Allowed

Punjab National Bank v. M/S Kathpal Dairies and Others

DRT1 Mar 2024OA/2105/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the applicant bank's original application for recovery of approximately Rs. 10.62 crore unpaid by the borrowers. The court validated the bank's claim, standardized the interest rate to 10% p.a., and issued a recovery certificate alongside authorization for execution proceedings.

What did the court decide?

Recovery certificate issued; liability declared to pay Rs. 10.62 crore plus costs and simple interest at 10% p.a.; liberty to enforce claim through sale of mortgaged or personal assets.

Punjab National Bank versus M/S Kathpal Dairies and Others — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.2105/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 22.03.2022

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DATE OF DECISION: 01.03.2024

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Punjab National Bank, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Corporate Office at Plot No.4, Sector 10, Dwarka, New Delhi-110075 and one of its Branch (e-OBC) at Railway Road, Moga and a Circle Sastra Division Moga, Tehsil & District Moga (Punjab), through its General Power of Attorney holder, Sh. Sandeep Kumar, Senior Manager presently posted at Circle Sastra Office at Moga, Punjab

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……..Applicant

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Versus

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M/s Kathpal Dairies through its Proprietor, Sh. Rakesh Kumar, Dharam Kot Road, VPO Fatehgarh Panjtoor, Tehsil Dharamkot, District Moga, Punjab

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2^nd Address : Village Kokri Phulla Singh, Tehsil Ajitwal, District Moga (Punjab) (Borrower/ Mortgagor)

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Sh. Rakesh Kumar S/o Sh. Manohar Lal, Proprietor M/s Kathpal Dairies, Dharam Kot Road, VPO Fatehgarh Panjtoor, Tehsil Dharamkot, District Moga, Punjab

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2^nd Address : Village Kokri Phulla Singh, Tehsil Ajitwal, District Moga (Punjab).

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And Also at: Flat A1, Roop Vihar, Arra Road, Near Arun Agarwal Nursing Home, Tehsil & District Moga (Borrower/ Mortgagor)

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Sh. Chander Shekhar S/o Sh. Rakesh Kumar, Flat A1 Roop Vihar, Arra Road, Near Arun Agarwal Nursing Home, Tehsil & District Moga (Punjab)

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2^ndAddress: Village VPO Fatehgarh Panjtoor, Tehsil Dharamkot,
District Moga, Punjab (Guarantor)
4. Smt. Riphy Arora wife of Sh. Chander Shekhar, Flat A1 Roop Vihar, Arra Road, Near Arun Agarwal Nursing Home, Tehsil & District Moga
(Punjab)
2^ndAddress: Village Fatehgarh Panjtoor, Tehsil Dharamkot, District
Moga, Punjab (Guarantor)
5. Smt. Sunita Rani wife of Sh. Rakesh Kumar, VPO Fatehgarh Panjtoor, Tehsil Dharamkot, District Moga, Punjab
2^ndAddress: Flat A1 Roop Vihar, Arra Road, Near Arun Agarwal Nursing Home, Tehsil & District Moga (Mortgagor /Guarantor) ………Defendants
Advocates: Argued by Sh. Aseem Kataria, Advocate for the Applicant Defendants are ex-parte 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.10,62,17,421.00 (Rupees Ten Crores Sixty Two Lacs Seventeen
Thousand Four Hundred Twenty One only). The Original Application has
been filed through Sh. Sandeep Kumar, Senior Managerof the applicant bank, who is competent to institute the Original Application vide General Power of Attorney dated 04.11.2016, which isAnnexure A1to this OA.
2. The brief facts of the OA are that the defendant No.1 through its
proprietor defendant No.2 had approached the applicant bank for the
grant of credit facilities i.e. Term Loan-I of Rs.2.70 Crores, CC limit of
Rs.2.00 Crores, Term Loan-II of Rs.4.00 Crores, Fresh CC limit of

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Rs.30.00 Lacs and Term Loan-III of Rs.3.90 Crores vide Loan Applications dated 10.10.2016, 01.06.2017 and 14.11.2017, which are Annexures A3, A28 and A43 to this OA.

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The applicant Bank sanctioned the credit facilities i.e. Term LoanI of Rs.2.70 Crores, CC limit of Rs.2.00 Crores, Term Loan-II of Rs.4.00 Crores, Fresh CC limit of Rs.30.00 Lacs and Term Loan-III of Rs.3.90 Crores vide Sanction Letters dated 08.12.2016, 08.06.2017, 23.11.2017 and 19.05.2019, which are Annexures A4, A29, A44 and A59 to this OA; and the terms and conditions were duly accepted by the defendants. 4. Defendant Nos.1, 2 and 5 had mortgaged their immovable properties detailed as:

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(a) Factory Land & Building measuring 2 Kanal 10 Marlas; situated at Village Fatehgarh Panjtoor, Tehsil Dharamkot, District Moga, Punjab owned by defendant no.2; vide Sale Deed bearing Vasika No.1934 dated 17.03.2016 along with its translation, which are Annexures A10 and A10/T to this OA;

