Allowed

State Bank of India v. M/S Kehar Singh Surinder Singh

DRT17 Jan 2024OA/2118/2022

Case brief

AI extract

What is this about?

The Tribunal allowed an application filed by State Bank of India against two defendants. The court held the defendants liable to repay Rs. 60,41,027.44 with interest at 7% per annum from the filing date, considering the pandemic's impact. The Tribunal issued a recovery certificate.

What did the court decide?

The Original Application was allowed; defendants ordered to pay Rs. 60,41,027.44 plus 7% simple interest; Recovery Certificate issued.

State Bank of India versus M/S Kehar Singh Surinder Singh — Banking and Recovery | DRT (2024)

¶1

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

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ORIGINAL APPLICATION NO.2118/2022

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DATE OF INSTITUTION: 14.11.2022

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

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State Bank of India , a body corporate, constituted under the State Bank of India Act, 1955, having its Corporate Office at Madam Cama Road, Nariman Point, Mumbai, one of its local Head Offices at Sector17-A, Chandigarh, having Branches all over India and one of its Branches situated at Devi Mandir Road, Shahabad-Markanda, District Kurukshetra, Haryana and also having Stressed Assts Recovery Branch (SARB) at SCO No. 70, Ground Floor, Sector 5, Panchkula, Haryana, through its Chief Manager, Sh. Ravindra Kumar Dass

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…..Applicant

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Versus

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M/s Kehar Singh Surinder Singh, Proprietorship concern situated at Shop No. 21 A, New Grain Market, Shahabad, Tehsil Shahabad-Markanda, District Kurukshetra, Haryana, through its Proprietor, Sh. Karambir Singh s/o Sh. Kehar Singh

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Sh. Karambir Singh s/o Sh. Kehar Singh, Proprietor of M/s Kehar Singh Surinder Singh, r/o Village Rattangarh, Tehsil Shahabad, District Kurukshetra, Haryana

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…..Defendants

¶11

Argued by: Sh. Dinesh Chatrath, Advocate for the applicant bank Defendants ex parte vide order dated 01.09.2023

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OA/2118/2022 STATE BANK OF INDIA Vs M/S KEHAR SINGH SURINDER SINGH AND ANOTHER 2

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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 due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as ‘the Act’ for brevity), against the defendants for recovery of Rs.60,41,027.44/- (Rupees Sixty Lakh Forty One Thousand Twenty Seven and Forty Four Paisa Only). It has been filed through Sh. Ravindra Kumar Dass, Chief Manager of the applicant bank stated to be competent to institute the Original Application vide Gazette Notification dated 22.02.2017, AnnexureA1 (copy).

¶15

The brief facts of the case of the applicant as per Original Application are that defendant No. 1 through defendant No. 2, had approached the applicant bank for grant of Cash Credit Limit of Rs. 40,00,000/which was further enhanced to Rs. 48,00,000/and thereafter further renewed for Rs. 43,00,000/- and a Term Loan of Rs. 2,21,114 under FITL scheme .

¶16

The applicant bank sanctioned aforesaid facilities to the defendants vide letters of arrangement dated 06.12.2013, 24.03.2015, 30.07.2015, 15.02.2017 and 10.03.2021, AnnexuresA2, A5, A6, A9 and A10 (copy), as per terms and conditions which were duly accepted by the defendants.

¶17

In order to secure the aforementioned credit facilities, the defendants executed agreements dated 06.12.2013 and 30.07.2015 of loan-cum-hypothecation, Annexures-A3 and A7 (copy) and

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OA/2118/2022 STATE BANK OF INDIA Vs M/S KEHAR SINGH SURINDER SINGH AND ANOTHER 3

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demand promissory notes dated 06.12.2013 and 30.07.2015, Annexures-A4 and A8 (copy).

¶20

The aforesaid loan facilities were further secured by creation of mortgage by defendant No. 2 in respect of shop No. 21 A, measuring 94.44 Square Yard situated at New Grain Market, Shahabad-Markanda, District Kurukshetra, Haryana, fully detailed in Para No. 5(xiv) of the Original Application.

