Allowed

Idbi Bank v. M/s Shiv Kriti Infracon Pvt. Ltd. and Others

DRT10 Apr 2023OA/265/2022

Case brief

AI extract

What is this about?

This is an ex-parte order in an application filed by IDBI Bank Ltd. under the Recovery of Debts and Bankruptcy Act, 1993. The bank sought recovery of loan dues aggregating Rs. 25,50,872 along with interest from the borrowers and guarantors who failed to appear and contest the claim.

What did the court decide?

Declaration of debt amounting to Rs. 25,50,872 along with interest from 12.4.2022. Attachment of mortgaged/hypothecated assets. Recovery certificate to be issued.

Idbi Bank versus M/s Shiv Kriti Infracon Pvt. Ltd. and Others — Banking and Recovery | DRT (2023)

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OA 265 of 2022 [J[

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DRT,PATNA

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Debts Recovery Tribunal, Patna,

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Karpuri Thakur Sadan, Aashiana Digha Road at PATNA-800025

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Presiding Officer : Shri Kaushalendra Yadav

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OA Case no. : 265 of 2022

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IDBI Bank Ld. Goel Premises, Near Bharat Jalpan Hotel, Saraeyaganj, Muzaffarpur, Pin code 842001.

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. Applicant

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Vs.

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MIs Shiv Kriti Infracon Pvt. Ltd. represented through its Directors, Sri Sanjay Kumar, Sri Vinay Kumar and Sri Amit Ranjan, Registered office at Mishra Tola, Gannipur, Clo Suman Kumar Thakur, House no. 313,Ward no. 28, Muzaffarpur-842002. Factory site at Kanti Village-Sarsia Bujurg, Muzaffarpur, Pin dcode 843108.

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Sri Vinay Kumar Sio Late Phuldeo Prasad Singh, Rio Damu Chawk, In front of SDO Kothi, N.H.-146, P.S.-Kazi Mohammadpur, Muzaffarpur. (PAN no. APQPK9350Q)

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Sri Sanjay Kumar Sio Late Binod Kumar Thakur at Mishra Tola, Gannipur, Clo Suman Kumar Thakur, House no. 313,Ward no. 28, Muzaffarpur-842002. (PAN no. ASWPK7052N)

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Sri Amit Ranjan Sio Sri Sharda Nand Singh, at Mishra Tola, Gannipur, Clo Suman Kumar Thakur, House no. 313,Ward no. 28, Muzaffarpur-842002. (PAN no. AOAPR7779H)

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Smt. Mridula Thakur W/o Sri Sanjay Kumar at Mishra Tola, Gannipur, Clo Suman Kumar Thakur, House no. 313,Ward no. 28, Muzaffarpur-842002

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...Defendants.

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Present: For the Applicant : Shri J.K. Roy, Advocate For the Defendants : None

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Dated: 10.04.2023

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JUDGMENT

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1- The Applicant bank has made this application uls 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 12.4.2022 against the defendants to recover its debts from defendants of Rs.25,50,872/- upto 28.1.2022 alongwith pendente-lite and future interest at the contractual rate from 29.1.2022 with costs till realization.

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2- The application has been duly registered and numbered as above.

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3- The brief facts of the case of the applicant bank as stated in the application are as under-

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The applicant IDBI Bank Ltd. a company incorporated and registered under the companies Act 1956 (1 of 1956) and a banking company within the meaning of section 5© under the Banking regulation Act 1949 carrying the business of Banking and having its registered office at IDBI Tower, WTC complex, Cuffe Parade, Mumbai-400005 and its Zonal Office at Kashi Palace in New Dak Bunglow Road, Patna and a Branch Office at Goel Premises, Near Bharat Jalpan Hotel, Saraeyaganj, Muzaffarpur, Pin code 842001

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The defendant no. 1 is a company, defendant no. 2,3 & 4 are its Directors/ guarantors and the defendant no. 5 is the mortgagor. The defendant no. 1 is doing manufacturing business of concrete electricity pole. The defendants approached the bank and submitted an application on 24.4.2015 for grant of cash credit overdraft limit of Rs.40 lakh for working capital to run the said business smoothly. On 2.5.2015, the competent authority of the bank considered the loan application according to the procedure of the bank and sanctioned the cash credit overdraft limit of Rs.22.5 lakh with interest @13% p.a. compounded monthly repayable on demand renewable after 12 months at the discretion of the bank as per the operation of the account by the defendants and the terms and conditions mentioned therein and the same have been accepted by Board Resolution of the company dated 2.5.2015. The defendants executed the various loan documents i.e. DP note, agreement for hypothecation cum facility agreement and letter of guarantee. The defendant no. 5 has mortgage her immovable property details given at page 14 in Schedule-II of OA. The defendants further request of the bank for renewed the said cash credit overdraft facility ofrS.22.50 lakh on 31.10.2016, 27.4.2015 and 31.10.2019.

