Allowed

Indian Bank v. M/S Lucky Hotel and Restaurant and Others

DRT24 Sept 2024OA/1862/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal adjudicated an application for recovery of Rs. 35,03,939 issued under Section 19 of the RDBFI Act, 1993 against borrowers who failed to repay term loans and CC limits. After examining documentary evidence ex-parte, the tribunal declared the defendants liable to pay the principal, interest at 8% p.a., and allowed enforcement via sale of mortgaged or personal assets.

What did the court decide?

Recovery of Rs. 35,03,939.00 with interest at 8% p.a. from filing; enforcement through sale of mortgaged or personal assets.

Indian Bank versus M/S Lucky Hotel and Restaurant and Others — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1862/2022

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PRESIDED OVER BYMRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 19.10.2022

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DATE OF DECISION: 24.09.2024

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Indian Bank, a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Corporate Office, 254-260, Avvai Shanmugam Salai, Royapettah, Chennai-600014 and w.e.f 01.04.2020 being the successor to Allahabad Bank in terms of Gazette of India Notification No.G.S.R.156 (E) dated 04^th March, 2020 issued by the Central Government in exercise of the powers conferred upon it by Section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970) and Section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980),the Central Government after consultation with the Reserve Bank of India, notified the Scheme of Amalgamation of Allahabad Bank into Indian Bank Scheme, 2020. Therefore, the term “Applicant Bank”, wherever the context so warrants, would interchangeably mean the erstwhile Allahabad Bank and/or Indian Bank. The erstwhile Allahabad Bank’s Branch Office at Dashmesh Nagar, Bela Chowk Branch, Tehsil Ropar, District Roop Nagar (Punjab) through its Principal Officer General Power of Attorney Holder Sh. Jai Karan Sillay posted as Chief Manager at Applicant Bank i.e. Indian Bank, Zonal Office, SCF No.88, Urban Estate, Phase-I, Dugri, Ludhiana (Punjab).

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……..Applicant Bank

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Versus

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M/s Lucky Hotel & Restaurant, Village Bari Railon, P.O. Phool Khurd, Tehsil Ropar, District Roop Nagar (Punjab) through its Proprietor Smt. Raj Rani.

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Smt. Raj Rani W/o Sh. Harwinder Singh, R/o Village Bari Railon, Tehsil & District Roop Nagar (Punjab) Proprietor of M/s Lucky Hotel & Restaurant.

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Sh. Gajjan Singh S/o Sh. Chunni Lal, R/o Village Rail Majra, Tehsil Balachaur, District S.B.S. Nagar (Punjab). . Defendants

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Advocates:

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Argued by Ms. Savita Trighatia Nar, 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.35,03,939.00 (Rupees Thirty Five Lacs Three Thousand Nine Hundred Thirty Nine Only). The Original Application has been filed through Sh. Jai Karan Sillay, Chief Manager o f the applicant, who is competent to institute the Original Application vide General Power of Attorney dated 08.10.1996, which is Annexure A1 to this OA. 2. The brief facts of the OA are that the defendants had approached the applicant for grant of Term Loan of Rs.25.00 Lacs and CC Limit of Rs.3.00 Lacs. 3. The applicant sanctioned Term Loan of Rs.25.00 Lacs and CC Limit of Rs.3.00 Lacs vide Sanction Letters along with its Acceptance letters dated 20.11.2017, which are Annexures A2 & A3 to this OA and the terms and conditions were duly accepted by the defendants. 4. Defendant No.3 had mortgaged his immovable properties i.e. (i) total land measuring 06M-06 Sarsai (200 Sq. yards) situated Village Bari Railon, H.B. No.50, Tehsil & District Roop Nagar (Punjab) vide Equitable Mortgage of Sale Deed bearing v asika No.282 dated 02.05.2016. (ii) total land measuring 00M-06 Sarsai situated Village Bari Railon, H.B. No.50, Tehsil & District Roop Nagar (Punjab) vide Equitable Mortgage of Sale Deed bearing v asika No.126 dated 18.04.2016 along with their translations, which are Annexures A4 & A5 to this OA.

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Documents executed:-Gazette Notification dated 04.03.2020, which is Annexure A/A to this OA; Valuation Reports dated 22.06.2017 & 30.06.2017, which is Annexure A6 to this OA; Legal Opinion-cum None Encumbrance Certificate & Legal & Legal Scrutiny Report dated 11.10.2017 along with its translations, which is Annexure A7 to this OA; Term Loan Agreement, General Letter of Hypothecation, Guarantee Form by defendant no.2 & 3, Letter of Mortgager confirming deposit of title deeds executed by defendant no.3, Declaration by Borrower-Mortgagor on affidavit executed by defendant no.3 & Revised Recital applicable in the case of Proprietorship Firm/Individual all dated 21.11.2017, which are Annexures A8 to A14 to this OA; Letter of waiving presentment of Pronote dated 02.12.2017, which is Annexure

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A15 to this OA; Consent Clause to be executed by Borrower dated 26.10.2017, which is Annexure A16 to this OA; Main Limit Pronotes executed by defendant no.2 for Rs.25.00 Lacs & 3.00 Lacs dated 23.11.2017, which are Annexures A17 & A18 to this OA; Main Limit Pronote executed by defendant no.2 for Rs.7.00 Lacs and Rs.5.00 Lacs dated 24.11.2017 & 02.12.2017, which are Annexures A19 & A20 to this OA; Undertaking dated 23.11.2017, which is Annexure A21 to this OA; Acknowledgement of debt dated 11.12.2019, which is Annexure A22 to this OA; Notice under Section 13 (2) dated 09.09.2021, which is Annexure A23 to this OA; Possession Notice dated 02.02.2022, which is Annexure A24 to this OA; Legal Notice dated 08.08.2022, which is Annexure A25 to this OA and Statement of Account along with Certificate under Banker’s Book Evidence Act, which is Annexures A26 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 both loan accounts there was a debit of Rs.35,03,939.00, 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. Defendant no.3 appeared through his counsel on 26.05.2023 and filed Power of Attorney but did not filed WS. Since no one appeared on behalf of defendants and they were proceeded ex-parte on 27.08.2024.

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In support of the OA, affidavit of Sh. Jai Karan Sillay, Chief Manager, Indian Bank h as been filed.

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Heard arguments and perused record.

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It was argued by learned 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 A/A, A1 to A26 to this OA, it is proved that the defendants approached applicant for availing of the loans 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 loans 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.35,03,939.00 (Rupees Thirty Five Lacs Three Thousand Nine Hundred 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 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 @14.90%p.a. in CC Limit and @11.05%p.a. in Term Loan from 21.09.2022 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 loans and prevalent market rates of

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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 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.35,03,939.00 (Rupees Thirty Five Lacs Three Thousand Nine Hundred Thirty Nine Only) jointly and severally, with costs, current and future simple interest @08.00%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 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 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.

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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 16.10.2024.

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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 . Dated: 24.09.2024

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

Indian Bank v. M/S Lucky Hotel and Restaurant and Others

Case brief

What is this about?

What did the court decide?

Indian Bank v. M/S Lucky Hotel and Restaurant and Others

Case brief

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What did the court decide?

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