Allowed

State Bank of India v. Sh. Mohan Lal

DRT22 Jun 2023OA/359/2023

Case brief

AI extract

What is this about?

The DRT allowed an original application filed by State Bank of India against respondents for recovery of Rs. 28.32 lakhs. The court awarded a uniform simple interest of 8% per annum instead of the claimed rate and authorized sale of mortgaged property for realization.

What did the court decide?

Recovery of Rs. 28,32,531.75 with simple interest at 8% per annum from 28.12.2022. Liberty to recover through sale of mortgaged property or attachment of personal assets.

State Bank of India versus Sh. Mohan Lal — Specific Performance | DRT (2023)

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DEBTS RECOVERY TRIBUNAL-2, CHANDIGARH, PRESIDED OVER BY M.M. DHONCHAK

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ORIGINAL APPLICATION NO.359/2023

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DATE OF INSTITUTION: 28.12.2022

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DATE OF DECISION: 22^nd DAY OF JUNE, 2023

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State Bank of India , (erstwhile State Bank of Patiala having its Head Office at the Mall Patiala, Punjab, acquired by State Bank of India with effect from 01.04.2017 under Section 35 of the State Bank of India Act, 1955 (Act No. 23 of 1955) vide Notification dated 22.02.2017), a body corporate constituted under the State Bank of India Act, 1955 (Act No.23 of 1955) having its Central Office at Mumbai and one of its Local Head Offices at Panchkula and a Branch amongst other places at Mohiuddinpur, District Karnal, Haryana, through its Branch Manager/Principal Officer namely Sh. Balkar Singh

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…..Applicant Bank

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Versus

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Sh. Mohan Lal S/o Sh. Harpal S/o Sh. Surta R/o Village Dakwala Roran, Tehsil and District, Karnal, Haryana-132037

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Sh. Sunny S/o Sh. Satpal S/o Sh. Surta R/o Village Dakwala Roran, Tehsil and District Karnal, Haryana-132037

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…..Defendants

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Argued by: Sh. Divjot Singh Rekhi, Nodal Officer for the applicant bank Defendants ex parte vide order date 03.06.2023

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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

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OA/359/2023 STATE BANK OF INDIA Vs SH. MOHAN LAL AND OTHERS

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as ‘the Act’ for brevity), against the defendants for recovery of Rs.28,32,531.75/- (Rupees Twenty Eight lacs Thirty Two Thousand Five Hundred Thirty One and Seventy Five Paisa Only) . It has been filed through Sh. Balkar Singh, Branch Manager of the applicant bank stated to be competent to institute the Original Application vide Gazette Notifications dated 22.02.2017 and 02.05.1987, Annexure-A1 and A2 (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 10 lacs vide application Form dated 23.11.2013, Annexure-A3 (copy).

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The applicant bank sanctioned aforesaid facility to the defendants vide sanction letter dated 26.11.2013, Annexure-A4 (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 26.11.2013, Annexure-A5 (copy).

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The aforesaid loan was further secured by creation of mortgage by the defendants in respect of agricultural land measuring 10 Kanals 13 Marlas situated in the revenue estate of Dhakwala, Tehsil and District Karnal, Haryana, fully detailed in para No. 5(vi) of the Original Application.

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The documents relating to the mortgage are as under:

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i. Registered mortgaged deed dated 26.11.2013, AnnexureA6 (copy).

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OA/359/2023 STATE BANK OF INDIA Vs SH. MOHAN LAL AND OTHERS

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ii. Request letter dated 26.11.2013 to the Tehsildar, Karnal, for entry/mutation of mortgaged property, Annexure-A7 (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 12.09.2017. The defendants executed balance confirmatorycum-acknowledgement of security letter dated 22.09.2016, Annexure-A8 (copy). The applicant bank recalled the entire outstanding amount vide legal notice dated 14.10.2022 along with its postal receipts, Annexure-A9 (colly) (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 accounts, a sum of Rs.28,32,531.75/- (Rupees Twenty Eight lacs Thirty Two Thousand Five Hundred Thirty One and Seventy Five Paisa Only) is recoverable against the defendants as per statement of account dated 06.11.2022, Annexure-A10 (copy) certified under Bankers’ Books Evidence Act.

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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

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the defendants, but since none appeared on behalf of the defendants, thus, defendants were proceeded against ex-parte vide order dated 03.06.2023

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OA/359/2023 STATE BANK OF INDIA Vs SH. MOHAN LAL AND OTHERS

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In support of the contents of the OA, affidavit of evidence of Sh. Balkar Singh, Branch Manager of the applicant bank was filed.

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This Tribunal has heard ex-parte arguments advanced by Sh. Divjot Singh Rekhi, Nodal Officer of the applicant bank and gone through the record carefully.

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It was argued by Sh. Divjot Singh Rekhi, Nodal Officer 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 A10 , 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. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.28,32,531.75/- (Rupees Twenty Eight lacs Thirty Two Thousand Five Hundred Thirty One and Seventy Five 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 @11.50% per annum with half yearly rests. In sanction letter dated 26.11.2013, Annexure-A4 (copy), rate of interest has been mentioned @11.75% per annum.

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OA/359/2023 STATE BANK OF INDIA Vs SH. MOHAN LAL 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, 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.

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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.28,32,531.75/- (Rupees Twenty Eight lacs Thirty Two Thousand Five Hundred Thirty One and Seventy Five Paisa Only) with current and future simple interest @8% per annum w.e.f. 28.12.2022 , till the date of realisation of the amount. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of 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.

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OA/359/2023 STATE BANK OF INDIA Vs SH. MOHAN LAL AND OTHERS

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 22.08.2023 .

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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

State Bank of India v. Sh. Mohan Lal

Case brief

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State Bank of India v. Sh. Mohan Lal

Case brief

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