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All the transactions were entered in the ledger of the loan accounts in the name of the defendants duly maintained by the applicant bank in its usual course of business. After availing the sanctioned credit facilities became irregular in repayment of their dues as per agreed terms and failed to adhere to the financial norms of the bank and avoiding the repayment of its dues to the bank, in spite of several assurances given by it to the applicant bank resulting in the account turning as NPA on 30.5.2021.

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Thus the total liability in the loan account is Rs.25,50,872/- as on 28.1.2022 with pendentelite and future interest at the contractual rate of interest with monthly rests from 29.1.2022 till the realization.

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The interest /compound interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.

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Since, the defendants have failed and neglected in spite of several reminders to make payment of the dues recoverable to bank, hence this application has been filed by the bank.

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4- D/s 19 (4) of the Act & Rule of the DRT [Procedure] Rules, 1993, copies of application & paper book was sent by this Tribunal to the

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defendants by registered/speed post on 23.5.2022, and summons/notices issued requiring the defendants to show-cause within 30 days of the service of summons/notices as to why relief prayed for, should not be granted.

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Despite the registered summons/notices, which is evident from the tracking report and the Sufficient time has been given to the defendants1,2,4 & 5 have not appeared before this Tribunal to contest the case. The sufficient time has been given to the defendants no. 1,2,4 & 5 to defend their case, but they failed to appear and to file WS, hence, the Tribunal has passed an order to proceed ex-parte against the defendants no. 1,2,4 & 5 on 2.8.2022. Defendant no. 3 has appeared and filed Vakalatnama but failed to file written statement. Hence further opportunity to file written statement is closed on 20.10.2022.

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5- To prove its case, the applicant Bank has referred various certified photocopies of documents before this Tribunal. The applicant bank has also given evidence on affidavit by way of affidavit of Shri Vijay Kumar Sinha, Recovery Officer of the applicant bank. The details of documents are as follows. :-

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SI.No	Description of photocopies Documents	Date of Execution	Amount	Signature of executant	Ex.! Ann. No.
1	Loan application	24.4.2015	Rs.40 lakh	defendant no. 1to 4	1
2	Sanctioned letter	2.5.2015	Rs.22.50 lakh	bank	2
3	DP note	2.5.2015	Rs.22.50 lakh	defendant no. 1to 4	3
4	DP note	2.5.2015	Rs.22.50 lakh	defendant no. 1to 4	4
5	Agreement for hypothecation	2.5.2015	...	defendant no. 1to 4	5
6	letter of guarantee	2.5.2015	Rs.22.50 lakh	defendant no. 2 to 5	6
7	letter of declaration and memorandum	2.5.2015	...	defendant no. 5	7
8	sanction letter	31.10.2016 27.4.2018	Rs.22.50 lakh	bank	8
9	Acknowledgeme nt of debt	26.4.2018	...	defendant no. 1to 4	9
10	sanction letter	31.10.2018	Rs.22.50 lakh	bank	10
11	Recall notice	18.10.2021 3.11.2021	...	bank	11
12	demand notice	26.11.2021	...	bank	12
13	Possession notice	27.1.2022	...	bank	13
14	statement of account	as on 28.1.2022	Rs.25,50,872/-	bank	14

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6- Opportunity of hearing has been fully given to both the parties, but despite several opportunities given to defendants, the defendants have not

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appeared to contest the case, hence, the ex-parte arguments of learned counsel for applicant bank were heard and perused the case record.

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Ld. counsel of applicant bank submitted that the defendants have taken the loan and utilized the same and also executed the various loan documents to secure the loan. Further, submitted that the claim of the bank has been proved by documentary evidence.

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It is further submitted by ld. Counsel of applicant bank that there is no any stay granted by any Higher Court, in respect of the proceedings of the present OA and requested to issue recovery certificate, as claimed for, inOA.

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7- It has been established that defendants are living and carrying on their business in the state of Bihar. Cause of action also arose in the State of Bihar. The said claim on the date of filing of application exceeded Rs.20 lacs. The applicant bank is functioning within jurisdiction of this tribunal. Therefore, this Tribunal has territorial as well as pecumary jurisdiction to adjudicate upon the present application.

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8- On the issue of Limitation, to prove it, the applicant bank has submitted that the applicant bank has declared the account as NPA on 30.5.2021, whereas the present application has been filed on 12.4.2022 Even, it is counted for the purpose of Limitation, then it is established that the applicant bank has filed the case within the limitation period. As such, it is established that present application has been filed well within the period of limitation.

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9- In the affidavit of Shri Vijay Kumar Sinha, Recovery Officer of the applicant bank, has stated that he is well acquainted with the facts of the case and has on verification of record, sworn in the affidavit in support of contents of application and the documents as evidence and established on oath the pleadings and documents of the applicant bank as stated above.

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The documents as stated above reveal that the defendants have applied for loan and the bank had sanctioned the loan and to secure the loan and for repayment of loan amount with interests etc., the defendants have executed various loan documents, which strength the case of the applicant bank.

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The applicant bank has also furnished statement of account as above, which is not only admissible but shall be taken as correct statement of account, more so since the entries in the statement of account has not been challenged.

