Allowed

Bank of India v. Sh. Gurjit Singh

DRT16 Jan 2024OA/1074/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the applicant bank's original application for recovery of Rs. 35,61,694.51/- incurred as an NPA from the joint and several defendants. The court issued a recovery certificate and ordered simple interest at 7% per annum. The case was tried ex parte against absent defendants.

What did the court decide?

Issued a Recovery Certificate for Rs. 35,61,694.51/- payable with current and future simple interest @7% per annum from 21.07.2023 till realization.

Bank of India versus Sh. Gurjit Singh — 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. 1074/2023

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DATE OF INSTITUTION: 21.07.2023

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DATE OF DECISION: 16^th DAY OF JANUARY, 2024

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Bank of India , body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its head office at Star House, C-5, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai-400051 and one of its Branches at Dhanas, through its Principal Officer-cum-Branch Manager, Sh. Harish Kumar Goyal, Bank of India, Branch at Dhanas, Chandigarh

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…..Applicant

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Versus

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Sh. Sh Gurjit Singh s/o Sh. Jaswinder Singh r/o House No. 185, Sector 41-D, Badheri, Chandigarh

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Sh. Hernek Singh s/o Sh. Ajmer Singh R/o House No. 24, Village Urdan, Tehsil Rajpura, District Patiala, Punjab

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....Defendants

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Argued by: Sh. Anil Sharma counsel for the applicant bank Defendants ex parte vide order dated 14.09.2023

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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), a gainst the defendants for recovery of

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Rs.35,61,694.51/- (Rupees Thirty Five Lakh Sixty One Thousand Six Hundred Ninety Four and Fifty One Paisa Only) .

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OA/1074/2023 BANK OF INDIA VS GURJIT SINGH AND ANOTHER 2

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It has been filed through Sh. Harish Kumar Goyal, Principal Officer-cum-Branch Manager of the applicant bank stated to be competent to institute the Original Application vide Authority Letter dated 28.06.2023, 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. 10 lakh and MOD Facility of Rs. 2.50 lakh vide application Form dated 02.02.2016 for agricultural credit, Annexure-A2 (copy).

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The applicant bank sanctioned aforesaid facilities to the defendants vide sanction letter dated 08.03.2016, Annexure-A3 (copy), as per terms and conditions which were duly accepted by the defendants.

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In order to secure the aforementioned credit facilities, the defendants executed demand promissory notes dated 18.03.2016, Annexures-A4 and A11 (copy), hypothecation-cum-loan agreement dated 18.03.2016, Annexure-A5 (copy), declarations dated 18.03.2016 regarding terms and conditions, Annexures-A6 and A12 (copy), undertakings dated 18.03.2016 regarding terms and conditions, Annexures-A7 and A13 (copy), letter of authority dated 18.03.2016 for agricultural loans, Annexure-A8 (copy) comprehensive authority letter dated 18.03.2016, Annexure-A9 (copy), letters dated 18.03.2016 of declaration, undertaking and authority, Annexures-A10 and A14 (copy) and deed of guarantee dated 18.03.2016, Annexure-A16 (copy).

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OA/1074/2023 BANK OF INDIA VS GURJIT SINGH AND ANOTHER 3

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The aforesaid loan facilities were further secured by creation of mortgage by defendant No. 1 in respect of agricultural land measuring 16 Kanal situated in the revenue estate of Urdan, Hadbast No. 265, Tehsil Rajpura, District Patiala, Punjab, fully detailed in para No. 5(iv) of the Original Application. Declaration dated 17.03.2016 under Section 4(1) of the Punjab Agriculture Credit Operations and Miscellaneous Provisions (Banks) Act, 1978, along with request letter to the Tehsildar, Rajpura, for entry/mutation of mortgaged property and non-encumbrance certificate dated 29.01.2016 is Annexure-A17 (colly) (copy).

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It is further the case of the applicant bank that the loan facilities were duly availed of by the defendants but they failed to maintain the financial discipline of the applicant bank leading to the loan accounts becoming irregular and those being classified as NPA on 30.09.2022. The defendants executed acknowledgement of debt/securities letters dated 09.01.2019 and 29.01.2016, Annexure-A18 (colly) (copy). The applicant bank recalled entire outstanding amount vide legal notices dated 06.08.2018 and 20.10.2022 along with postal receipts, Annexure-A19 (colly) (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 accounts, a sum of Rs.35,61,694.51/- (Rupees Thirty Five Lakh Sixty One Thousand Six Hundred Ninety Four and Fifty One Paisa Only) , is recoverable against the defendants as per certificate of due amount and statements of accounts, duly certified under Bankers’ Books Evidence Act, 1891, Annexure-A20 (colly) (copy).

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OA/1074/2023 BANK OF INDIA VS GURJIT SINGH AND ANOTHER 4

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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 14.09.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Harish Kumar Goyal, Principal Officer-cum-Branch Manager 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 A20 , it is clear that the defendants had approached the applicant bank for availing of the loan facilities which were granted to them. It is further clear that the 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.35,61,694.51/- (Rupees Thirty Five Lakh Sixty One Thousand Six Hundred Ninety Four and Fifty One Paisa Only) from the defendants.

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OA/1074/2023 BANK OF INDIA VS GURJIT SINGH AND ANOTHER 5

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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 @13.20% per annum with half yearly rests. In sanction letter dated 08.03.2016, Annexure-A3 (copy), the rate of interest has been mentioned @13.20% per annum in both facilities.

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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, 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.35,61,694.51/- (Rupees Thirty Five Lakh Sixty One Thousand Six Hundred Ninety Four and Fifty One Paisa Only)

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with current and future simple interest @7% per annum w.e.f. 21.07.2023 , 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

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OA/1074/2023 BANK OF INDIA VS GURJIT SINGH AND ANOTHER 6

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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 05.03.2024.

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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

Bank of India v. Sh. Gurjit Singh

Case brief

What is this about?

What did the court decide?

Bank of India v. Sh. Gurjit Singh

Case brief

What is this about?

What did the court decide?

What the court decided

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