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(b) 5 Commercial Shops measuring 06 Marlas 2.5 Sarsai; situated at 9, New Town Moga owned by defendant no.5; vide Sale Deed bearing Vasika no.7580 dated 04.02.2011, Sale Deed bearing vasika no.8417 dated 28.12.2011 and Sale deed bearing vasika no.3493 dated 18.07.2011; along with their translations, which are Annexures A11, A11/T, A12, A12/T, A13 and A13/T to this OA;

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(c) Total land measuring 12K-00M situated at Village Kokri Phula Singh, District Moga, Punjab; in the name of defendant no.1 vide Sale Deed bearing Vasika No.75 dated 05.05.2017 along with its translation, which are Annexures A41 and A42/T to this OA;

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(d) Total land measuring 07 Kanal 04 Sarsai situated at Fatehgarh Panjtoor owned by defendant no.2; vide Sale Deed bearing Vasika No.1348 dated 26.10.2016 along with its translation, which are Annexures A14 and A14/T to this OA;

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(e) Commercial Property measuring 05 Marlas situated at Fatehgarh Panjtoor, Tehsil Dharamkot, District Moga owned by defendant no.5; vide Sale Deed bearing Vasika no.5290 dated 16.02.2012 along with its translation, which are Annexures A24 and A25 to this OA; (f) Commercial Property measuring 15 Marla 04 Sarsai situated at Village Fatehgarh Panjtoor, Tehsil Dharamkot, District Moga, Punjab; owned by defendant no.5 vide Sale Deed bearing Vasika No.1248 dated 01.07.2009 along with its translation, which are Annexures A15 and A15/T to this OA; and (g) Total land measuring 03 Marla 06 Sarsai situated at Flat no. A1, Arra Road, Roop Vihar, Moga Mehla Singh; owned by defendant no.5 vide Sale deed bearing Vasika No.3946 dated 01.08.2011 along with its translation, which are Annexures A16 and A16/T to this OA. Documents executed: - Sole Proprietorship dated 13.12.2016, which is Annexure A2 to this OA; Agreement of Hypothecation, Common Agreement and Guarantee Agreements dated 13.12.2016, which are Annexures A5, A6 and A9 (Colly) to this OA; Agreements of Term loan dated 30.12.2016, which are Annexures A7 and A8 to this OA; Letters evidencing deposit of Title Deeds dated 31.12.2016, which are Annexures A17 to A23 to this OA; Letter evidencing deposit of Title Deed dated 24.01.2017, which is Annexure A26 to this OA; Supplemental Agreement to secure credit facilities dated 13.02.2017, which is Annexure A27 to this OA; Agreement of Hypothecation, Common Agreement, Agreement of Term Loan and Guarantee Agreements all dated 14.06.2017, which are Annexures A30 to A33 (Colly) to this OA; Letters evidencing extension of mortgage dated 15.06.2017, which are Annexures A34 to A40 to this OA; Agreement of Term Loan, Agreement of Term Loan for Immovable Property, Common Agreement and Guarantee Agreements all dated 23.11.2017, which are Annexures A45, A46, A48 and A49 (Colly) to this OA; Undertaking, which is Annexure A47 to this OA; Letters Evidencing

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extension of mortgage dated 24.11.2017, which are Annexures A50 to A58 to this OA; Agreement of Hypothecation of assets dated 01.07.2019, which is Annexure A60 of this OA; Balance and security confirmation letters dated 15.10.2019, which are Annexures A61 to A64 to this OA; Notice u/s 13(2) dated 07.11.2020, which is Annexure A65 of this OA; Notice u/s 13(4) dated 24.09.2021, which is Annexure A66 to this OA and Statements of Accounts, which are Annexures A67 to A69 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.10,62,17,421.00, 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. Defendants once appeared before this Tribunal through their counsel but later due to non-appearance; they were proceeded ex-parte on 06.02.2024.

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In support of the OA, affidavit of Sh. Sandeep Kumar, Senior Manager, Punjab National Bank has been filed. 8. Heard ex-parte arguments and perused record. 9. 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 A69 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

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bank is entitled to recover a sum of Rs.10,62,17,421.00 (Rupees Ten Crores Sixty Two Lacs Seventeen Thousand Four Hundred Twenty One 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; (i) @10.60%p.a. (inclusive of @2%p.a. additional interest) with monthly rests in respect of Term Loan-I facility; (ii) @10.60%p.a. (inclusive of @2%p.a. additional interest) with monthly rests in respect of Term Loan-II facility; and (iii) @11.60%p.a. (inclusive of @2%p.a. additional interest) with monthly rests in respect of CC loan facility; from 09.03.2022 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 exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @10.00%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. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.10,62,17,421.00 (Rupees Ten Crores Sixty Two Lacs Seventeen Thousand Four Hundred Twenty One only) jointly and severally, with costs, current and future simple interest @10.00%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

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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.

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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 15.03.2024.

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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

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Dated: 01.03.2024

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

Punjab National Bank v. M/S Kathpal Dairies and Others

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/S Kathpal Dairies and Others

Case brief

What is this about?

What did the court decide?

What the court decided

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