Allowed

Canara Bank v. M/S Satkar Car Bazaar and Others

DRT24 Jan 2024OA/1981/2022

Case brief

AI extract

What is this about?

The Tribunal allowed an Original Application filed by Canara Bank for recovery of a disputed debt of over Rs.41 Lakhs. The respondents agreed to the facts via documentary evidence and did not repudiate the claim. The court granted the recovery of the principal along with adjusted simple interest at 8.90% per annum and directed issuance of a Recovery Certificate.

What did the court decide?

Declaration that respondents are liable to pay Rs.41,75,807.31p jointly and severally with costs and 8.90% p.a. simple interest; Recovery Certificate issued.

Canara Bank versus M/S Satkar Car Bazaar and Others — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1981/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 31.10.2022

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DATE OF DECISION: 24.01.2024

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Canara Bank, a body corporate constituted under Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Jaya Chamarajendra Road, Bangalore and Branch Offices, amongst others at Canara Bank, SME at B-24, 2537/1, Ward No.19, Basti Mani Singh, Sunder Nagar, Ludhiana (Syndicate Bank, which has been amalgamated with Canara Bank w.e.f. 01.04.2020 vide Notification No. G.S.R. 155(E) dated 04.03.2020 issued by the Ministry of Finance, Government of India and since then all the assets and liabilities and properties of said Syndicate Bank has been vested into Applicant Bank i.e. Canara Bank through Ms. Pratima Singh, Manager/Principal Officer/Power of Attorney Holder, Branch SMESunder Nagar-Ludhiana of the applicant bank

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……..Applicant

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Versus

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M/s Satkar Car Bazaar, Plot No.11/1, Sector 39, Chandigarh Road, Ludhiana, District Ludhiana (Punjab) through its proprietor, Smt. Baljeet Kaur Verma (Borrower-Firm)

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Smt. Baljeet Kaur Verma W/o Sh. Vipan Kumar, R/o H.No.3863, Street No.5, Near Gurudwara Nanak Darbar, Hargobindpura, Ludhiana, District Ludhiana, Punjab (Borrower/Proprietor)

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Sh. Vipan Kumar Verma S/o Sh. Ram Lal, R/o H.No.3863, Street No.5, Near Gurudwara Nanak Darbar, Hargobindpura, Ward no.9, Ludhiana, District Ludhiana, Punjab (Co-Obligant)

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Sh. Balvir Kumar Verma S/o Sh. Ram Lal, R/o H.No.3863, Street No.5, Near Samrala Chowk, Hargobindpura, Ward no.9, Ludhiana, District Ludhiana, Punjab (Guarantor)

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………Defendants

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Advocates:

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Argued by Ms. Rahish Pahwa, 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 under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.41,75,807.31p (Rupees Forty One Lacs Seventy Five Thousand Eight Hundred Seven and Thirty One Paisa only). The Original Application has been filed through Ms. Pratima Singh, Senior Manager of the applicant bank, who is competent to institute the Original Application vide Authority letter dated 31.05.2022, which is Annexure A1 to this OA. 2. The brief facts of the OA are that the defendant No.2 being proprietor of defendant No.1 along with Co-obligant defendant No.3 had approached the applicant bank from time to time for the grant of credit facilities i.e. SOD Synd MSE CC Limit of Rs.15.00 Lacs, COVID relief fund of Rs.1.30 Lacs and GECL facility of Rs.2.80 Lacs vide Loan Applications dated 06.08.2018, 30.05.2020 and 26.06.2020, which are Annexures A5, A15 and A22 to this OA.

