Allowed

State Bank of Indore v. Prime Corporation

DRT18 Jun 2024OA/1029/2022

Case brief

AI extract

What is this about?

In an ex-parte recovery application, the Tribunal allowed the claim for a sum of ₹2.69 crore reduced from the claimed amount after deducting resolution agent fees. The court awarded future interest at 9% per annum and directed the issuance of a recovery certificate secured by an equitable mortgage on industrial property.

What did the court decide?

Recovery of Rs.2,69,68,593/- with interest at 9% p.a.; entitlement to sell mortgaged property; issuance of Recovery Certificate.

State Bank of Indore versus Prime Corporation — Execution and Attachment | DRT (2024)

¶1

Presented on: 22.07.2022 Registered on: 11.11.2022 Decided on: 18.06.2024 Duration: Y M D 1 10 26

¶2

IN THE DEBTS RECOVERY TRIBUNAL AT PUNE (Before Shri Dilip G. Murumkar, Presiding Officer) ORIGINAL APPLICATION No.1029/2022.

¶3

State Bank of India ,

¶4

A Banking Company constituted under the State Bank of India Act, 1955 and having its Corporate Office at State Bank Bhavan, Nariman Point, Madam Cama Road, Mumbai 400 021 and its branch at State Bank of India, Commercial Branch, Office No.101 & 102, First Floor, Next Gen Avenue, Bahiratwadi, Behind ICC Trade Tower, Off. Senapati Bapat Road, Pune-411 006.

¶5

… Applicant

¶6

Versus

¶7

M/s Prime Corporation ,

¶8

A Partnership Firm, Ashthavinayak Apartment, Bhabhulsar Road, Karegaon, Taluka Shirur, District Pune-412 209.

¶9

2. Mr. Machhindra Yashwant Pachange 133, Pachange Vasti, Dhok Sangavi, Nimgaon Bhogi, Shirur, Pune-412 220.

(OA No.1029/2022)

Page 1 of 7

[ANIL]

3. Mr. Laxman Kisan Walke Walke Wasti, Babhulsar Khurd, Karegaon, Pune-412 220.

¶14

…Defendants

¶15

APPEARANCES

¶16

For the Applicant For the Defendant

¶17

Advocate Sudha Koloti Ex parte

¶18

TOTAL CLAIM AMOUNT –Rs.2,70,00,362/JUDGMENT (Delivered on 18^th June, 2024)

¶19

The Applicant Bank has filed present application for recovery of Rs.2,70,00,362/- on account of Cash Credit Account No.39735445696 inclusive of interest till 21.07.2022 together with future interest @13.30% per annum with monthly rests from 21.07.2022 till repayment/realization of the entire dues from the defendants.

¶20

Brief facts of the application are as under:

¶21

The Applicant Bank states that the Defendant No.1 is a

¶22

Partnership Firm and defendant No.2 and 3 are the Partners of Defendant No.1 Firm. Defendant No.2 and 3 the partners of Defendant No.1 stood Guarantors to the credit facilities granted by the Applicant Bank to defendant No.1.

¶23

Defendant No.1 through defendant No.2 and 3 approached Applicant Bank with application dated

(OA No.1029/2022)

Page 2 of 7

[ANIL]

08.09.2020 requesting for Business Loan Credit Facility for Cash Credit Loan for an amount of Rs.2,50,00,000/-.

¶28

The Applicant Bank considered the request of Defendant No.1 and sanctioned the Business Loan (Cash Credit) for an amount of Rs.2,50,00,000/- vide Letter of Arrangement dated 15.10.2020.

¶29

In order to secure the aforesaid Cash Credit Loan facilities, defendant No.1 through defendant No.2 and 3 executed all the loan and security documents in the capacity of Borrower and Guarantors as set out in Para No.5.7 of the Original Application in favour of the Applicant Bank.

¶30

In addition to this, defendants executed Equitable Mortgage for securing the repayment under the Cash Credit Loan Facility of Rs.2,50,00,000/- of the immovable property of the land i.e. all the piece and parcel of Industrial Plot at Gat No.409 (part), 411 (part), 412 (part), Near MSEDCL, Sub Station and Ranjangaon MIDC area at PO Dhoksangavi, admeasuring total area 10200 Sq. Mtrs. within Taluka Shirur, District Pune, more particularly mentioned in Para No.5.6 (d) of the Original Application.

(OA No.1029/2022)

Page 3 of 7

[ANIL]

Defendants executed an agreement of Loan-cumHypothecation dated 15.10.2020 and executed first charge of stock of RM, SIP and FG, Receivables and Book debts and other current assets of the defendant No.1, in favour of the Applicant Bank, as set out in Para No.5.8 of the Application.

