Allowed

Punjab National Bank v. Gulzar Singh and Others

DRT29 Aug 2024OA/1317/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the bank's application for recovery of a defaulted KCC loan of Rs.57 lakhs plus interest, reducing the claimed interest rate to 8% per annum and directing the issue of a Recovery Certificate against the borrowers.

What did the court decide?

Declarations of liability to pay Rs.57,35,226 plus costs at 8% p.a. simple interest, and issue of Recovery Certificate for enforcement against mortgaged and personal assets.

Punjab National Bank versus Gulzar Singh and Others — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1317/2023

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PRESIDED OVER BYMRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 09.10.2023

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DATE OF DECISION: 29.08.2024

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Punjab National Bank, a body corporate under Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi 110075 and having its Branch Office at different places including one at Nihal Singhwala, Distt. Moga through its Attorney holder & Officer Sh. Rajesh Sachdeva, Manager, Circle Sastra, Moga Circle.

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……..Applicant Bank

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Versus

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Sh. Gulzar Singh S/o Sh. Kartar Singh

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Sh. Inderjit Singh S/o Sh. Gulzar Singh

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Both r/o VPO Bir Rauke Patti Sukha, Near Gurudwara Nanaksar, Tehsil Nihal Singhwala, District Moga, Punjab

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……Defendants-Borrowers

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1. Sh. Inderjit Lal S/o Sh. Chiranji Lal R/o Grain Market, Nihal Singhwala, District Moga, Punjab (Commission Agent)

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……Defendant-Guarantor

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Advocates:

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Argued by Sh. Raghav Sharma, Advocate for the applicant (through VC) Defendants are ex-parte

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FINAL ORDER 1. 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.57,35,226.00 (Rupees Fifty Seven Lacs Thirty Five Thousand Two Hundred And Twenty Six Only). The Original Application has been filed through Sh. Rajesh Sachdeva, Manager of the applicant bank, who is

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competent to institute the Original Application vide Power of Attorney dated 09.06.2017, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant no.1 & 2 had approached the applicant bank for the grant of KCC/OGC Limit of Rs.38.00 Lacs vide Loan application dated 02.01.2012, which is Annexure A2 to this OA. Further, defendant no.1 approached the applicant bank for renewal of KCC/OGC Limit of Rs.38.00 Lacs vide Renewal application dated 16.05.2017.

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The applicant Bank sanctioned the KCC/OGC Loan of Rs.38.00 vide Sanction Letter dated 02.01.2012, which is Annexure A3 (Colly) to this OA. Further, applicant bank sanctioned an OGC Limit of Rs.38.00 Lacs dated 23.05.2017, which is Annexure A8(Colly) to this OA and the terms and conditions were duly accepted by the defendants.

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Defendants no.1 had mortgaged his immovable property i.e. land measuring 89K-03M situated at Village Bir Rauke, Tehsil Nihal Singhwala, District Moga, Punjab vide Registered Mortgaged Deed bearing vasika no.832 dated 02.01.2012 and Mutation Certificate dated 04.01.2012 along with Jamanbandi and their translations, which are Annexures A6 & A7 to this OA. Documents executed:- Agreement for Hypothecation, which is Annexure A4 to this OA; Agreement of Guarantee dated 24.01.2012, which is Annexure A5 to this OA; Balance Confirmation Letters dated 04.12.2014, 22.05.2017, 20.04.2020 & 19.04.2023, which is Annexures A9 to this OA; Statement & Memorandum of Account along with Certificate, which is Annexures A10 to this OA; Legal Notices dated 31.10.2021, 02.11.2021, 08.03.2022, 20.10.2022 & 29.08.2023 with Postal Receipts, which is Annexure A11 to this OA. 5. The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in loan account there was a debit of Rs.57,35,226.00 which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount,

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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 22.07.2024. 7. In support of the OA, affidavit of Sh. Rajesh Sachdeva, Manager, Punjab National Bank has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned counsel through video conferencing 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 A11 to this OA, it is proved that the defendants approached applicant bank for availing of the loan facility 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 loans as per terms and conditions of the agreement between the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.57,35,226.00 (Rupees Fifty Seven Lacs Thirty Five Thousand Two Hundred And Twenty Six 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 @10.50%p.a. plus penal interest @2.00%p.a. with half yearly rests in the loan account from 01.09.2023 till the realization. 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

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exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @8.00%p.a. in the loan account 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.57,35,226.00 (Rupees Fifty Seven Lacs Thirty Five Thousand Two Hundred And Twenty Six Only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in the loan account 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 21.09.2024. 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: 29.08.2024

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

Punjab National Bank v. Gulzar Singh and Others

Case brief

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Punjab National Bank v. Gulzar Singh and Others

Case brief

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