Allowed

Indian Bank v. Sh. Pardeep Kumar

DRT9 Oct 2023OA/823/2023

Case brief

AI extract

What is this about?

The DRT allowed the bank's application for recovery of Rs. 27,09,321/- from the legal heirs of a deceased borrower. The court reduced the interest rate to 5% p.a. and clarified that heirs' liability is confined to the inherited estate.

What did the court decide?

Recovery certificate issued for Rs. 27,09,321/- plus 5% simple interest w.e.f. 17.05.2023, enforceable against mortgaged property or estate of the deceased.

Indian Bank versus Sh. Pardeep Kumar — 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. 823/2023

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DATE OF INSTITUTION: 17.05.2023

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DATE OF DECISION: 9^th DAY OF OCTOBER, 2023

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Indian Bank, (erstwhile Allahabad Bank), on the basis of Amalgamation Scheme dated 01.04.2020 a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at 66, Rajaji Salai, Chennai and Corporate Office at 254-260, Avval Royapettah, Chennai, Tamil Nadu, 600014 and having its Zonal Office at Karnal and amongst other Branches a Branch at Samalkha through its Senior Manager, Sh. Ombir duly constituted and Authorised Signatory

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…..Applicant Bank

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Versus

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Sh. Pardeep Kumar s/o Sh. Surajmal r/o VPO Macharauli, District Panipat, Samalkha, District Panipat since deceased through his legal heirs (Borrower)

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(i) Smt. Sunita Devi w/o Sh. Pardeep Kumar

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(ii) Sh. Sukhdev Singh s/o Sh. Pardeep Kumar

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(iii) Sh. Amit s/o Sh. Pardeep Kumar

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(iv) Sh. Sunil s/o Sh. Pardeep Kumar

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(v) Sh. Anil s/o Sh. Pardeep Kumar

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(vi) Ms Meenu d/o Sh. Pardeep Kumar

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All residents of VPO Macharauli, Samalkha, District Panipat, Samalkha, District Panipat

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OA/823/2021 INDIAN BANK VS PARDEEP KUMAR SINCE DECEASED THROUGH LRS 2

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....Defendants

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Argued by: Ms Padam Radha, Manager Law for the applicant bank Defendants ex parte vide order dated 15.07.2023

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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.27,09,321/- (Rupees Twenty Seven Lac Nine Thousand Three Hundred and Twenty One Only) . It has been filed through Sh. Ombir, Senior Manager of the applicant bank stated to be competent to institute the Original Application vide Authority Letter dated 03.10.2022 , Annexure-A1 (copy).

¶21

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 Akshay Krishi Credit Card (KCC) facility of Rs. 20,00,000/- vide application Form for Akshay Krishi Kisan Credit Card dated 24.05.2016, Annexure-A2 (copy), apraisal note dated 24.05.2016 Akshay Krishi Kisan Credit Card, Annexure-A3 (copy) and memorandum for sanction, Annexures-A4 (copy).

¶22

The applicant bank sanctioned the above said facility vide sanction letter dated 24.05.2016, Annexures-A5 (copy) to defendant No.1 as per terms and conditions which were duly accepted by defendant No.1.

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In order to secure the aforementioned credit facility, the defendant executed various loan and security documents, i.e.

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OA/823/2021 INDIAN BANK VS PARDEEP KUMAR SINCE DECEASED THROUGH LRS 3

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demand promissory note dated 24.05.2016, Annexure-A6 (copy) and hypothecation agreement dated 24.05.2016, Annexure-A7 (copy).

¶26

The aforesaid loan was further secured by creation of mortgage by defendant No.1 in respect of agricultural land measuring 69 Kanal 01 Marla situated in the revenue estate of Machhrauli, Tehsil Samalkha, District Panipat, Haryana, fully detailed in para No. 5.5 of the Original Application

¶27

The documents related to mortgage as under:

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i. Declaration dated 16.05.2016 under Section 4(1) of the Haryana Agricultural Credit and Operations and Miscellaneous Provisions (Banks) Act, 1973, Annexure-A8 (copy).

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ii. Copy of ‘Jamabandi’ for the years 2019-2020, Annexure-A9 (copy).

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iii. Confirmation letter dated 20.01.2023 regarding creation of mortgage of property, Annexure-A10 (copy).

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It is further the case of the applicant bank that the loan facility was duly availed of by defendant No.1 but he failed to maintain the financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA. The applicant bank recalled entire outstanding amount vide legal notice dated 11.11.2022, Annexure-A11 (copy), but to no avail.

¶32

It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.27,09,321/- (Rupees Twenty Seven Lac Nine Thousand Three Hundred and Twenty One Only) is recoverable against

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OA/823/2021 INDIAN BANK VS PARDEEP KUMAR SINCE DECEASED THROUGH LRS 4

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defendant No.1 as per statement of account, duly certified under Bankers’ Books Evidence Act, 1891, Annexure-A12 (copy).

¶35

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

¶36

Notices of the Original Application were duly served upon the defendants, but since none appeared on behalf of the defendants, thus, the defendant were proceeded against ex parte vide order dated 15.07.2023

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In support of contents of the OA, affidavit of evidence of Sh. Ombir, Senior Manager of the applicant bank was filed.

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This Tribunal has heard ex-parte arguments advanced by Ms Padam Radha, Manager Law of the applicant bank and gone through the record carefully.

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It was argued by Ms Padam Radha, Manager Law 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 defendant No.1 had approached the applicant bank for availing of the loan facility which was granted to him. It is further clear that defendant No.1 had executed all the relevant documents as stated above in favour of the applicant bank. Sh. Pardeep Kumar had died, leaving behind defendant Nos. 1(i) to 1(vi) as his legal heirs who have been impleaded as defendants. Unfortunately, the defendants failed to pay back the loan as per terms and conditions of the agreement executed between the

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OA/823/2021 INDIAN BANK VS PARDEEP KUMAR SINCE DECEASED THROUGH LRS 5

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parties. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.27,09,321/- (Rupees Twenty Seven Lac Nine Thousand

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Three Hundred and Twenty One Only) from the defendants.

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In so far as pendent lite and future interest is concerned, the applicant bank has claimed rate of interest @12.10% per annum plus penal interest @2% per annum. In demand promissory note dated 24.05.2016, Annexure-A6 (copy), the rate of interest has been mentioned @12.1% per annum in Krishi Credit Card (KCC).

¶44

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. agricultural, present conditions of economy based on agriculture, quantum of loan, prevalent market rates of interest which have gone drastically downhill in yesteryears, death of the borrower and defendant Nos. 1(i) and 1(vi) being a females, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @5% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

¶45

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.27,09,321/- (Rupees Twenty Seven Lac Nine Thousand Three Hundred and Twenty One Only) with current

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OA/823/2021 INDIAN BANK VS PARDEEP KUMAR SINCE DECEASED THROUGH LRS 6

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and future simple interest @5% per annum w.e.f. 17.05.2023 , 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 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. The applicant bank is at liberty to enforce the claim through due process of law. However, it is clarified that

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there should not be any ambiguity that the liability of the defendants by virtue of their being the legal heirs of the deceased borrower shall remain confined only to estate of the deceased borrower if it is inherited by them and not beyond that or otherwise. The recovery proceedings shall proceed only after the Recovery Officer is fully satisfied on the aspect of the estate being inherited by the Legal Representatives/Heirs and the liability being incurred accordingly .

¶49

Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 03.11.2023.

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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.

¶52

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

Indian Bank v. Sh. Pardeep Kumar

Case brief

What is this about?

What did the court decide?

Indian Bank v. Sh. Pardeep Kumar

Case brief

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What did the court decide?

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