Allowed

Canara Bank v. Suresh Associates

DRT22 Nov 2023OA/96/2022

Case brief

AI extract

What is this about?

This Debt Recovery Tribunal allowed an application under S. 19 of the RDBFIA, 1993, for recovery of a business loan default of Rs. 85,24,621. The court held the defendant liable based on documents produced by the bank, noting the defendant forfeited the right to evidence.

What did the court decide?

The defendant is liable to pay Rs. 85,24,621 with interest; bank is entitled to proceed against OA schedule assets and defendant's properties and is awarded costs.

Canara Bank versus Suresh Associates — Contract and Commercial Disputes | DRT (2023)

¶1

]N THE DEBTS RECOVERY TRIBUNAL.II AT HYDERABAD DATED THIS THE 22ND DAY OF NOVEMBER, 2023 PRESENT: SH. RAMESHWAR KoTHE, B.com, L.LB. (Hons.), M.A. PRESIDING OFFICER

¶2

ORIGINAL APPLICATIoN No. 96 oF 2022

¶3

Canara Bank Balanaqa r Bra nch JK Complex 1st Floor, N4ain Road Balanagar, Hyderabad Rep. by its GPA Holder. ....Appticant.

¶4

Vers us M/s. Su resh Associates Rep. by its Proprietor Mr. Elugu Su resh S/o E. Chandraia h Age: about 47 years Occ: Business, R/o 2-54, Swarnagiri Colony Jodlmetla, Ghatkesar lvledchal Makajgiri Dist.500088.

¶5

Also at: Archana Gra n ites Ghan pur Station warrangal

¶6

...... Defendant.

¶7

Counsel for the Applicant : Ms. Sangeeta Jaiswal. Counsel for Defendant : Mr. V. Sethu l4adhava Rao.

¶8

:: ORDER::

¶9

The Applicant Bank filed the present OA filed u/s 19 of the Recovery of the Debts Due to Banks and Financial Institutions Act, 1993, for recovery of a sum of Rs.8S,Z4,62t/- from the ffi*s

¶10

oa.9612022

¶11

¶12

defendant with future^{interest @1o.4ooloptus 2olo penal interest} p.a. with monthly rests^{frcm 25.01.2022 till the dateof} realisation along with^{costs and saleof OA schedule assets'}

¶13

The averments^{of appllcant bank as per the OA, briefly' are that} defendant^{represented by it Proprietor availedbusinessloan on} 23.0g.2020 for^{establishing aGranite Cutting Unitby} hypothecating^{the machinery purchasedout of theloan} amount.^{Duringthe visit of the bank offlcialsin August'2021'} the it was^{found that the unit was not functioning and} machinery^{was not available. The account was classifiedas NPA} on 17.01.2022,^{followedby legal notice dated 27 07 2022'} Defendant^{has not liquidatedthe outstandingduesHencethis} Application.

¶14

Defendant^{filed written statement. The avermentsof defendant} as^per the written^{statement,in brief, are that applicant bank} got defendant's signatures^{on blankprinted documentsat the} time of sanctioning^{the loan.There is every reason to belleve} that those blank^{documents are made use of to suit applicant's} requirements in the^{OA. The Affidavit/Vakalatnamafiled in the} OA have not been^{attested by the Advocate. The applicant bank} failed to restructure and^{converting lnto FITL as per RBI/} Ministry of Finance^{guidelines.The paymentsmade by the} defendant are not shown^{in the statement of account.It is} incorrect to state that the^{business actlvitieswere closed and} the hypothecated machinery^{were found misslng and contrary} to the information furnished in Para^{3 of the OA DUe to} stoppage of activities during^{Covid.19,the machinery became} scrap as it was lying idle and exposed^{to air and water.The rate} ,AV.o U/^'>''

¶15

¶16

o^.9612022

¶17

of interest charged by the applicant is contrary to the terms of the agreement. With these submissions, defendant prayed for dismissal of OA.

¶18

The Applicant Bank examined T. Gaikwad, Manager of the Applicant, as AW-1 and marked 10 documents through him as Ex. A.1 to Ex. A.10.

¶19

Defendant's right of evidence is forfeited vide docket order dated 03.10.2023.

¶20

Heard learned counsel appearing for the applicant. Learned counsel appearing for the defendant reported that Written Statement filed by him may be treated as arguments. perused the material placed on record.

¶21

According to learned counsel for the applicant the defendant committed default in repayment of loan as per agreed terms. The defendant neither produced any documentary evidence to rebut the OA claim nor chose to cross examine the AW.1 to prove the contentions raised in the written statement. Hence the OA may be allowed on the basis of the recitals in the Exs.A.1 to A.10.

¶22

The point that arises for consideration is:-

¶23

whether the Applicant Bank is entitled for the claim made in the OA against the Defendant and OA schedule propefty? lw*'

¶24

oA.9612022

¶25

¶26

It is an admitted fact^{that defendantavailed loan from the} applicant bank.^{The contentions raised by the defendant in the} written statement are^{validityof affidavit/vakalatnama filed in} the OA, obtaining^{signatures of defendanton blankprinted loan} documents, extending^{the benefit of restructuring of loan as per} RBI guidelines and^{charginghigher rate of interest contrary to} agreed terms.^{Having contendedso, defendantneither} produced any documents in support of^{its contentions nor cross} examined the AW.1^{to substantiateits contentionsover the} validity of documents and^{rate of interest etc. Under such} circumstances, the documents^{relied on by the applicantbank} along wlth the recitals^{mentionedtherein clinches the OA claim} in favour of the applicant bank and^{against the defendant.} Accordingly, I hold that the^{defendant is liable to pay the OA} claim to the applicant^{alongwith interest and coststhereon.}

¶27

In the result, the^present original^{Application No.96/2022is} allowed as under:^-

¶28

i) The defendant is liable to^pay to^the Applicant Bank a sum of Rs.85,24,621l- with future lnterest @10.40olo^p.a. simple^from the date of application till the date of realization;

¶29

ii) the OA claim is secured by way of hypothecation of OA schedule assets and the applicant bank is entitled to proceed against the same for recovery ot its dues,?fu€

¶30

oa.96/2022

¶31

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

¶32

iv) the applicant bank is entitled for the costs.

¶33

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

¶34

Issue Recovery Certificate accordingly.

¶35

Communicate a copy of this order to the parties concerned. (Dictated to the steno, signed and pronounced by me in the open court on this the 22"d day of November, 2023).

¶36

ESHWAR KOTHE) PRESID]NG OFFICER

Canara Bank v. Suresh Associates

Case brief

What is this about?

What did the court decide?

Canara Bank v. Suresh Associates

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Bank of India versus Ranjan Jyoti Goswami

Uco Bank versus MD Abdul Razzak

Kusum Chandrakant Raut versus Icici Home Finance Company Ltd.

Kotak Mahindra Bank Limited versus Om Transport

Idfc First Bank Limited versus Paras Poly N Print & Ors.

Canara Bank versus Anita Gupta and Ors.