Allowed

M/s. Bank of Baroda, v. Mrs. B. Pushpa

DRT30 Oct 2023TA/930/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the application filed under the RDB Act for issuance of a Recovery Certificate. The court recognized the debt but, due to the home loan nature and interest clause, awarded a reduced interest rate of 10% simple instead of penal interest.

What did the court decide?

Issuance of a recovery certificate for Rs.10,98,791/- plus future simple interest at 10% p.a.; rejection of claim for penal interest and interest with monthly rest.

M/s. Bank of Baroda, versus Mrs. B. Pushpa — 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 October, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.930 of 2023

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(Originally filed before DRT-III Chennai as OA No.400 of 2018 and thereafter transferred to DRT-I Chennai and renumbered as TA No.496/2018 and thereafter transferred to this Tribunal and renumbered as TA No.930 of

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M/s. Bank of Baroda, (formerly Vijaya Bank) No.44, Ramanaickenpet Village & Post, Ambalur Via, Vaniyambadi Taluk, Vellore Dist – 635 801

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…Applicant

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Versus

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Mrs. B. Pushpa, W/o. B. Venkatagiri, No.3/63B, Natahamedu, Ramanaickenpet Village & Post, Vanaiyambadi, Vellore – 635 801

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Mr. B. Venkatagiri, S/o. N. Balakrishnan, No.3/63B, Natahamedu, Ramanaickenpet Village & Post, Vanaiyambadi, Vellore – 635 801

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Mr. R. D. Dakshinamoorthy, S/o. R.A. Dhanapal, No.310/9C, Ramanaickenpet Village & Post, Vanaiyambadi, Vellore – 635 801 …Defendants

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Counsel for the Applicant Bank : M/s. G. Venkataramani Counsel for Defendants : Ex-parte

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FINAL ORDER

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This Original Application herein after been referred as OA is filed under section 19(1) of Recovery of Debts and Bankruptcy Act 1983, seeking issuance of a Recovery Certificate for Rs.10,98,791/- with future annual interest from the date of filing of the OA.

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The defendants had approached the east while Vijaya Bank and got disbursed a housing loan for construction of a house. In lieu of the disbursement of loan amount of 7,00,000/- the defendant 1 and 2 had executed agreements obliging themselves to pay back the amount borrowed with interest @11.5% per annum with monthly rest in 228 monthly installments of Rs.6630/- each and also for payment of penal interest @ 2% in case of default. The 3^rd defendant had executed letter of guarantee. It is also contended that apart from execution of loan documents, the 1^st defendant had created an Equitable Mortgage over the schedule properties by deposit of title deeds.

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It is the further case of the applicant that the defendant failed to pay back the amount and hence the applicant had issued a lawyer notice dated 25.10.2017 calling upon to pay the entire outstanding. It is also stated that even after the issuance of lawyer notice, no sincere effort was made by the defendant to repay the amount and hence the applicant is constrained to file this OA with the above prayers.

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Summons was taken out though paper publication and despite the same, there was no representation the defendants were called absent and set exparte on 05.03.2020. There after this OA stands transferred to this Tribunal and got renumbered as above. The earst while Vijaya Bank got amalgamated with applicant and applicant got substituted in place of earst while Vijaya Bank.

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The applicant had let in evidence through Aw1 who filed proof affidavit in conformity with the pleading of the OA. The applicant had also produced Ext.A1 to A18.

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Heard the Ld. Counsel for the applicant and considered the pleadings and evidence. The only issue that arise for consideration is whether the applicant had proved the OA claim.

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The only evidence availed in this matter is the exparte evidence adduced by the applicant through Aw1 and the documents produced as Ext.A1 to A18. The availment of credit facility and the agreed terms of lending are proved by Ext.A2 to A6. The letter of guarantee produced as Ext.A7 evidences the obligation of the 3^rd defendant to repay the facility as a guarantor. Ext.A7 demand promissory note, ExtA9 and A10; acknowledgments of liability are all in conformity with the pleadings of the applicant. Ext.A13, the memorandum of deposit of title deeds and Ext.A11 document deposited by the 1^st defendant evidences the creation of mortgage. Ext.A14 evidences that the applicant demanded repayment of the facility. ExtA15 evidences the defendant and the extent of liability. Ext.A15 along with declaration as to non-inclusion of charges and non-capitalization evidences that the penal interest is not capitalized.

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In view of above discussion it is to be held that the applicant had successfully proved the OA claim and is entitled to get a Recovery Certificate allowing recovery of the amount due in the account along with the future and pentalite interest. However as the credit facility is home loan and the applicant had

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levied and claimed interest at agreed rate, the applicant is to be awarded a reduced interest rate.

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In the result

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i) TA.930 of 2023 stands allowed.

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ii) The applicant is permitted to recover Rs.10,98,791/- with penal and future interest @10% (simple) from the date of filing of the OA. The prayer to penal interest and for claiming interest with monthly rest all rejected.

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iii) The amounts if any received or recovered during the pendency of OA is to give credit to.

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iv) The amount as allowed to be recovered above have to be realized by proceeding against and selling the schedule properties and if the entire amount could not be recovered by proceeding against schedule properties, the defendants are personally liable for the above amount.

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v) A recovery certificate to be drawn in terms of above and issued to the Recovery officer to recover the amount.

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vi) Applicant is also allowed cost of the proceedings for which a cost memo is to be filed in 7 days from the date of receipt of the 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 October, 2023)

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

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M/s. Bank of Baroda, v. Mrs. B. Pushpa

Case brief

What is this about?

What did the court decide?

M/s. Bank of Baroda, v. Mrs. B. Pushpa

Case brief

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What did the court decide?

What the court decided

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