Allowed

Punjab National Bank v. M/S. Krushnaratna Construction, Prop. Sunil Kisan Pawar

DRT5 Feb 2024OA/1044/2022

Case brief

AI extract

What is this about?

Debt Recovery Tribunal allowed the applicant bank's application for recovery of a cash credit loan account against the defaulting proprietor, modifying the future interest rate and directing sale of mortgaged properties.

What did the court decide?

Payment of Rs.50,56,458/- with future interest @9% p.a. from filing date; permission to sell mortgaged properties; issuance of recovery certificate.

Punjab National Bank versus M/S. Krushnaratna… — Contract and Commercial Disputes | DRT (2024)

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Presented on: 28.06.2022 Registered on: 11.11.2022 Decided on: 05.02.2024 Duration: Y M D 1 7 8

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IN THE DEBTS RECOVERY TRIBUNAL AT PUNE (Before Shri Dilip G Murumkar, Presiding Officer) ORIGINAL APPLICATION No.1044/2022

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Punjab National Bank

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(Erstwhile United Bank of India)

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[Erstwhile United Bank of India has been merged with Punjab National Bank as per Central Govt. Notification on 04.03.2020]. A Body Corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act 1970 having its Head Office at Plot No.4, Sector No.10, Dwarka, New Delhi-110 075 and one of its Branch known as Industrial Area Chinchwad Branch, Pune-411 019 and thereafter the file transferred to Circle SASTRA (Recovery) Centre at 9, Moledina Road, Aurora Towers, Camp, Pune411 001.

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… Applicant

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Versus

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M/s. Krushnaratna Construction, Proprietor, Mr. Sunil Kisan Pawar, Age: Adult, Occ: Business,

(OA No.1044/2022)

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Address:

A) Survey No.16, C/48, Indira Nagar, Telco Road, Near Panchsheel Hotel, Chinchwad, Pune-411 019. Also at:

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B) Shop No.9, Mangal Arcade, Telco Road, Mohan Nagar, Chinchwad, Pune-411 019.

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… Defendant

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APPEARANCES

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For the Applicant Mr. Satyan Jagtap - Advocate For Defendant Ex parte

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TOTAL CLAIM AMOUNT –Rs.55,37,018/-

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JUDGMENT

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(Delivered on 05^th February, 2024)

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The Applicant Bank has filed the present Application for recovery of Rs.55,37,018/- in respect of Cash Credit loan account together with future interest @11.20% p.a. with monthly rests along with penal interest @2% p.a. thereon from 28^th June, 2022 till full repayment/realization of entire dues from the defendant.

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Brief facts of the application are as under:

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The defendant is the proprietary Firm engaged in the business of civil contracts.

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The defendant was enjoying Cash Credit facility of Rs.25 Lakhs with the Erstwhile applicant Bank i.e. United

(OA No.1044/2022)

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Bank of India. Defendant through its proprietor approached the applicant Bank in 2014 for enhancement of existing Cash Credit facility of Rs.25 Lakhs to Rs.50 Lakhs for working capital requirements of his Firm.

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On 04^th February, 2014 the applicant Bank sanctioned and disbursed the enhanced Cash Credit facility of Rs.50 Lakhs, with interest @11.75% p.a. with monthly rests to defendant.

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On 05^th February, 2014 defendant signed and executed loan transaction and security documents more particularly mentioned in paragraph Nos.5.5 to 5.7 of the Original Application, including Equitable Mortgage of immovable properties.

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The applicant Bank contended that defendant has executed Balance and Security Confirmation Letters dated 18^th March, 2016, 06^th June, 2018, 04^th November, 2019 and 15^th February, 2022 and confirmed the outstanding balances on respective dates.

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The applicant Bank further contended that after availing the Cash Credit facility, defendant failed and neglected to comply with terms and conditions of sanction.

(OA No.1044/2022)

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The loan account of defendant was running irregular and defendant was reluctant to pay the amounts outstanding in the loan account. Resultantly, the loan account of defendant became Non-Performing Asset on 31^st March, 2021.

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Thereafter, the applicant Bank through its Advocate issued Legal Notice dated 02^nd February, 2022 calling upon defendant to repay the entire outstanding amount outstanding under the said loan account. In spite of issuance of Legal Notice, defendant failed to comply with requisitions of the said Legal Notice.

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Hence, this application is filed.

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Defendant failed to appear despite service of Summons. Hence, the application proceeded ex parte against him vide Order dated 10^th January, 2024 passed below the application (Exhibit-1).

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The applicant Bank has filed Claim Affidavit of evidence (Exhibit-6) of Shri Praveen Chandra Potdar, Chief Manager, Punjab National Bank, which supports the case of the applicant Bank elucidated in the application.

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The applicant Bank has produced on record the original

(OA No.1044/2022)

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loan transaction documents (Sr.Nos.AW-1/1 to AW-1/16) which corroborate the case of the applicant Bank.

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

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

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The applicant Bank has claimed Rs.1,22,354/- towards Simple Penal Interest; Rs.1,22,354/- towards Additional Penal Interest; Rs.2,32,353/- towards CFITL Closure amount debt and Rs.3,500/- towards Legal and other charges which cannot be granted and those amounts are required to be deducted from total claim amount. Thus, the total claim amount is reduced from Rs.55,37,018/- to Rs.50,56,458/- .

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The applicant Bank has claimed future interest @11.20% p.a. with monthly rests for Cash Credit Loan account. However, having regard to the facts of the case, I am of the opinion that if future interest is granted @9% p.a. (simple), it would

(OA No.1044/2022)

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be just and reasonable rate of interest.

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Hence, I pass the following order:-

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ORDER

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(A) Original Application No.1044/2022 is allowed with costs.

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(B) Defendant shall pay to the applicant Bank towards Cash Credit Loan account the sum of Rs.50,56,458/(Rupees Fifty Lakhs Fifty-Six Thousand Four Hundred and Fifty-Eight only) with future interest @9% p.a. from the date of filing of the Original Application i.e. 28^th June, 2022 till full realization of the amount mentioned in this operative order.

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(1) Gat No.84, Old Gat No.1204, Borhadwadi, Tal.-Haveli, Dist. Pune admeasuring area 428.81 sq. mtrs.;

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(2) Gat No.714/1/B admeasuring 1H 61 Aar,

(OA No.1044/2022)

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Village Nannaj, Solapur and

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(3) Gat No.44/2, admeasuring 3H 90 Aar, Village Nannaj, Solapur

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more particularly mentioned in paragraph No.5.7 of the Original Application.

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(D) The applicant Bank is entitled to sell the mortgaged properties to recover its dues.

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(E) Issue Recovery Certificate.

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

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Place : Pune Date : 05.02.2024

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Sd/- (Dilip G Murumkar) Presiding Officer Debts Recovery Tribunal, Pune

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(OA No.1044/2022)

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Punjab National Bank v. M/S. Krushnaratna Construction, Prop. Sunil Kisan Pawar

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/S. Krushnaratna Construction, Prop. Sunil Kisan Pawar

Case brief

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What did the court decide?

What the court decided

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