Allowed

Union Bank of India v. Sh. Ravi Kumar

DRT18 Jan 2024OA/1018/2023

Case brief

AI extract

What is this about?

DRT Chandigarh allowed an Original Application by Union Bank of India for recovery of Rs.22.94 lakh plus 7% simple interest against two defendants, one of whom was a guarantor, based on unrebutted documentary evidence of a loan facility and mortgage.

What did the court decide?

Recovery of Rs.22,94,676.65 along with simple interest @7% p.a. w.e.f. 06.07.2023 and issuance of Recovery Certificate.

Union Bank of India versus Sh. Ravi Kumar — Banking and Recovery | DRT (2024)

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

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ORIGINAL APPLICATION NO.1018/2023

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DATE OF INSTITUTION: 06.07.2023

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DATE OF DECISION: 18^th DAY OF JANUARY, 2024

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Union Bank of India (erstwhile known as Andhra Bank), a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at 239, Vidhan Sabha Marg, Nariman Point, Mumbai, having its Branches all over India amongst other places at SCO 12, HUDA, Sector 12, Panipat, Haryana-132103, through Shri Atul Raj S/o Shri Awadhesh Kumar Sinha, its constituted Attorney and Principal Officer

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…..Applicant

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Versus

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Sh. Ravi Kumar s/o Sh. Rajesh Kumar VPO Jondhan-Kalan, Israna, Panipat, Haryana, Voter ID XYY0714071, Mobile 9996992069

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Sh. Shamsher s/o Sh. Bhala Ram r/o VPO Jondhan-Kalan, Israna, Panipat, Haryana

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....Defendants

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Argued by: Sh. Akaant Kumar Mittal counsel for the applicant Bank (through VC) Defendants ex parte vide order dated 02.09.2023

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FINAL ORDER

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Present Original Application was instituted by the applicant

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bank under Section 19(1) of the Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), against the defendants for recovery of Rs.22,94,676.65/- (Rupees

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Twenty Two Lakh Ninety Four Thousand Six Hundred Seventy

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OA/1018/2023 UNION BANK OF INDIA VS SH. RAVI KUMAR AND ANOTHER 2

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Six and Sixty Five Paisa Only) . It has been filed through Shri Atul Raj, constituted Attorney and Principal Officer of the applicant bank stated to be competent to institute the Original Application vide General Power of Attorney dated 19.03.2020, Annexure-A1 (copy).

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The brief facts of the case of the applicant as per Original Application are that defendant No.1 had approached the applicant bank for grant of KCC Facility of Rs. 15 lakh vide loan application dated 16.06.2017, Annexure-A3 (copy). Defendant No.2 stood as a guarantor for repayment of the loan amount.

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The applicant bank sanctioned aforesaid facility to the defendants vide sanction letter dated 03.07.2017, Annexure-A4 (copy), as per terms and conditions which were duly accepted by the defendants.

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In order to secure the aforementioned credit facility, the defendants executed demand promissory note dated 03.07.2017, Annexure-A5 (copy), composite agreement dated 03.07.2017, Annexure-A6 (copy) and undertaking dated 03.07.2017 regarding repayment of loan amount with interest, Annexure-A8 (copy).

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The aforesaid loan facility was further secured by creation of mortgage by defendant No. 1 in respect of agricultural land measuring 40 Kanal 9 Marla situated in the revenue estate of Jondhan-Kalan, Tehsil Israna, District Panipat, Haryana, fully detailed in para No. 5(vi) of the Original Application. Declaration dated 23.06.2017 under Section 4(1) of the Haryana Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act, 1973, is Annexure-A7 (copy).

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It is further the case of the applicant bank that the loan facility was duly availed of by the defendants but they failed to maintain the

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OA/1018/2023 UNION BANK OF INDIA VS SH. RAVI KUMAR AND ANOTHER 3

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financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA on 28.09.2021. The applicant bank recalled entire outstanding amount vide legal notice dated 12.04.2023, Annexure-A9 (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.22,94,676.65/- (Rupees Twenty Two Lakh Ninety Four Thousand Six Hundred Seventy Six and Sixty Five Paisa Only) , is recoverable against the defendants as per statement of account, duly certified under Bankers’ Books Evidence Act, 1891, Annexure-A10 (copy).

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

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Notices of the Original Application were duly served upon the defendants, but since none appeared on behalf of the defendants, thus, the defendants were proceeded against ex parte vide order dated 02.09.2023 .

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

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

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It was argued by the learned counsel that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendants for recovery of the amount sought. From perusal of Annexures-A1 to A10 , it is clear that the defendants had approached the applicant bank for availing of the loan facility which was granted to them. It is further clear that the

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OA/1018/2023 UNION BANK OF INDIA VS SH. RAVI KUMAR AND ANOTHER 4

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defendants had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendants 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.22,94,676.65/- (Rupees Twenty Two Lakh Ninety Four Thousand Six Hundred Seventy Six and Sixty Five Paisa Only) from the defendants.

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In so far as pendente lite and future interest is concerned, the applicant bank in relief clause, has claimed rate of interest @11.30% per annum. In sanction letter dated 03.07.2017, Annexure-A4 (copy), the rate of interest has been mentioned @10.45% 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 the mortgaged property, purpose of loan, i.e. agricultural , present conditions of economy based on agriculture, quantum of loan and 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 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 defendants are liable to pay to the applicant bank a sum of Rs.22,94,676.65/- (Rupees Twenty Two Lakh Ninety Four Thousand Six Hundred Seventy Six and Sixty Five Paisa Only)

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OA/1018/2023 UNION BANK OF INDIA VS SH. RAVI KUMAR AND ANOTHER 5

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with current and future simple interest @7% per annum w.e.f. 06.07.2023 , till the date of realisation of the amount. The liability of the defendants shall be joint as well as several. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of mortgaged/hypothecated property of the defendants 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 defendants. 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 06.03.2024.

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Copy of this order be sent to the applicant bank and the defendants 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. Ravi Kumar

Case brief

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Union Bank of India v. Sh. Ravi Kumar

Case brief

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