Allowed

Union Bank of India v. M/s Anupama Utsav Hall and others

DRT27 Jun 2023OA/95/2022

Case brief

AI extract

What is this about?

Bank recovered loan of Rs.60.25 lakhs plus interest from proprietorship firm and guarantor under OA 95 of 2022. Court found limitation valid, applied law of admissions and banker's books evidence to determine debt. Recovery certificate issued for enforcement.

What did the court decide?

Recovery certificate issued for Rs.60,25,178.86 plus future interest against firm and guarantor.

Union Bank of India versus M/s Anupama Utsav Hall… — Contract and Commercial Disputes | DRT (2023)

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DRT,PATNA

OA 95 of 2022 IJI

Debts Recovery Tribunal, Patna

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Karpuri Thakur Sadan, Aashiana Digha Road at PATNA-800025

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Presiding Officer : Shri Kaushalendra Yadav

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OA Case no. : 95 of 2022

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Union Bank of India Patna City, Opposite Patna City Registry Office, P.S.-Alamganj, District-Patna.

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T . Applicant

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MIs Anupama Utsav Hall having registration no. PT/TBSE·REGI20 17/14364 through its proprietor Mr. Sanjeev Kumar Sinha, Address Khalasi Tola, Opposite Patna City Registry Office P.O.Gulzarbagh, P.S.-Alamganj, Patna City, District-Patna, Pin 800007.

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Mr. Sanjeev Kumar Sinha S/o Late Naveen Kumar Sinha having PAN no. BAHPS6905E, RIo Navin Awadh Niwas, Khalasi Tola, opposite Patna City Registry Office, P.O.-Gulzarbagh, P.S.Alamganj, Patna City, District-Patna, Pin-800007.

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Mr. Mantu Khurasi S/o Gayasuddin Khurasi, RIo 103, Sadikpur, Langru Akhara, P.S.-Alamga~, Patna City, District-Patna, Pin 800007.

...Defendants.

Present:

For the Applicant : Dr. Rajesh Tripathy Advocate For the Defendants no. 1 & 2 : Shri CSP Sinha, Advocate For the Defendants no. 3 : None

Dated: 27.06.2023

JUDGMENT

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1- The Applicant _bank has made this application uls 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 1.2.2022 against the defendants to recover its debts from defendants of Rs.60,25,178.86 as on 30.12.2021 alongwith pendente-lite and future interest at the contractual rate from 31.12.2021 with costs till realization.

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2- The application has been duly registered and numbered as above.

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3- The brief facts of the case of the applicant bank as stated in the application are as under-

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The applicant bank body corporate constituted under Banking companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai400021 and amongst other branches having one of the Branch office at

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OA 95 of20221J)

DRT,PATNA

Patna City, Opposite Patna City Registry Office, P.S.-Alamganj, DistrictPatna. ,.

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The defendant no. 1 is a proprietorship firm and defendant no. 2 is proprietor of the said firm and owner of the collateral security and defendant no. 3 is a guarantor of the said loan who were in need of money for construction of Marriage Hall and purchase of its equipment's, applied for term loan for the above said purpose on 3.7.2017. After scrutiny sanctioned the term loan ofRs.67.56Iakh on 31.10.2017. The defendants executed the various loan documents in favour of the bank. The defendant no. 2 created registered mortgage of his landed property details given at page 20A in Schedule B of OA. After some time defendant no. 2 again apply for term loan of rs.11 lakh on 28.2.2018. The bank sanctioned the same on 28.2.2018. The defendants executed the various loan documents. The defendant no. 2 again created registered mortgage of his landed property details given at page 20A in Schedule-B ofOA .

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The bank lodged a FIR against defendant no. 2 before economic offence, Police Station with regards to cheating, Criminal Breach of Trust, Fraud and Misappropriation of funds bearing FIR no. 3 of 2020 dated 6.3.2020 and the same has been registered under section 406,420,467,468,471,472 and 120(B)ofIPC against the defendant no. 2.

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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 adhere 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 31.10.2019

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Thus the total liability in the loan account is Rs.60,25,178.86/with pendentelite and future interest at the contractual rate from 31.12.2021till the realization. '

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The interest /compound 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.

