Allowed

Punjab National Bank v. M/S B. D. Mistry Prop Late Shri. Beheraram D Sharma

DRT30 Jan 2024OA/357/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application for recovery. The court reduced the claim by disallowing certain penal interest and charges, adjusted the future interest rate to 9%, and ordered payment secured by mortgaged properties.

What did the court decide?

Defendants to pay Rs.4,22,59,151/- with future interest @9% p.a. secured by mortgaged properties; issuance of Recovery Certificate.

Punjab National Bank versus M/S B. D. Mistry Prop… — Contract and Commercial Disputes | DRT (2024)

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Presented on : 28.12.2021 Registered on : 24.03.2022 Decided on : 30.01.2024 Duration : Y M D 02 01 02

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IN THE DEBTS RECOVERY TRIBUNAL AT PUNE (Before Shri Dilip G Murumkar, Presiding Officer) ORIGINAL APPLICATION No. 357/2022.

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Punjab National Bank,

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A body corporate constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act V of 1970 having its head office at Plot No. 4, Sector 10, Dwarka, New Delhi 110075 and branch at – 11/12, Nav Swaraj, Ideal Colony, Kothrud, Pune 411029.

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.. Applicant

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Versus

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1 Shri Sohan Beheraram Sharma, Guarantor and also Son and Legal Heir of Late Shri Beheraram D. Sharma, Prop. M/s. B.D. Mistry, Office No. 318, 3^rd Floor, Siddharth Tower, Nr. Sangam Press, Kothrud, Pune 411029. Also at --

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Flat No. 22, 3^rd Floor, Rohan Corner, Gaurihar Co-op. Housing Society, Shivtrirthnagar, Paud Road, Kothrud, Pune 411038.

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Also at -- Industrial Gala/Shop No. 21, 1^st Floor, Continental Industrial Estate, S. No. 17, Hissa No. 1-B, CTS No. 697, Nr. Sangam Press, Kothrud, Pune 411038. Also at -- Office No. 811 & 812, 8^th Floor, Building No.1, Siddharth Tower Premises No.1, CHS Ltd., CTS No. 421, S.No. 12, Hissa No. 3B, Kothrud, Pune 411029. 2 Shri Tejaram Laxman Sharma, Flat No. 22, Rohan Corner, Shivtrirth Nagar, Kothrud, Pune 411038 Also at -- Bunglow No. 28, Aamachi Colony, S.No. 1, Hissa No. 10 to 16, Bavdhan Khurd, Pashan Road, Bavdhan, Pune 411038. .. Defendants

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APPEARANCES

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For Applicant Advocate Sudha Koloti. For Defendants Without written statement.

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TOTAL CLAIM AMOUNT – Rs.4,50,57,863/-

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JUDGMENT (Delivered on 30^th January, 2024)

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The Applicant Bank has filed the present application for recovery of the sum of Rs.4,50,57,863/- together with future interest @13.45% and 12% per annum respectively with monthly rests from the date of Application till realization of the

(OA No. 357/2022)

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entire dues from the defendants.

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Brief facts of the application are as under :

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Defendant No.1 is the son and legal heir of Late Shri Beheraram D. Sharma (hereinafter referred as “the deceased” for the sake of brevity) and also guarantor to the loan facilities availed by deceased. Defendant No.2 also stood guarantor to the loan facilities availed by the deceased. The deceased was undertaking business in the name of M/s. B.D. Mistry, a proprietary concern and after demise of the deceased, defendant No.1 is undertaking the same business.

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As per the loan application of the deceased, the applicant Bank sanctioned and disbursed the Cash Credit facility of Rs.50,00,000/- and Term Loan of Rs.9,85,000/- to the deceased vide Sanction Letter dated 04.08.2007. Defendant Nos.1 and 2 accepted the terms and conditions of the said sanction. In order to secure the aforesaid facilities, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of ( A ) Flat No. 22, 3^rd Floor, Rohan Corner, Gaurihar Co-op. Housing Society, Plot No. A-6 and A-7 out of

