Allowed

Canara Bank v. Ms New Lucky Dresses

DRT19 Sept 2024OA/294/2023

Case brief

AI extract

What is this about?

The DRT upheld the bank's application for recovery of dues against a borrower who failed to repay sanctioned loans. The court validated evidence via affidavit and banker's books, dismissed the absent defendants, and ordered a recovery certificate.

What did the court decide?

Debt of Rs. 70,53,737.97 plus interest allowed; Recovery Certificate drawn; properties attached; case remanded to Recovery Officer.

Canara Bank versus Ms New Lucky Dresses — Company and Corporate | DRT (2024)

DRT, PA’rNA

OA 294 of 2023 IJI

Debts Recovery Tribunal, Patna

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Karpuri Thakur Sadan, Aashiana Digha Road Patna-800025

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Presiding Officer : Shri Kaushalendra Yadav

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OA Case No. 294 of 2023

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Canara Bank, Simri Bakhtiyarpur, District-Saharsa.

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. . . . . . .Applicant

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Vs.

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M/s New Lucky Dresses, through its proprietor Mohammad Mojahidul Islam, Regd. Office Address P.O. –Tariyama, P.S.-Simri Bakhtiyarpur, District-Saharsa-852127 Also at NH 107 Ranihat, P.O. + P.S.-Simri Bakhtiyarpur, District-Saharsa, -852127.

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Mohammad Mojahidul Islam S/o Mohammad Farhrudin @ Farhrudin, Address –Tariawan, Tariama, District-Saharsa-852 127 PAN no. AFIP12765R.

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. . . . . . . Defendants

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Present:

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For the Applicant Shri Anurag Kumar, Advocate For the Defendants None

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Dated:19.09.2024

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JUDGMENT

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The Applicant bank has made this application u/s 19 of the Recovery of Debts and Bankruptcy Act, 1993 (here-in-after referred to as Act) on 29.5.2023 against the defendants to recover its debts from defendants of Rs.70,53,737.97 as on 30.4.2023 along with pendente-lite and future interest @11.25% in OCC account, @7 .65% in WCTL account & @10.90% in FITL loan p.a. with monthly rests from 1.5.2023 with costs till realization.

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The application has been filed with the contention that the applicant bank, is a body corporate, corporate banking company under the provisions of the banking companies (Acquisition and Transfer for Undertaking) Act 1970 having its Head Office at 112, J.C. Road, Bangalore-560002 and Branch Office at Simri Bakhtiyarpur, District-Saharsa

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Defendant no. 1 through proprietor defendant no. 2 approached the bank for grant of OCC facility of Rs.25 lakh on 10.8.2017, which was sanctioned by the bank on 10.8.2017. Defendants further approached the bank for

OA 294 of 2023 1 Jl

DRT, PATN A

enhancement of credit facility upto Rs. 45 lakh on 5.5.2018, which was sanctioned by the bank on 5.5.2018. Defendants further approached the bank for enhancement of credit facility upto Rs.50 lakh on 21.5.2019, which was sanctioned by the bank on 21.5.2019. Defendants further approached the bank for grant of WCDL/TL facility of Rs. 4 lakh, which was sanctioned by the bank on 24.4.2020. Defendants further approached the bank for grant of CFITL facility of RS.3,23,998/-, which was sanctioned by the bank on 1.9.2020. Defendants executed the various loan documents in favour of the bank and defendant no. 2 also created equitable mortgage of the land details given at page 42 in schedule-A of OA.

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After availing the sanctioned credit facilities defendants became irregular in repayment of their dues as per agreed terms and failed to adhere to the financial norms of the bank and avoiding the repayment of its dues to the bank, in spite of several assurances given by it to the applicant bank resulting in the account turning as NPA on 3 1.3.202 1

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Since, the defendants failed and neglected in spite of several reminders to make payment of the dues recoverable to the bank, hence this application has been filed by the bank.

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The total liability in the loan account is Rs.70,53,737.97 with pendentelite and future interest @11.25% in OCC account, @7 .65% in WCTL account & @10.90% in FITL loan p.a. with monthly rests from 1.5.2023 till the realization.

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This Tribunal issued summons/notices copies of application & paper book to the defendants by registered/speed post on 4.7.2023, requiring them to show-cause within 30 days of the service U/s 19 (4) of the Act & Rule of the DRT [Procedure] Rules, 1993. But the defendants have not appeared, hence, the Registry of this Tribunal has ordered to publish the notice in newspaper and subsequently, substituted service by publication of notice by way of advertisement in newspaper was also made against the defendants on 3.9.2023 in “Dainik Bhashkar” newspaper.

