Allowed

Punjab National Bank v. Messrs Radhya Creations and Another

DRT13 Nov 2024OA/1261/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the borrower's application for recovery of an outstanding loan of Rs.41,66,072.24. The court declined the bank's claimed interest rates, granting a uniform rate of 8% per annum due to prevailing market conditions, and directed recovery via hypothecated properties.

What did the court decide?

Recovery certificate issued for Rs.41,66,072.24 with costs and uniform simple interest @8% p.a. from filing date till realization.

Punjab National Bank versus Messrs Radhya Creations and Another — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1261/2022

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PRESIDED OVER BYMRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 27.06.2022

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DATE OF DECISION: 13.11.2024

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Punjab National Bank, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi 110075 and branch amongst at Village Sudhar, Tehsil Raikot, Distt. Ludhiana through General Power of Attorney Holder Sh. Ravinder Kumar, Senior Manager and Constituted Attorney.

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……..Applicant Versus

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M/s Radhya Creations situated at G-4, 1077 St No.6, New Shivpuri, Bypass Road, Ludhiana-141003 through its proprietor Sh. Vishal Sahi.

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Sh. Vishal Sahi S/o Sh. Surinder Sahi, Proprietor, R/o B-4-1063, Mohalla Sudan, Near Old Sabji Mandi, Central Post Office, Ludhiana.

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………. Defendants

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Advocates:

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Argued by Ms. Lovedeep Kaur, Advocate proxy for Ms. Puja Sharma, Advocate for the applicant Defendants are ex-parte

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FINAL ORDER

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Present Original Application was instituted by the applicant under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.41,66,072.24p (Rupees Forty One Lacs Sixty Six Thousand Seventy Two and Twenty Four Paise Only). The Original Application has been filed through Sh. Ravinder Kumar, Senior Manager o f the applicant, who is competent to institute the Original Application vide General

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Power of Attorney dated 05.06.1997, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant no.1 through its proprietor of defendant no.2 had approached the applicant for grant of CC Limit of Rs.30.00 Lacs vide Loan Application dated 10.11.2010, which is Annexure A2 to this OA. Further, defendants had again approached the applicant for Renewal of CC Limit of Rs.30.00 Lacs vide Loan Application dated 30.06.2014, which is Annexure A5A to this OA. Thereafter, defendants had again approached the applicant for Term Loan of Rs.16.00 Lacs vide Loan Application dated 27.02.2017, which is Annexure A7 to this OA. Later, defendant no.1 through its proprietor of defendant no.2 had approached the applicant for Renewal of CC Limit of Rs.30.00 Lacs and Term Loan of Rs.16.00 Lacs to this OA. 3. The applicant sanctioned CC Limit of Rs.30.00 Lacs vide Sanction Letter dated 06.12.2010, which is Annexure A3 to this OA. Further, applicant sanctioned for Renewal of CC Limit of Rs.30.00 Lacs vide Sanction Letter dated 04.01.2017, which is Annexure A6 to this OA. Thereafter, applicant sanctioned for Term Loan of Rs.16.00 Lacs vide Sanction Letter dated 03.03.2017, which is Annexure A8 to this OA and thereafter, applicant sanctioned for Renewals of CC Limit of Rs.30.00 Lacs and Term Loan of Rs.16.00 Lacs vide Sanction Letter dated 29.11.2018, 31.03.2020 & 16.01.2021, which are Annexures A11 to A13 to this OA; to this OA. 4. Defendants had Hypothecated their movable properties i.e. Hypothecation of stocks of Raw Material, Stock in Process, finished goods lying at the borrower’s place/places of business and assignment of Book Debts & future etc. Documents executed:-PAN card of defendant no.2, which is Annexure A4 to this OA; Agreement of Hypothecation of Assets dated 06.12.2010, which is Annexure A5 to this OA; Agreement of Term

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Loan & Common Agreement both dated 03.03.2017, which are Annexures A9 & A10 to this OA; Balance & Security Confirmation Letters dated 31.01.2013, 19.01.2016, 12.02.2018, 31.12.2020 & 29.01.2021, which are Annexures A14 to A18 to this OA and Statements of Accounts along with Certificate under Banker’s Book Evidence Act, which are Annexures A19 & A20 to this OA.

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The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.41,66,072.24p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant requested to accept the application and to issue Recovery Certificate accordingly.

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The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte on 11.11.2024.

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In support of the OA, affidavit of Sh. Ravinder Kumar, Senior Manager, Punjab National Bank has been filed.

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Heard arguments and perused record.

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It was argued by learned proxy counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant had proved its case. From the perusal of all the Annexures A1 to A20 to this OA, it is proved that the defendants approached applicant for availing of the loans facilities which was granted to them and for that they had executed all the relevant documents in favour of the bank. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.41,66,072.24p (Rupees Forty One Lacs Sixty Six Thousand Seventy Two and Twenty Four Paise Only) along with interest from the defendants, jointly and

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severally, from the date of filing of the present Original Application till realization of the accounts.

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In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @10.25%p.a. for CC Limit and @8.25%p.a. for Term Loan along with penal interest @2.00%p.a. with monthly rests from 01.06.2022 till the realization.

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The Tribunal is of the considered opinion that sometimes in appropriate cases the prerogative of mercy is the brightest jewel in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including nature of the mortgaged property, undertaking of the defendants, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yester years, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @08.00%p.a. in the loan accounts from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly.

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In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.41,66,072.24p (Rupees Forty One Lacs Sixty Six Thousand Seventy Two and Twenty Four Paise Only) jointly and severally, with costs, current and future simple interest @08.00%p.a. in the loan accounts from the date of filing of OA till the date of realization of the amount. Accordingly, the applicant shall be entitled to recover aforesaid amount from the sale of hypothecated/mortgaged properties of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the applicant still remain unsatisfied, it shall be entitled to recover the same by attachment and sale of personal assets of the defendants. The applicant is at liberty to enforce the claim through due process of law. 12. Any other application pending stands disposed of.

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Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 07.12.2024.

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Copy of this order be given dasti to the applicant and be sent to defendants through registered/speed post and this order be also uploaded on the official website of this Tribunal and record be consigned.

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Pronounced by me in the open Tribunal .

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Dated: 13.11.2024

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Punjab National Bank v. Messrs Radhya Creations and Another

Case brief

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Punjab National Bank v. Messrs Radhya Creations and Another

Case brief

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