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Since, the defendants have 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.

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4-. U/s 19 (4) of the Act & Rule of the DRT [Procedure] Rules, 1993, copies of application & paper book was sent by this Tribunal to the defendants by registered/speed post on 23.4.2022, and summons/notices b0~

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DRT,PATNA

OA 95 of 2022 IJI

issued requiring the defendants to show-cause within 30 days of the service of summons/notices as to why relief prayed for, should not be granted.

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On perusal of the case records, it is clear that on 23.4.2022, summons/notices were sent to the defendants, but the defendants no. 3has 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 no. 3 on"'20.7.2022in "Aaj" newspaper.

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Despite the registered summons/notices and publication of notice in newspaper, the defendant no. 3 has not appeared before this Tribunal to contest the case. The sufficient time has been given to the defendant no. 3 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 no. 3 on 14.12.2022. Sufficient time has been given to defendant no. 1 & 2 for filing written statement but no written statement has been filed so far. Statuary period for filing written statement has already been expired. Hence right to file written statement is closed against the defendant no. I & 2 on 14.12.2022.

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Ld. Counsel for the defendant no. 1 & 2 argues the case without filing of written statement and has not denied the sanction of loan amount, its utilization and further to secure the loan, execution of relevant documents,

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Arguments of ld. Counsels of the applicant bank and ld. Counsel of defendants no. 1& 2 were heard and record perused and considered.

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5- To prove its case, the applicant Bank has referred various certified photocopies of documents before this Tribunal. The applicant bank has also given evidence on affidavit by way of affidavit of Shri Manoj Kumar, Branch Manager of the applicant bank. The details of documents are as follows. :-

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SI.No	Description of photocopies Documents	Date of Execution	Amount	Signature of executant	Ex.! Ann. No.
1 .	Loan application	3.7.2017	Rs.67.48 lakh	defendant no. 1&2	1
2	sanction letter...	31.10.2017	Rs.67.56 lakh	bank	2
3	composite agreement	20.11.2017	Rs.67.56 lakh	defendant no. 1&2	3
4	General form of guarantee	20.11.2017	.Rs.67.56 lakh	defendant no. 3	4
5	consent letter .	20.11.2017	....	defendant no.1& 2	5

OA 95 of20221J]

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DRT,PATNA

	6	consent letter	20.11.2017	....	defendant no. 3	6
	7	RF256	30.6.2017 or	Rs.67.48Iakh	defendant no. 2	7
	8	RF 216	23.10.2017	....	bank	8
	9	property statement	30.5.2017	...	...	9
	10	copy of .simple mortgage deed no. 7763	20.11.2017	..,	defendant no. 2	10
	11	loan application	28.2.2018	Rs.l l lakh .	defendant no. 1&2	11
	12	sahction letter	28.2.2018	Rs.l l Iakh	bank	12
•	13	composite agreement	28.2.2018	Rs.l l lakh	defendant no. 2	13
	14	consent letter	28.2.2018	...	defendant no. 2	14
	15	RF256	17.6.2016 or	.,.	defendant no. 2	15
	16	RF216	28.2.2018	...	bank	16
	17	property statement	28.2.2018	...	defendant	17
	18	copy of registered mortgage deed no. 2002	15.3.2018	...	defendant no. 2	18
	19	Demand notice and Recall notice	2.12.2019 1.1.2020	...	bank	19
•	20	statement of account	as on 30.12.2021	Rs.60,25,178.86	bank	20
	21	copy of FIR no. 3/2020	6.3.2020	..,	...	21

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. 6- It is submitted by ld. Counsel-of applicant bank that the defendants no. 1 & 2 have admitted the loan facilities, granted to them and there is no any specific denial of execution of loan documents by the defendants. It is further submitted that there is no any stay granted by the Hon'ble Higher Court in the matter.

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It is further submitted that the applicant bank has filed the Original

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Application, for recovery of due amount, after deducting all the amounts, deposited by the defendants and by calculating the interest charged, as agreed by the defendant. It is further submitted that the defendants have

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• not deposited any amount, after filing of the OA.