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The documents relating to the mortgage are as under:

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i. Registered sale deeds dated 04.02.2011 and 23.08.2013,

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Annexures-A11 and A12 (copy).

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ii. Letters dated 25.07.2012 and 31.07.2015 for confirmation of deposit of title deeds, Annexures-A13 and A14 (copy).

¶25

It is further the case of the applicant bank that the loan facilities were duly availed of by the defendants but they failed to maintain the financial discipline of the applicant bank leading to the loan accounts becoming irregular and those being classified as NPA on 31.03.2021. The defendants executed balance confirmatory-cumacknowledgement of security letters dated 24.03.2015, 15.02.2017,

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Annexures-A15 and A16 (copy) and revival letter dated 17.05.2018, Annexure-A17 (copy). The applicant bank recalled entire outstanding amount vide notice dated 14.09.2021 under Section 13(2) and notice dated 03.02.2022 under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 along with its postal receipts, Annexures-A18 and A19 (colly) (copy), but to no avail.

¶27

It is further the case of the applicant bank that after adjusting debit and credit entries in the loan accounts, a sum of

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OA/2118/2022 STATE BANK OF INDIA Vs M/S KEHAR SINGH SURINDER SINGH AND ANOTHER 4

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Rs.60,41,027.44/- (Rupees Sixty Lakh Forty One Thousand Twenty Seven and Forty Four Paisa Only), is recoverable against the defendants as per statements of accounts duly certified under Bankers’ Books Evidence Act, 1891, Annexures-A20 to A23 (copy).

¶30

Since the defendants did not repay the outstanding amount, therefore, the applicant bank preferred the present Original Application for issuance of Recovery Certificate.

¶31

Notices of the Original Application were duly served upon the defendants, but since none appeared on behalf of the defendants, thus, the defendants were proceeded against ex-parte vide order dated 01.09.2023 .

¶32

In support of contents of the OA, affidavit of evidence of Sh. Ravindra Kumar Dass, Chief Manager of the applicant bank was filed.

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

¶34

It was argued by the learned counsel of the applicant bank that in view of unrebutted documentary evidence brought on record, the applicant bank had proved its case against the defendants for recovery of the amount sought. From perusal of Annexures-A1 to A23 , it is clear that the defendants had approached the applicant bank for availing of the loan facilities which were granted to them. It is further clear that the defendants had executed all the relevant documents as stated above in favour of the applicant bank.

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OA/2118/2022 STATE BANK OF INDIA Vs M/S KEHAR SINGH SURINDER SINGH AND ANOTHER 5

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Unfortunately, the defendants 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 Rs.60,41,027.44/- (Rupees Sixty Lakh Forty One Thousand Twenty Seven and Forty Four Paisa Only) from the defendants. 11. In so far as pendente lite and future interest is concerned, in relief clause the applicant bank has claimed rate of interest @10.05% per annum plus @2% per annum penal interest in cash credit limit and @7.65% per annum in term loan. In letter of arrangement dated 06.12.2013, Annexure-A2 (copy), rate of interest has been mentioned @10.75% per annum.

¶37

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 property, purpose of loan, i.e. business, 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.

¶38

In the result, the Original Application is allowed with costs holding that the defendants are liable to pay to the applicant bank a sum of Rs.60,41,027.44/- (Rupees Sixty Lakh Forty One Thousand Twenty Seven and Forty Four Paisa Only) with

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OA/2118/2022 STATE BANK OF INDIA Vs M/S KEHAR SINGH SURINDER SINGH AND ANOTHER 6

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current and future simple interest @7% per annum w.e.f. 14.11.2022 , till the date of realisation of the amount. The liability of the defendants shall be joint as well as several. Accordingly, the applicant bank shall be at liberty to recover aforesaid amount from the sale of mortgaged/hypothecated property of the defendants 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 defendants. However, the applicant bank is at liberty to enforce the claim through due process of law.

¶41

Issue Recovery Certificate accordingly.

¶42

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 defendants through registered/speed post. This order be uploaded on the official website of this Tribunal.

¶44

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

State Bank of India v. M/S Kehar Singh Surinder Singh

Case brief

What is this about?

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State Bank of India v. M/S Kehar Singh Surinder Singh

Case brief

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