Allowed

Idbi Bank v. Mr. v Pakiswaran

DRT16 Feb 2023TA/643/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's application for recovery of dues from an agriculturist who defaulted on agricultural term and crop loans. Confirming the bank's proof of disbursement and liability, the Tribunal awarded the principal amount plus interest and authorized the sale of pledged properties.

What did the court decide?

Recovery certificate issued for Rs. 63,52,090/- plus interest at 9% p.a. from OA filing date; sale of schedule properties authorized; cost of proceedings awarded to applicant.

Idbi Bank versus Mr. v. Pakiswaran — Banking and Recovery | DRT (2023)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 16^th day of February, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.643 of 2022

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(Originally filed before DRT-I Chennai as OA No.222 of 2020 and thereafter

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transferred to this Tribunal and renumbered as TA No.643 of 2022)

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M/s IDBI Bank Limited Represented by its Branch Manager Mr. Manikandan Thanjavur Branch No.7A, Rajappa Nagar Medical College Road, Thanjavur-613 007 …Applicant

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Versus

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Mr. V. Pakiswaran No.3/17A, Sirusaluvar Street Pinnaiyur Post, Orathanadu Taluk Thanjavur – 614 902 …Defendant

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Counsel for the Applicant Bank : S. Parthasarathy Counsel for Defendant : 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 an aggregate sum of Rs.39,49,321/- with interest at the rate of 11.90% per annum with monthly rests plus 2% additional interest for default being the amount due under Agriculture Term Loan Account and a sum of Rs.24,02,769/- with interest at the rate of 10.35% per annum with monthly rests being the amount due under Crop Loan / Kissan Credit Card Loan from the date of filing of the OA till the date

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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 “Agricultural Term Loan” and “Crop Loan / Kissan Credit Card 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 for grant of credit facilities vide application dated 11.1.2016 for the purpose of his agriculture activities and the applicant bank considering the said request sanctioned Agricultural Term Loan of Rs.30 lakhs to the defendant vide its sanction dated 12.01.2016 for the purpose of purchase of 2 Nos. CLASS Crop Tiger Combine Harvester CT 30 TT repayable in 14 half yearly installments with an initial moratorium period of six months. It is also the case of the applicant that the defendant having availed the credit facility executed various loan and security documents viz., Demand Promissory Note for Rs.30 lakhs dated 4.2.2016, Hypothecation cum Loan Agreement dated 12.1.2016.

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It is also the case of the applicant that at the request of the defendant vide his application dated 14.9.2016, the applicant bank vide its sanction dated 14.9.2016 Crop Loan / Kissan Credit Card Loan of Rs.19.75 lakhs and the limit is valid for five year. It is the case of the applicant that the defendant having availed the credit facility executed various loan and security documents viz., Demand Promissory Note dated 6.10.2016 for a sum of Rs.19.75 lakhs and Hypothecation cum Loan Agreement dated 14.9.2016.

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It is the further case of the applicant that the defendant to further secure the credit facilities 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 confirmed the same by executing Memorandum of Deposit of Title deeds dated 12.01.2016 registered as Doc. No.39 of 2016 on the file of SRO, Orathanadu.

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It is the case of the applicant that the defendant having availed the credit facilities defaulted in repayments and failed to regularize the loan account despite repeated demands and also failed to comply with the terms and conditions of sanction and therefore the loan account was classified the case a NPA on 11.01.2018 and 31.03.2018. It is also stated that as the defendant did not come forward to the clear the outstanding dues the applicant issued a demand notice under Section 13(2) of the SARFAESI Act on 29.12.2018 calling upon the defendant to clear the outstanding dues followed by a Possession Notice dated 24.07.2019 under Section 13(4) of the SARFAESI Act. It is stated that despite the above notices as the defendant did not come forward to clear the outstanding dues the applicant issues a legal notice on 29.11.2019 and the same was served on the applicant.

