Allowed

Federal Bank v. R Vigneshwaran

DRT28 Dec 2023TA/158/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an applicant bank's application for recovery of a defaulted vehicle loan. The court rejected the prayer for compound interest, directing recovery of principal with simple interest instead, due to a reduction in rates.

What did the court decide?

Permitted realization of Rs.27,11,798.13plus interest at 9% simple per annum from filing date and costs.

Federal Bank versus R Vigneshwaran — Contract and Commercial Disputes | DRT (2023)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 28^th day of December, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.158 of 2022

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(Originally filed before DRT-I Chennai as OA No.39 of 2022 and thereafter transferred to this Tribunal and renumbered as TA No.158 of 2022)

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The Federal Bank Ltd., No.10, Rajammal Nagar Salem Main Road, Kallakurichi Villupuram District – 606 202 Rep. by its Associate Vice President and Branch Head …Applicant

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Versus

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Mr. Vigneshwaran S/o Mr. Rajendran. S No.57, Chennai Main Road Neelamangalam P.O. Kallakurichi Taluk Villupuram District – 606 202

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Mr. Rajendran S. S/o Mr. Subramanian No.57, Chennai Main Road Neelamangalam P.O. Kallakurichi Taluk Villupuram District – 606 202

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Mrs. Ambika. R W/o Rajendran No.57, Chennai Main Road Neelamangalam P.O. Kallakurichi Taluk Villupuram District – 606 202 …Defendants Counsel for the Applicant Bank : M/s P.V. Murlidhar 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 defendants for recovery of a sum of Rs.27,11,798.13p together with interest at the rate of 9.25% per annum with monthly rests, from the date of filing of the application till the date of realization in full along with costs of this application.

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The above Original Application is filed before DRT-I Chennai and stood transferred to this Tribunal and renumbered as above.

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The case of the applicant can be encapsulated as follows: -

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The defendants approached the applicant by submitting Loan Application dated 02.06.2017 for grant of Agri Mobile Loan of Rs.20 lakhs for purchasing Toyota Fortuner Model 2.81 (4x2) and considering the said request the applicant vide sanction letter dated 2.6.2017 sanctioned a sum of Rs.20 lakhs to the defendants. The defendants executed necessary loan and security documents on 02.06.2017. The defendants hypothecated the Brand New Toyota Fortuner bearing Registration No. TN-15 S-2277 more fully described in the schedule to the application.

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It is further stated that even though the defendants had obliged to repay the amount promptly and regularly, they failed to do so resulting in default in repayment and hence the loan account was classified as NPA on 30.03.2021.

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It is contended by the applicant that the applicant’s officials had on many occasions approached the defendants requesting them to regularize the account and despite the same, no effort was made by the defendants to get the account regularized or to pay back the amount.

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It is also the case of the applicant that despite repeated reminders and requests the defendant failed to make the repayment forcing the applicant to file this OA seeking recovery of the amount due in the account with further interest and costs.

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The defendants remained absent and hence were called absent and set ex-parte on 24.01.2023. Even though an application is filed IA No.885 of 2023 seeking a prayer to set aside the ex-parte order, the same was not prosecuted.

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The applicant had let in evidence through AW-1, who had sworn to a Proof Affidavit in terms of the pleading in the OA and also produced Exhibits A-1 to A-9 and got the same marked in evidence.

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Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

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The following issues arise for consideration in this matter: -

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(i) Whether the applicant had succeeded in proving the OA claim as against the defendants?

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(ii) What orders are to be passed?

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Both these issues are gone into and decided together.

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The case put forth by the applicant in the Application remains unrebutted as defendants remained ex-parte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible. From the statement of accounts as produced by the applicant, it is evident that the amount as claimed in the OA is outstanding in the account, which the applicant is entitled to get recovered from the defendants and their assets. The claim of the applicant is well within the period of limitation and there is no capitalization of penal interest.

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In view of the fact that the subject loan is vehicle loan availed by the defendants and the applicant has claimed interest at contractual rates till the time of filing of the application and the interest rates have also considerably come down, this Tribunal is inclined to reject the prayer of the applicant for award of interest with monthly rests and award the pendent lite and future interest at simple and reduced rates.

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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 and the defaults committed by the defendants, which the applicant is entitled to realize. Hence, TA is disposed off in the following manner: -

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(a) TA No.158 of 2022 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.27,11,798.13p together with interest at the rate of 9% simple per annum from the defendants jointly and severally from the date of filing of the application till the date of realization in full along with costs of this application and for sale of the hypotheca and 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 15 days from the date of receipt 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 28^th day of December, 2023)

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

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Federal Bank v. R Vigneshwaran

Case brief

What is this about?

What did the court decide?

Federal Bank v. R Vigneshwaran

Case brief

What is this about?

What did the court decide?

What the court decided

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