Allowed

Punjab National Bank v. Sh. Labh Singh

DRT22 Sept 2023OA/2095/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the application filed by Punjab National Bank against Defendant Labh Singh for recovery of a defaulting loan of Rs.23,42,672 secured by agricultural land, granting recovery proceedings and issuing a recovery certificate.

What did the court decide?

Recovery Certificate issued for Rs.23,42,672 with 8% simple interest w.e.f. 07.11.2022; liberty to recover via sale of assets.

Punjab National Bank versus Sh. Labh 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.2095/2022

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DATE OF INSTITUTION: 07.11.2022

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DATE OF DECISION: 22^nd 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 (hereinafter referred to as the said Bank) and amongst many Branches, one at Kheri Lakha Singh, District Yamunanagar, (Haryana), through Shri Virender Kumar Tewari, General Attorney and Principal Officer of Circle SASTRA Centre, Karnal

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…..Applicant Bank

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Versus

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Sh. Labh Singh s/o Sh. Puran Singh r/o village Antawa, Tehsil Radaur, District Yamunanagar, Haryana

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....Defendant

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Argued by: Ms Arpita Sonkar, Manager Law for the applicant bank Defendant ex parte vide order dated 25.08.2023

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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 as ‘the Act’ for brevity) , against the defendant for recovery of Rs.23,42,672/(Rupees Twenty Three Lac Forty Two Thousand and six Hundred Seventy Two Only) . It has been filed

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OA/2095/2022 PUNJAB NATIONAL BANK VS LABH SINGH 2

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through Shri Virender Kumar Tewari, General Attorney and Principal Officer of the applicant bank stated to be competent to institute the Original Application vide general power of attorney, Annexure-A1 (copy).

¶15

The brief facts of the case of the applicant as per Original Application are that the defendant had approached the applicant bank for grant of Rs. 16,00,000/- under KCC Gold Card Scheme vide loan application dated 26.02.2018, Annexure-A2 (copy).

¶16

The applicant bank sanctioned aforesaid facility to the defendant vide sanction letter, Annexure-A3 (copy), as per terms and conditions which were duly accepted by the defendant. 4. In order to secure the aforementioned credit facility, the defendant executed hypothecation agreement dated 05.03.2018, Annexure-A4 and supplementary agreement dated 05.03.2018, Annexure-A5 (copy).

¶17

The aforesaid limit was further secured by creation of equitable mortgage by defendant in respect of agricultural land measuring 48 Kanals situated in the revenue estate of Antawa, Tehsil Radaur, District Yamunanagar, Haryana fully detailed in para No. 5.5 of the OA.

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The documents related to mortgage are as under:

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i. Declaration under Section 4(1) of the Haryana Agricultural Corporation and Miscellaneous Provisions (banks) Act, 1973, Annexure-A6 (copy).

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ii. Copy of ‘Jamabandi’ for the years 2016-17, Annexure-A7 (copy).

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OA/2095/2022 PUNJAB NATIONAL BANK VS LABH SINGH 3

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It is further the case of the applicant bank that the loan facility was duly availed of by the defendant but he failed to maintain the financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA on 02.01.2022. The defendant executed balance and security confirmation letter dated 24.02.2021, Annexure-A8 (copy). The applicant bank recalled entire outstanding amount vide legal notice dated 12.09.2022 along with postal receipt, Annexure-A9 (colly) (copy), but to no avail.

¶23

It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of

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Rs.23,42,672/(Rupees Twenty Three Lac Forty Two Thousand and six Hundred Seventy Two Only), is recoverable against the defendant as per statement of account, duly certified under Bankers’ Books Evidence Act, 1891, Annexure-A10 (copy).

¶25

Since the defendant did not repay the outstanding amount, therefore, the applicant bank preferred the present Original Application for issuance of Recovery Certificate.

¶26

Notice of the Original Application was duly served upon the defendant, but since none appeared on behalf of the defendant, thus, the defendant was proceeded against ex-parte vide order dated 25.08.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Varinder Kumar Tewari, General Attorney and Principal Officer of the applicant bank was filed.

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OA/2095/2022 PUNJAB NATIONAL BANK VS LABH SINGH 4

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This Tribunal has heard ex-parte arguments advanced by Ms Arpita Sonkar, Manager Law of the applicant bank and gone through the record carefully.

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It was argued by Ms Arpita Sonkar, Manager Law that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendant for recovery of the amount sought. From perusal of Annexures- A1 to A10 , it is clear that the defendant had approached the applicant bank for availing of the loan facility which was granted to him. It is further clear that the defendant had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendant 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.23,42,672/(Rupees Twenty Three Lac Forty Two Thousand and six Hundred Seventy Two Only) from the defendant.

¶31

In so far as pendente lite and future interest is concerned, the applicant bank has claimed rate of interest @9.20% per annum with half yearly rests. In hypothecation agreement dated 05.03.2018, Annexure-A4 , the rate of interest has been mentioned @9.20% 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/2095/2022 PUNJAB NATIONAL BANK VS LABH SINGH 5

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Covid-19 affecting businesses, nature of mortgaged property, purpose of loan, i.e. agricultural, present conditions of economy based on agriculture, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yesteryears, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @8% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

¶35

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.23,42,672/- (Rupees Twenty Three Lac Forty Two Thousand and six Hundred Seventy Two Only) with current and future simple interest @8% per annum w.e.f. 07.11.2022 , till the date of realisation of the amount. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of hypothecated property of the defendant 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 defendant. 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 30.10.2023.

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OA/2095/2022 PUNJAB NATIONAL BANK VS LABH SINGH 6

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Copy of this order be sent to the applicant bank and the defendant 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. Labh Singh

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. Sh. Labh Singh

Case brief

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