Allowed

Canara Bank, v. M/s Achhu Dairy Farm through its Partners

DRT21 Aug 2023OA/431/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an application filed by Canara Bank against several defendants for recovery of Rs. 1.03 crore outstanding loans. The court decreed interest at a uniform rate of 10% p.a. and directed execution proceedings under the SARFAESI Act if dues remain unsatisfied.

What did the court decide?

Defendants directed to pay Rs. 1,03,32,984.13 with interest at 10% p.a.; Recovery Certificate issued.

Canara Bank, versus M/s Achhu Dairy Farm through its Partners — Banking and Recovery | DRT (2023)

¶1

DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.431/2022 PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 03.03.2022

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DATE OF DECISION: 21.08.2023

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Canara Bank, a body corporate and a nationalized bank, constituted under the provisions of Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at 112, Jaya Chamarajendra Road, Bangalore-560002 and having branches all over India and one of its branch amongst other places at Delhi Gate, Malerkotla, Tehsil and District Malerkotla, Punjab-148023, through its Branch Manager/Attorney holder Sh. Gurinder Pal Singh

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……..Applicant

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Versus

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M/s Achhu Dairy Farm through its Partners, situated on MalerkotlaNaudhrani Road, Adjoining Jindal Rice Mills at Village Naudhrani, Tehsil and District Malerkotla, Punjab-148023

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Mr. Mohammad Aslam S/o Mr. Abdul Mazeed, (Partner), resident of Noor Basi, Malerkotla, Tehsil and District Malerkotla, Punjab148023

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Mr. Abdul Shakoor S/o Mr. Abdul Mazeed, (Partner), resident of Noor Basi, Malerkotla, Tehsil and District Malerkotla, Punjab- 148023

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Mr. Mohd. Akram S/o Mr. Abdul Mazeed, (Partner), resident of Mohalla Haji Basti, Malerkotla, Tehsil and District Malerkotla, Punjab-148023

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Mr. Mohd. Ashraf S/o Mr. Abdul Majeed, (Partner), resident of Mohalla Beriwala, Malerkotla, Tehsil and District Malerkotla, Punjab140823

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Mr. Mohd. Rashid S/o Mr. Mohd. Aslam (Guarantor), resident of Haji Basti, Malerkotla, Tehsil and District Malerkotla, Punjab-148023

¶14

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Mrs. Rabia W/o Mr. Mohd. Aslam (Guarantor), resident of Haji Basti, Malerkotla, Tehsil and District Malerkotla, Punjab-148023 Also at : Noor Basi, Malerkotla, Tehsil and District Malerkotla, Punjab-148023

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….……Defendants

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Advocates:

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Argued by Sh. Sunil Salotra, counsel proxy for Sh. Nitin Grover, counsel for the applicant Defendants are ex-parte

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.1,03,32,984.13p (Rupees One Crore Three Lacs Thirty Two Thousand Nine Hundred Eighty Four and Paisa Thirteen only). The Original Application has been filed through Sh. Gurinder Pal Singh, Branch Manager o f the applicant bank, who is competent to institute the Original Application vide Power of Attorney dated 24.06.2013, which is Annexure A1 to this OA.

¶21

The brief facts of the OA are that the defendant No.1 through its partners defendants No.2 to 5 had approached the applicant bank from time to time for the grant of Working Capital (OCC) Limit-I of Rs.40.00 Lacs, Term Loan-I of Rs.125.00 Lacs and Term Loan-II of Rs.54.00 Lacs and further for the several renewals of the OCC limit vide Loan Applications and Renewal Letters dated 27.05.2014, 15.02.2018, 30.07.2019 and 04.12.2019, which are Annexures A3, A24, A29, A50 and A52 to this OA.

¶22

The applicant Bank sanctioned the Working Capital (OCC) Limit-I of Rs.20.00 Lacs, Term Loan-I of Rs.100.00 Lacs and Term Loan-II of Rs.48.45 Lacs and also renewed the OCC limit from time to time vide Sanction Letters dated 30.09.2014, 15.02.2018, 29.09.2018 and

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24.12.2019, which are Annexures A4, A23, A30 and A51 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendants No.2, 3, 4, 5, 6 & 7 had mortgaged their immovable properties detailed as:

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(i) total land measuring 4 Bigha 19 Biswa 12 Biswasi situated at Village Naudharani, Tehsil and District Malerkotla, Punjab i.e.

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(a) 1 Bigha 5 Biswa 16 Biswasi in the name of defendant no.2; (b) 1 Bigha 5 Biswa 16 Biswasi in the name of defendant no.3; (c) 1 Bigha 5 Biswa in the name of defendant no.4; (d) 0 Bigha 4 Biswa 4 Biswasi in the name of defendant no.5; and (e) 0 Bigha 18 Biswa 16 Biswasi in the name of defendant no.5; (ii) Land measuring 1 Bigha 1 Biswa 2 Biswasi situated at Naudhrani Road, Malerkotla, Punjab in the name of defendant no.6; (iii) Residential House built up on the Plot measuring 0 Kanal 10 Marla (302 Sq. Yards) bearing House No. B-10/1020 (Old) now bearing New No.G-1/0044, situated at Noor Basti, Near Kuti Road, Adjoining Islamia Girls School, Malerkotla, Tehsil and District Malerkotla, Punjab in the name of defendant no.6; and

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(iv) Land measuring 1 Bigha 0 Biswa 6 Biswasi situated at Naudhrani Road, Malerkotla, Punjab in the name of defendant no.7; vide Declaration U/s 4(1) dated 07.10.2014, Jamabandi for the year 2012-13 along with its translation, Declaration U/s 4(1) dated 15.10.2018 and Transfer deed no.1755 dated 27.10.2017 along with its translation, which are Annexures A19 , A20, A44 and A45 to this OA.