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S.No. 120, Shivtrirthnagar, Paud Road, Kothrud, Pune, and ( B ) Industrial Gala No. 21, 1^st Floor, Continental Industrial Estate, Plot No. 6 out of S.No. 7, Hissa No. 1-B, CTS No. 697, Near Sangam Press, Kothrud, Pune, in favour of the applicant Bank. Defendant Nos.1 and 2 executed independent guarantee deed. 3. The deceased again approached the applicant Bank in the year 2008 for enhancement of loan facilities. Accordingly, applicant Bank enhanced the Credit facilities to Rs.1,00,00,000/-; Term Loan of Rs.9,85,000/- and Bank Guarantee for amount of Rs.10,00,000/vide Sanction Letter dated 26.03.2008. Defendant Nos.1 and 2 stood guarantors for the said loan facilities. So also, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of (A) Flat No. 22, 3^rd Floor, Rohan Corner, Gaurihar Co-op. Housing Society, Plot No. A-6 and A-7 out of S.No. 120, Shivtrirthnagar, Paud Road, Kothrud, Pune, (B) Industrial Gala No. 21, 1^st Floor, Continental Industrial Estate, Plot No. 6 out of S.No. 7, Hissa No. 1-B, CTS No. 697, Near Sangam Press, Kothrud, Pune, and (C) Bunglow No. 28, Aamachi Colony,

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S.No. 1, Hissa No. 10 to 16, Bavdhan Khurd, Pashan Road, Bavdhan, Pune, in favour of the applicant Bank.

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The deceased again in the year 2009 approached the applicant Bank for enhancement of loan facilities. Accordingly, applicant Bank enhanced the Credit facility to Rs.1,50,00,000/- and Bank Guarantee for amount of Rs.40,00,000/- vide Sanction Letter dated 18.02.2009. Defendant Nos.1 and 2 stood guarantors for the said loan facilities. So also, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of above mentioned three immovable properties.

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The deceased again in the month of October 2009 approached the applicant Bank for enhancement of loan facilities. Accordingly, applicant Bank enhanced the Credit facility to Rs.2,50,00,000/- and renewal of Bank Guarantee for amount of Rs.40,00,000/vide Sanction Letter dated 12.10.2009. Defendant Nos.1 and 2 stood guarantors for the said loan facilities. So also, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of

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the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of above mentioned three immovable properties.

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The deceased again in the month of April 2010 approached the applicant Bank for enhancement of loan facilities. Accordingly, applicant Bank enhanced the Credit facility to Rs.3,50,00,000/and Bank Guarantee for amount of Rs.40,00,000/- vide Sanction Letter dated 30.04.2010. Defendant Nos.1 and 2 stood guarantors for the said loan facilities. So also, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of above mentioned three immovable properties.

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The deceased again in the month of April 2011 approached the applicant Bank for enhancement of Credit facility. Accordingly, the applicant Bank enhanced the Credit facility to Rs.4,50,00,000/vide Sanction Letter dated 18.10.2011. Defendant Nos.1 and 2 stood guarantors for the said loan facility. So also, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of

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the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of above mentioned three immovable properties.

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The deceased again in the month of September 2014 approached the applicant Bank for enhancement of Credit facility. Accordingly, the applicant Bank enhanced the Credit facility to Rs.5,00,00,000/vide Sanction Letter dated 19.09.2014. Defendant Nos.1 and 2 stood guarantors for the said loan facility. So also, the deceased and defendant Nos. 1 and 2 executed necessary loan and security documents in favour of the applicant Bank along with deed of hypothecation of manufacturing material and machinery and deed of mortgage of above mentioned three immovable properties.

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Thereafter, on 31.08.2015, the applicant Bank has sanctioned Over Draft Facility of Rs.1,50,00,000/- to defendant No.1 and the defendants executed loan and security documents along with deed of mortgage of Office Nos. 811 and 812, 8^th Floor, Building No.1, Siddharth Tower Premises No.1, CHS Ltd., CTS No. 421, S.No. 12, Hissa No. 3B, Kothrud, Pune in favour of the applicant Bank.

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Thereafter, on 10.04.2018, the deceased executed

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equitable mortgage deed of above mentioned Office Nos. 811 and 812 in favour of the applicant Bank and thereby confirmed the mortgage of the same, for all the facilities. Again on 16.08.2018, the deceased executed two Balance cum Security Confirmation Letter and thereby accepted balance in both the accounts.

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Thereafter, on 05.11.2019, Beheraram Sharama expired. In July 2020, defendant No.1 produced registered release deed executed by other legal heirs in favour of defendant No.1 and thereby defendant No.1 has acquired all the assets and liabilities of the deceased. Defendant No. 1 also admitted amount of Rs.4,23,69,138/- outstanding as on 30.09.2020 and submitted OTS proposal vide letter dated 07.12.2020 and the said proposal for Rs.2.60 Crore was sanctioned vide Sanction Letter dated 30.12.2020. But the defendant No.1 did not pay the amount as per OTS. Thereafter, defendant No.1 sought extension of time vide letter dated 17.06.2021, but same was not acceptable to applicant Bank and therefore OTS failed.

