Allowed

Central Bank of India v. Mr. v Rajendran

DRT22 Sept 2023TA/425/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an application by a bank under Section 19(1) of the RDB Act to recover an agricultural loan of Rs. 35,65,644/- from the defendant. The court rejected the claim for penal interest and awarded pendente lite interest at 9% p.a. allowing recovery via sale of properties or personal liability.

What did the court decide?

Recovery of sum of Rs.35,65,644/- along with interest at 9% p.a. and costs, realisable from personal assets or sale of schedule properties.

Central Bank of India versus Mr. v. Rajendran — Contract and Commercial Disputes | DRT (2023)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 22^nd day of September, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.425 of 2023

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(Originally filed before DRT-I Chennai as OA No.85 of 2019 and thereafter transferred to this Tribunal and renumbered as TA No.425 of 2023)

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Central Bank of India Marmad Markanam Branch Rep. by its Branch Manager Marakanam, Tindivanam Taluk Villupuram District – 604 303

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Now represented by its Chief Manager Asset Recovery Branch Central Bank of India No.48/49, Montieth Road Egmore, Chennai – 600 008 …Applicant

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Versus

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Mr. V. Rajendran S/o Veerasamy Gounder No.27, Mariammankoil Street Vellore Village, Soonambedu Cheyyur Taluk, Kancheepuram District …Defendant

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Counsel for the Applicant Bank : Mr. C. Ramaiah 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 seeking issuance of a Recovery Certificate for recovery of a sum of Rs.35,65,644/- together with interest at the rate of 14% per annum with half yearly rests from the date of filing of the OA till the date of realisation along with costs of the application and for sale of schedule properties.

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The subject matter of the case is the Agricultural Loans availed by the defendants from the Applicant Bank.

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It is the case of the applicant that the defendant approached the applicant by Loan Application dated 29.11.2008 for grant of Term Loan for purchase of tractor / trailers and paddy harvester and the applicant considering the said request sanctioned Loan of Rs.14,70,000/- to the defendants vide sanction dated 29.11.2008 and the defendants executed various loan and security documents on 02.12.2008.

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It is also the case of the applicant that the defendants deposited the title deeds of the properties more fully described in Schedule to the OA with an intention to create equitable mortgage over the same and executed Memorandum of Deposit of Title deeds dated 01.12.2008 registered as Doc. No.4195 of 2009, SRO, Marakanam. It is stated that at the request of the defendants the said loan was rescheduled on 04.03.2015.

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It is also the case of the applicant that the defendants violated the terms and conditions of sanction and committed default in repayments and failed to regularize the loan accounts despite repeated request and hence the loan account was classified as NPA on 23.05.2015.

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It is the case of the applicant that after availing the loan, the defendants were 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 taken out to the defendants were served. As there was no representation on behalf of the defendants on 06.05.2019, the defendants were called absent and set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 16 documents, which were marked as Ex. A-1 to A-16 on 08.06.2023, however, exhibits A-8, A-9 and A-15 are marked subject to proof. The Ld. Counsel for Applicant Bank made his submissions on 09.08.2023 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 defendants?

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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-16 along with the proof affidavit. The documents produced in evidence are all found admissible. 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. Further, the statement of accounts in respect of the loan account

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produced and certified under the Banker’s Book Evidence Act, 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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In view of the foregoing, it is clearly evident that the application filed by the applicant bank is well within the period of limitation and this Tribunal possesses the territorial and pecuniary jurisdiction to entertain this OA.

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In view of the fact that the loan facility availed by the defendant is agricultural loan and the applicant has claimed interest at contractual rate till the date of filing of the OA, this Tribunal is of the view that the pendente lite interest can be awarded at reduced rates and prayer for grant of penal interest is rejected.

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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.425 of 2023 stands allowed.

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(b) Applicant is permitted to realize an aggregate sum of Rs.35,65,644/from the defendant together with interest at the rate of 9% per annum (simple), from the date of filing of OA till date of realization after deducting all the amounts received by them during the pendency of OA, and also by selling the schedule properties and other assets of the defendant.

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(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendant is personally liable for all such amounts due as ordered above.

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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 22^nd day of September, 2023)

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

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Central Bank of India v. Mr. v Rajendran

Case brief

What is this about?

What did the court decide?

Central Bank of India v. Mr. v Rajendran

Case brief

What is this about?

What did the court decide?

What the court decided

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