Allowed

Union Bank of India v. Sh. Gurvinder Singh

DRT12 Oct 2023OA/571/2023

Case brief

AI extract

What is this about?

DRT-2, Chandigarh allowed an original application filed by Union Bank of India against two borrowers for recovery of Rs. 38,19,490.27. The Tribunal ordered payment of principal along with 8% simple interest from the date of filing, pursuant to its discretion.

What did the court decide?

Recovery Certificate issued for Rs. 38,19,490.27 with 8% simple interest payable by respondents jointly and severally.

Union Bank of India versus Sh. Gurvinder Singh — 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.571/2023

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DATE OF INSTITUTION: 28.03.2023

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DATE OF DECISION: 12^th DAY OF OCTOBER, 2023

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Union Bank of India, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Central Office at 239, Vidhan Sabha Marg, Nariman Point, Mumbai 400021 and its substitution being transferee bank to the then applicant bank, i.e. erstwhile Corporation Bank by virtue of order of the Central Government, published in the Gazette Notification No. 133 GSR.154(E) dated 04.03.2020, Transferor Bank 2”, i.e. Corporation Bank have been Amalgamated with Union Bank of India under Section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 and one of its Branches Opposite Sector 7, Hisar Road, Urban Estate, Ambala city-134003 (Haryana), through its Branch Manager-cum-Principal Officer, Sh. Jeetendra Kumar

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…..Applicant Bank

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Versus

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Sh. Gurvinder Singh s/o Sh. Sharwan Singh r/o House No. 106, Village Amipur, Post Office Charumastpura, Tehsil and District Ambala, Haryana

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Sh. Lakhbir Singh s/o Sh. Ajaib Singh r/o House No. 106 Village Amipur, Post Office Charumastpura, Tehsil and District Ambala, Haryana

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…..Defendants

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OA/571/2023 UNION BANK OF INDIA Vs GURVINDER SINGH AND ANOTHER 2

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Argued by: Sh. Satish Kumar, Senior Manager (with authority letter) for the applicant bank Defendants ex parte vide order dated 21.06.2023

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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 defendants for recovery of Rs.38,19,490.27/(Rupees Thirty Eight Lac Nineteen Thousand Four Hundred Ninety and Twenty Seven Paisa Only) . It has been filed through Sh. Jeetendra Kumar, Branch Manager-cum-Principal Officer of the applicant bank stated to be competent to institute the Original Application vide letter of authority dated 14.02.2023, Annexure-A1 (copy).

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The brief facts of the case of the applicant as per Original application are that defendant No. 1 had approached the applicant bank for grant of CCCK facility of Rs. 24,90,000/- vide application form for agriculture credit dated 21.01.2016, Annexure-A2 (copy). Defendant No. 2 stood as a guarantor for repayment of the loan.

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The applicant bank sanctioned aforesaid facility to defendants vide sanction letter dated 21.01.2016, Annexure-A3 (copy), as per terms and conditions which were duly accepted by the defendants.

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In order to secure the aforementioned credit facility, the defendants executed various loan and security documents, i.e. demand promissory note dated 21.01.2016, Annexure-A4 (copy), hypothecation agreement dated 21.01.2016, Annexure-A5 (copy), agreement for covering hypothecation crops under National

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OA/571/2023 UNION BANK OF INDIA Vs GURVINDER SINGH AND ANOTHER 3

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Agricultural Insurance Scheme (RKBY) dated 21.01.2016, Annexure-A6 (copy), letter of undertaking dated 21.01.2016 regarding terms and conditions, Annexure-A7 (copy) and deed of guarantee dated 21.01.2016, Annexure-A8 (colly) (copy).

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The aforesaid limit was further secured by creation of equitable mortgage by defendant No.1 in respect of agricultural land measuring 55 Kanal 18 Marla situated in the revenue estate of Amipur, Hadbast No. 258, Tehsil and District Ambala, Haryana fully detailed in para No. V of the OA. Registered mortgage deed dated 30.12.2015 is Annexure-A9 (copy).

