Allowed

Bank of India v. M/s. Ace Engineering

DRT11 Mar 2024OA/357/2022

Case brief

AI extract

What is this about?

This tribunal allowed an Original Application filed by Bank of India under Section 19(1) of the 1993 Act. The court directed the defendants to pay the reduced claim amount of Rs. 1,48,85,412.18 with interest and ordered the issuance of a Recovery Certificate.

What did the court decide?

Issued Recovery Certificate and directed defendants to pay Rs. 1,48,85,412.18 with interest at 12.60% p.a. from 31.12.2020.

Bank of India versus M/s. Ace Engineering — Banking and Recovery | DRT (2024)

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Presented on : 31.12.2020 Registered on : 19.07.2022 Decided on : 11.03.2024 Duration : Y M D 03 02 11

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IN THE DEBTS RECOVERY TRIBUNAL No.2, MUMBAI

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ORIGINAL APPLICATION NO.357 OF 2022

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TOTAL CLAIM AMOUNT : Rs.1,49,74,173.22

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Bank of India a Body Corporate Constituted under the Banking Companies (Acquisition Transfer of Undertakings) Act V of 1970, having their Head Office at “Star House”, C- 5, “G” Block, Bandra-Kurla Complex, Bandra (East), Mumbai – 400 051, and having its one of the Branches situated at: 1^st Floor, Tirthankar Apartment 294, S.K. Bole Marg, Dadar (West), Mumbai – 400 028; known as “Dadar (West) Branch” through their Authorized Officer/Chief Manager Mr. R.D. Kujur

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… Applicant

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Versus

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M/s. Ace Engineering A Proprietorship Firm, Indian Inhabitant of, having its at: Shop No.301, Mhatre Classic, L.T. Road, Dahisar (West), Mumbai – 400 068; And having another address at: C312, Gokul Dahisar CHSL, B.P. Road, Kandarpada, Dahisar (West), Mumbai – 400 068.

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Mr Ashish Vasantrao Kini Proprietor of M/s. Ace Engineering An adult, Indian Inhabitant of, having his Address at: Shop No.301, Mhatre

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Classic, L.T. Road, Dahisar (West), Mumbai – 400 068; and having another address at: C312, Gokul Dahisar CHSL, B.P. Road, Kandarpada, Dahisar (West), Mumbai – 400 068; having his Residential address at: 301, Mahatre Classic, L.T. Road, Vitthal Mandir, Dahisar (West), Mumbai – 400 068. …Defendants

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APPEARANCES For the Applicant : Ms Dhanshri Wakchaure i/b Mr O.A. Das - Advocate For Defendants : None

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Shri Deepak M Thakkar Presiding Officer

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HEARING : 11^th March 2024 PRONOUNCEMENT : 11^th March 2024

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J U D G M E N T

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(1) This is an application under Section 19(1) of the Recovery of the Debts due to Banks and Financial Institutions Act, 1993 renamed as Recovery of the Debt and Bankruptcy Act, 1993 (for short, ‘the 1993 Act’) to recover Rs.1,49,74,173.22 with future interest thereon from the date of presentation of the Original Application till payment/realization and to enforce the

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hypothecated securities.

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(2) The 2^nd defendant carries on the business in the name and style of M/s. Ace Engineering as sole proprietor. The 2^nd defendant approached the applicant seeking financial assistance through cash credit facility against hypothecation of stock and book debts. On 20^th January 2016, the applicant sanctioned the cash credit limit of Rs.1 crore repayable with interest at 13.50% per annum with monthly rest under CGTMSE scheme.

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(3) On 21^st January 2016, defendant signed and executed the loan and security documents as set out in paragraph 5.5 of the Original Application. After that, defendants failed to adhere to the financial discipline which resulted in the applicant classifying defendants’ account as NPA on 30^th September 2019. Prior thereto, defendants executed the letter acknowledging the debt on 18^th January 2019. On 10^th December 2019, the applicant issued the demand notice calling upon the defendants to pay within sixty days under the SARFAESI Act. On 11^th December 2020, the applicant, through its advocate, issued notice calling upon the defendants to liquidate the entire outstanding within seven days. Despite notices, defendants failed to pay.

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(4) As of 28^th December 2020, there was owing, due and payable by defendants to the applicant the

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aggregate sum of Rs.1,49,74,173.22. The applicant has maintained the loan ledger extract and the entries posted therein are made in the usual and ordinary course of the banking business.

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(5) Since defendants failed and neglected to make the payment, the applicant was left with no other alternate but to file the Original Application which was presented on 31^st December 2020. The applicant served the summons upon defendants vide order dated 29^th November 2022 and was deemed to have been set ex-parte on 9^th March 2023.

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(6) The applicant filed affidavit (exhibit-6) in lieu of examination in chief of Ms Naina Kamble and list of documents (exhibit-7) thereby adducing in evidence the documents at AW-1 to AW-20, which are admitted in evidence, read, recorded and exhibited.

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(7) Ms Wakchaure submits that the applicant does not press for the 2% penal interest as per the final relief and waives the penal interest of Rs.88,761.04. The learned counsel submits that the applicant does not press for the relief concerning the hypothecated securities and therefore, the question of passing the order in this regard does not arise.

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(8) Ms Wakchaure requests the Tribunal to issue the

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recovery certificate for the reduced amount of Rs.1,48,85,412.18 with pendent lite and future interest at the rate of 12.60% per annum with monthly rest from the date of presentation of the Original Application, that is, 31^st December 2020 till payment/realisation. Request accepted.

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(9) The Tribunal have scrutinised and examined the allegations contained in the Original Application and analysed the evidence adduced by the applicant which has gone unchallenged, uncontroverted and unrebutted.

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(10) Upon careful scrutiny and the examination of the Original Application, analysing the evidence and giving due weightage to the documentary evidence adduced by the applicant, the Tribunal views that there is no reason to disbelieve the claim made by the applicant bank.

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(11) In view of the observations made hereinabove, Original Application filed by the applicant deserves to be granted.

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(12) Hence, the following order:

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ORDER

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(A) The Original Application No.357 of 2022 is allowed with costs.

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(B) Defendants are ordered and directed to pay to the applicant, either jointly or severally, the aggregate sum of Rs.1,48,85,412.18 with pendent lite and future interest at the rate of 12.60% per annum

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with monthly rest from the Original Application’s presentation date, that is, 31^st December 2020 till payment/realization.

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(D) The learned Registrar is directed to send a copy of the judgment and recovery certificate to (i) the applicant, (ii) defendants by post and email and (iii) the Recovery Officer.

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Sd/-

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(Deepak M. Thakkar) Presiding Officer,

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DRT-2, Mumbai

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Radhika

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Bank of India v. M/s. Ace Engineering

Case brief

What is this about?

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Bank of India v. M/s. Ace Engineering

Case brief

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