Allowed

Punjab National Bank v. Sh. Inder Singh

DRT9 Jun 2023OA/274/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the Original Application filed by Punjab National Bank against legal heirs of a deceased borrower for recovery of an outstanding loan amount. While admitting liability, the Tribunal exercised discretion to grant a lower interest rate of 5% per annum and clarified that the heirs' liability is restricted to the inherited estate.

What did the court decide?

Recovery of Rs.31,72,088.02 with simple interest @5% p.a. from date of filing. Issuance of Recovery Certificate. Liability confined to inherited estate.

Punjab National Bank versus Sh. Inder 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.274/2023

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DATE OF INSTITUTION: 25.01.2023

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DATE OF DECISION: 9^th DAY OF JUNE, 2023

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Punjab National Bank , a body corporate and perpetual succession, constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970, carrying on Banking business and having its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi-110075, one of its Branches amongst other places is known as Dhamtan Sahib, District Jind, Haryana, through Sh. Malkeet Singh Soday, Chief Manager, its Principal Officer and General Attorney

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…..Applicant Bank

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Versus

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Sh. Inder Singh S/o Sh. Bhagwana since deceased through LR's

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i. Smt. Sunheri W/o Sh. Inder Singh R/o Balak Das Patti, Dhamtan, Tehsil Nrawana, District Jind, Haryana

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ii. Sh. Balwan S/o Sh. Inder Singh R/o Balak Das Patti, Dhamtan, Tehsil Nrawana, District Jind, Haryana

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iii. Smt. Krishna D/o Sh. Inder Singh W/o Sh. Rajbir R/o V.P.O Gurusar near Balak Das Patti, Dhamtan, Tehsil Nrawana, District Jind, Haryana

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iv. Smt. Mana D/o Sh. Inder Singh W/o Sh. Ramesh R/o V.P.O Kapro, Tehsil Narnaund, District Hisar, Haryana

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Sh. Balwan S/o Sh. Inder Singh R/o Balakdas Patti Dhantam, Tehsil Narwana District Jind No. 4, Village Ghorawali, Tehsil and District, Sirsa, Haryana-125103

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…..Defendants

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OA/274/2023 PUNJAB NATIONAL BANK Vs INDER AND OTHERS

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Argued by: Ms Priyanka Gupta, Chief Manager (Law) along with Mrs. Arpita Sonkar, Manager (Law) for the applicant bank Defendants ex parte vide order dated 05.06.2023

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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), a gainst the defendants for recovery of Rs.31,72,088.02/- (Rupees Thirty One lacs Seventy Two Thousand Eighty Eight and Two Paisa Only) . It has been filed through Sh. Malkeet Singh Soday, Chief Manager of the applicant bank stated to be competent to institute the Original Application vide General Power of Attorney dated 09.03.2021, Annexure- A1 (copy).

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The brief facts of the case of the applicant as per Original Application are that the defendants had approached the applicant bank for grant of KCC facility of Rs.7 lacs which was further enhanced to Rs. 14 lacs vide loan application dated 09.03.2012, Annexure-A2 (colly) (copy).

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The applicant bank sanctioned aforesaid credit facility to the defendants vide sanction letter dated 09.03.2012, 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 facility, the defendants executed hypothecation agreement dated 02.03.2012, Annexure-A3 (copy).

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The aforesaid loan was further secured by creation of registered mortgage by the defendants in respect of agricultural land measuring

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OA/274/2023 PUNJAB NATIONAL BANK Vs INDER AND OTHERS

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114 Kanals 10 Marlas situated in the revenue estate of Dhamtan Sahib, District Jind, Haryana, fully detailed in para No. 5.10 of the Original Application. Request letters dated 15.04.2015 and 17.02.2012 to the Tehsildar, Narwana/Uchana/Kalayat, for entry/mutation of mortgaged property, registered supplementary mortgage deed, registered mortgage deed and affidavit regarding mortgaged property are Annexure-A4 (colly) (copy).

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It is further the case of the applicant bank that the loan facility was duly availed of by the defendants but they failed to maintain the financial discipline of the applicant bank and resultantly, the loan account became irregular and it was declared NPA on 31.03.2021. The applicant bank recalled the entire outstanding amount vide legal notices dated 24.01.2020, 31.10.2022, Annexure-A6 (colly) (copy) and dispatch details, Annexure-A7 (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 account, a sum of Rs.31,72,088.02/- (Rupees Thirty One lacs Seventy Two Thousand Eighty Eight and Two Paisa Only) is recoverable against the defendants as per statement of account, Annexure-A7 (copy) certified under Bankers’ Books Evidence Act. 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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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 05.06.2023 .

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OA/274/2023 PUNJAB NATIONAL BANK Vs INDER AND OTHERS

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

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This Tribunal has heard ex-parte arguments advanced by Ms Priyanka Gupta, Chief Manager (Law) of the applicant bank and gone through the record carefully. 10. It was argued by Ms Priyanka Gupta, Chief 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 A7 , it is clear that the defendants had approached the applicant bank for availing of the loan facility which was 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. Sh. Inder Singh had died, leaving behind defendant Nos. 1(i) to 1(iv) as his legal heirs who have been impleaded as defendants. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.31,72,088.02/- (Rupees

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Thirty One lacs Seventy Two Thousand Eighty Eight and Two

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Paisa Only) from the defendants.

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In so far as pendent lite and future interest is concerned, the applicant bank in relief clause has claimed rate of interest @14% per annum plus @2% per annum penal interest. In sanction letter dated 09.03.2012, Annexure-A2 (colly) (copy), rate of interest has been mentioned @12.25% per annum.

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OA/274/2023 PUNJAB NATIONAL BANK Vs INDER AND OTHERS

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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 the 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, death of the borrower and defendant Nos. 1(i), 1(iii) and 1(iv) being ladies, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @5% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

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In the result, the Original Application is allowed with costs declaring that the defendants are liable to pay to the applicant bank a sum of Rs.31,72,088.02/- (Rupees Thirty One lacs Seventy Two Thousand Eighty Eight and Two Paisa Only) with current and future simple interest @5% per annum w.e.f. 25.01.2023 , till the date of realisation of the amount. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of 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. The applicant bank is at liberty to enforce the claim through due process of law. However, it is clarified that there should not be any ambiguity

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OA/274/2023 PUNJAB NATIONAL BANK Vs INDER AND OTHERS

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that the liability of the defendants by virtue of their being the legal heirs of the deceased borrower shall remain confined only to estate of the deceased borrower if it is inherited by them and not beyond that or otherwise. The recovery proceedings shall proceed only after the Recovery Officer is fully satisfied on the aspect of the estate being inherited by the Legal Representatives/Heirs and

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the liability being incurred accordingly .

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 09.08.2023 .

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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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Announced in the open Tribunal (M.M. Dhonchak) Presiding Officer DRT-2, Chandigarh

Punjab National Bank v. Sh. Inder Singh

Case brief

What is this about?

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Punjab National Bank v. Sh. Inder Singh

Case brief

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