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It is requested that the recovery certificate may be issued for the

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claim amount, as made in OA, as there is no any specific denial by the defendants. T

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7- It has been established that defendants are living and carrying on their business in the state of Bihar. Cause of action arose in the State of

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DRT,PATNA

OA 95 of20221JI

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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.

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8- On the issue of Limitation,"to prove it, the applicant bank has submitted that the account was declared as NPA on 31.10.2019, whereas the present application has been filed on 1.2.2022. 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.

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9- In the affidavit of Shri Manoj Kumar, Branch Manager of 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 docuinents of the applicant bank as stated above.

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10On perusal of the above documents, it is clear that the applicant bank has granted loan facility to the defendants and to secure the loan, various loan documents were executed by the defendants and loan facility was availed by the defendants as stated in the application.

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11The documents as stated above reveal that the defendants have applied for loan and bank had sanctioned loans, the-reafter,to secure the loan and for repayment of loan amount with interests etc., the defendants have executed various loan documents; which strength the case of the applicant bank.

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While on perusal of the loan documents it appears that the applicant bank has initially sanctioned Rs.67.56 lakh and to secure the loan, the defendant no. 1 to 3 have executed various loan documents, including the guarantee documents. Thereafter the applicant bank has further sanctioned loan facility upto Rs.11 lakh and to secure the loan the defendant no. 1 & 2 have executed various loan documents including the guarantee documents.

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In view of the above, it is clear that the defendant no. 3 has given guarantee for the loan ofRs.67.56 lakh only. Therefore, the defendant no. 3 is liable to pay the loan ofRs.67.56 lakhwith interest only

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12The applicant bank has also furnished statement of account as shown 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.

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OA 95 of 2022IJ]

DRT,PATNA

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13Defendants have neither denied the utilization of funds advanced by applicant bank nor have pointed out any 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 alqngwith application filed under sub section 1 of section 19 by the applicant.

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14-. On consideration of the arguments and on perusal of the application, documents, affidavit, it is proved that the applicant bank has granted the loan facilities to the defendants and to secure the loan, various loan documents were executed by the defendants and facilities were availed by the defendants as stated in the application.

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15- The'Section 58 of the Indian Evidence Act, 1872 reads as under-

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"58. Facts admitted need not be proved.- No fact need to be proved in any proceeding which the parties thereto or their agents agree to admit at the hearing, or which, before the hearing, they agree to admit by any writing under their hands, or which by any rule,. of pleading in force at the time they are deemed to have admitted by their pleadings: Provided that the Court may, in its discretion, require the facts admitted to be proved otherwise than by such admissions.

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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-

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"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."

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17Facts of the case, in my view, are well proved by evidence of the applicant bank as well as admission of defendant no.1 & 2. The applicant bank is entitled to receive from defendants jointly and severally of Rs.60,25,178.86 together with pendentelite and future interest @10.60% p.a. compounded monthly rests from 1.2.2022 (The date of filing of this O.A.) till realization. Since the defendant no. 3 is liable to pay the loan of .

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OA 95 of 2022 IJI

DRT,PATNA

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Rs.67.56 lakh with interest only 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 and debt is determined with costs against the defendants and it is, hereby jointly and severally, ordered that the applicant bank is entitled to receive from sole defendants, it's debts with interest, amounting to Rs.60,25,178.86 together with pendentelite and future interest @10.60% p.a. compounded monthly rests from 1.2.2022 (The date of filing of this O.A.) till realization of the entire sum due and recoverable with costs.

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It is further made clear that any amount deposited by the defendants, be deducted in the claim amount, if not deducted. • I

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It is made clear.that the defendant no. 3 is liable to pay the loan of Rs.67.56 lakh with interest only.

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Defendants are 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 ofjustice.

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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 .realise the amount as per the certificate in the manner and mode prescribed under the Act from the defendants, by sale of mortgaged! hypothecated assets as well as other personal movable/immovable assets of the defendants.

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Parties are directed to appear before the Recovery Officer, DRT, Patna on 30.8.2023. The order be communicated accordingly.

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Judgment signed, sealed, dated and pronounced in the open court on this 27thDay of June, 2023.

