Allowed

Canara Bank v. Harry Enterprises

DRT27 Jul 2023OA/95/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's original application for recovery of dues arising from a loan facility. The court held that despite the defendant's objections regarding missing attestation and alleged RBI guideline violations, the documented claim and admitted defaults entitled the bank to the relief prayed for.

What did the court decide?

The defendant is liable to pay Rs. 85,02,023/- with future interest at 9.90% p.a., and the bank is entitled to proceed against OA schedule assets and the defendant's person and properties for recovery

Canara Bank versus Harry Enterprises — Contract and Commercial Disputes | DRT (2023)

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IN THE DEBTS RECOVERY TRIBUNAL-II AT HYDERABAD DATED THIS THE 27TH DAY OF JULY, 2023

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PRESENT: SH. RAMESHWAR KOTHE, B.Com, L.LB. (Hons.), M.A. PRESIDING OFFICER

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oA. NO. 95 0F 2022

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M/s. Canara Bank Balanagar Branch JK Complex, 1st Floor Main Road, Balanagar Hydera bad -50003 7. ....Applicant. Versus

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M/s. Harry Enterprises Rep. by its Proprietrix Ms. K. Aruna Richard D/o Prakki Anand Achari Age: about 3B years Occ: Business D. No. 10-5-789 Sainagar, Lalaguda Secunderabad - 500 017.

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... Defendant.

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Counsel for Applicant : Ms. Sangeeta laiswal. Counsel for Defendant : Mr. V. Sethu Madhava Rao.

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:: ORDER ::

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The Applicant Bank filed the present OA for the recovery of a sum of Rs.85,02,023/- frcm the defendant with interest @ 9.90o/o p.a. plus 2olo p.a. penal interest with monthly rests from 25.01.2022ljl| the date of realisation along with costs and sate of oA schedute assets. dYp

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oa.9512022

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The averments of applicant bank as per the OA, briefly, are that defendant availed credit facilities in the year 202O to a tune of Rs.95 lakhs for establishing granite cutting unit. Defendant created hypothecation over the OA schedule-A property as a collateral security for the credit facility. Defendant did not maintain the loan account as pr the agreed terms. The officials of the applicant bank did not find the hypothecated assets at the defendant's unit during their inspection. The applicant issued a recall notice dated 16.09.2021 classified the account as NPA on 77.01.2022. Defendant did not liquidate the dues despite legal notice dated 27.0t.2022. Hence the present OA.

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The defendant filed written statement. At the outset defendant questioned the validity of OA on the ground that the Affidavit and Vakalatnama were not attested by the Advocate. As such the OA is liable to be rejected. The applicant bank failed to show the payment made by the defendant. The applicant bank obtained signatures of the defendant on various blank/printed documents, which are now used by the applicant for the purpose of filing of the OA. Due to lack of orders during Covid.19 period, the defendant suffered losses. Applicant bank did not extend the benefit of restructuring of loan as per RBI guidelines. The averment of applicant bank's officers did not find the existence of hypothecated assets is contrary to the averment in para 34 of the OA where in was certified that the OA claim is fully secured by the assets. Accordingly, defendant prayed for dismissal of OA.

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The Applicant Bank examined T. Gaikwad, Manager, as AW-l and marked 12 documents through him as Ex. A.1 to Ex. A.12. ,4{3

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(-/ +'

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oA.95/2022

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The defendant's right of leading evidence forfeited vide docket orders dated 22.06.2023.

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Heard learned counsel appearing for both the parties. perused the material placed on record.

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It is contention of the learned counsel appearing for the applicant bank that defendant failed to clear the outstanding dues despite repeated reminders and recall and legal notices.

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B. Learned counsel for the defendant submitted that the respondent did not allow restructuring of loan as per RBI/ Ministry of Finance guidelines holding the field. The OA has not been verified by the Advocate. Hence on these two counts, the OA is liable to be dismissed.

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The point that arises for consideration is:-

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Whether the Applicant Bank is entitted for the claim made in the OA against the Defendant and OA schedule assets as prayed for?

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)

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According to learned counsel appearing for the applicant bank, defendant failed to clear the dues as per the agreed terms. The material documents placed as Exs. A.1 to A.12 marked through AW,1 amply prove the claim in favour of the applicant and against the defendant. The defendant did not adduce any evidence to substantiate her defence. Hence learned counsel prayed for allowing the OA. /)V^9

oA.gs/2022

There is no denial^{of defendant availing loan from the applicant} bank. There is also^{no denial of committing default in} repayment of loan amount^{as per agreed terms As stated} supra, defendant's^rlght of^{adducing evidence has been} forfeited. Except filing^{written statement, no specificorder/} guidelines on the restructure and^{conversionof irregularportion} of Term Loan and^{FITL accounts issuedby RBI or Ministry of} Finance and alleged to^{have been flouted by the applicantbank} has been filed by the^{defendant. Therefore,the contentlons of} the defendant do^{not deserve acceptance. Accordingly,the} Evidence Affldavit^{coupled withthe recitals in documents viz', Exs'A'1to} A.12 marked on behalf^{of the Applicant Bank, clinchesthe claimof the} Applicant Bank against^{the Defendants. Hencethe defendant is liable to} pay the OA claim to the applicant bank.

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In the result, the^{present Original Application No.95/2022is} allowed as under:^-

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i) The Defendant is liable to^pay to^the Applicant Bank a sum of^{Rs.85,02,023/- with} future interest @9.90%^{p.a. simple from the} date of application till^{the date of realization;}

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ii) the OA claim is secured bY^{way of} hypothecation of assets described in^the schedule annexed to the OA^{and the} applicant bank is entitled to^{proceed agalnst} the same for recovery of^its dues;

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iii) the applicant bank is also entitled to^proceed against the person and^properties of^the defendant for realization of its dues; and Y^o

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oA.9512022

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iv) the applicant bank is entitled for the costs.

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The Applicant Bank is directed to file Cost Memo within 2 weeks from the date of receipt of this Order.

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Issue Recovery Certificate accordingly.

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Communicate a copy of this order to the parties concerned, (Dictated to the steno, corrected, signed and pronounied by me in the open court on this the 27th day of Juty,2O23l.

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,/Xl^lrrr!r{,r- 1-r/^6.-,."

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(trAMESHWAR KOTHE) PRESIDING OFFICER

Canara Bank v. Harry Enterprises

Case brief

What is this about?

What did the court decide?

Canara Bank v. Harry Enterprises

Case brief

What is this about?

What did the court decide?

What the court decided

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