated that Sri Dilip Kumar Bordoloi is not a Power of Attorney
sli/s0^ou_yf v o -'''/ \r Presiding &lr DRT, Guwahati
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Holder on behalf of the Applicant Bank. There is no power of aftorney is furnished by the Applicant Bank along with this instant Original Applicant which is required under the law. Therefore, Sri Dilip Kumar Bordolol has no knowledge about the execution of documents and it isquestionable without having knowledge of documents howhe signed in the Affidavit and in the Verification. lt is further stated that the Defendant has signed some blankpapers asper the directiongiven by theApplicantBank without knowing the exact intentionof the Applicant Bank. lt is further stated that this answering Defendants had neversignedthe Guarantee Deed of his own consent. Due to illegal action of the Applicant,the Defendanthad suffered and will suffer continuously without his fault.The Defendant also on so many occasionstried his best to contact with theBank officials for knowingthe exactpositionof his loan accounts but no suitablereply wasgivenby the Bank Officials. This answering defendants never receivedany letter from the applicant Bankat any point of time. Applicant Bank had neverinformed or intimated the answering defendant with any letter, correspondence, noticeswhatsoeverabout the claim of the applicantBank that the loan had turnedirregularand or classifiedas Non-performingassets. No Legal Notices were sent tothe Defendantto paythe duesof the Applicant Bank. ln reality thepresent Defendanthas no dues left and Applicant Bankwithmala fide intention declared thesaid loan accountof the defendant'sas NPA withoutgiving sufficient time/opportunitiesand the applicantBankfailedto mention on whatbasis they declared the said accountsas NPA as substantial amount was always paid to the Applicant Bankand the Applicant Bankalsoadmittedthis fact in the original Application. TheApplicantBank failed to extentthe mortgaged property which is required to be done ifthereis any renewalof loan. The answering defendants never stood as a defaulterat any point of time. The applicant Bank charged higher rate of interest which wasnot agreed uponby the Defendant. Thestatementof accounts are notproperly certifiedwhich is required as per Banker's Book EvidenceAct and the original Applicationis totally frivolousand vexationsone just to keep the defendant in dark. Lastlyit has beenprayedto dismiss the original application with cost
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The leamed counsel for the applicant bank has filed rejoinder against the written statement cum evidence on affidavit filed by the defendants No.'l ,2 & 3 in which it has been stated that the original application is not baned by limitation as alleged. The land mortgaged to the applicant bank is common in all the loan accounts. The original application is not bad in law as well as in facts. The valuation of the mortgaged property is done by the approved valuer of the applicant bank Sri Rajesh Roy who have submitted his report dated 07.06.2021 and as per the said valuation report, the value of the mortgaged property is Rs 84,02,250.00. The valuation report is admissible in the eye of law. The mortgage created is equitable mortgage and the same is registered with Central Registry of Securitization Asset Reconshuction and Security lnterest of lndia (CERSAI). The original application is represented by the Chief Manager of the applicant bank duly empowered/ authorized to represent the applicant bank vide Gazette notification dated 27.03.1987. lt is further stated that the Hon'ble Apex Court in Civil Appeal No. 11884 of 1996 held inter-alia that plaint or written statement signed by offcers of the corporation /company even without authority or power of aftomey, the court can on the basis of evidence on record and after taking all the circumstances of the case, specially with regard to the conduct of trial come to the conclusion that the corporation have ratified the act of signing of pleading by its officers. Sri Dilip Kumar Bondoloi being the Chief Manager of the applicant bank is the principal officer of the applicant bank to sign and verifo the pleadings in accordance with Order 29 Rule'l CPC. The documents executed by the defendant was duly filled up and after going through the contents of the same properly and having understood the same. The defendants have not denied the signatures appearing in the guarantee agreements. The loan account of the defendant was classified as NPA in accordance to the guidelines of Reserve Bank of lndia. The mortgage created in favour of the applicant bank by the defendant by deposit of title deeds is valid and enforceable in the eye of law. The statement of accounts further reveals that the defendant is a defaufter inpayment of installments in the loan account. The interest charged in the loan account is as per rate applicable in the said account from time to time as per documents executed by the defendant in favour of the applicant. The statement of account is duly certified under the
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Bankers Book Evidence Act and lndian Evidence Act. The defendant having acknowledged the liability by executing revival letter as well as by making payment in the loan account, cannot deny the liabilig to pay the outstanding dues in the loan account in view of the law laid down by the Hon'ble Apex court in syndicate Bank versus R Veeranna and others. The loan documents are valid and enforceable in the eye of law. Lastly, it has been prayed to issue Recovery Certificate as per prayers made in the original application.