OA 294 of 2023 1 Jl

DRT1 PATNA

Despite the registered summons/notices and publication of notice in newspaper, the defendants have not appeared before this Tribunal to contest the case. The sufficient time has been given to the defendants to defend their case, but they failed to appear and to file WS, hence, the Tribunal has passed an order to proceed ex-parte against the defendants on 6.11.2023 .

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To prove its case, the applicant BatIk has referred various certified photocopies of documents before this Tribunal. The applicant bank has also given evidence on affidavit by way of affidavit by Shri Jai Kishore Paswan, Senior Manager of the applicant bank. The details of documents are as follows:

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Sl.No	of Description Documents Photocopies	Dateof Execution	Amount	Signature of Executants	Ex./ Ann No
1	Loanapplication	10.8.2017	Rs.25 lakh	Defendants	1
2	Sanctionletter	10.8.2017	Rs.25lakh	Bank	2
3	Cash creditagreement	10.8.2017	Rs.25lakh	Defendants	3
4	Copy ofsale deed				4
5	Letter of renewaland loan application	5.5.2018	Rs.45lakh	Bank and defendant	5
6	Sanction letter	5.5.2018	Rs.45 lakh	Bank	6
7	Supplemental agreement	5.5.2018	Rs.45 lakh	defendants	7
8	Draft LEDTD	5.5.2018	Rs.45 lakh	Defendants	8
9	Linkletter	5.5.2018	Rs.45 lakh	Defendants	9
10	Letter of renewaland loanapplication	21.5.2019	Rs.50 lakh	Bank and defendant	10
11	Sanction memorandum	21.5.2019	Rs.50 lakh	Bank	11
12	Supplemental agreement	21.5.2019	Rs.50 lakh	Defendants	12
13	r	21.5.2019	Rs.50 lakh	Defendants	13
14	Loanapplication	24.4.2020	Rs.4 lakh	Defendants	14
15	Sanction memorandum	24.4.2020	Rs.4 lakh	Bank	15
16	Agreement cumdeed ofhyDothecation	24.4.2020	Rs.4 lakh	Defendants	16
17	Canaracreditsupport				17
18	Acknowledgement of debtand securit'	27.7.2020		Defendants	18

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DRT,PATNA			OA 294of20231Jl
Statementofaccount	Ason	Rs.70,53,737.97	1bank
	30.4.2023

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Heard arguments and perused the case record.

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Ld. Counsel of applicant bank submitted that the defendants have taken the loan and utilized the same and also executed the various loan documents to secure the loan. Further, submitted that the claim of the bank has been proved by documentary evidence. All the transactions were entered in the ledger of the loan accounts in the name of the defendant duly maintained by the applicant bank in its usual course of business. The interest /compound interest has been charged at such rates, and capitalized at such periodical rests as are permitted by and do not run counter to the directives of Reserve Bank of India.

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It is further submitted by Id. Counsel of applicant bank that there is no stay granted by any Higher Court, in respect of the proceedings of the present OA and requested to issue recovery certificate, as claimed for, in OA.

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It has been established that defendants are living and carrying on their business in the state of Bihar. Cause of action also arose in the State of Bihar. The said claim on the date of filing of application exceeded Rs.20 lacs. The applicant bank is functioning within the jurisdiction of this Tribunal. Therefore, this Tribunal has territorial as well as pecuniary jurisdiction to adjudicate upon the present application.

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On the issue of Limitation, to prove it, the applicant bank has submitted that the applicant bank has declared the account as NPA on 3 1.3.202 1, whereas the present application has been filed on 29.5.2023. Even, it is counted for the purpose of Limitation, then it is established that the applicant bank has filed the case within the limitation period. As such, it is established that the present application has been filed well within the period of limitation.

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Shri Jai Kishore Paswan, Senior Manager of the applicant bank, has filed the affidavit in support of contents of application and the documents as evidence and proved on oath the pleadings and documents of the applicant bank as stated above. ) . ' -My

DRT, PATN A

OA 294 of 2023 IJI

14 Section 19(3) of the Recovery of Debts and Bankruptcy Act, 1993 provides that the application u/s S.19 (1) shall be accompanied with true copies of all the documents relied on in support of the claim.

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The rule 12 (10) of the Debt Recovery Tribunal (Procedure) Rules, 1993, provides that if the defendant denies his liability to pay the claim made by the applicant, the tribunal may act upon the affidavit of the applicant who is acquainted with the facts of the case or who has on verification of the record sworn the affidavit in respect of the contents of the application and the documents as evidence.

