Debts Recovery Tribunal allowed the applicant bank's ex-parte application to determine the defendant's liability. The court fixed future interest at 6% p.a. simple where the contractual rate was unproven, and issued a recovery certificate.
Recovery certificate issued for Rs.37,07,101 including future interest at 6% p.a. simple from 31.1.2022 and costs.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
OA 88 of 2022 (J)
DRT,PATNA
Debts Recovery Tribunal, Patna
Karpuri Thakur Sadan, Aashiana Digha Road at PATNA-800025
Presiding Officer : Shri Kaushalendra Yadav
OA Case no. : 88 of 2022
Punjab National Bank, Sarmera Branch, District-Nalanda
....... Applicant
Vs.
Chundra Kumar S/o Surya Mani Prasad Singh Rio Village + P.O.SArmera, P.S.-Sarmera, District-Nalanda, PAN no. KUPZA5896P.
.. .Defendant.
Present: : Shri Prashant Kumar, Advocate For the Applicant For the Defendant : None
Dated:17.02.2023
JUDGMENT
1- The Applicant bank has made this application u/s 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 31.1.2021 against the defendant to recover its debts from defendant of Rs.37,07,101las on 31.12.2021 alongwith pendente-lite and future interest at the contractual rate from 1.1.2022 with costs till realization.
3- The brief facts of the case of the applicant bank as stated in the application are as under-
The applicant bank body corporate constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act, 1970, having its Corporate Office Plot no. 4,Sector-10,Dwarka New Delhi-l10075 and inter alia a branch Office at Sarmera Branch, District-Nalanda-803109.
The defendant had applied for a credit facility by way of term loan to the tune ofRs.l1.95 lakh on 30.4.2013 under CGTSME Scheme to the bank to purchase a passenger Bus bearing Model Name Tata Starbus. The applicant bank had considering the said loan application and sanctioned term loan of Rs.l1.95 lakh on 30.4.2013. The defendant executed the various loan documents i.e. hypothecation agreement, consent clause. The bank issued a delivery order to the concern Dealer Mis Maurya Motors Ltd. with a request to deliver the said vehicles to the borrower. As requested by the applicant vide its delivery order dated 30.4.2013, the vehicles in question have been delivered to the borrower after getting the same registered before the RTO office which is apparent from the copy of registration certificate bearing registration no. BR21G8924. The defendant after receiving the bus in question in good condition had
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DRT,PATNA
OA 88 of 2022 [J]
utilized the same as per his own wish and desire in order to expand his business of Transport.
All the transactions were entered in the ledger of the loan accounts in the name of the defendant duly maintained by the applicant bank in its usual course of business. After availing the sanctioned credit facilities became irregular in repayment of their dues as per agreed terms and failed to ~dhere to the financial norms of the bank and avoiding the repayment of Its dues to the bank, in spite of several assurances given by it to the applicant bank resulting in the account turning as NPA on 29.1.2016.
Thus the total liability in the loan account is Rs.37,07,101l- with pendentelite and future interest at the contractual rate from 1.1.2022till the realization.
The interest Icompound interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.
Since, the defendant has failed and neglected in spite of several reminders to make payment of the dues recoverable to bank, hence this application has been filed by the bank.
4- Dis 19 (4) of the Act & Rule of the DRT [Procedure] Rules, 1993, copies of application & paper book was sent by this Tribunal to the defendant by registered/speed post on 23.4.2022, and summon/notice issued requiring the defendant to show-cause within 30 days of the service of summon/notice as to why relief prayed for, should not be granted.
On perusal of the case records, it is clear that on 23.4.2022, summon/notice was sent to the defendant, but the defendant has not appeared, hence, the Registry of this Tribunal has ordered to publish the notice in newspaper and subsequently, substituted service by publication of notice by way of advertisement in newspaper was also made against the defendant on 19.8.2022in "Hindustan" newspaper.
Despite the registered summon/notice and publication of notice in newspaper, the defendant has not appeared before this Tribunal to conte~t the case. The sufficient time has been given to the defendant to defend hIS case, but he failed to appear and to file WS, hence, the Tribunal has passed an order to proceed ex-parte against the defendant 21.10.2022.
