Allowed

Punjab National Bank v. M/s Spintex Woolen Mills and Others

DRT3 Apr 2024OA/377/2023

Case brief

AI extract

What is this about?

In an ex-parte original application under S. 19 RDBFI Act, the Debt Recovery Tribunal allowed the applicant bank's claim for recovery of an outstanding principal debt of Rs.6.22 crores. The tribunal allowed a reduced uniform simple interest rate and directed recovery from mortgaged or personal assets.

What did the court decide?

Recovery of Rs.6,22,27,732.61p with simple interest @9.25% p.a. declared; Recovery Certificate issued; Relief via sale of mortgaged properties or attachment of personal assets.

Punjab National Bank versus M/s Spintex Woolen Mills and… — Execution and Attachment | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.377/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 15.03.2023

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DATE OF DECISION: 03.04.2024

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Punjab National Bank, a body corporate duly constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi carrying on business of banking and its branches at different places throughout India including one namely Circle Sastra, Site No.5, Ferozepur Road, Ludhiana-141012, through its Principal officer and duly constituted attorney Sh. Ravinder Kumar, Senior Manager

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……..Applicant

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Versus

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M/s Spintex Woolen Mills (through its Partners), situated at B-29/27 Sherpur, G.T. Road (East) Adj. Lane SPS Hospital Ludhiana-141003 (Punjab)

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Sh. Ram Lal Gupta S/o Late Sh. Ronaq Ram Gupta, R/o House No.640-B, Aggar Nagar, Rajguru Nagar, Ludhiana-141001 (Punjab)

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Sh. Gaurav Gupta S/o Sh. Ravi Lal Gupta, R/o House No.640-B, Aggar Nagar, Rajguru Nagar, Ludhiana-141001 (Punjab)

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(Partners and Guarantors of M/s Spintex Woolen Mills)

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…… …Defendants Advocates: Argued by Sh. V.K. Dewan, Advocate for the Applicant Defendants are ex-parte

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19 of the Recovery of Debts Due to Banks and Financial

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Institutions Act, 1993, against the defendants for recovery of Rs.6,22,27,732.61p (Rupees Six Crores Twenty Two Lacs Twenty Seven Thousand Seven Hundred Thirty Two and Sixty One Paisa only). The Original Application has been filed through Sh. Ravinder Kumar, Senior Manager o f the applicant bank, who is competent to institute the Original Application vide General Power of Attorney dated 05.06.1997, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant No.1 through its Partners i.e. defendants Nos.2 and 3 were already availing various Credit

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Facilities from the applicant bank which were

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enhanced/reduced/renewed from time to time.

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The defendant No.1 through its Partners i.e. defendants Nos.2 and 3 approached the applicant bank for the grant of Demand Loan of Rs.5.00 Lacs under CECF scheme vide Loan Application dated 15.05.2020 and for the grant of Working Capital Term Loan under GECL scheme of Rs.91.20 Lacs vide Loan Application dated 28.08.2020, which are Annexures A12 and A18 to this OA and thereafter for the grant of Car Loan of Rs.10.00 Lacs.

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The applicant Bank sanctioned the enhancement/reduction of credit facilities i.e. CC limit of Rs.4.60 Crores, Inland Letter of Credit Limit of Rs.5.00 Lacs and review of existing term loans of Rs.32.39 Lacs vide Sanction letter dated 16.07.2016, which is Annexure A3 to this OA. Further, fresh Demand Loan of Rs.5.00 Lacs under PNB CECF scheme and Working Capital Term Loan of Rs.91.20 Lacs under GECL scheme were sanctioned vide Sanction letters dated 30.05.2020 and 14.09.2020, which are Annexures A13 and A19 to this OA and thereafter a fresh Car Loan of Rs.10.00 Lacs was also sanctioned vide Sanction Letter dated 16.11.2020, which is Annexure A24 to this OA; and the terms and conditions were duly accepted by the defendants. 4. Defendant No.1 through its Partners i.e. defendants Nos.2 and 3 had mortgaged its immovable properties through equitable mortgage detailed as:

