Allowed

Canara Bank v. Sh. Mohar Singh

DRT17 Jan 2024OA/2013/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed the bank's original application and directed the defendant to pay the outstanding principal of Rs 27.09 lakh. The Tribunal reduced the claimed interest rate to a uniform 7% per annum and authorized recovery via sale of secured assets.

What did the court decide?

Recovery of Rs 27,09,459/- with simple interest at 7% per annum from date of filing; liberty to recover amount from sale of mortgaged properties or attachment of personal assets.

Canara Bank versus Sh. Mohar Singh — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-2, CHANDIGARH, PRESIDED OVER BY M.M. DHONCHAK

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ORIGINAL APPLICATION NO. 2013/2022

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DATE OF INSTITUTION: 04.11.2022

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DATE OF DECISION: 17^th DAY OF JANUARY, 2024

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Canara Bank , a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its head office at 112, J.C. Road Bangaluru-2 (herein after referred to as (the Bank) with its Branches throughout India and one such Branch at G.T. Road Fatehabad, District Fatehabad, Haryana-125050, through its Principle Officer and Power of Attorney holder, Sh. Jitendra Kumar Arora, Branch Manager, Canara Bank, Fatehabad

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…..Applicant

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Versus

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Sh. Mohar Singh s/o Sh. Jagdish s/o Sh. Naanu r/o V.P.O Dharnia, Tehsil and District, Fatehabad, Haryana-125048

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....Defendant

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Argued by: Ms Anuradha Gupta counsel for the applicant bank Defendant ex parte vide order dated 19.08.2023

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19(1) of the Recovery of Debts and Bankruptcy Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), a gainst the defendant for recovery of Rs.27,09,459/- (Rupees Twenty Seven Lakh Nine Thousand Four Hundred and Fifty Nine Only) . It has been filed through Sh. Jitendra Kumar, Officer of the applicant bank stated to be competent to institute the Original Application vide General Power of Attorney dated 03.12.2013, Annexure-A1 (copy).

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OA/2013/2022 CANARA BANK VS MOHAR SINGH 2

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The brief facts of the case of the applicant as per Original Application are that the defendant had approached the applicant bank for grant of KCC facility of Rs. 14.64 lakh and again approached for Kisan OD Limit vide common application-cum-appraisal Forms dated 04.05.2016 and 10.08.2017 for agricultural loan, Annexures-A2 and A8 (colly) (copy).

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The applicant bank sanctioned aforesaid facilities to the defendant vide sanction memorandums dated 04.05.2016 and 10.08.2017, Annexure-A3 and A8 (copy), as per terms and conditions which were duly accepted by the defendant. 4. In order to secure the aforementioned credit facilities, the defendant executed agreement dated 11.05.2016 and deed of hypothecation for Kisan Credit Card, Annexure-A4 (copy) and agreement dated 17.08.2017 and deed for Kisan OD, Annexure-A9 (copy).

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The aforesaid loan facilities were further secured by creation of mortgage by the defendant in respect of two properties detailed as below:

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i. Agricultural land measuring 66 Kanal 3 Marla situated in the revenue estate of Dharnia, Tehsil and District Fatehabad, Haryana

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ii. Agricultural land measuring 23 Kanal 3 Marla situated in the revenue estate of Dhand, Sub-Tehsil Bhattu-Kalan, District Fatehabad, Haryana, fully detailed in para No. 5.5 of the Original Application.

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The documents relating to the mortgage are as under:

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i. Link letter dated 11.05.2016, Annexure-A5 (copy).

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ii. Registered simple mortgage deed dated 04.05.2016, AnnexureA6 (copy).

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OA/2013/2022 CANARA BANK VS MOHAR SINGH 3

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iii. Copy of ‘Jamabandi’ for the years 2013-2014, Annexure-A7 (copy).

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iv. Registered mortgage deed dated 16.08.2017, Annexure-A10 (copy).

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v. Copy of ‘Jamabandi’ for the years 2013-2014, Annexure-A11 (copy).

