The DRT allowed an application for a recovery certificate against borrowers and guarantors of a proprietorship firm that failed to repay a sanctioned cash credit limit. Evidence of executed security agreements was unchallenged.
Recovery certificate issued for Rs. 21,22,207.75 along with pendentelite and future interest along with cost.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
o.A. 382022IORTGwthati
IN THE DEBTS RECOVERY TRIBUNAL, GUWAHATI
(North Eastern Region)
(Tnbunal ofAssam, Nagaland, Meghalaya, Manipur, Mizoram, Arunachal Pradesh & Tnpura)
Before shri shiv Sharan Dubev. Presidino Officer
O.A. No. 382/2022
ln the matter of -
Canara Bank Dispur 2 Branch Upasana Palace, Dr. R P Road, Ganeshguri, Guwahati, Assam781 006.
Applicant
Vs.
'1. M/s Biroja Bhandar
A proprietorship Firm, havingits Office At Lohit OjahComplex,
Dr. R. P. Road, Ganeshguri,P.S.-Dispur, Kamrup MetropolitanDistrict, AssamPin-781006' Represented byits ProPrietor Sri Surajit Roy(Defendant No. 2)
Sri SurajitRoY S/o Late SridharRoY
Resident of -House No. 8, Tribeni Path, Near MoonlightKali Mandir, Bhaskar Nagar, Kamruo MetropolitanDistrict, P.S.-FatashilAmbari' Guwahati, Pin-781OO8Assam, Proprietorof M/s BirojaBhandar (DefendantNo l)
3. Sri RaniitRoY
S/o Late SridharRoY
Residentof -House No. 8, Tribeni Path' Near MoonlightKali Mandir, Bhaskar Nagar, iiamrup f'et'ropofitanDistrict, P S -Fatashil Ambari' Guwahati,Pin- 781008,Assam'
Defendants
PresenceoI the Counsel:
For the Applicant : Mr. M K. Bora,Advocate For the Defendants: None(Ex-Parte)
Dated it7108/2023
JUOGMENT
This is anapplicationunder section19 of the Recoveryof DebtsDue to Banks and FinanciallnstitutionsAct, 1993filedby the Canara Bank, DisPur Branch' UpasanaPalace, Dr. R P Road,Ganeshguri' Guwahati'Assam' 781006. witha Prayer
*"ffift|dDRT, Guwahali
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to issue Recovery Certificate for the sum of Rs,21,ZZ,2OZ.7S (Rupees Twenty Ono Lakhs Twenty Two Thouaand Two Hundrod Seven and paise Sevsnty Five) only as on 31.07.2022 against the defendants with pendentelite and future interest lhereon at the contractual rate till realization along with cost and other retief.
A few facts giving rise to the present application are as under.
The defendant No. 1 is proprietorship firm running shop of grocery items and defendant No 2 is the proprietor. Defendant No 3 is the guarantor. The defendant No. 2 on behalf of the defendant No.t had approached the applicant bank and applied for financial assistance for enhance ils business initially on 24.02.2014. The applicant bank sanctioned cash credit limit of Rs.14,70,OOO.OO on 24.02.2014. The defendant No 2 on behalf of the defendant No. t had executed Composite Hypothecated Agreement and defendant No 3 executed Guarantee Agreement on 24.02.2014. Thereafter said limit was enhanced up to Rs. 24,OO.OOO.OO on 24.07.2015 and renewed on 06.1.t.2017. Thereafter on 03.09.201g on request of the borrower, the applicant bank enhanced existing limit of Rs. 24.00 lakh to Rs. 30.00 Lakh vrhich is running limit for two years. The dafendant No 2 on behalf of the defendant No..l had freshly executed composite Hypothecation Agreement on 29.09.2018 for Rs. 3O.OO Lakh facility. The defendant No 3 atso executed Guarantee Agreement dated 29.09.2018 for 30.OO Lakh.
The Defendants had avaited of the said loan facility from the Applicant Bank, buthave not paid the loan amount as per the terms and condilions as agreed upon with the Applicant Bank, inspite of repeated demands and requests by lhe Applicant Bank. As the defendants failed to repay the loan amounts, the said account became NPA on 28.01.2022. tt is stated by the applicant bank that on 14.09.2021 the defendant No. 2 on behalf of the defendant No..l had executed Acknowledgement of Debts and Security and hereby admit the correctness, confirm and acknowledge that a sum as mentioned in the said AOD is due and outstanding and also admit, confirm and acknowledge that all the relalive documents, agreements, securities and obligation shall remain in force and effect until repaymenl of lhe amount due in the
O.A 382/2022lDRI€aah6li
loan account. After the account became NPA the applicant bank issued notices for repayment of the due amount, but the defendants have neither chosen for repayment of the loan amount nor approached to the applicant bank for renewal of the loan account.
