Allowed

Bank of Baroda v. M/s Aakanksha Diamonds Pvt. Ltd. and others

DRT22 Feb 2023OA/42/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an ex-parte application by Bank of Baroda for recovery of Rs. 49 lakh principal along with interest and pendente-lite interest against defaulting loan borrowers who failed to appear.

What did the court decide?

Recovery certificate issued for payment of Rs. 49,02,199.64 with interest @11.70% p.a. with compounded monthly rests from 13.1.2022 till realization.

Bank of Baroda versus M/s Aakanksha Diamonds Pvt. Ltd. and others — Money Laundering | DRT (2023)

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OA 42 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-80002S

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Presiding Officer : Shri Kaushalendra Yadav

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OA Case no. : 42 of 2022

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Bank of Baroda, Main Branch, Dak Bungalow Chowk, Frazer Road, Patna

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....... Applicant

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Vs.

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MIs Aakanksha Diamonds Pvt. Ltd. represented through its Directors i. Prashant Kumar Jha and ii. Sri Ashok Kumar Jha Sarovar Jamuna Sadan, Krishi Nagar, A.G. Colony, Patna-25

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Prashant Kumar Jha S/o Sri Ashok Kumar Jha Rio Sarovar Jamuna Sadan, Krishi Nagar, A.G. Colony, Patna-25

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Sri Ashok Kumar Jha S/o Sri Ram Narayan Jha Rio Sarovar Jamuna Sadan, Krishi Nagar, A.G. Colony, Patna-25

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Vijay Sharma S/o Kamta Singh Flat no. B-402, Sapna Apartment, Ramnagari Road, Ashiana Patna-25.

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...Defendants.

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Present:

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For the Applicant : Shri Umapati Jha, Advocate For the Defendants : None

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Dated: 22.02.2023

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JUDGMENT

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1- The Applicant bank has made this application U/S 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 13.1.2022 against the defendants to recover its debts from defendants of Rs.49,02,199.64 upto 30.11.2021 alongwith pendente-lite and future interest at the contractual rate with monthly rests from 1.12.2021with 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 bank is a body corporate constituted under the Banking Companies (Acquisition and Transfer of undertakings) Act, 1970, having its Head Office at Baroda Bhavan, R.C. Dutt Road, Alkapuri, Baroda-390007, India and one of its Zonal Offices at 1st Floor, Anand Vihar Building,West Boring Canal Road, Patna-l and one of its Regional Officers at 1st Floor Anand Vihar Building,West Boring Canal Road, Patna-l and one of its Branch Office at Main Branch, Dak Bungalow Chowk, Frazer Road, Patna.

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OA 42 of 2022 [J]

DRT,PATNA

. The defendant no. 2 requested the bank for credit facility up to the amount of RS.25 lakh for smooth running of his business and submitted the loan application dated 25.6.2014. The bank considering the loan applications of the defendant vide dated 25.6.2014 sanctioned the loan to the defendant of RS.25 lakh on 25.6.2014. The defendants executed the various loan documents i.e. DP note, letter of repayment, letter of guarantee, letter of lien, supplementary agreement, memorandum, letter of guarantee. The defendant no. 2 executed equitable mortgage of regd. sale /title deed dated 25.11.2005 creating mortgage of the immovable property in favour of the bank. The defendant further requested the bank for renewal of credit facility and submitted application on 28.11.2016 requesting the creditor bank to renew the limit to the extent of RS.25lakh. The bank considering and after processing the application of the defendant on 30.11.2016 sanctioned the loan facility limit for the amount of RS.25 lakh. The defendants executed the various loan documents i.e. DP note, letter of repayment, letter of guarantee, letter of confirmation, supplementary agreement, letter of guarantee.

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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 29.10.2017.

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Thus the total liability in the loan account is Rs.49,02,199.64 as on 30.11.2021 with pendentelite and future interest at the contractual rate of interest with monthly rests from 1.12.2021till 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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4V/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 defendants by registered/speed post on 29.4.2022, 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 were evidence on the tracking report. The defendants have not appeared before this Tribunal to contest the case. The sufficient time has been given to the defendants to defend their case, but they failed to appear and to file WS,

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OA 42 of 2022 [J]

DRT,PATNA

hence, service is sufficient of the defendants, proceed ex-parte against defendants on 17.8.2022.

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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 Kumar Harendra, Chief Manager 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	notification	...	...	...	1
2	loan application	25.6.2014	Rs.25lakh	defendant no. 1&2	2
3	sanction letter	25.6.2014	Rs.25lakh	bank	3
4	DP note	25.6.2014	Rs.251akh	defendant no. 1&2	4
5	letter of repayment	25.6.2014	RS.251akh	defendant no. 1&2	5
6	letter of guarantee	25.6.2014	Rs.251akh	defendant no. 4	6
7	letter of lien	25.6.2014	...	defendant no. 1&2	7
8	supplementary agreement	25.6.2014	Rs.25lakh	defendant no. 1&2	8
9	agreement	25.6.2014	Rs.251akh	defendant no. 1&2	9
10	memorandum	25.6.2014	...	defendant no. 3	10
11	letter of guarantee	13.11.2014	RS.251akh	defendant no. 2&3	11
12	copy of sale deed	...	...	...	12
13	application for renewal	28.11.2016	...	defendants	13
14	sanction letter	30.11.2016	Rs.251akh	bank	14
15	DP note	30.11.2016	Rs.251akh	defendant no.1 & 2	15
16	letter of repayment	30.11.2016	...	defendant no. 1to 3	16
17	letter of guarantee	30.11.2016	Rs.25lakh	defendant no. 2&3	17
18	letter of confirmation	30.11.2016	...	defendant no. 1to 3	18
19	suppl. Agreement	30.11.2016	...	defendant no. 1to 3	19
20	Acknowledgeme nt of liability	30.11.2016	...	defendant no. 1to 3	20
21	letter of guarantee	30.11.2016	Rs.25lakh	defendant no. 4	21
22	recall notice	7.9.2017	...	bank	22
23	Demand notice	2.11.2017	...	bank	23
24	Acknowledgeme nt of liability	29.3.2019	...	defendant no. 1to 3	24

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DRT,PATNA

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TNA				OA 42o	f2022 [J]
Statement	of	as on	Rs.49,02,199.64	bank
account		30.11.2021

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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 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 pecuniary 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 29.10.2017, whereas the present application has been filed on 13.1.2022. 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 Kumar Harendra, Chief Manager 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.

DRT,PATNA

OA 42 of 2022 [J]

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 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 facilities, documents were executed by the defendants and facilities were 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.49,02,199.64/- with cost and further interest at the contractual rate from 1.12.2021till 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

DRT,PATNA

OA 42 of 2022 [J]

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."

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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 defendants jointly and severally of Rs.49,02,199.64/alongwith pendente-lite and future interest @11.70% p.a. with compounded monthly rests from 13.1.2022 (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 ex-parte and debt is determined with costs against the defendants. The defendants is hereby jointly and severally, ordered to pay the applicant bank it's debts amounting to Rs.49,02,199.64/- alongwith pendente-lite and future interest @11.70% p.a. with compounded monthly rests from 13.1.2022 (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 ofjustice.

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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 1.4.2023.The order be communicated accordingly.

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Judgment signed, sealed, dated and pronounced in the open court on this 22nd Day of February, 2023. ~/v'

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Dictated & corrected by me.

Bank of Baroda v. M/s Aakanksha Diamonds Pvt. Ltd. and others

Case brief

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Bank of Baroda v. M/s Aakanksha Diamonds Pvt. Ltd. and others

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