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The applicant Bank contended that the defendants committed defaults in payment of installments and failed to regularize the accounts. Therefore, on 05.12.2020, the applicant Bank issued

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legal Notice to the defendants. Despite service of Notice, the defendants failed and neglected to pay the outstanding dues of the applicant Bank. Hence, this application is filed.

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The defendants failed to file written statement despite service of summons. Hence, the application proceeded without written statement of the defendants as per Order dated 08.01.2024 passed below Application (Exhibit-1).

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The applicant Bank has filed Claim Affidavit of evidence (Exhibit-5) of Praveen C. Potdar, Chief Manager of the applicant Bank, and has produced on record the original loan transaction documents at Sr. Nos. AW-1 to AW-78 along with list (Exhibit 7), which corroborates the case of the applicant Bank.

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I have heard arguments of the learned Advocate for the applicant Bank.

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Since the defendants failed to contest the application, I find no reason to disbelieve evidence of the applicant Bank. Therefore, the applicant Bank is entitled for reliefs as claimed.

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The applicant Bank has claimed relief in respect of hypothecated assets. However, there is no detailed description with respect to the hypothecated assets, therefore, the relief in

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terms of hypothecated assets cannot be granted.

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The applicant Bank has claimed Penal Interest and Other Charges total of Rs.27,98,712/- (Penal Interest of Rs.16,93,495/and other charges of Rs.1,21,120/- for Cash Credit facility and Penal Interest of Rs.9,78,698/- and other charges of Rs.5,399/for Credit facility (ODIP), which cannot be granted and the same is required to be deducted from the total claim amount. Therefore, the total claim amount of Rs.4,50,57,863/- is reduced to Rs.4,22,59,151/-.

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The applicant Bank has claimed future interest @ 13.45% and 12% per annum respectively for two loan facilities with monthly rests. However, considering the facts of the case, I am of the opinion that if future interest is granted @9% per annum (simple), it would be just and reasonable rate of interest.

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Hence, I pass the following order :-

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ORDER

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

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(B) Defendant Nos. 1 and 2 either jointly or severally shall pay to the applicant Bank the sum of Rs.4,22,59,151/- (Rupees Four Crore Twenty Two

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Lakhs Fifty Nine Thousand One Hundred Fifty One only) along with future interest @9% per annum from the date of filing of the Original Application i.e. 28.12.2021 till full payment/realization of the amount mentioned in this operative order.

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(C) The aforesaid adjudicated amount is secured by the valid and subsisting mortgage of immovable properties i.e. (A) Flat No. 22, 3^rd Floor, Rohan Corner, Gaurihar Co-op. Housing Society, Plot No. A-6 and A-7 out of S. No. 120, Shivtrirthnagar, Paud Road, Kothrud, Pune, (B) Industrial Gala No. 21, 1^st Floor, Continental Industrial Estate, Plot No. 6 out of S.No. 7, Hissa No. 1-B, CTS No. 697, Near Sangam Press, Kothrud, Pune, (C) Office No. 811, 8^th Floor, Building No.1, Siddharth Tower Premises No.1, CHS Ltd., CTS No. 421, S.No. 12, Hissa No. 3B, Kothrud, Pune and (D) Office No. 812, 8^th Floor, Building No.1, Siddharth Tower Premises No.1, CHS Ltd., CTS No. 421, S.No. 12, Hissa No. 3B, Kothrud, Pune, more particularly described in the Para No. 6-d of the Original Application.

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(D) The applicant Bank is entitled to sell the mortgaged properties to recover its dues.

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(E) Issue Recovery Certificate.

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(F) The Registrar is directed to send the copy of Judgment and Recovery Certificate to the applicant and defendants.

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Place : Pune Date : 30.01.2024

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Sd/(Dilip G Murumkar) Presiding Officer Debts Recovery Tribunal, Pune.

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(OA No. 357/2022)

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Punjab National Bank v. M/S B. D. Mistry Prop Late Shri. Beheraram D Sharma

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/S B. D. Mistry Prop Late Shri. Beheraram D Sharma

Case brief

What is this about?

What did the court decide?

What the court decided

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