Heard the learned 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.
Heard the learned counsel for the defendants No. 1,2 & 3 who prayed for dismissal of the original application.
I have carefully perused the documents on record including original application, evidence on affidavit and exhibited documents as well as written statement cum evidence on affidavit filed by the defendants No. 1,2 & 3.
It is observed that the defendants No. 1,2 & 3 have not denied the availment of loan, execution of documents and their signature on the same.
The defendants have contended that he has signed some blank papers as per the direction given by the Applicant Bank without knowing the exact intention of the Applicant Bank.
The above contention of the defendants is not only untrust-worthy but also does not raise any triable issue. Under Section 20 of the Negotiable lnstruments Act, 1981 , it is provided that when a person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments either wholly blank or having written thereon an incomplete instrument he gives prima facie authority to the holder of such an instrument to complete upon it a negotiable instrument for any amount which may be covered by the stamp affixed on it. The person so signing is made liable upon such an instrument in the capacity in which he signed it to any
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holder in due course. The defendants did not raise their little finger to point out if their signatures were obtained on any blank documents by the then Manager of the applicant bank or under duress. lf the signatures had been obtained in blank documents under duress by the Manager of the Bank, the defendants could have filed FIR or Complaint before the Competent Authority. But no FIR has been lodged by the defendants. The documents were executed in the month of November 2010 and thereafter till May 2022 (dale of filing written statement) the defendants choose to keep silent about their signatures having been obtained on blank documents or under duress. The only irresistible conclusion, therefore, is that the plea now sought to be raised by the defendants to the effect that their signatures were obtained on blank documents is merely a sham plea, devoid of any force and as such cannot be deemed to raise any triable issue. This has also been held by the Hon'ble Delhi High Court in the case of Punjab & Sindh Bank Vs. Ram Prakash 1990(1) BC 386.
ln the case of Grasim lndustries Limited and Another Vs. Agarwal Steel repofted in (2010) 1 Supreme Couft Cases 83, Hon'ble Justice Markandey Katju and Hon'ble Justice A.K. Ganguly had held that "when a person signs a document, therc is a presumption, unless there is a proof of force or fraud, that he has read the document properly and understood it and only then he has affixed his signatures thereon, otherwise no signature on a document can ever be accepted. ln pafticular, businessmen, being careful people (since their money is involved) would have ordinarily read and understood a document before signing it. Hence, the presumption would be even stronger in their case."
ln view of the above, the plea sought to be raised by the defendants, is devoid of any force. Hence the contention of the defendants is negated.
Further contention of the defendants is that the Applicant Bank charged higher
rate of interest which was not agreed upon by the Defendants.
It is observed that the statement of account has been filed by the applicant bank, which is maintained in the Bank in the Books of the Bank in the usual and ordinary course of business and is admissible as per Section 4 of the Banker's Books of Evidence Act. lt is also observed that the defendants have failed to show/pin-point about any particular entry which is wrong or which should not have been there or which should have been
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O.A. 04/2022lDRT-Guwahati
there. ln the absence of the same, the contentionof the defendants has no force and is negated.
It is observed thatas per ExhibitA-4, which is an anElngementletter 24-1'l-2010' the applicant bankhad sanctionedcashcredit facilityof Rs.15,00,000.00 and term loan of Rs.45,OO,O0O.OOthus totaling of Rs.60,00,000.00 lacs to the defendant no. 1. The defendantshad accepted and signedon the said letter of arrangement, thereby agreeingto the terms and condition laid down therein. The defendants agreed to repay theloan with interest at the rate of 10.85%per annum calculated on daily balance of theloan amount at monthly rests in the cashcredit accountand1 1'05% per annum in the termloan account.