¶35

The Applicant Bank contended that the defendants committed defaults in payment of installments and failed to regularize the Cash Credit Account No.39735445696. Hence, on 31.01.2022, the Applicant Bank has classified the account of the defendant No.1 as Non-Performing Asset in accordance with the guidelines of Reserve Bank of India. Therefore, on 30.06.2022 the Applicant Bank sent a Legal Notice to the defendant, through its advocate. Despite Service of notice, the defendants failed and neglected to pay the outstanding dues of the Applicant Bank.

¶36

Hence, this application is filed.

¶37

The defendants failed to appear despite service of summons. Hence, the application proceeded ex-parte as per order dated 13.02.2024 passed below Application (Exhibit-1).

(OA No.1029/2022)

Page 4 of 7

[ANIL]

The Applicant Bank has filed Claim Affidavit (Exhibit-6) of Mr. Sameer Borvandkar, Chief Manager, and has produced on record the Original Loan Transaction documents at Sr. Nos.AW-1 to AW-1-21 alongwith list (Exhibit 7), which corroborates the case of the Applicant Bank.

¶42

I have heard arguments of the learned Advocate for the Applicant Bank.

¶43

Since the defendants failed to appear and contest the application, I find no reason to disbelieve the evidence of the Applicant Bank. Therefore, the Applicant Bank is entitled for the reliefs claimed.

¶44

The applicant bank has claimed relief in respect of hypothecated assets. However, there is no detailed description with respect to the hypothecated assets. Therefore, the relief in terms of hypothecated assets cannot be granted.

¶45

The applicant Bank has claimed expenses incurred towards Search Report of Mortgaged Property, Paper Publication and Resolution Agent Fees of Rs.31,769/-, which cannot be granted and the same is required to be deducted from the total claim amount. Therefore, the total claim amount of

(OA No.1029/2022)

Page 5 of 7

[ANIL]

Rs.2,70,00,362/- is reduced to Rs.2,69,68,593/-. Thus, the Applicant Bank is entitled to recover Rs.2,69,68,593/- from the defendants.

¶50

The Applicant Bank has claimed future interest @13.30% per annum with monthly rests. However, considering the facts of the case, I am of the opinion that if future interest is granted @9% per annum (simple), it would be just and reasonable rate of interest.

¶51

Hence, I pass the following order:-

¶52

ORDER

¶53

(A) Original Application No.1029/2022 is allowed with costs.

¶54

(B) Defendant No.1 to 3 either jointly or severally shall pay to the Applicant Bank a sum of Rs.2,69,68,593/- (Rupees Two Crore Sixty Nine Lakhs Sixty Eight Thousand Five Hundred Ninety Three only ) on account of Cash Credit Account No.39735445696, with future interest @ 9% per annum from the date of filing of the Original Application i.e22,07.2022 till payment/realization of the amount mentioned in this operative order.

¶55

(C) The aforesaid adjudicated amount is secured by the Equitable Mortgage regarding immovable property i.e. all the piece and parcel of

(OA No.1029/2022)

Page 6 of 7

[ANIL]

Industrial Plot at Gat No.409 (part), 411 (part), 412(part), Near MSEDCL, Sub Station and Ranjangaon MIDC area at PO Dhoksangavi, admeasuring total area 10200 Sq. Mtrs. within Taluka Shirur, District Pune, more particularly described in Para.No.5.6(d) of the Original Application.

¶60

(D) The Applicant Bank is entitled to sell the mortgaged property to recover its dues.

¶61

(E) Issue Recovery Certificate.

¶62

(F) The Registrar is directed to send the copy of Judgment and Recovery Certificate to the Applicant Bank and the defendant.

¶63

Sd/(Dilip G. Murumkar) Place : Pune Presiding Officer Date: 18.06.2024 Debts Recovery Tribunal, Pune

(OA No.1029/2022)

Page 7 of 7

[ANIL]

[ANIL] (OA No.1029/2022) Page 8 of 7

State Bank of Indore v. Prime Corporation

Case brief

What is this about?

What did the court decide?

State Bank of Indore v. Prime Corporation

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Parties & counsel

Coram

Case details

Similar cases

Punjab National Bank versus Suresh Pandhare

Union Bank of India versus Vikas Kate

Bank of India versus Yashwant Pawar

Canara Bank versus Jignesh Naram

Federal Bank versus Prakash

Uco Bank versus Alka Mhetre