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The rule 12 (11) of the aforesaid Rules, provides that the provisions contained in section 4 of the Banker’s Books evidence that Act, 1891 (18 of 1891) shall apply to a certified copy of an entry in a Banker’s Books furnished along with application filed under sub section 1 of section 19 by the applicant.

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Section 4 of Banker’s Books evidence Act, 1891 runs as underS.4. Mode of proof of entries in bankers’ books.–Subject to the provisions of this Act, a certiBed copy of any entry in a banker’s book shall in all legal proceedings be received as prima facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions and accounts therein recorded in every case where, and to the same extent as, the original entry itself is now by law admissible, but not further or otherwise.

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As such the certified true copies of the documents are admissible in evidence. The statement of account maintained in the ordinary course of business is not only admissible but shall be taken as the correct statement of account, more so since the entries in the statement of account have not been challenged.

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On perusal of the application, documents, affidavit and on consideration of the arguments, it is proved that the defendants have applied for loan and the bank had sanctioned the loan and to secure the loan and for repayment of loan amount with rnterests etc., the defendants have executed various loan documents, as stated in the application and proved by aforesaid evidence. Defendants have neither denied the utilization of funds advanced by applicant bank nor have pointed out any specific error and discrepancy in the Statement of Account.

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The evidence discussed above goes to establish that the amount of loan as mentioned in the O. A., was availed by the borrower under the agreed terms and conditions for repayment with interest. The balance amount till 30.4.2023

OA 294 of 2023 1 Jl

DRT, PATNA

has been proved to be Rs.70,53,737.97 only by way of statement of account. There is nothing to prove the amount more than that disclosed in the aforementioned statement. As such this amount is recoverable till full and final realization of the claim .

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In my view, facts of the case stand proved by evidence of the applicant bank. Accordingly, the applicant bank is entitled to recover from defendants jointly and severally of Rs.70,53,737.97 along with pendente-lite and future interest @ 7.65% p.a. with compounded monthly rests from 29.5.2023 (The date of filing of this OA) till realization. So the final order may be passed accordingly, to meet the ends of justice.

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ORDER

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In the result, the application of the applicant bank is allowed and debt is determined with costs against the defendants. The defendants are hereby jointly and severally, ordered to pay the applicant bank its debt amounting to Rs.70,53,737.97 along with pendente-lite and future interest @ 7.65% p.a. with compounded monthly rests from 29.5.2023 (The date of filing of this OA) till realization of the entire sum due and recoverable with costs.

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It is made clear that any amount deposited by the defendants, be deducted in the claim amount, if not deducted.

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Defendants are debarred from transferring, alienating encumbering or otherwise dealing with or disposing of the mortgaged or hypothecated or any other properties and assets without paying the aforesaid adjudicated dues to the applicant bank to secure the ends of justice. The mortgaged or hypothecated assets to secure the loan in question are hereby attached and shall be subject to the final order under the recovery proceedings in pursuance of the Recovery certificate issued under Section 19(22) of Recovery of Debts and Bankruptcy Act 1993. The applicant may submit the certified copy of this Judgment and the Recovery Certificate before the Registrar/Sub- Registrar to endorse the charge over the secured assets.

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Let a certificate of recovery be drawn up forthwith and put up for signatures in terms of provisions contained in Section 19(22) of the Act to be issued, on the basis of the order of the Tribunal to the Recovery Officer. The

14\n

OA 294 of 2023 1 Jl

DRT, PATNA

Recovery Officer shall realize the amount as per the certificate in the manner and mode prescribed under the Act from the defendants, by sale of mortgaged/ hypothecated assets as well as other personal movable/immovable assets of the defendants.

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Parties are directed to appear before the Recovery Officer, DRT, Patna on 04.11.2024. The order be communicated accordingly.

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Judgment signed, sealed, dated and pronounced in the open court on

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19th day of September, 2024.

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Dictated &corrected by me.

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[KaushalendraYadav] Presiding Officer Debts Recovery Tribunal, Patna

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FORNI NQ. 9 [See Regulation 24( 1 )]

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DEBTS RECOVERY TRIBUNAL PATNA

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2nd Fl1,.)or. ( A. B & F Wing) Kdrpuri Thakur Sadan. Kendrlvi1 Karamchari Paris;ar (GPO A). Ashiana Digha Road, Patna-800025.

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RE.COVERY CERTIFICATE UNDER SECTION 19(Z)E (a)

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BANKRUPTCy AC'1-, 1993, AS AMENDED FROM TIME TO TIME.