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Dictated & Corrected by me

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[Kaushalendra Yadav] Presiding Officer Debts Recovery Tribunal, Patna

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FORM NO. 9

DEBTS RECOVERY TRIBUNAL PATNA

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[See Regulation 24(1)]

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2nd Floor, (A. B & F Wing) Karpuri Thakur Sadan, Kendriya Karamchari Parisar (GPOA), Ashiana Digha Road, Patna-800025.

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RECOVERY CERTIFICATE UNDER SECTION 19(1) READ WITH SECTION 19(1l) OF THE RECOVERY OF DEBTS & BANKRUPTCY ACT,.1.221, AS AMENDED FROM TIME TO TIME.

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RC No. 354/2023

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Case No: OA/95/2022

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In the Matter of:

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(CH- I) UNION BANK OF INDIA PATNA CITY BRANCH OPPOSITE BANK OF INDIA PATNA CITY BRANCH OPPOSITE PATNA CITY REGISTRY OFFICE PS ALAMGANJ PATNA ,BIHAR -0

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Applicant(s)

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------ Versus -------

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To, (CD- I) MIS ANUPAMA UTSAV HALL AND OTHERS.

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through its Proprietor Mr. Sanjeev Kumar Sinha

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Address- Khalasi Tola, Opposite Patna City Registry Office, ,P.O.- Gulzarbagh, P.S.-Alamganj, Patna City, Patna ,BIHAR -800007

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(CD- 2) MR. SANJEEV KUMAR SINHA SON OF LATE NAVEEN KUMAR SINHA HAVING RESIDENT OF NAVIN-AWADH NIWAS KHALASI TOLA, OPPOSITE PATNA CITY REGISTRY OFFICE, P.O.-GULZARBAGH, P.S.-ALAMGANJ, PATNA CITY, DISTRICT- PATNA PIN CODE-800007

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Defendant(s)

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(CD- 3) MR. MANTU KHURASI SON OF GAYASUDDIN KHURASI, RESIDENT OF 103, SADIKPUR, LANGRU AKHARA, P.S.ALAMGANJ, PATNA CITY, DlSTRICT- PATNA PIN

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-800007

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y Certificate for Rs 6025178.86 1___Ryy Lakhs Twenty Five Thousands One Hundred Seventy...Eight And Paise llig!!.tY. Six Only)

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In terms of final order dated 27/06/2023 passed by this Tribunal in the above mentioned case, it is ordered that the Applicant Certificate Holder Bank is entitled to recover a sum of Rs. 6025178.86 along with cost, expenses and interest from the 01/02/2022 i.e. date of filing 1 with effective date of the OAl95/2022 and future interest from order date till the date of realisation in full,jointly or severally from the Certificate Debtors, hereinafter referred to as:-

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Int Rat	Effective i Date	Order Date	Amount(Rs.)	Interest	RC! i Amount(Rs.) iRemark:

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In case of failure to pay the aforementioned adjudicated amount within 30 days, same shall be recovered from the sale of the mortgaged/hypothecated assets as well as other personal movablel Immovable assets of the certificate debtors.

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The mortgaged or hypothecated assets to secure the loan in question are hereby attached and shall be subject to the final order under the recovery proceeding in pursuance of the Recovery certificate issued under Section 19(22) of Recovery of Debts and Bankruptcy Act 1993

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Parties are directed to appear before MANOJ KUMAR, Recovery Oflicer, DEBTS RECOVERY TRIBUNAL PATNA on 30/08/2023.

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The Recovery Officer shall realize the amount as per this Certificate in the manner and mode prescribed under Sections 25 to 28 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (as amended from time to time) from the above named Certificate Debtors.

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This Certificate has been issued under my signature and seal of the Tribunal on this 27/06/2023

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PRESIDING OFFICER DEBTS RECOVERY TRIBUNAL PATNA

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FORM NO. 10

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[See Regulation 24(2)]

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DEBTSRECOVERYTRIBUNALPATNA

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2nd Floor, (A. B & F Wing) Karpuri Thakur Sadan, Kendriya Karamchari Parisar • (GPOA), Ashiana Digha Road, Patna-800025.