Allowed

Canara Bank v. M S Sri Extrusion Technics

DRT18 Jul 2023OA/267/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an Original Application filed by Canara Bank to recover outstanding loans. The defendants failed to repay term loans and overdraft limits, leading to NPAs. The tribunal confirmed the bank's right to recover the principal amount along with future interest from the sum total as per the executed documents and recover the amount from the defendants properties. Discl

What did the court decide?

Joint and several liability to pay Rs. 1,52,32,232.85 with future interest; liberty to proceed against hypothecated assets and properties of defendants for realization of dues; costs.

Canara Bank versus M S Sri Extrusion Technics — Contract and Commercial Disputes | DRT (2023)

¶1

IN THE DEBTS RECOVERY TRIBUNAL-I AT HYDERABAD

¶2

DATED THIS THE 18TH DAY OF JULY 2023

¶3

PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER OA.No.267 OF 2(J22

¶4

Between :

¶5

Canara Bank, Branch office at N.S. Road, D. No. 5-3-1062, Veerji towers, Osmangunj area, Opp Hotel Jewel Residency, Near Old P.S. Begum Bazar, Hyderabad - 500 001. Telangana State.

¶6

Represented by its Chief Manager Applicant

¶7

VERSUS

¶8

M/s. Sri Extrusion Technics, Represented by its pa rtner Sri Rakesh Roshan Jain, Male, R/o 7-3-116 to 118, 5y.No.72,73, Katedan Ind ustrial Area, Gagan Pahad, Hyderabad - 5OO O77. 2. Sri Rakesh Roshan Jain, s/o Late Ramchander Jain Male, partner of M/s. Sri Extrusion Technics, aged 50 years,

¶9

Occ: business, R/o 7-3-116 to 118, Sy.No.7 2,7 3, Katedan Industrial Area, Gagan Pahad, Hyderabad - 50O 077. And Flat no.504, KBR Manicom Residency, Sri Nagar colony, Hyderabad - 500 073.ffi 'W'tttP ii:^{1B JUr.zurl} il

¶10

And

¶11

lOA.No.267 /20221

¶12

Smt Rajini Jain, w/o Sri Ajay Kumar, partner of M/s. Sri Extrusion Technics, aged major, Occ: business, R/o H.No.4-7-4513, Attapur, Back side Hanuman Temple, Maruth i nagar, Rajendranagar, Hyderabad - 500 048.

¶13

Defenda nts

¶14

Counsel for the Pa rties:

For the Applicant

For the Defendants

Sri A.V.S.S. Prasad

Expa rte

ORDER

The Applicant Bank filed the present OA against Defendants for recovery of a total sum of Rs.L,S2,32,232.gSps (Rupees One crore Fifty two Lakhs thirty two thousand two hundred thirty two and paise Eight five only) i.e., a sum of Rs.1,05,73,486.73ps in SOD limit with future Interest @ 10.90olo p.a with monthly rests; a sum of Rs.32,31,436.43ps in respect of term loan account with future interest @ 11.16o7o p.a at monthly rests and a sum of

¶21

Rs.74,27,309.69ps in respect of GECL account with current and future interest @ 10.90o/op.a with monthly rests from 01.08.2022 till the date oF realization and in default for sale of hypothecated assets as described in the schedule to OA.

¶22

(oA.No.26712022)

¶23

As per the averments in the apprication, the Appricant Bank states that the defendant No.1 firm floated with two partners i.e., Smt Reena Jain and sri Rishikanth Kota vide partnership deed dated 18.04.2018, thereafter smt Reena Jain retired from firm on 07.05.2018 and sri Rakesh Roshan Jain joined as new partner. On request of defendants 7 and 2 working capitar rimit of Rs.25.00 rakhs and term roan rimit of rs.60,00 lakhs was sanctioned for carrying on business against hypothecation of stocks, furniture and equipment etc. Defendants 1 and 2 availed GECL limit on 04.06.2020 and executed agreement cum deed of hypothecation dated 05.06.2020 for Rs.15.00 lakhs. Defendants 1 to 3 availed enhancement of OD facility from Rs,25.00 lakhs to Rs.1.00 crore and executed the forowing documents in favour of the Applicant Bank.