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The defendant nos.2 and 3 had approached the applicant bank for the grant of Housing loan of Rs.20.00 Lacs and COVID relief fund (CCS) of Rs.70,000.00 vide Loan Applications dated 20.07.2018 and 27.05.2020, which are Annexures A30 and A37 to this OA. 3. The applicant Bank sanctioned the credit facilities i.e. SOD Synd MSE CC Limit of Rs.15.00 Lacs, COVID relief fund of Rs.1.30 Lacs,

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GECL facility of Rs.2.80 Lacs, Housing loan of Rs.20.00 Lacs and COVID relief fund of Rs.70,000.00 vide Process Notes/Sanction Letters dated 05.02.2021, 26.06.2020, 21.07.2018 and 27.05.2020, which are Annexures A6, A23, A31 and A38 to this OA; and the terms and conditions were duly accepted by the defendants.

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Defendant nos.2 and 3 had mortgaged their immovable property i.e. Equitable mortgage of House bearing MC No.B-XXX-4160 measuring 578 Sq. Yards situated at Village Sherpur Kalan, H.B. No.176, locality known as Street No.4, Beant Pura, Indra Colony, Tehsil and District Ludhiana, Punjab vide Confirmation letter of mortgage and Annexure III dated 10.08.2018, Agreement to Mortgage dated 21.07.2018 and Confirmation of deposit of title deeds dated 07.02.2018, which are Annexures A11, A12, A33, A34 and A35 to this OA.

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Documents executed:- Copies of Pan Cards, which are Annexures A2 to A4 to this OA; Power of attorney for collection of book debts, Composite hypothecation agreement, Subordination agreement and Request for overdraft all dated 06.08.2018, which are Annexures A7 to A10 to this OA; Guarantee agreement and Annexure A-III both dated 10.08.2018, which are Annexures A13 and A14 to this OA; Letter of proprietorship, Agreement-cum-Deed of hypothecation, Agreement of take delivery letter, Pronote and Undertaking letters all dated 30.05.2020, which are Annexures A16 to A21 to this OA; Agreement, Take delivery Letter, Pronote, Letters of undertaking, Annexure A-II all dated 26.06.2020, which are Annexures A24 to A29 to this OA; Housing loan agreement dated 21.07.2018, which is Annexure A32 to this OA; Guarantee agreement dated 07.02.2018, which is Annexure A36 to this OA; Take delivery letter to DPN and Pronote both dated 27.05.2020, which are Annexures A39 and A40 to this OA; Acknowledgment of debt dated 02.11.2020, which is Annexure A41 to this OA; Demand notice dated 02.06.2022, which is

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Annexure A42 to this OA; Statements of accounts along with Certificate under Bankers Book Evidence Act, which are Annexures A43 to A47 to this OA and Valuation report dated 19.04.2022, which is Annexure A48 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.41,75,807.31p, 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 09.08.2023.

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In support of the OA, affidavit of Ms. Pratima Singh, Senior Manager, Canara Bank h as been filed.

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Heard ex-parte 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 bank had proved its case. From the perusal of all the Annexures A1 to A48 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 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 bank is entitled to recover a sum of Rs.41,75,807.31p (Rupees Forty One Lacs Seventy Five Thousand Eight Hundred Seven and Thirty One Paisa 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 bank in relief clause has claimed interest @15.00%p.a. in SOD Synd MSE CC Limit, @9.05%p.a. in COVID relief fund, @8.90%p.a. in GECL facility, @8.90%p.a. in Housing loan account and @9.80%p.a. in COVID relief fund (CCS) along with @2%p.a. penal interest with monthly rests in all the accounts, from 18.08.2022 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 defendant, 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 @8.90%p.a. in all 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.41,75,807.31p (Rupees Forty One Lacs Seventy Five Thousand Eight Hundred Seven and Thirty One Paisa only) jointly and severally, with costs, current and future simple interest @8.90%p.a. in all 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.

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Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 13.02.2024. 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: 24.01.2024 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Canara Bank v. M/S Satkar Car Bazaar and Others

Case brief

What is this about?

What did the court decide?

Canara Bank v. M/S Satkar Car Bazaar and Others

Case brief

What is this about?

What did the court decide?

What the court decided

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