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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. As there was no representation on behalf of the defendant on 02.11.2021 the defendant was set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 16 documents, which were marked as Exhibits A-1 to A-16 on 15.07.2022. The Ld. Counsel for Applicant Bank made his submissions on 20.01.2023 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-16 along with the proof affidavit. Exhibit A-1 is the Application Form dated 11.01.2016 submitted by the applicant. Exhibit A-2 is the Letter of Intent dated 12.01.2016 issued by the applicant bank sanctioning Agricultural Term Loan of Rs.30 lakhs. Exhibit A-3 is the Demand Promissory Note dated 4.2.2016 for a sum of Rs.30 lakhs executed by the defendant. Exhibit A-4 is the Hypothecation cum Loan Agreement dated 12.01.2016 executed by the defendant. Exhibit A-5 is the Hypothecation cum Loan Agreement for a sum of

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Rs.30 lakhs dated 12.01.2016 executed by the defendant. Exhibit A-6 is the Application Form dated 14.9.2016 submitted by the defendant. Exhibit A-7 is the Letter of intent dated 14.9.2016 issued by the applicant bank sanction Crop Loan / Kissan Credit Card Loan of Rs.19.75 lakhs to the defendant. Exhibit A-8 is the Demand Promissory Note date 06.10.2016 for a sum of Rs.19.75 lakhs executed by the defendant. Exhibit A-9 is the Hypothecation cum Loan Agreement dated 14.9.2016 executed by the defendant. Exhibit A-10 is the Demand Notice dated 29.12.2018 issued by the applicant bank under Section 13(2) of the SARFAESI Act. Exhibit A-11 is the Memorandum of deposit of title deeds dated 12.1.2016 executed by the defendant, registered as Doc. No.39 of 2016 on the file of SRO, Orathanadu. Exhibit A-12 is the Settlement Deed dated 25.3.2015 registered as Doc. No.1797 of 2015 on the file of SRO, Orathanadu. Exhibit A-13 is the Sale deed dated 15.05.2014 registered as Doc. No.652 of 2014 on the file of SRO, Orathanadu. Exhibit A-14 is the Legal Notice dated 29.11.2019 issued by the applicant bank. Exhibit A-15 and A-16 are the statement of accounts in respect of Agricultural Term Loan and Crop Loan respectively.

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Exhibit A-1 evidences that the defendant vide his loan application dated 11.1.2016 approached the applicant bank for sanction of Term Loan for purchase of 02 Nos. CLASS Crop Tiger Combine Harvester CT 30 TT. Exhibit A-2 evidences that the applicant vide Letter of Intent dated 12.01.2016 sanctioned Agricultural Term Loan of Rs.30 lakhs to the defendant. Exhibit A-3 to A-5 evidences that the defendant executed various loan documents on 04.02.2016 and 12.01.2016 to secure the credit facility availed by him. Exhibit A-6 evidences

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that the defendant vide application dated 14.9.2016 approached the applicant bank for grant of Crop Loan / Kissan Credit Card Loan . Exhibit A-7 evidences that considering the request of the defendant, the applicant vide Letter of intent dated 14.9.2016 sanctioned Crop Loan of Rs.19.75 lakhs to the defendant. Exhibit A-8 evidences that the applicant executed Demand Promissory Note for a sum of Rs.19.75 lakhs on 6.10.2016. Exhibit A-9 evidences that the defendant executed Hypothecation cum Loan Agreement on 14.9.2016 in favour of the applicant. Exhibit A-10 evidences that the defendant defaulted in repayments and hence the applicant sanctioned the loan account as NPA and the applicant bank invoked the provisions of the SARFAESI Act and issued the demand notice under Section 13(2) of the SARFAESI Act on 29.12.2018. Exhibit A-11 to A-13 evidences that the defendant is the absolute owner of the schedule mentioned properties and he deposited the title deeds of the properties with the applicant and created equitable mortgage over the same by executing Memorandum of Deposit of Title deeds dated 12.01.2016 registered as Doc. No.39/2016. Exhibit A-14 evidences that as the defendant did not come forward to regularize the loan accounts, the applicant issued the legal notice on 29.11.2019 calling upon the defendant to clear the outstanding dues. Exhibit A-15 and A-16, the statement of accounts in respect of the loan accounts 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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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 availed by the defendant being agricultural loan and the interest rates have come down and the borrowing is for agricultural facility, this Tribunal is of the view that the pendent lite and future interest be awarded at the rate 9% 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.643 of 2022 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.63,52,090/- with further interest at the rate of 9% per annum (simple) from the defendant from the date of filing of the OA till date of realization, after deducting all the amounts received by them during the pendency of OA, and also by selling schedule mentioned properties and the 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.

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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 16^th day of February, 2023)

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

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Idbi Bank v. Mr. v Pakiswaran

Case brief

What is this about?

What did the court decide?

Idbi Bank v. Mr. v Pakiswaran

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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Case details

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