¶29

Documents executed:- Partnership deed dated 04.03.2014, which is Annexure A2 to this OA; Particulars of Vehicle/Machinery/Equipment/Livestock Hypothecated, Memorandum of Agreement, Request for overdraft facilities, Partnership Letter, Common Hypothecation Agreement, Pronote, Guarantee Covering Letters and Guarantee Agreements all dated 30.09.2014, which are Annexures A5 to A18 to this OA; Acknowledgments of debt dated

¶30

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17.06.2017 and 16.09.2017, which are Annexures A21 and A22 to this OA; Copies of Letters dated 15.02.2018, which are Annexures A25 to A28 to this OA; Memorandum of Agreement of Agriculture Loan, Guarantee Covering Letters and Guarantee Agreements and Letter Evidencing Deposit of Title Deeds all dated 31.10.2018, which are Annexure A31 to A43 and A46 to this OA; Acknowledgments of debt dated 02.12.2019, which are Annexures A47 to A49 to this OA; Copies of Letters, which are Annexures A53 to A56 to this OA; Guarantee Covering Letters and Guarantee Agreements all dated 20.04.2020, which are Annexures A57 to A68 to this OA; Demand Notice dated 24.05.2021, which is Annexure A69 to this OA and Statements of accounts along with the certificate, which are Annexures A70 to A72 to this OA.

¶32

The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.1,03,32,984.13p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant bank requested to accept the application and to issue Recovery Certificate accordingly. 6. The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants and were proceeded ex-parte on 16.08.2023. 7. In support of the OA, affidavit of Sh. Gurinder Pal Singh, Branch Manager, Canara Bank h as been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned proxy counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant bank had proved its case. From the perusal of all the Annexures A1 to A72 to this OA, it is proved that the defendants approached applicant bank for availing of the loan facilities which were granted to them and for that they had executed all the relevant documents in favour of the bank. The defendants failed to pay back

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the loans as per terms and conditions of the agreement between the parties. Subsequently, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.1,03,32,984.13p (Rupees One Crore Three Lacs Thirty Two Thousand Nine Hundred Eighty Four and Paisa Thirteen only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the account.

¶35

In so far as pendent elite and future rate of interest is concerned, the applicant bank in relief clause has claimed interest as follows:

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(a) @13.05%p.a. (inclusive of @2%p.a. penal interest) with monthly rests in Term Loan-I from 04.02.2022 till the realization; (b) @10.95%p.a. (inclusive of @2%p.a. penal interest) with monthly rests in Term Loan-II from 04.02.2022 till the realization;

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(c) @12.05%p.a. (inclusive of @2%p.a. penal interest) with monthly rests in OCC limit from 01.02.2022 till the realization.

¶38

The Tribunal is of the considered opinion that sometimes in appropriate cases the prerogative of mercy is the brightest jewel in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including nature of the mortgaged property, undertaking of the defendants, quantum of loans and prevalent market rates of interest which have gone drastically downhill in yester years, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @10.00%p.a. in all the loan accounts from the date of filing of the OA till realization of the amounts ordered vide this final order. It is ordered accordingly. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.1,03,32,984.13p (Rupees One Crore Three Lacs Thirty Two Thousand Nine Hundred Eighty Four and Paisa Thirteen only) jointly and severally, with costs, current and future simple interest

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@10.00%p.a. in all the loan accounts from the date of filing of OA till the date of realization of the amounts. Accordingly, the applicant bank shall be entitled to recover aforesaid amount from the sale of hypothecated/mortgaged properties of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the bank still remain unsatisfied, it shall be entitled to recover the same by attachment and sale of personal assets of the defendants. The applicant is at liberty to enforce the claim through due process of law.

¶41

Any other application pending stands disposed of.

¶42

Issue Recovery Certificate accordingly.

¶43

Parties to appear before Learned Recovery Officer of this Tribunal on 31.08.2023.

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Copy of this order be given dasti to the applicant bank and be sent to defendants through registered/speed post and this order be also uploaded on the official website of this Tribunal and record be consigned.

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Dated: 21.08.2023

¶46

(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

¶47

Order dictated, signed and pronounced by me in the open Tribunal.

¶48

Dated: 21.08.2023

¶49

(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Canara Bank, v. M/s Achhu Dairy Farm through its Partners

Case brief

What is this about?

What did the court decide?

Canara Bank, v. M/s Achhu Dairy Farm through its Partners

Case brief

What is this about?

What did the court decide?

What the court decided

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