Allowed

M/s Deutsche Bank Ag v. M/s Sarveswaran Container Carriers

DRT30 Mar 2023TA/118/2022

Case brief

AI extract

What is this about?

The Tribunal allowed an application under Section 19(1) of the RDB Act filed by a bank to recover a defaulting business loan principal and interest from the borrower, who was held personally liable.

What did the court decide?

Applicant permitted to realize Rs. 23,13,192.11 plus interest at 12.75% p.a. and costs. Defendant held personally liable. Recovery Certificate to be issued.

M/s Deutsche Bank Ag versus M/s Sarveswaran… — Contract and Commercial Disputes | DRT (2023)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 30^th day of March, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.118 of 2022

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(Originally filed before DRT-I, Chennai as OA No.446 of 2018 and thereafter transferred

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to this Tribunal and renumbered as TA No.118 of 2022)

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M/s Deutsche Bank AG 4-4A, Western Tower Sunny Side, Ground Floor Shafi Mohammed Road Thousand Lights, Chennai – 600 006 Represented by its Authorised Representative Mr. S. Thajudeen …Applicant

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Versus

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M/s Sarveswaran Container Carriers Represented by its Proprietor P. Kumar Having Business at No.11/6, BC Press Road Royapuram, Chennai – 600 013 Residing at 12A, SBOA Teacher Nagar Vinayagapuram Chennai – 600 099 …Defendant

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Counsel for the Applicant Bank : M/s Sai Krishnan Associates Counsel for Defendants : Ex-parte

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FINAL ORDER

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This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendant for recovery of a sum of Rs.23,13,192.11pwith further interest @12.75% per annum with monthly rests

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from the date of filing of the OA till the date of realization in full along with costs of this application.

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The subject matter of the case is the Business Installment Loan availed by the defendant from the applicant bank.

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It is the case of the applicant that the defendant approached the applicant bank vide Loan Application Form dated 8.3.2017 for grant of credit facility and considering the said request the applicant vide Loan Agreement dated 16.03.2017 granted Business Loan of Rs.30,00,000/- under Loan Account No.250024742640028 repayable in 36 equated monthly installments of Rss1,00,721/- each commencing from 5.4.2017 till 5.3.2020. It is also the case of the applicant that the defendant executed personal guarantee dated 16.3.2017 in favour of applicant bank to secure the said facility.

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It is the case of the applicant that the defendant having availed the credit facility defaulted in repayments and failed to regularize the loan account despite repeated demands the applicant terminated / recalled the said loan facility vide its notice dated 23.8.2018 thereby calling upon the defendant to pay a sum of Rs.22,76,323.32p, which notice also returned back with endorsement “Refused”.

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It is the case of the applicant that after availing the loan, the defendant was irregular in remitting the loan amount. The efforts of the applicant bank to make the defendant to settle the loan did not yield any result, and hence the applicant approached this Tribunal seeking issuance of a Recovery Certificate allowing recovery of the amount due in the account.

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Summons were taken out to the defendant and the same was served at the first address and returned with endorsement “Unclaimed” in respect of the 2^nd Address and therefore the service was held sufficient. As there was no representation on behalf of the defendant on 7.3.2019, the defendant was called absent and set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 10 documents, which were marked as Ex. A-1 to A-10on 16.02.2023. The Ld. Counsel for Applicant Bank made his submissions on 09.03.2023 and thereafter the matter stood till this date for passing final orders.

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The following issues arise for consideration in the matter: -

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(a) Whether the applicant had succeeded in proving the liability of the defendant?

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(b) What order as to cost of the proceedings need be passed?

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These issues are considered together.

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Heard the Ld. Counsel for the applicant, perused the OA averments and the record placed before the Tribunal.

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The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-10 along with the proof affidavit. Exhibit A-1 is the Certificate of Place of Establishment of place of business in India. Exhibit A-2 is the Licence No.BOM-41 dated 5.4.1998 issued by Reserve Bank of India. Exhibit A-3 is the Power of Attorney dated 22.2.2018 issued by the applicant bank authorizing the Authorised Signatory to institute and defend the case for and on behalf of the

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applicant. Exhibit A-4 is the Loan Application form dated 8.3.2017 submitted by the defendant. Exhibit A-5 is the Loan Agreement dated 16.3.2017 executed by the defendant. Exhibit A-6 is the personal guarantee executed by the defendant on 16.3.2017. Exhibit A-7 is the Legal notice dated 23.8.2018 issued by the applicant bank. Exhibit A-8 is the Returned cover of the legal notice sent to the defendant at the Royapuram address. Exhibit A-9 is the returned cover of the legal notice sent to the defendant at Kolathur address. Exhibit A-10 is the statement of accounts in respect of the loan account along with certificates under Bankers’ Book Evidence Act.

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Exhibit A-1 to A-3 evidences that the applicant bank is a banking company incorporated and existing under the laws of Federal Republic of Germany and has been authorized to carry banking business in India by Reserve Bank of India. It also evidences that the Authorised Signatory has been empowered to institute and defend the case on behalf of the applicant bank. Exhibit A-4 to A-6 evidences that at the request of the defendant vide loan application dated 8.3.2017, the applicant sanctioned Business Installment Loan of Rs.30,00,000/to the defendant vide Loan Agreement dated 16.3.2017 and the defendant executed necessary loan document and personal guarantee to secure the said facility. Exhibit A-7 to A-9 evidences that the defendant having availed the credit facility defaulted in repayment and hence the applicant by its legal notice dated 23.8.2018 recalled the said facility and the said notice returned unserved with endorsement “Refused”. Exhibit A-10, the statement of accounts in respect of the loan accounts produced and certified under the Banker’s Book Evidence Act,

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clearly indicates that the amount claimed by the applicant is due from the defendant. It is clear from the statement of accounts that penal interest is not capitalized.

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The proof affidavit of the applicant bank remained unchallenged and unrebutted. Therefore, on careful consideration of proof affidavit along with Exhibits filed on behalf of the applicant bank, besides the material placed before the Tribunal, the Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendant. Point is answered accordingly.

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In view of the fact that the loan facility availed by the defendant is for its business and despite repeated requests the defendants have not come forward to clear the dues, this Tribunal is not inclined to interfere with the interest rate claimed by the applicant,

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In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, OA is disposed off in the following manner: -

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(a) TA No.118 of 2022 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.23,13,192.11p with further interest at the rate of 12.75% per annum with monthly rests from the date of filing of the OA till date of realization from the defendant, after deducting

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all the amounts received by them during the pendency of OA, and also by selling the other assets of the defendants.

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(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 7 days from the date of receipt of the copy of the order.

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(e) The Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of this final order.

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Communicate a copy of the order to the parties concerned in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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(Dictated to PS, transcribed by him, corrected, signed and pronounced by me in Open Court on this the 30^th day of March, 2023)

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Sd/(T. RAJESH ) PRESIDING OFFICER DRT-II, CHENNAI

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M/s Deutsche Bank Ag v. M/s Sarveswaran Container Carriers

Case brief

What is this about?

What did the court decide?

M/s Deutsche Bank Ag v. M/s Sarveswaran Container Carriers

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

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