The applicant bank thus became constrained to file thepresent Original Application for the recovery of Rs. 21,22,207.7 5 (Rupoes Twenty One Lakhs Twenty Two Thousand Two Hundred Seven and Paise SevEnty Five)only as on 31 .07 .2022 along with interest and cost of the application.
Afier filing of the OA the Tribunal issued notices upon the defendants through registeredpost and the applicant bank filed servicereport on 0612.2022and brought on record thepostal receiptalong with track consignmenl reportwhich shows that notices have not been served upon thedefendants. Thereafterihe Tribunalordered paper publication of notice upon the defendants and the applicant bank issued notice to the defendants on 17.12.2022lhtoughPaper Publicationin two newspapers namely "Times of lndia" and "Dainik Asom". Even after issuance of notice throughpaper publication also there was no representation on behalf of the defendants either by the counsel or theperson andhence the defendantswere set ex-parte on 03.03.2023 and their right tofile written statement cumevidence on affidavitwas closed and the matter wasposted for hearing on behalfof the applicant bank
Supporting the claimof the applicant bank Sri Debapriya Saha,Managerof the Applicant Bank has riledevidence onafiidavitcoupled with the security documents marked as Exhibit AW-1/1to AW-'l/6 supporting the claimof the applicant bank
Heard the learned counselfor the applicant bankwho prayed for issuanceof Recovery Certificateagainstthe defendants as perpleadings made in the Application, supported by evidenceon affidavit of their witnesswho aflirmed on oath the execution of the security andother documentsby the defendants and also executionof their own documents Ieliedupon, which have been marked exhibits'
Considering thefacts and circumstancesof the case, I am of the considered
9;r,tA,t^r^A^Xl?lo*l>c /f PrBiding Oftdr l-..- v DRT. Guwahati
O A 382r2022lDRT-Guwahati
view that the documentfiled by the applicanl bankare supportingtheclaimof the applicant bank and establishingtheliability of the defendants.lt is proved that the defendants are liable topay to the applicantbank the claim made in the Original Application. The loan was obtainedand documentshave been executed on 29.09.2018. On 14.09.202'l the defendantNo. 2 on behalfof thedefendantNo. 1 had executed Acknowledgementof Oebtsand Security. The accounibecame NPA on 28.01.2022 and the OAhas beenfiled on 14.09.2022. Hence,the OAis filed well within theperiod of limitationand this Tribunalhavinga iurisdictionto adjudicatethe Original Application.
Considering the unchallenged/unrebuttedversion of Sri Debapriya Saha, the applicant's witness andall the documents marked as exhibits, including duly certilied copy of the statementof account alongwithinterestcalculation sheet maintained by the applicantgank in it's regularcourse of business, I hold that the applicantis entitled toget theRecovery Certificate as prayed for.
ln the result, thepresent OriginalApplication No. 382 of 2022is allowed with cost as under:-
S[i, $"-."-Q..^gP."'dhs#Jlo+d DRT, Guwahali
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0.A. 362/202lDRT€uw.heti
iv) The applicant bank is also entitled to proceed against lhe personal assets and properties of the defendants towards recovery of the dues.
y, The applicant bank is entitled to the costs of the O.A. rryhich includes the advocate fees of the applicant bank. Applicant is directed to file the cost memo within 2 weeks from today.
vi) lssue Recovery Certiricate accordingly for a sum Rs. 21,22,2O1.t5 lRup3,e. Twonty Ono Lakhs Twsnty Two Thousend Two Hundrod Seven and Pal.o Seventy Five)onty in favour of lhe appticant bank against the defendants No. 1,2 & 3.
vii) Communicate copy of this order to the concemed parties.
This order is dictated and corrected by the undersigned.
Judgment dated 17h August 2023, signed and pronounced in the Tribunal
today under my signature.
Copy of the JudgmenvFinal Order be uploaded in the Tribunal,s Website and file be consigned to Record Room.
,,,,,{H,*,SqtMf Presiding Ofricer ORT, cuwahati.
2 issues framed by the court
Whether the recovery certificate is maintainable when the Original Application is filed within the limitation period for NPA accounts.
How the recoverable dues of a financial institution against borrowers and guarantors are to be judicially calculated.
1 provisions across 1 enactments
Canara Bank Dispur 2 Branch
M/s Biroja Bhandar
Sri Surajit Roy
Sri Ranit Roy
Shiv Sharan Dubey
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