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10Since, the case was proceeded ex-parte against defendants, all contentions raised and documents produced by plaintiff remained unrebutted and the tribunal may act upon the affidavit of the applicant as per law. Defendants have neither denied the utilization of funds advanced by applicant bank nor have pointed out any specific error and discrepancy in

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OA 265 of 2022 (J)

the Statement of Account, which is kept in due course of business, evidence on affidavit, which has supported the claim of the applicant bank, established to have fully correct and believable. Provisions contained in Rule 9(2) of Debt Recovery Tribunal (Procedure) Rules, 1993 provide that the documents referred in the application shall be duly stated by senior officer of the bank, or financial institution as the case may be and numbered accordingly. The rule 12 (10) provides that the provisions contained in section 4 of the Banker's Books evidence that Act, 1891 (18 of 1891) shall applied to certified copy of an entry in a Banker's Books furnished alongwith application filed under sub section 1 of section 19 by the applicant.

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11On consideration of the arguments and on perusal of the application, documents and affidavit, it is proved that the applicant bank has granted the loan facility, documents were executed by the defendants and facility was availed by the defendants as stated in the application.

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12The applicant bank has sought for recovery of a sum of Rs.25,50,872/- with cost and further interest at the contractual rate from 29.1.2022 till realization.

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13Learned Advocate appearing for applicant bank submits that the applicant bank has charged interest in terms of the agreements and that interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.

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14On consideration of the arguments and on perusal of the pleadings, documents and affidavit, it is proved that the applicant has charged interest against defendants in terms of documents and as per directives of RBI.

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15None of the defendants appeared before the tribunal to contest the claim made by the applicant, therefore, it necessarily goes to establish that the claim made by the applicant bank is genuine and true. It is manifest that the defendants have not disputed the claim, therefore, the claim referred to the tribunal is recoverable till full and final realization of the claim.

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16In Indian Bank Vs. Blue Jaggers Estates Limited and others [2010] 8 SCC 129,the Hon'ble Supreme Court of India has observed as under-

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"The Court cannot lose sight of the fact that the bank is a trustee of public fund. It cannot compromise the public interest for benefiting private individuals. Those who take loan and avail financial facilities from the bank are duty bound to repay the amount strictly in accordance with the terms of the contract. Any lapse in such matters has to be viewed seriously and the bank is not only entitled but duty bound to recover the amount by adopting all legally permissible methods. Parliament enacted the act because it was found that legal mechanism available till then was wholly insufficient for recovery of the outstanding dues of the banks and Financial Institutions." V \ ~\ '-'

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OA 265 of20221JI

17In my view, Facts of the case stand proved by evidence of the applicant bank ex-parte. Accordingly, The applicant bank is entitled to recover from defendantsjointly and severally ofRs.25,50,872/- alongwith pendente-lite and future interest @11% p.a. with compounded monthly rests from 12.4.2022(The date of filing of this O.A.) till realization. So the final order may be passed accordingly, to meet the ends ofjustice.

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ORDER

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In the result, the application of the applicant bank is, allowed exparte and debt is determined with costs against the defendants. The defendants are hereby jointly and severally, ordered to pay the applicant bank it's debts amounting to Rs.25,50,872/- alongwith pendente-lite and future interest @11% p.a. with compounded monthly rests from 12.4.2022 (The date of filing of this O.A.) till realization of the entire sum due and recoverable with costs.

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It is made clear that any amount deposited by the defendants, be deducted in the claim amount, if not deducted.

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Defendants are debarred from transferring, alienating encumbering or otherwise dealing with or disposing of the mortgaged or hypothecated or any other properties and assets without paying the aforesaid adjudicated dues to the applicant bank to secure the ends of justice. The mortgaged or hypothecated assets to secure the loan in question are hereby attached and shall be subject to the final order under the recovery proceedings in pursuance of the Recovery certificate issued under Section 19(22) of Recovery of Debts and Bankruptcy Act 1993. The applicant may submit the certified copy of this Judgment and the Recovery Certificate before the Registrar/ Sub- registrar to endorse the charge over the secured assets.

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Let a certificate of recovery be drawn up forthwith and put up for signatures in terms of provisions contained in Section 19(22)of the Act to be issued, on the basis of the order of the Tribunal to the Recovery Officer. The Recovery Officer shall realize the amount as per the certificate in the manner and mode prescribed under the Act from the defendants, by sale of mortgaged! hypothecated assets as well as other personal movable/immovable assets of the defendants.

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Parties are directed to appear before the Recovery Officer, DRT, Patna on 23.5.2023. The order be communicated accordingly.

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Judgment signed, sealed, dated and pronounced in the open comt on this io" Day of April, 2023. .~

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Dictated & corrected by me.

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[Kaushalendra Yadav] Presiding Officer Debts Recovery Tribunal, Patna

Idbi Bank v. M/s Shiv Kriti Infracon Pvt. Ltd. and Others

Case brief

What is this about?

What did the court decide?

Idbi Bank v. M/s Shiv Kriti Infracon Pvt. Ltd. and Others

Case brief

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