Allowed

Indian Bank v. Mangat Ram and Anr.

DRT14 Jun 2023OA/538/2022

Case brief

AI extract

What is this about?

Debt Recovery Tribunal allowed the applicant bank's original application for recovery of a loan account declared NPA. The court removed awarded 8% simple interest rather than the claimed 12.20%. The tribunal granted liberty to recover dues via sale of mortgaged property or attachment of personal assets.

What did the court decide?

Recovery Certificate issued for Rs.40,70,803/- with 8% simple interest; liberty granted to recover via sale of mortgaged property or attachment of personal assets.

Indian Bank versus Mangat Ram and Anr. — 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. 538 of 2022

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DATE OF INSTITUTION: 16.03.2022

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DATE OF DECISION: 14^th DAY OF JUNE, 2023

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Indian Bank (erstwhile Allahabad Bank), a body corporate with perpetual succession constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1980, having its Corporate Office, 254-260, Avvai Shanumugam Salai, Royapettah, Chennai-600014 and amongst other Branches at various places including Indian Bank (erstwhile Allahabad Bank), Kurukshetra Branch, SCF-42, Sector-13 Market, Kurukshetra, Haryana, through its Authorised Officer/Senior Manager, Sh. Anil Kumar Yadav

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.......Applicant Bank

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Versus

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Sh. Mangat Ram S/o Sh. Prithvi R/o House No.300, Village Amin, Tehsil Thanesar, District Kurukshetra

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......Defendant

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Argued by: Sh. Bharat Bhushan, Senior Manager, Law for the applicant bank Defendant ex parte vide order dated 02.02.2023

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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) , against the defendant for recovery of Rs.40,70,803/- (Rupees Forty lacs seventy Thousand Eight

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OA 538/2022 INDIAN BANK VS MANGAR RAM 2

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Hundred and Three Only) . The OA has been filed through Sh. Anil Kumar Yadav, Senior Manager of the applicant bank, stated to be competent to institute the Original Application vide Authorisation letter dated 07.02.2022, Annexure-A1 (copy).

¶15

The brief facts of the case of the applicant as per Original Application are that the defendant had approached the applicant bank for grant of KCC limit of Rs14 lacs and term loan of Rs.9 lacs vide application Form dated 06.09.2013 for ‘Akshay Kirshi’ Kisan credit card Annexure-A2 (copy).

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The applicant bank sanctioned aforesaid credit facilities to the defendant vide sanction letter dated 10.10.2013, Annexure-A3 (copy) as per terms and conditions duly accepted by the defendant.

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In order to secure the aforementioned credit facilities, the defendant executed demand promissory note dated 11.10.2013, Annexure-A4 (copy), hypothecation agreement dated 04.10.2013, Annexure-A5 (copy) and consent letter dated 11.10.2013, regarding disclosure of information to CIBIL, Annexure-A9 (copy).

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The aforesaid loans were further secured by creation of registered mortgage by the defendant in respect of two parcels of agricultural land admeasuring 79 Kanals 16 Marlas situated in the revenue estate of Amin, Tehsil Thanesar, District Kurukshetra, Haryana, fully detailed in para No. 5(5) of the Original Application.

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The documents relating to the mortgage are as under:

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i. Registered mortgage deed dated 18.09.2013, Annexure-A6 (copy).

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ii. Copy of ‘Jamabandi’ for the Years 2009-2010, Annexure-A7 .

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OA 538/2022 INDIAN BANK VS MANGAR RAM 3

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It is further the case of the applicant that the loan facilities were duly availed of by the defendant but he failed to maintain the financial discipline of the applicant bank and resultantly, the loan accounts were declared as NPA because those became irregular. The defendant executed acknowledgement of debts letters dated 31.08.2018, 14.06.2021 and 14.08.2021 are Annexures-A12 to A14 (copy). The applicant bank recalled the entire outstanding amount vide legal notice dated 17.03.2020, Annexure-A8 (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 loan accounts a sum of Rs.40,70,803/(Rupees Forty lacs seventy Thousand Eight Hundred and Three Only) is recoverable against defendant as per statements of accounts, Annexures-A10 and 10A (copy), certified under Bankers’ Book Evidence Act, Annexure-A11 (copy).

¶25

Since the defendant did not repay the outstanding amount, therefore, the applicant bank preferred the present Original Application for issuance of Recovery Certificate.

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Notice of the Original Application was duly served upon the defendant, but since none appeared on behalf of the defendant despite service, thus, defendant was proceeded against ex-parte vide order dated 02.02.2023.

¶27

In support of the contents of Original Application, affidavit of evidence of Sh. Anil Kumar Yadav, Senior Manager of the applicant bank was filed. 9. This Tribunal has heard ex parte arguments advanced by Sh. Bharat Bhushan, Senior Manager, Law of the applicant bank and gone through the record carefully.

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OA 538/2022 INDIAN BANK VS MANGAR RAM 4

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It was argued by Sh. Bharat Bhushan, Senior 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 defendant for recovery of the amount sought. From perusal of Annexures-A1 to A14 , it comes out that the defendant had approached the applicant bank for availing of the loan facilities which were granted to him. It is further clear that the defendant had executed all the relevant documents as stated above in favour of the applicant bank. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.40,70,803/- (Rupees Forty lacs seventy Thousand Eight Hundred and Three Only) from the defendant, from the date of filing the present Original Application, till realisation of the amount.

¶30

In so far as pendente lite and future interest is concerned, the applicant bank in relief clause has claimed rate of interest @12.20% per annum. In sanction letter dated 10.10.2013, Annexure-A3 (copy), rate of interest has been mentioned @10.20% per annum.

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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. agriculture 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

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OA 538/2022 INDIAN BANK VS MANGAR RAM 5

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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 cost declaring that the defendant is liable to pay to the applicant bank a sum Rs.40,70,803/- (Rupees Forty lacs seventy Thousand Eight Hundred and Three Only) with current and future simple interest @8% per annum w.e.f. 16.03.2022 , 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 defendant in execution proceedings, if not sold earlier under the provisions of the Securitization 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 defendant. The applicant bank is at liberty to enforce the claim through due process of law.

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 10.08.2023.

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Copy of this order be sent to the applicant bank and the defendant 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)

Indian Bank v. Mangat Ram and Anr.

Case brief

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Indian Bank v. Mangat Ram and Anr.

Case brief

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