Moreover,asperSection2l-AottheBankingRegulationAct,1949a transaction betweena banking company andits debtorcannot be reopened by any Court on theground that the rate of interestcharged by the bankingcompany in respect of suchtransaction is excessive.section21-Aof the Act read as under:-
,Ratesofintercstchargedbybankingcompaniesnottobesubjecttoscrutinyby Courts._NotwithstandinganythingcontainedinthelJsuiousLoansAct,l9lS(10of 1918)oranyotherlawrelatingtoindebtednessinforceinanyState,atransaction betweenabankingcompanyanditsdebtorshallnotbereopenedbyanyCoudon thegrcundthattherateofinterestchargedbythebankingcompanyinrespctof such transactionts excessrVe'"
lnthecaseofStateBankofHyderabadandetc.Vs.AdvathSakruandanother etc.reportedinAlRlgg4(fullbench),theHon,bleAndhraPradeshHighCourthas held inpara 91 that "a trcnsactionbetweena bankingcompany andits debtor can not bereopenedonthegroundthattherateofintercstclaimedisusunous notwithstandingthe provisionsof Act 10 of 1918or the other provrsionsof Debf Laws prevailing in theState'"
lnviewoftheabove,thereisnoforceinthecontentionofthedeferrdantsandis negated.
ltisevidentfromthestatementofaccountfiledbytheapplicantbankthatthe defendantshavedefaultedinrepaymentoftheloan.lfthereisdefaultinrepa},mentofthe loan theapplicantbank has every right to proceed against the defendants for realization
IUreAa^4- ryh DAsX'zt I PresidingOffcer DRT' Gtlwahati
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O.A. 04/2022lDRT-Guwahati
of the outstanding dues. Hence I have no hesitation to hold that this original applicationis maintainable.
The applicant bank hasproduced on record the copies of the statement of account in respect of the defendants, duly certified under Bankers' Books Evidence Act. The applicant bank by the evidence-on-affidavit of Sri Dilip Kumar Bordoloi, ChiefManager of the Applicant Bank had deposed the correctness ofthe affidavit and certified copyof the account. Beyond that nothing morehas to be deposed by an officer of the bank. lt is thus obvious that apart from the entriesof the Books of account there are ampleevidence on the record to corroborate the saidentries.
The documents executed by theprincipal borrower as well as guarantorcum mortgagor from time to time areduly proved by the applicant bank and the witness of the applicant. ltis alsofound that the claim is within the periodof limitation.The applicant has sufficientcauseof action for filing the instant applicationdue to disbursemenUavailmentof loan to/by the defendantsand on default in repayment of the loan by the defendants,inspiteof demands made,as per exhibiteddocuments filed by the applicant bank.
considering the factsand circumstancesof the case, I am of the considered view that the documentsfiledby the applicant bank are supportingthe claim of the applicant bank and establishingthe liability of the defendants.lt is proved that the defendants are liable topay to the applicant bank the claim made in the Original Application. The loanswere obtained and documents have been executedon
24.11.2010,28.08.2013,16.10.2015,17.10.2015& 19.07.2020.The defendant no.1 represented by itspartner being defendant no.2 executed Revival Letteron 07.07.2018 in respect ofthe documents executedby defendantno.1on 16..10.2015. The defendantno thave made payments in the cash creditaccount no 31529028126 on24.05.2016,31.05.2016' 16.06.2016, 18.01'2017,19''12'2017' 14.06.2018, 18.04.2019amongst variousother dates and the defendant no 1 having madepayments in the cash credit account on the abovementioned dates have acknowledged the debtand liability in respect of the cashcredit account with the applicant bank onthe said dates.The accountsbecame NPA on 01.12.2020and
!;rda.a^nJv p."iomgo#{B( DRT, Guwahati
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O.A. 04/202ZDRT-Guwahati
the OA has been filed on 01.01 .2022. Hence, the OA is filed well within the period of limitation and this Tribunal having ajurisdiction to adjudicate the Original Application.