¶24

a) Pronote dated 26.11.2020 for Rs.1.00 Crore; b) Supplemental common hypothecation agreement dated 26.11.2020 for Rs.1.00 Crore;

¶25

c) Guarantee agreement dated 26.11.2020 along with covering letter by defendant no.1 in favour of applicant bank;

¶26

d) Guarantee agreement da 20 along with coverlng letter by defendant "".r,y{i@ ;i,9"e) Renewat tetter dated,f6. 1 1.2o5Bi li ig ur,rrn iic.^{18 JIJI zrn} ? 'Wu.*#'

¶27

lOA.No.267 /20221

¶28

After availing the roan facirities, the defendants faired to compry the terms of sanction, hence the applicant bank was constrained to classify the account as NpA and issued notice dated tO.Ol.2O22. Inspite of several requests and demands, the defendants did not crear the outstanding. Hence this OA.

¶29

Defendants were called absent and set exparte on 07.06.2023.

¶30

sri K,P. Linganna, officer of the Appricant Bank examined himserf as AW.1 and exhibited rerevant documents, which are marked as Ex.A.1 to A.15.

¶31

Heard the Ld. Counsel for the Applicant Bank.

¶32

The point that arise for consideration is whether the Applicant Bank is

¶33

entitled for the claim made in the OA against the Defendants as prayed for?

¶34

The defendants were cailed absent and set exparte. To substantiate the case of the Applicant Bank, AW.1 who is the official of the Applicant Bank was examined and he exhibited rerevant documents as Ex.A1 to A.15. In view of I hold thaL the Applicant Bank has established thei A against the Defendants

¶35

and hence the Ap ver the claim made in *

¶36

the OA with future ligleresl &r4$psffi i! -'{ $

¶37

(OA.No.267 /2022]|

¶38

B. In the result, the present OA is allowed with costs, as under:

¶39

The Defendants No.1to 3 are jointry and severaily riabre to pay to the Applicant Bank a total sum of Rs.1,52,32,232.g5ps (Rupees One crore Fifty two Lakhs thirty two thousand two hundred thirty two and paise Eight five only) i.e., a sum of Rs.1,05,73,486.73ps in SOD limit with future interest @ 10.90olop.a ; a sum of Rs.32,31,436.43ps in respect of term loan account with future interest @ 11.10o/o p.a and a sum of Rs.I4,27,3)g.69ps in respect of GECL account with current and future interest @ 10.90o/op.a from 0L.08.2022 till the date of rearization tiil the date of rearization.

¶40

i) The Applicant bank is entitled to proceed against the hypothecated assets as described in the schedure to oA towards rearization of its dues.

¶41

ii) The applicant bank is also entitled to proceed against the person and properties of defendants No.2 & 3 and properties of defendant no.1 firm towards realization of the debt due.

¶42

iii) The Applicant Bank is entitled to the costs of the OA.

¶43

iv) ]::i:,;:::::'F&-E\ weeks from the date :i^*

¶44

lOA.No.267 /2oz2l

¶45

Issue Recovery certificate accordingly.

¶46

Communicate a copy of the order to the parties concerned.

¶47

(Dictated to the p'A., transcribed by her, corrected, signed and pronounced by me in the open court on this the 18th day of July, 2023)

¶48

sd/-

¶49

(G. GOPTCHAND) PRESIDING OFFICER

¶50

46%<br>:1oJrm ;
W

¶51

Canara Bank v. M S Sri Extrusion Technics

Case brief

What is this about?

What did the court decide?

Canara Bank v. M S Sri Extrusion Technics

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Parties & counsel

Coram

Case details

Similar cases

Punjab National Bank versus M/s Puja Plastic Industry

Punjab National Bank versus Ms Dinesh Electronics

Shri Pandit So Dattarao Sarnaik versus Motilal Oswal Home Finande Ltd.

Neha Gupta versus Hdfc Housing Development Finance Corporation Ltd.

Ms Sanatan Logistics Pvt. Ltd. versus Kotak Mahindra Bank Limited

Punjab National Bank versus M/S Satya Inc.