5- To prove its case, the applicant Bank has referred v~rious certified photocopies of documents before this Tribunal. The applIcant ~ank has also given evidence on affidavit by way of affidaVIt.of Shn Atulya Kumar, Chief Manager of the applicant bank. The details of documents are as follows. :-
| f SI.No I |
Description photocopIes |
of | Date of <br>Execution |
Amount | <br>Signature of executant |
\ Ex.! J Ann. |
|---|
•
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DRT,PATNA
OA 88 of 2022[J)
| Documents | No. | ||||
|---|---|---|---|---|---|
| 1 | Loan application | 30.4.2013 | Rs.ll.95 lakh |
defendant | 1 |
| 2 | sanction letter | 30.4.2013 | Rs.ll.95 lakh |
bank | 2 |
| 3 | Hypothecation agreement, consent clause |
30.4.2013 | Rs.ll.95 lakh |
defendant | 3 |
| 4 | Delivery order | 30.4.2013 | ... | bank | 4 |
| 5 | Notice | 14.1.2016 | ... | bank | 5 |
| 6 | Balance and security confirmation letter |
27.4.2017 | ... | defendant | 6 |
| 7 | Notices | 17.11.2017 26.12.2017 |
... | bank | 7 |
| 8 | Balance and security confirmation letter |
25.4.2019 | ... | defendant | 8 |
| 9 | Notice | 22.8.2019 | ... | bank | 9 |
| 10 | Legal notice | 17.2.2020 | ... | bankadv. | 10 |
| 11 | Statement of account | as on 31.12.2021 |
Rs.37,07,101/- | bank | 11 |
6- Opportunity of hearing has been fully given to both the parties, but despite several opportunities given to defendant, the defendant has not appeared to contest the case, hence, the ex-parte arguments of learned counsel for applicant bank were heard and perused the case record.
Ld. counsel of applicant bank submitted that the defendant has taken the loan and utilized the same and also executed the various loan documents to secure the loan. Further, submitted that the claim of the bank has been proved by documentary evidence.
It is further submitted by ld. Counsel of applicant bank that there is no any stay granted by any Higher Court, in respect of the proceedings of the present OA and requested to issue recovery certificate, as claimed for, inOA.
7- It has been established that defendant is living and carrying on his business in the state of Bihar. Cause of action also arose in the State of Bihar. The said claim on the date of filing of application exceeded Rs.20 lacs. The applicant bank is functioning within jurisdiction of this tribunal. Therefore, this Tribunal has territorial as well as pecuniary jurisdiction to adjudicate upon the present application.
8- On the issue of Limitation, to prove it, the applicant bank has submitted that the applicant bank has declared the account as NPA on 29.1.2016, whereas the present application has been filed on 31.1.2022. Even, it is counted for the purpose of Limitation, then it is established that the applicant bank has filed the case within the limitation period. As such, it is established that present application has been filed well within the period of limitation.
•
4
OA 88 of 2022 IJ]
DRT,PATNA
9- In the affidavit of Shri Atulya Kumar, Chief Manager of the applicant bank, has stated that he is well acquainted with the facts of the case and has on verification of record, sworn in the affidavit in support of contents of application and the documents as evidence and established on oath the pleadings and documents of the applicant bank as stated above.
The documents as stated above reveal that the defendant has applied for loan and the bank had sanctioned the loan and to secure the loan and for repayment of loan amount with interests etc., the defendant has executed various loan documents, which strength the case of the applicant bank.
The applicant bank has also furnished statement of account as above, which is not only admissible but shall be taken as correct statement of account, more so since the entries in the statement of account has not been challenged.
10Since, the case was proceeded ex-parte against defendant, all contentions raised and documents produced by plaintiff remained unrebutted and the tribunal may act upon the affidavit of the applicant as per law. Defendant has neither denied the utilization of funds advanced by applicant bank nor have pointed out ani specific error and discrepancy in the Statement of Account, which is kept in due course of business, evidence on affidavit, which has supported the claim of the applicant bank, established to have fully correct and believable. Provisions contained in Rule 9(2) of Debt Recovery Tribunal (Procedure) Rules, 1993 provide that the documents referred in the application shall be duly stated by senior officer of the bank, or financial institution as the case may be and numbered accordingly. The rule 12 (10) provides that the provisions contained in section 4 of the Banker's Books evidence that Act, 1891 (18 of 1891) shall applied to certified copy of an entry in a Banker's Books furnished alongwith application filed under sub section 1 of section 19 by the applicant.
11On consideration of the arguments and on perusal of the application, documents and affidavit, it is proved that the applicant bank has granted the loan facility, documents were executed by the defendant and facility were availed by the defendant as stated in the application.
12The applicant bank has sought for recovery of a sum of Rs.37,07,101l- with cost and further interest at the contractual rate from 1.1.2022till realization.
