Allowed

Punjab and Sind Bank, v. M/S Sandeep Enterprises and Another

DRT15 Sept 2023OA/540/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's application for recovery of a loan of Rs.21.60 Lakhs sanctioned under MSE and GECL schemes. The Tribunal granted uniform interest at 7% p.a. and ordered recovery from hypothecated properties.

What did the court decide?

Recovery of Rs.21,60,574.91 with interest @7% p.a.; Recovery Certificate issued; Liberty to attach/sale assets.

Punjab and Sind Bank, versus M/S Sandeep… — Contract and Commercial Disputes | DRT (2023)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.540/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 22.03.2022

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DATE OF DECISION: 15.09.2023

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Punjab and Sind Bank, a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act of 1980, having its Head Office at Bank House 21, Rajendra Place, New Delhi and amongst others, a branch at Guru Nanak Public School, Ludhiana, Tehsil and District Ludhiana (Punjab), through its General Attorney, Sh. Parminder Singh, Branch Manager, Punjab and Sind Bank, Branch Guru Nanak Public School, Ludhiana, Tehsil and District Ludhiana (Punjab)

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……..Applicant

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Versus

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M/s Sandeep Enterprises though its proprietor Sh. Sandeep Singh S/o Sh. Rajinder Singh, R/o H.No.625, Backside Govt. Sen. Sec. School, Near Orient Cinema, Sunet, Ludhiana, Tehsil and District Ludhiana, Punjab

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Sh. Sandeep Singh S/o Sh. Rajinder Singh, R/o H.No.625, Backside Govt. Sen. Sec. School, Near Orient Cinema, Sunet, Ludhiana, Tehsil and District Ludhiana, Punjab

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………Defendants

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Advocates:

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Argued by Sh. Neeraj Madaan, 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.21,60,574.91p (Rupees Twenty One Lacs Sixty Thousand Five Hundred Seventy Four and Paisa Ninety One only). The Original Application has been filed through Sh. Parminder Singh, Branch Manager o f the applicant bank, who is competent to institute the

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Original Application vide Power of Attorney dated 10.09.2020, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant No.1 i.e. Firm through its proprietor defendant No.2 had approached the applicant bank for the grant of CC Limit of Rs.15.00 Lacs under MSE loan Scheme and further for a Loan of Rs.2.99 Lacs under PSB GECL Scheme.

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The applicant Bank sanctioned the CC Limit of Rs.15.00 Lacs under MSE loan Scheme and a Loan of Rs.2.99 Lacs under PSB GECL Scheme vide Sanction letters dated 21.12.2018 and 30.05.2020, which are Annexures A2, A3 and A19 to this OA and which the terms and conditions were duly accepted by the defendants. 4. Defendants had hypothecated their movable properties i.e. all types of assets, stocks along with Plant and Machinery and Book Debts etc. vide A greement of hypothecation of movable assets-Form No.192(R), Agreement of hypothecation of Book Debts-Form No.193 dated 28.12.2018 ; Deed of Hypothecation and C ash credit (hypothecation) and Book Debt Facility Agreement Form No.PSB-A17 dated 01.06.2020, which are Annexures A10, A11, A20 and A21 to this OA.

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Documents executed:- Loan agreement, D.P. note-Form No.14(R), Letter regarding bank’s right to demand adjustment, in case of violation of terms and conditions of loan-Form No.103/291/412, Undertaking by borrower-Form No.122, Letter of undertaking-Form No.126, Letter of continuity-Form No.159, Undertaking-Form No.199, Revised clause pertaining to rate of interest- Form No.200, Declaration-Form No.216, Undertaking/Consent, Letters of undertaking and Form No.106 all dated 28.12.2018, which are Annexures A4 to A9 and A12 to A18 to this OA; Balance and confirmation letters dated 10.11.2021, which is Annexure A22 to this OA; Notice u/s 13(2) of SARFAESI Act dated 08.04.2021, which is Annexure A23 to this OA and Account statement, which are Annexures A24 and A25 to this OA.

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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.21,60,574.91p, 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 they were proceeded ex-parte on 30.08.2023. 7. In support of the OA, affidavit of Sh. Parminder Singh, Branch Manager, Punjab and Sind Bank has been filed.

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Heard ex-parte arguments and perused record.

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It was argued by learned 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 A25 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 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.21,60,574.91p (Rupees Twenty One Lacs Sixty Thousand Five Hundred Seventy Four and Paisa Ninety One only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the accounts.

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In so far as pendent elite and future rate of interest is concerned, the applicant bank in relief clause has claimed interest @9.85%p.a. in CC limit and @7.00%p.a. in PSB GECL loan account with monthly rests from 01.02.2022 till the realization.

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The Tribunal is of the considered opinion that sometimes in appropriate cases the prerogative of mercy is the brightest jewel in the

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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 loan 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 @7.00%p.a. in both the loan accounts from the date of filing of the OA till realization of the amount 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.21,60,574.91p (Rupees Twenty One Lacs Sixty Thousand Five Hundred Seventy Four and Paisa Ninety One only) jointly and severally, with costs, current and future simple interest @7.00%p.a. in both the loan accounts from the date of filing of OA till the date of realization of the amount. 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. 12. Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 25.09.2023. 15. 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. Pronounced by me in the Open Tribunal. Dated: 15.09.2023

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

Punjab and Sind Bank, v. M/S Sandeep Enterprises and Another

Case brief

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Punjab and Sind Bank, v. M/S Sandeep Enterprises and Another

Case brief

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