Allowed

Idbi Bank Ltd., v. a. Saranya

DRT19 May 2023TA/620/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the application by IDBI Bank Ltd. for recovery of dues. Finding the defendants liable based on unchallenged documentary evidence, the Court directed joint and several recovery of principal and interest, sanctioned cost of proceedings, and authorized issuance of a Recovery Certificate.

What did the court decide?

Recovery of Rs. 43,61,024/- with interest at 8% p.a.; issuance of Recovery Certificate; defendants jointly and severally liable.

Idbi Bank Ltd., versus a. Saranya — Contract and Commercial Disputes | DRT (2023)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 19^th day of May, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.620 of 2022

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(Originally filed before DRT-I Chennai as OA No.448 of 2019 and thereafter transferred to this Tribunal and renumbered as TA No.620 of 2022)

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IDBI Bank Ltd., Pudukottai Branch Represented by its Branch Head No.4085/12 & 4098/2, Palson Building South 4^th Street Pudukottai – 622 002

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…Applicant

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Versus

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A. Saranya

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No.1725, Roja Street Abirami Nagar, Thirukokarnam Pudukkottai – 622 022

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P. Arun Mozhi Maran

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S/o Palanisamy

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No.1725, Roja Street

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Abirami Nagar, Thirukokarnam

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Pudukkottai – 622 022 …Defendants

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Counsel for the Applicant Bank : M/s R. Palani Kumar Ramesh 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 defendants for recovery of an aggregate sum of Rs.43,61,024/-with further interest at the rate of 9.6% per

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annum with monthly rests from the date of the OA till the date of realization in full along with costs of this application and for sale of schedule mentioned properties.

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The subject matter of the case is the “Kissan Credit Card Facility” availed by the defendants from the applicant.

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It is the case of the applicant that the1^st defendant approached the applicant for grant of credit facility for agriculture business and the applicant considering the said request sanctioned Kissan Credit Card Facility (Under the caption of Agri Business Group) for a sum of Rs.44,88,000/- on 24.03.2015. It is also the case of the applicant that the 1^st defendant executed various loan and security documents on 26.03.2015 viz., Hypothecation Agreement, Undertaking and Demand Promissory Note for a sum of Rs.44,88,000/-. It is stated that the 2^nd defendant executed deed of guarantee dated 26.3.2015 thereby guaranteeing due repayment of the credit facility availed by the 1^st defendant.

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It is also the case of the applicant that the 1^st defendant deposited the title deeds of his property, more fully described in the schedule to the OA with the applicant bank with an intention to create equitable mortgage over the same and executed Mortgage deed dated 26.03.2015.

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It is stated that the defendants having availed the credit facility defaulted in repayments and failed to regularize the loan account despite repeated demands and also failed in compliance of the terms and conditions of sanction and therefore the loan account was classified the case a NPA on 26.03.2018. It is also stated that as the defendants did not come forward to clear the outstanding

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dues despite repeated demands, however, executed acknowledgement of debt and security on 31.03.2017 and 26.3.2018.

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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 defendants 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 defendants and the same were returned unserved with endorsement “Left” and hence were served with notice by way of substituted service by causing paper publication. As there was no representation on behalf of the defendants on 23.01.2020 they were called absent and set exparte on that day. Applicant Bank filed Proof Affidavit along with 12 documents, which were marked as Ex. A-1 to A-12 on 08.03.2023.The Ld. Counsel for Applicant Bank made his submissions on 17.04.2023 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-12 along with the proof affidavit. Exhibit A-1 is the Sale Deed dated 26.11.2014 executed by Mr. Kopparasu in favour of A. Saranya registered as Doc. No.1388 of 2014 on the file of SRO, Perungalur. Exhibit A-2 is the Letter of Intent dated 24.03.2015 issued by the applicant and accepted by the defendants. Exhibit A-3 is the Hypothecation Agreement dated 26.03.2015 executed by the 1^st defendant. Exhibit A-4 is the Demand Promissory Note dated 26.03.2015 for a sum of Rs.44,88,000/- executed by 1^st defendant. Exhibit A-5 is the Mortgage deed dated 26.03.2015 executed by the 1^st defendant. Exhibit A-6 is the deed of guarantee dated 26.03.2015 executed by the 2^nd defendant. Exhibit A-7 is the Letter of acknowledgement of debt dated 31.03.2017 executed by the 1^st defendant. Exhibit A-8 is the Letter of acknowledgement of debt dated 26.03.2018 executed by the 1^st defendant. Exhibit A-9 is the statement of account in respect of the loan accounts along with certificates under Bankers’ Book Evidence Act. Exhibit A-10 is the Legal notice dated 12.11.2018 issued by the applicant bank. Exhibit A-11 is the returned cover of the legal notice. Exhibit A-12 is the Authorisation Letter and delegation of powers issued by the applicant bank.

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Exhibit A-1 evidence that the 1^st defendant is the absolute owner of the schedule mentioned property and is empowered to deal with the property. Exhibit A-2 evidences that at the request of the 1^st defendant the applicant bank by Letter of

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Intent dated 24.03.2018 sanctioned Kissan Credit Card facility (Agri Business Group) of Rs.44,88,000/- to the 1^st defendant subject to terms and conditions. Exhibit A-3 to A-5 evidences that the applicant executed various loan and security documents in favour of applicant bank on 26.03.2015. It also evidences that the 1^st defendant had executed mortgage deed thereby mortgaging the schedule mentioned property in favour of applicant. It further evidences that the 2^nd defendant executed agreement of guarantee dated 26.03.2015 thereby guaranteeing due repayment of the credit facility availed by the 1^st defendant. Exhibit A-7 and A-8 evidences that the 1^st defendant executed Letter of Acknowledgements on 31.03.2017 and 26.03.2018. Exhibit A-9, the statement of accounts in respect of the loan account produced and certified under the Banker’s Book Evidence Act, clearly indicates that the amount claimed by the applicant is due from the defendants. It is clear from the statement of accounts that penal interest is not capitalized. Exhibit A-10 and A-11 evidences that the defendant defaulted in repayment and failed to regularize the loan account despite affording sufficient time and repeated reminders and hence the applicant on 12.11.2018 caused a legal notice on the defendant calling upon the defendants to clear the outstanding dues but in vain. Exhibit A-12 evidences that the applicant had authorized the Regional Head of the applicant to institute and defend the case on behalf of applicant.

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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

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Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendants. Point is answered accordingly.

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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 instant loan are availed by the defendants for the agricultural business and also that the applicant had calculated and claimed interest at contractual rates, this Tribunal is of the view that the pendent lite interest can be awarded at reduced rates and therefore proceeds to award interest at the rate of 8% per annum (simple).

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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.620 of 2022stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.43,61,024/- with further interest at the rate of 8% per annum (simple) from the date of filing of the application till date of realization from the defendants jointly and severally, after deducting 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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(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendants are personally liable for all such amounts due.

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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 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 the19^th day of May, 2023)

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

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Idbi Bank Ltd., v. a. Saranya

Case brief

What is this about?

What did the court decide?

Idbi Bank Ltd., v. a. Saranya

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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