Allowed

Union Bank of India v. the Essentials and Another

DRT19 Sept 2024OA/245/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an Original Application by Union Bank of India to recover Rs. 20,35,631.40 from borrowers who defaulted on a cash credit facility. The court proceeded ex-parte due to defendant non-appearance, declared liability jointly and severally, and fixed interest at 8% p.a.

What did the court decide?

Recovery of Rs.20,35,631.40 with simple interest at 8% p.a. from date of filing till realization. Recovery Certificate issued. Defendants jointly and severally liable.

Union Bank of India versus the Essentials and Another — Banking and Recovery | DRT (2024)

¶1

DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

¶2

ORIGINAL APPLICATION NO.245/2024

¶3

PRESIDED OVER BY MRIDULESH KUMAR SINGH

¶4

DATE OF INSTITUTION: 16.01.2024

¶5

DATE OF DECISION: 19.09.2024

¶6

Union Bank of India, a Government of India Undertaking incorporated under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and having its Head Office at Union Bank Bhavan, 239, Vidhan Bhavan Marg, Backday Reclamation, Nariman Point, Mumbai, carrying on the business of banking at various places, throughout India including a branch at Kumbra, Sector 68, SAS NAGAR (MOHALI) through Ms. Monica Kohli, Senior Manager/Principal Officer/General Attorney, Union Bank of India, Kumbra, Sector 68, SAS Nagar (Mohali)

¶7

……..Applicant Versus

¶8

The Essentials through its proprietor Ms. Sukhmani Sandhu having its office at SCO 2/1, VPO Kumbra, Sector 68, SAS Nagar Mohali140308

¶9

Ms. Sukhmani Sandhu D/o Mr. Narinder Singh R/o H. No.4011, Sector 68, SAS Nagar (Mohali)-160062

¶10

….……Defendants

¶11

Advocates:

¶12

Argued by Sh. Gaurav Chadda, Advocate for applicant Defendants are ex-parte

¶13

FINAL ORDER

¶14

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.20,35,631.40p (Rupees Twenty Lakh Thirty Five Thousand Six Hundred Thirty One and Paise Forty Only). The Original Application has been filed through Ms. Monica Kohli, Senior Manager, o f the applicant, who is competent to institute the Original Application vide Power of Attorney dated 26.08.2016, which is Annexure A1 to this OA.

¶15

¶16

The brief facts of the OA are that the defendant No.1 through its proprietor i.e. defendant No.2 had approached the applicant for the grant of Cash Credit Facility of Rs.25.00 Lacs vide Loan Application dated 01.09.2020, which is Annexure A2 to this OA. 3. The applicant sanctioned the Cash Credit Facility of Rs.20.95 Lacs vide Sanction Letter and Communication of Sanction, both dated 11.09.2020, which are Annexures A3 & A4 to this OA and the terms and conditions were duly accepted by the defendants. 4. Defendant No.2 had mortgaged his immovable property i.e. Flat No. A-506, 6^th Floor, 3 BHK, Gulmohar Heights, Tower No. 5, White Towers, Khanpur, Tehsil Kharar, District SAS Nagar vide equitable registered sale deed bearing vasika No. 2020-21/15/1/1631 dated 14.07.2020 and jamabandi for the year 2014-15 along with their translations, which is Annexures A15 to A18 to this OA. Documents executed: - Demand Promissory Note, Letter of Continuity Letter of General Lien and Set off, Hypothecation of Goods Agreement, Letter of undertaking Not Alienate Hypothecated Goods and Interest Agreement and Letter of Undertaking from Borrower to pay residual amount all dated 11.09.2020 which are Annexures A5 to A11 ; affidavit & letter of declaration both dated 23.10.2020, which are Annexures A12 & A13 to this OA; Memorandum of deposit of title deed dated 14.09.2020, which is Annexure A14 to this OA; Notice U/s 13(2) of SARFAESI Act dated 04.08.2023, which is Annexure A19 to this OA; Debit Balance Confirmation dated 30.06.2023, which is Annexure A20 to this OA; Statement of account and Certificate of Banker’s Book of Evidence Act and Section 65B of Evidence Act dated, which are Annexures A22 to A23 to this OA. 5. The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in loan account there was a debit of Rs. Rs.20,35,631.40p, 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.

¶17

¶18

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 19.08.2024.

¶19

In support of the OA, affidavit of Smt. Ms. Monica Kohli, Senior Manager, Union Bank of India has been filed.

¶20

Heard arguments and perused record.

¶21

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 A1 to A23 to this OA, it is proved that the defendants approached applicant for availing of the loan facility which was granted to them and for that they had executed all the relevant documents in favour of the applicant. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs. Rs.20,35,631.40p (Rupees Twenty Lakh Thirty Five Thousand Six Hundred Thirty One and Paise Forty 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.

¶22

In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @13.05%p.a. with monthly rests from 01.01.2024 till the realization.

¶23

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 @8.00%p.a. in

¶24

¶25

the loan account from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly.

¶26

In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.20,35,631.40p (Rupees Twenty Lakh Thirty Five Thousand Six Hundred Thirty One and Paise Forty Only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in the loan account 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 applicant 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. 13. Issue Recovery Certificate accordingly.

¶27

Parties to appear before Learned Recovery Officer of this Tribunal on 11.10.2024.

¶28

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.

¶29

Pronounced by me in the Open Tribunal . Dated: 19.09.2024

¶30

(MRIDULESH KUMAR SINGH) Presiding Officer,

¶31

DRT-III, Chandigarh

Union Bank of India v. the Essentials and Another

Case brief

What is this about?

What did the court decide?

Union Bank of India v. the Essentials and Another

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Uco Bank versus Messrs Juneja Hardware and Scrap Store and Others

Punjab Gramin Bank versus Gurpartap Singh

Punjab National Bank versus Onkar Singh and Another

Punjab National Bank versus Jaipal Goyal and Another

Punjab National Bank versus Mohinder Singh Alias Mahinder Singh Another

Indian Overseas Bank versus Pritam Singh and Others