Considering the version of Sri Dilip Kumar Bordoloi, 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.
ln the result, the present Original Application No. 04 of 2022is allowed with cost as under :-
i) The defendants No. 1, 2,3,4 & 5 are jointly and severally liable to pay to the applicant bank a sum Rs.41,83,064.68 (Rupees Forty One Lakhs Eighty Three Thousand Sixty Four and Paise Sixty Eight) only with pendentelite and future interest @7.40o/o per annum with monthly rests from 01.12.2021 lill the date of full paymenUrealization and also cost of the application.
ii) The charge of the certificated amount be kept alive on leasehold property i.e. All that piece and parcel of land measuring 0.50 acres in lndustrialplot in Zone ll of Growth Centre are at Bodhjungnagar, Mouza and Tehsil Bodhjungnagar under RS Plot No. 4558 (P) Khatian No. 1090/10 under Sub Division Mohanpur, Sub Regishar Office Sadar, Agartala and land measuring 0.15 acres under Khatian No. 1090/'10, C.S.Plot No.4560 (p) Tehsil and Mouza Bodhjungnagar situated at lndustrial Plot in Zone ll Growth Centre Areas, Bodhjungnagar, West Tripura and is bounded as under : North : plot of Rotomoc lndustries; South : 15.0 mt Ring Road of Growth Centre; East: lnternal Road of Growth Centre; West: Ring Road of Grorrvth Centre, as mentioned in Schedule-A of the O.A. till the amount is realized in full.
iii) The charge of the certificated amount be kept alive on mortgaged property i.e. All that piece and parcel of a plot of land measuring 1 ganda 19 dhur (0.051 acres) and 2 kara 2 krant 15 dhur (0.0145 acres) covered under dag no 15924164073(old) 826870 (Hat) dag no 1947 (new) khatian No 1222, dag no 15924164015 (old) 1948 (new) '18268/306 (hat) Khatian No 991 of Tehsit
-h !U"/ d"q^o_,h$4, )Ltg4 / , Presiding Offcer DRT, Guwahati
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O.A. 04/2022yDRT-Guwahati
Agartala East, Mouza- Agartala Sheet No 18, Revenue Circle Agartala, district West Tripura situated at Jagaharimura, Agartala, West Tripura and is bounded as under: North:Land of Haradhan Saha; South: Gali Road; East: Late Sudhir Chandra Saha; West: Road, as mentioned in Schedule-B of the O.A. till the amount is realized in full.
Copy of the JudgmenUFinal Order be uploaded in the Tribunal's Website and file be consigned to Record Room.
[,cl'"-itlR:*f (Shiv Sharan Dubey)- - \ Presiding Officer DRT, Guwahati.
3 issues framed by the court
Whether the original application filed under Section 19 of the RDDBFA is maintainable in view of the documents executed and evidence on record.
Whether the plea regarding signatures on blank documents and excessive interest rates raises a triable issue during the DRT proceedings.
Whether the applicant is entitled to issue a recovery certificate granting charge on mortgaged properties.
Colour shows how this judgement treated each authority
Civ. App. No. 11884 of 1996Referred¶90
Grasim Industries Limited and Another Vs. Agarwal SteelDistinguished¶105
Grasim Industries Limited and Another Vs. Agarwal Steel (2010) 1 Supreme Court Cases 83
State Bank of Hyderabad and etc. Vs. Advath Sakru and anotherReferred¶117
State Bank of Hyderabad and etc. Vs. Advath Sakru and another reported in A.I.R.1994 (full bench)
Syndicate Bank versus R Veeranna and othersReferred¶90
Syndicate Bank versus R Veeranna and others
Punjab & Sindh Bank Vs. Ram PrakashDistinguished¶101
Punjab & Sindh Bank Vs. Ram Prakash 1990(1) BC 386
4 provisions across 4 enactments
State Bank of India Stressed Assets Recovery Branch (SARB), Guwahati
Pradeep Industries
Sri Prangopal Saha
Smt Dipanwita Saha
Smt Paramita Dutt Roy
Smt Smitha Shirodkar
Shiv Sharan Dubey
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