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It is further the case of the applicant bank that the loan facilities were duly availed of by the defendant but he failed to maintain the financial discipline of the applicant bank leading to the loan accounts becoming irregular and those being classified as NPA on 06.11.2021. The defendant executed acknowledgement of debt and security letters dated 28.09.2018, 19.01.2022 and 09.01.2020, Annexures-A12, A13 and A14 (copy). The applicant bank recalled entire outstanding amount vide legal notice dated 17.09.2022, Annexure-A15 (copy) and postal receipt, Annexure-A16 (copy), but to no avail.

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It is further the case of the applicant bank that after adjusting debit and credit entries in the loan accounts, a sum of Rs.27,09,459/-

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(Rupees Twenty Seven Lakh Nine Thousand Four Hundred and

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Fifty Nine Only) , is recoverable against the defendant as per statements of accounts, duly certified under Bankers’ Books Evidence Act, 1891, Annexures-A17 and A18 (copy).

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Since the defendant did not repay the outstanding amount, therefore, the applicant bank preferred the present Original Application for issuance of Recovery Certificate. 7. Notice of the Original Application was duly served upon the defendant, but since none appeared on behalf of the defendant, thus,

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OA/2013/2022 CANARA BANK VS MOHAR SINGH 4

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the defendant was proceeded against ex-parte vide order dated 19.08.2023 .

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In support of contents of the OA, affidavit of evidence of Sh. Jitendra Kumar, Senior Manager of the applicant bank was filed.

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This Tribunal has heard ex-parte arguments advanced by the learned counsel and gone through the record carefully.

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It was argued by the learned counsel that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendant for recovery of the amount sought. From perusal of Annexures-A1 to A18 , it is clear that the defendant had approached the applicant bank for availing of the loan facilities which were granted to him. It is further clear that the defendant had executed all the relevant documents as stated above in favour of the applicant bank. Unfortunately, the defendant failed to pay back the loan as per terms and conditions of the agreement executed between the parties. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of

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Rs.27,09,459/- (Rupees Twenty Seven Lakh Nine Thousand Four Hundred and Fifty Nine Only) from the defendant.

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In so far as pendente lite and future interest is concerned, the applicant bank in relief clause, has claimed rate of interest @10.35% in KCC facility and @12.15% per annum plus penal interest @2% per annum in Kisan OD Limit. In sanction memorandums dated 04.05.2016 and 10.08.2017, Annexure-A3 and A8 (copy), the rate of interest has been mentioned @11.65% per annum in KCC facility and @10.70% per annum in Kisan OD Limit.

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OA/2013/2022 CANARA BANK VS MOHAR SINGH 5

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This Tribunal is of the considered opinion that sometimes in appropriate cases the prerogatives of mercy and magnanimity are the brightest jewels in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including the Pandemic Covid-19 affecting businesses, nature of the mortgaged properties, purpose of loan, i.e. agricultural , present conditions of economy based on agriculture, quantum of loan, prevalent market rates of interest which have gone drastically downhill in yesteryears, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @7% per annum from the date of filing of the OA till realisation of the amount ordered vide this order. It is ordered accordingly.

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In the result, the Original Application is allowed with costs holding that the defendant is liable to pay to the applicant bank a sum of Rs.27,09,459/- (Rupees Twenty Seven Lakh Nine Thousand Four Hundred and Fifty Nine Only) with current and future simple interest @7% per annum w.e.f. 04.11.2022 , till the date of realisation of the amount. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of mortgaged/hypothecated properties of the defendant in execution proceedings, if not sold earlier under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 or otherwise. If the dues of the bank still remain unsatisfied, the applicant bank shall be at liberty to recover the same by attachment and sale of personal assets of the defendant. However, the applicant bank is at liberty to enforce the claim through due process of law.

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Issue Recovery Certificate accordingly.

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OA/2013/2022 CANARA BANK VS MOHAR SINGH

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Parties to appear before Recovery Officer concerned on 05.03.2024.

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Copy of this order be sent to the applicant bank and the defendant through registered/speed post. This order be uploaded on the official website of this Tribunal.

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Pronounced in the open Tribunal (M.M. Dhonchak) Presiding Officer DRT-2, Chandigarh

Canara Bank v. Sh. Mohar Singh

Case brief

What is this about?

What did the court decide?

Canara Bank v. Sh. Mohar Singh

Case brief

What is this about?

What did the court decide?

What the court decided

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