RC No. 230/2024

Case No: OA/294/2023

In the Matter of (CH- 1) CANARA BANK SIMRI BAbIITIYARPUR. SAHARSA ,BIHAR -o

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Applicant(s)

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(CD- 1) MS NEW LUCKY DRESSES Through its Proprietor Mohammad N4ojahidul Islam. Reg(1. OfFice Address- P.O. -Tariyama. P.S.- Simri Bakhtlyarptlr.

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Saharsa .BIH AR -852 127

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Also At

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N.H. 1 07, RANIH AT, P.0. P.S.- srNIRI BAKHTIYARPUR. DISTT.- SAHARSA STATEBIHAR PIN - 852 127

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Defendant(s)

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(CD- 2) MOHAMMAD MOJAHIDUL ISLAM S/0 MOHAMMAD FARHRUD IN ALI AS FARHRUDIN ADDRESS- TARIAWAN. TARI AMA, DISTRIC-T- SAHARSA - 852 127 PAN NO AFIP12705R

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Recovery CertifIcate for Rs 7053737.97 [ Rupees Seventy Lakhs Fifty Three Thousands Seven Hundred Thirty Seven And Paise

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Ninety Seven QuILl

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In terms of tlna1 order dated 19/09/2024 passed by this Tribunal in the above mentioned case. it is ordered that the Applicant C'eNificatc Holder Bank is entitled to recover a sum of Rs. 7053737.97 along with cost. expenses and interest from the 29/05/2023 i.e. date of tlling I with effective date of the OA/294/2023 and future interest from order date till the date of realisation in full, jointly or severally from the Certificate Debtors, hereinafter referred to as:-

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L11O	CD Nanrc	Loan Type	Int I Type/Mode	Int iRate	Effective Date	Order Date	bnlount(Rs,)	Liability Type	Interest (ason Order Date)	RC F Amount(Rs.)	Remark
	MS NEW LUC'KY DRESSES		Interest I(Monthly)	[7.65	:29/05/2023	119’09/2024	l7053737.97	int ly	As on	737.97
	MOHAMMAD MOJAHIDLFL ISLAM		jcompound Interest i(Monthly)	.65	l29/05/2023	119/09/2024	l7053737.97	rointly	lterest trder	1053737.97

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In case of failure to pay the aforenrentioned adjudicated amount within 30 days, same shall be recovered from the sale of the mortgaged/hypothecated assets as well as other personal movable/ Immovable assets of the certificate debtors

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The mortgaged or hypothecated assets to secure the loan in question are hereby attached and shall be subject to the final order under the recovery proceeding in pursuance of the Recovery certificate issued under Section 19(22) of Recovery of Debts and Bankruptcy Act 1 993 .

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Parties are directed to appear before ASHISH KUMAR . Rccovery Otbcel DEBTS RECOVERY TRIBUNAL PATNA on 04/ 11/2024.

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The Recovery CJfHcer shall realize the amount as per this C'ertitlcatl- in the manner and mode prescribed under Sections 25 to 28 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1 993 ( as amended from time to time) fron1 the above named C:ertiHcate Debtors.

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This Certitlcate has been issued under my signature and seal of the Tribunal on this 20/09/2024

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PRESIDING OFFICER DEBTS RECOVERY TRIBUNAL PATNA

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Xh Registrar Debts Rec;very Tribunal Patna

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FORM NO. 10

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''\

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[See Regulation 24(2)]

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DEBTS RECOVERY TRIBUNAL PATNA

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2nd Floor, ( A, B & F Wing) Karpuri Thakur Sadan, Kendriya Karamchari Parisar

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(GPOA). Ashiana Digha Road, Patna-800025 .

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SCHEDULE TO RECOVERY CERTIFICATE

MEMO OF COSTS

RC No. 230/2024

Case No: OA/294/2023

Applicant(s): CANARA BANK

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Versus

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Defendant(s): MS NEW LUCKY DRESSES

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Item ofCosts	r
Feeon the application	m
	[0
AdvocateFees	ra
Commissioner/Receiver/Valuation/SecurityFee	[0
MiscellaneousCharges	[0
-otalCosts:Rs	m7

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Place: PATNA

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Date: 20/09/2024

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PRESIDIN(iOfFICER DEBTS RECOVERY TRIBUNAL PATNA

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Note: Strike out whichever is not applicable

Canara Bank v. Ms New Lucky Dresses

Case brief

What is this about?

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Canara Bank v. Ms New Lucky Dresses

Case brief

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