Allowed

Indian Bank v. M/S Garib Nawaz Moters

DRT10 Jan 2024OA/1109/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an original application filed by Indian Bank against borrowers and a guarantor for recovery of Rs. 1.46 crore outstanding under a cash credit limit. The court granted a recovery certificate and fixed simple interest at 10% per annum.

What did the court decide?

Recovery of Rs. 1,46,25,642 plus simple interest @10% per annum from 01.08.2023. Issuance of Recovery Certificate.

Indian Bank versus M/S Garib Nawaz Moters — DRT (2024) — LawSathi Research

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

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ORIGINAL APPLICATION NO.1109/2023

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DATE OF INSTITUTION: 01.08.2023

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DATE OF DECISION: 10^th DAY OF JANUARY, 2024

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Indian Bank, (erstwhile Allahabad Bank), a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at 254-260, Avvai Shanmugham Salai, Royapettah, Channai-600014 and amongst other places a Branch at Sector-17, Chandigarh and one of the specialised Recovery Branches known as Stressed Assets Management Branch, at Sector-17, Chandigarh, through Sh. Nishant Shukla, Assistant General Manager/Authorised Officer

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…..Applicant

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Versus

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M/s Garib Nawaz Motors, having its registered office at 29/7, Industrial-cum-Business Park, Phase-II, Chandigarh, through its Proprietor

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Sh. Sunil Kumar Bansal s/o Sh. Nav Rattan Bansal r/o House No. D-15, Uppal Marvel Arch, Manimajra, Sector-13, Chandigarh160101 (U.T.)

¶10

Second Address: House No. 51, Ward No. 16, Mandi Dabwali, Sirsa, Haryana-125104

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Smt. Bimla Devi Bansal w/o Sh. Nav Rattan Bansal r/o House No. 51, Ward No. 16, Mandi Dabwali, Sirsa, Haryana-125104

¶12

…..Defendants

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OA/1109/2023 INDIAN BANK Vs M/S GARIB NAWAJ MOTORS AND OTHERS 2

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Argued by: Ms Manjari Joshi counsel for the applicant bank Defendants ex parte vide order dated 16.09.2023

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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 defendants for recovery of Rs.1,46,25,642/- (Rupees One Crore Forty Six Lakh Twenty Five Thousand Six Hundred and Forty Two Only) . It has been filed through Sh. Nishant Shukla, Assistant General Manager of the applicant bank stated to be competent to institute the Original Application vide Power of Attorney dated 14.03.2015, Annexure-A1 (copy).

¶17

The brief facts of the case of the applicant as per the Original Application are that defendant No.1, through defendant No. 2, had approached the applicant bank for grant of Cash Credit Limit of

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Rs. 1,00,00,000/- vide loan application Form dated 07.11.2014, Annexure-A2 (copy). Defendant No. 3 stood as a guarantor for repayment of the loan amount.

¶19

The applicant bank sanctioned aforesaid credit facility to the defendants vide sanction letter dated 20.12.2014, Annexures-A3 (copy), which was further renewed vide sanction letter dated 26.12.2016, Annnexure-A11 (copy), as per terms and conditions which were duly accepted by the defendants.

¶20

In order to secure the aforementioned credit facility, the

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defendants executed, letter dated 20.12.2014 for acknowledging the

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OA/1109/2023 INDIAN BANK Vs M/S GARIB NAWAJ MOTORS AND OTHERS 3

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receipt of sanction letter, Annexure-A4 (copy), limit pronote dated 20.12.2014 and demand promissory note dated 22.12.2014, Annexure-A5 (colly) (copy), general letter of hypothecation dated 20.12.2014, Annexure-A6 (copy), undertaking dated 20.12.2014, Annexure-A7 (copy), deed of guarantee dated 20.12.2014, Annexure-A8 (copy), letter dated 29.04.2017 regarding request to purchase cheques, Annexure-A12 (copy) and letter dated 26.03.2019 for up-gradation of the loan account, Annexure-A13 (copy).

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The aforesaid loan facility was further secured by creation of equitable mortgage by defendant Nos. 2 and 3 in respect of agricultural land measuring 08 Kanal situated at revenue estate of Barring-Khera, Tehsil Lambi, District Muktsar, Punjab, fully detailed in Para Nos. 5.8 of the Original Application.

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The documents relating to the mortgage are as under:

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i. Registered sale deed dated 03.03.2005 along with its translation, Annexures-A9 and A9/T (copy).

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ii. Letters dated 20.12.2014 by the mortgagor for confirming deposit of tile deed, Annexure-A10 (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 financial discipline of the applicant bank leading to the loan account becoming irregular and it being classified as NPA on 31.12.2019. The defendants executed letters dated 12.03.2021 for One Time Settlement of the loan account, Annexure-A15 (copy). The applicant bank recalled entire outstanding amount vide demand notice dated 29.09.2020 under Section 13(2) of the Securitisation

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OA/1109/2023 INDIAN BANK Vs M/S GARIB NAWAJ MOTORS AND OTHERS 4

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and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, Annexure-A17 (copy), but to no avail .

¶31

It is further the case of the applicant bank that after adjusting debit and credit entries in the loan account, a sum of Rs.1,46,25,642/- (Rupees One Crore Forty Six Lakh Twenty Five Thousand Six Hundred and Forty Two Only) , is recoverable against the defendants as per balance sheet and statement of account duly certified under Bankers’ Books Evidence Act, 1891, Annexures-A14 and A16 (copy).

¶32

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 16.09.2023 .

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In support of contents of the OA, affidavit of evidence of

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Sh. Nishant Shukla, Assistant General Manager/Authorised Officer 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.

¶37

It was argued by the learned counsel of the applicant bank 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

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OA/1109/2023 INDIAN BANK Vs M/S GARIB NAWAJ MOTORS AND OTHERS 5

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A17 , 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 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.1,46,25,642/- (Rupees One Crore Forty Six Lakh Twenty Five Thousand Six Hundred and Forty Two Only) from the defendants.

¶40

In so far as pendente lite and future interest is concerned, in relief clause the applicant bank has claimed rate of interest @12.60% per annum. In sanction letter dated 20.12.2014, Annexure-A3 (copy), rate of interest has been mentioned @12.25% per annum.

¶41

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. business, quantum of loan, prevalent market rates of interest which have gone drastically downhill in yesteryears and defendant No. 3 being a female, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @10% per annum from the date of

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OA/1109/2023 INDIAN BANK Vs M/S GARIB NAWAJ MOTORS AND OTHERS 6

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

¶44

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.1,46,25,642/- (Rupees One Crore Forty Six Lakh Twenty Five Thousand Six Hundred and Forty Two Only) with current and future simple interest @10% per annum w.e.f. 01.08.2023 , 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.

¶45

Issue Recovery Certificate accordingly.

¶46

Parties to appear before Recovery Officer concerned on 29.02.2024

¶47

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.

¶48

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

Indian Bank v. M/S Garib Nawaz Moters

Case brief

What is this about?

What did the court decide?

Indian Bank v. M/S Garib Nawaz Moters

Case brief

What is this about?

What did the court decide?

What the court decided

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