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It is further the case of the applicant bank that the loan facility was duly availed of by the defendants but they failed to maintain the financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA on 31.10.2021. The defendants executed acknowledgement of debt letter dated 03.01.2019, Annexure-A10 (copy). The applicant bank recalled entire outstanding amount vide legal notice dated 28.10.2021 and 01.06.2022 along with postal receipts, AnnexureA11 (colly) (copy), but to no avail.

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7. It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.38,19,490.27/(Rupees Thirty Eight Lac Nineteen Thousand Four Hundred Ninety and Twenty Seven Paisa Only), is recoverable against the defendants as per statement of account, certified under Bankers’ Books Evidence Act, 1891, Annexure-A12 (copy).

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OA/571/2023 UNION BANK OF INDIA Vs GURVINDER SINGH AND ANOTHER 4

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

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Notices of the Original Application were duly served upon the defendants, but since none appeared on behalf of the defendants, thus, the defendants were proceeded against ex-parte vide order dated 21.06.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Jeetendra Kumar, Branch Manager-cum-Principal Officer of the applicant bank was filed.

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This Tribunal has heard ex-parte arguments advanced by Sh. Satish Kumar, Senior Manager for the applicant bank and gone through the record carefully.

¶28

It was argued by Sh. Satish Kumar, Senior Manager of the applicant bank that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendants for recovery of the amount sought. From perusal of Annexures-A1 to A12 , it is clear that the defendants had approached the applicant bank for availing of the loan facility which was granted to them. It is further clear that the defendants had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendants failed to pay back the loan as per terms and conditions of the agreement executed between the parties. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.38,19,490.27/- (Rupees Thirty Eight Lac Nineteen

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OA/571/2023 UNION BANK OF INDIA Vs GURVINDER SINGH AND ANOTHER 5

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Thousand Four Hundred Ninety and Twenty Seven Paisa

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Only) from the defendants.

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In so far as pendent lite and future interest is concerned, the applicant bank in relief clause has claimed rate of interest @10.90% per annum plus penal interest @2% per annum with monthly rests. In sanction letter dated 21.01.2016, Annexure-A3 (copy), rate of interest has been mentioned @10.90% per annum.

¶33

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, purpose of loan, i.e. agricultural, present conditions of economy based on agriculture, quantum of loan 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 the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

¶34

In the result, the Original Application is allowed with costs holding that the defendants are liable to pay to the applicant bank a sum of Rs.38,19,490.27/- (Rupees Thirty Eight Lac Nineteen Thousand Four Hundred Ninety and Twenty Seven Paisa Only) with current and future simple interest @8% per annum w.e.f. 28.03.2023 , till the date of realisation of the amount. The liability of the defendants shall be joint as well as several. Accordingly, the applicant bank shall be at liberty to recover

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OA/571/2023 UNION BANK OF INDIA Vs GURVINDER SINGH AND ANOTHER 6

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aforesaid amount from the sale of mortgaged/hypothecated property of the defendants in execution proceedings, if not sold earlier under the provisions of the Securitisation 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 defendants. However, 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 07.11.2023 .

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

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Pronounced in the open Tribunal (M.M. Dhonchak) Presiding Officer DRT-2, Chandigarh

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OA/571/2023 UNION BANK OF INDIA Vs GURVINDER SINGH AND ANOTHER 7

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Argued by: Sh. Satish Kumar, Senior Manager (with authority letter) for the applicant bank Defendants ex parte vide order dated 21.06.2023

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Synopsis has been filed. Arguments heard. Vide separate order of even date, recovery of Rs.38,19,490.27/(Rupees Thirty Eight Lac Nineteen Thousand Four Hundred Ninety and Twenty Seven Paisa Only) with current and future simple interest @8% per annum with costs, has been ordered.

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Parties to appear before Recovery Officer concerned on 07.11.2023 . Copy of this order be sent to the applicant bank and the defendants through registered/speed post. This order be also uploaded on the official website of this Tribunal. File be consigned to the record room after due compliance.

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Pronounced in the open Tribunal

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(M.M. Dhonchak) Presiding Officer DRT-2, Chandigarh

Union Bank of India v. Sh. Gurvinder Singh

Case brief

What is this about?

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Union Bank of India v. Sh. Gurvinder Singh

Case brief

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What did the court decide?

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