Allowed

Bank of India v. Malook Singh and Another

DRT12 Jul 2024OA/1287/2023

Case brief

AI extract

What is this about?

In an ex-parte application, the Debts Recovery Tribunal allowed the applicant bank's claim for recovery of Rs. 21,39,479.39 from borrowers and a guarantor for defaulted agricultural and cash credit limits, directing issuance of a recovery certificate and fixing uniform simple interest at 8% per annum.

What did the court decide?

Recovery of Rs. 21,39,479.39 with simple interest @8% p.a. from the date of filing till realization; Issuance of Recovery Certificate.

Bank of India versus Malook Singh and Another — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1287/2023 PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 24.10.2023

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DATE OF DECISION: 12.07.2024

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Bank of India, a body corporate and a nationalized bank under the provisions of the Banking Companies (Acquisition and Transfer of Undertakings) Act of 1970 with its Head Office at Bank of India, Star House, C-5, “G” Block, Bandra Kurla Complex, Bandra (East), Mumbai400051 and amongst others a branch at Circular Road, Gidderbaha, District Muktsar, Punjab-152101 through Mr. Ajit Singh Dadwal Constituted Attorney of Applicant Bank.

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……..Applicant Versus Sh. Malook Singh S/o Sh. Gurtej Singh R/o VPO Kotbhai, Gidderbaha, Muktsar, Punjab Borrower

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Sh. Malook Singh S/o Sh. Gurtej Singh R/o VPO Kotbhai, Gidderbaha, Muktsar, Punjab

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Sh. Gurtej Singh S/o Sh. Sadha Singh R/o House No.1716, Dhania Te Kothe village Kotbhai, Tehsil Gidderbaha District Muktsar, Punjab

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Guarantor

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….……Defendants

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Advocates: Argued by Ms. Sonal Chabra, counsel proxy for Sh. Pankaj Beri, counsel 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 bank under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.21,39,479.39p (Rupees Twenty One Lacs Thirty Nine Thousand Four Hundred Seventy Nine and Paisa Thirty Nine only). The Original Application has been filed through Mr. Ajit Singh Dadwal, Constituted Attorney of the applicant bank, who is competent to institute the

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Original Application vide Power of Attorney dated 20.02.2023, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant no.1 had approached the applicant bank for the grant of Cash Credit Limit (KCC) of Rs.3.00 Lacs and Agriculture Over Draft Limit of Rs. 8.00 Lacs vide Loan application dated 23.05.2015, which are Annexures A2 & A8 to this OA. Defendant no.2 stood as guarantor. 3. The applicant Bank sanctioned the Cash Credit Limit (KCC) of Rs.3.00 Lacs and Agriculture Over Draft Limit of Rs. 8.00 Lacs vide Sanction Letter dated 01.06.2015 filed in compliance of order dated 07.06.2024 vide diary no.9818 dated 27.06.2024 and the terms and conditions were duly accepted by the defendants. 4. Defendants No.1 had mortgaged his immovable property i.e. total land measuring 24K situated at Village Kotbhai-I, Tehsil Gidderbaha, District Muktsar (Punjab) vide Declaration under Section 4 (1) bearing vasika no.283 dated 01.06.2015 and Letter to Sub Registrar for creation of charge dated 2 8.05.2015, which is Annexure A13 to this OA. Documents executed:- Demand Promissory Notes, Hypothecation cum Loan Agreement, Agreements (L516), Letters of Declaration, Undertaking and Authority and Deeds of Guarantee (OD 194) all dated 05.06.2015, which are Annexures A3 to A7 & A9 to A12 to this OA; Letter of Acknowledgments of Debt and Securities dated 24.04.2018 and 19.02.2021, which are Annexures A14 to A17 to this OA; Notice dated 08.08.2023 with postal receipts, which is Annexure A18 to this OA and Statements of Accounts with certificate, which are Annexures A19 & A20 to this OA. 5. The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in both the loan accounts there was a debit of Rs.21,39,479.39p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant bank 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 03.06.2024.

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In support of the OA, affidavit of Mr. Ajit Singh Dadwal, Constituted Attorney, Bank of India has been filed.

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Heard ex-parte 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 bank 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 bank for availing of the loan facilities which were 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, both the accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.21,39,479.39p (Rupees Twenty One Lacs Thirty Nine Thousand Four Hundred Seventy Nine and Paisa Thirty Nine only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the account. 10. In so far as pendent elite and future rate of interest is concerned, the applicant bank in relief clause has claimed interest @9.50%p.a. in KCC and @12.50%p.a. in Overdraft plus penal interest @2.00%p.a. in both with half yearly rests from 02.08.2023 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

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just and appropriate to grant uniform simple interest @8.00%p.a. in both 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. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.21,39,479.39p (Rupees Twenty One Lacs Thirty Nine Thousand Four Hundred Seventy Nine and Paisa Thirty Nine only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in both the loan accounts from the date of filing of OA till the date of realization of the amount. Accordingly, the applicant bank 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 bank 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. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 02.08.2024. 15. Copy of this order be given dasti to the applicant bank 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. Pronounced by me in the open Tribunal . Dated: 12.07.2024 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Bank of India v. Malook Singh and Another

Case brief

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Bank of India v. Malook Singh and Another

Case brief

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