13Learned Advocate appearing for applicant bank submits that the applicant bank has charged interest in terms of the agreements and that interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.
5
OA 88 of 2022 [J]
DRT,PATNA
14On consideration of the arguments and on perusal of the pleadings, documents and affidavit, it is proved that the applicant has charged interest against defendant in terms of documents and as per directives of RBI.
On perusal of the statement of account and loan documents, including sanction letter, it appears that the applicant bank has not shown the agreement in respect of the rate of interest charged. There are unfilled blanks wherever required in the standard-form as prescribed for the interest rate. As such the interest rate is not proved. However, since the statement of account has not been disputed by defendant, the balance derived thereunder is deemed as proved ex-parte.
In the above circumstances, the applicant bank is not entitled to get the recovery certificate with future & pendentelite interest because the contractual rate of interest has not been proved. The applicant bank is entitled to get the recovery certificate with future & pendentelite interest @ 6 % p.a. simple yearly, from the date of filing of this O.A. till realization.
15None of the defendant appeared before the tribunal to contest the claim made by the applicant, therefore, it necessarily goes to establish that the claim made by the applicant bank is genuine and true. It is manifest that the defendant has not disputed the claim, therefore, the claim referred to the tribunal is recoverable till full and final realization of the claim.
16In Indian Bank Vs. Blue Jaggers Estates Limited and others [2010] 8 SCC 129,the Hon'ble Supreme Court of India has observed as under-
"The Court cannot lose sight of the fact that the bank is a trustee of public fund. It cannot compromise the public interest for benefiting private individuals. Those who take loan and avail financial facilities from the bank are duty bound to repay the amount strictly in accordance with the terms of the contract. Any lapse in such matters has to be viewed seriously and the bank is not only entitled but duty bound to recover the amount by adopting all legally permissible methods. Parliament enacted the act because it was found that legal mechanism available till then was wholly insufficient for recovery of the outstanding dues of the banks and Financial Institutions."
17In my view, Facts of the case stand proved by evidence of the applicant bank ex-parte. Accordingly, The applicant bank is entitled to recover from defendant of Rs.37,07,101/- alongwith pendente-lite and future interest @ 8% p.a. simple yearly rests from 31.1.2022 (The date of filing of this O.A.) till realization. So the final order may be passed accordingly, to meet the ends ofjustice.
ORDER
In the result, the application of the applicant bank is, allowed exparte and debt is determined with costs against the defendant. The ~\V \
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OA 88 of 2022 [J)
DRT,PATNA
defendant is hereby, ordered to pay the applicant bank it's debts amounting to Rs.37,07,101/alongwith pendente-lite and future interest @ 6% p.a. simple yearly rests from 31.1.2022 (The date of filing of this O.A.) till realization of the entire sum due and recoverable with costs.
It is made clear that any amount deposited by the defendant, be deducted in the claim amount, if not deducted.
Defendant is debarred from transferring, alienating encumbering or otherwise dealing with or disposing of the mortgaged or hypothecated or any other properties and assets without paying the aforesaid adjudicated dues to the applicant bank to secure the ends of justice.
Let a certificate of recovery be drawn up forthwith and put up for signatures in terms of provisions contained in Section 19(22) of the Act to be issued, on the basis of the order of the Tribunal to the Recovery Officer. The Recovery Officer shall realize the amount as per the certificate in the manner and mode prescribed under the Act from the defendant, by sale of mortgaged! hypothecated assets as well as other personal movable/immovable assets of the defendant.
Parties are directed to appear before the Recovery Officer, DRT, Patna on 30.3.2023. The order be communicated accordingly.
Judgment signed, sealed, dated and pronounced in the open court ~ on this 17th Day of February, 2023.
Dictated & corrected by me.
[ ,_,'1'1",/7
[Kaushalendra Y adav] Presiding Officer Debts Recovery Tribunal, Patna
3 issues framed by the court
Whether the applicant bank is entitled to a recovery certificate after ex-parte proceedings.
Whether the future interest claimed should be compounded or calculated at a specific simple rate.
Whether the defendant can transfer assets pending determination of dues.
Colour shows how this judgement treated each authority
Indian Bank Vs. Blue Jaggers Estates LimitedDistinguished¶61
Indian Bank Vs. Blue Jaggers Estates Limited and others [2010] 8 SCC 129 · Who else cites this
2 provisions across 1 enactments
Punjab National Bank, Sarmera Branch
Chundra Kumar
Kaushalendra Yadav
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
