Allowed

Union Bank of India v. Sh. Kuldeep

DRT29 Jan 2024OA/1006/2023

Case brief

AI extract

What is this about?

The DRT allowed the bank's application for recovery of an outstanding loan amount of Rs. 25,58,608.61 from the defendant ex-parte. The court exercised discretion to grant uniform simple interest at 7% per annum from the date of filing and directed issuance of a Recovery Certificate.

What did the court decide?

Recovery of Rs. 25,58,608.61 with simple interest @7% p.a. from 06.07.2023; Issuance of Recovery Certificate.

Union Bank of India versus Sh. Kuldeep — Contract and Commercial Disputes | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-2, CHANDIGARH, PRESIDED OVER BY M.M. DHONCHAK

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ORIGINAL APPLICATION NO.1006/2023

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DATE OF INSTITUTION: 06.07.2023

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DATE OF DECISION: 29^th DAY OF JANUARY, 2024

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Union Bank of India, a body corporate and Banking Company, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai 400021 and amongst others a Branch at Sector-11-12, HUDA, Panipat, Haryana, through Sh. Atul Raj, Principal Officer, General Power of Attorney and Branch Manager of the applicant bank

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….. Applicant

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Versus

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Sh. Kuldeep s/o Sh. Ran Singh r/o House No. 565, Madalouda, Kalkha, Panipat, Haryana-132105

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.... Defendant

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Argued by: Sh. Akaant Kumar Mittal, Advocate for the applicant bank (through VC) Defendant ex parte vide order dated 31.08.2023

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19(1) of the Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), against the defendant for recovery of Rs.25,58,608.61/- (Rupees Twenty Five

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Lakh Fifty Eight Thousand Six Hundred Eight and Sixty One Paisa Only). It has been filed through Sh. Atul Raj, Principal Officer, General Power of Attorney and Branch Manager of the

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OA/1006/2023 UNION BANK OF INDIA VS SH KULDEEP 2

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applicant bank stated to be competent to institute the Original Application vide General Power of Attorney dated 19.03.2020 and Gazette Notification dated 04.03.2020, Annexures-A1 and A2 (copy).

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The brief facts of the case of the applicant as per Original Application are that the defendant had approached the applicant bank for grant of KCC Limit of Rs. 16,50,000/- vide common loan application Form dated 06.12.2017 for KCC facility, Annexure-A3 (copy).

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The applicant bank sanctioned aforesaid facility to the defendant vide sanction letter dated 06.12.2017, Annexure-A4 (copy), as per terms and conditions which were duly accepted by the defendant.

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In order to secure the aforementioned credit facility, the defendant executed composite agreement dated 23.10.2017, Annexure-A5 (copy) and demand promissory note dated 06.12.2017, Annexure-A6 (copy).

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The aforesaid loan facility was further secured by creation of mortgage by the defendant in respect of agricultural land measuring 39 Kanal 8 Marla situated in the revenue estate of Kalkha, Tehsil Israna, District Panipat, Haryana, fully detailed in Para Nos. 5(vi) of the Original Application. Declaration dated 04.12.2017 under Section 4(1) of the Haryana Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act, 1973 along with letter dated 04.12.2017 to the Tehsildar, Madlauda, for entry/mutation of the mortgaged property, AnnexureA7 (colly) (copy).

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OA/1006/2023 UNION BANK OF INDIA VS SH KULDEEP 3

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It is further the case of the applicant bank that the loan facility was duly availed of by the defendant but he failed to maintain the financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA. The applicant bank recalled the entire outstanding amount vide legal notice dated 12.04.2023, Annexure-A8 (copy), but to no avail.

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It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.25,58,608.61/- (Rupees Twenty Five Lakh Fifty Eight Thousand Six Hundred Eight and Sixty One Paisa Only), is recoverable against the defendant as per statement of account, duly certified under Bankers’ Books Evidence Act, 1891, Annexure-A9 (copy).

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Since the defendant did not repay the outstanding amount, therefore, the applicant bank preferred the present Original Application for issuance of Recovery Certificate.

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Notice of the Original Application was duly served upon the defendant, but since none appeared on behalf of the defendant, thus, the defendant was proceeded against ex-parte vide order dated 31.08.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Atul Raj, Branch Manager of the applicant bank was filed.

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This Tribunal has heard ex-parte arguments advanced by the learned counsel for the applicant bank and gone through the record carefully.

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OA/1006/2023 UNION BANK OF INDIA VS SH KULDEEP 4

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It was argued by the learned counsel for the applicant bank that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendant for recovery of the amount sought. From perusal of Annexures-A1 to A9 , it is clear that the defendant had approached the applicant bank for availing of the loan facility which was granted to him. It is further clear that the defendant had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendant failed to pay back the loan as per terms and conditions of the agreement executed between the parties. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.25,58,608.61/- (Rupees Twenty Five Lakh Fifty Eight Thousand Six Hundred Eight and Sixty One Paisa Only) from the defendant.

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In so far as pendente lite and future interest is concerned, in relief clause, the applicant bank has not claimed any particular rate of interest. In sanction letter dated 06.12.2017, Annexure-A4 (copy), the rate of interest has been mentioned @10.35% per annum.

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This Tribunal is of the considered opinion that sometimes in appropriate cases the prerogatives of mercy and magnanimity are the brightest jewels in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including the Pandemic Covid-19 affecting businesses, nature of mortgaged property, purpose of loan, i.e. agricultural, present conditions of economy based on agriculture, quantum of loan, prevalent market rates of interest which have gone drastically downhill in yesteryears, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @7% per annum from the date of filing of

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OA/1006/2023 UNION BANK OF INDIA VS SH KULDEEP 5

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the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

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In the result, the Original Application is allowed with costs holding that the defendant is liable to pay to the applicant bank a sum of Rs.25,58,608.61/- (Rupees Twenty Five Lakh Fifty Eight Thousand Six Hundred Eight and Sixty One Paisa Only) with current and future simple interest @7% per annum w.e.f. 06.07.2023 , till the date of realisation of the amount. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of mortgaged/hypothecated property of the defendant in execution proceedings, if not sold earlier under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 or otherwise. If the dues of the bank still remain unsatisfied, the applicant bank shall be at liberty to recover the same by attachment and sale of personal assets of the defendant. However, the applicant bank is at liberty to enforce the claim through due process of law.

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Issue Recovery Certificate accordingly.

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Parties to appear before Recovery Officer concerned on 13.03.2024.

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Copy of this order be sent to the applicant bank and the defendant through registered/speed post. This order be uploaded on the official website of this Tribunal.

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Pronounced in the open Tribunal (M.M. Dhonchak) Presiding Officer DRT-2, Chandigarh

Union Bank of India v. Sh. Kuldeep

Case brief

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Union Bank of India v. Sh. Kuldeep

Case brief

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