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(a) Land and Building measuring 800 sq. yards situated at Plot no B- 29,27 Sherpur Kurd, Ludhiana (Near Sherpur Chowk, G.T. Road, adjoining S.P.S. Hospital), Punjab owned by defendant no.1 registered vide Sale Deed bearing Vasika No.17899 dated 30.03.1982 along with its translation, which is Annexure A31 to this OA;

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(b) Land measuring 700 sq. yards situated at Plot no B-29,27 Sherpur Kurd, Ludhiana (Near Sherpur Chowk, G.T. Road, adjoining S.P.S. Hospital), Punjab owned by defendant no.1 registered vide Sale Deed bearing Vasika No.984 dated 22.04.1982 along with its translation, which is Annexure A32 to this OA;

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(c) Land and Building measuring 4K-0M situated at village Tibba, Hadbast No.249, Sub Tehsil Dehlon, Tehsil and District Ludhiana, Punjab owned by defendant no.1 registered vide Sale Deed bearing Vasika No.1818 dated 04.02.2008 along with its translation, which is Annexure A35 to this OA;

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(d) Land and Building measuring 2K-9M situated at village Tibba, Hadbast No.249, Sub Tehsil Dehlon, Tehsil and District Ludhiana, Punjab owned by defendant no.1 registered vide Sale Deed bearing Vasika No.603 dated 04.07.2008 along with its translation, which is Annexure A36 to this OA;

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(e) Land and Building measuring 4K-0M situated at village Tibba, Hadbast No.249, Sub Tehsil Dehlon, Tehsil and District Ludhiana, Punjab owned by defendant no.1 registered vide Sale Deed bearing Vasika No.1819 dated 04.02.2008 along with its translation, which is Annexure A37 to this OA;

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Documents executed: - Partnership Deed dated 01.04.2014, which is Annexure A2 to this OA; Agreement Executed by defendant no.1, Declaration, Affidavits and Agreements executed by defendant no.2 and 3 all dated 28.07.2016, which are Annexures A4 to A11 to this OA; Demand promissory note, Master Agreement and Agreements of Hypothecation all dated 01.06.2020, which are Annexures A14 to A17 to this OA; Demand promissory note, Master Agreement, Agreement

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and agreements of Hypothecation all dated 22.09.2020, which are Annexures A20 to A23 to this OA; Master Agreement, letter of Hypothecation and Guarantee Agreements executed by defendant no.2 and 3 all dated 24.11.2020, which are Annexures A25, A26, A28 and A29 to this OA; Undertaking dated 07.12.2020, which is Annexure A27 to this OA; Certificate of Registration of car dated 07.12.2020, which is Annexure A30 to this OA ; letters dated 20.06.1998, 29.09.2020, 13.05.2010, 29.09.2020 and 29.03.2022 which are Annexures A33, A34, A38, A39, A56 and A57 to this OA; Legal Opinions all dated 28.05.2022, which are Annexures A40 to A41A to this OA; CERSAI Search report, which is Annexure A42 to this OA; Balance and security confirmation letters dated 19.02.2002, 14.06.2003, 25.03.2006, 11.02.2008, 31.07.2009, 12.05.2010, 05.11.2011, 24.05.2012, 19.11.2012, 19.01.2014, 31.05.2016, 28.07.2016, 13.03.2018 and 13.06.2019, which are Annexures A43 to A54B to this OA; Notice u/s 13(2) dated 15.02.2022, which is Annexure A55 to this OA: and Statements of Accounts and Statements of accrued interest, which are Annexures A58 to A65 to this OA. 5. The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.6,22,27,732.61p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant bank requested to accept the application and to issue Recovery Certificate accordingly. 6. 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 18.03.2024. 7. In support of the OA, affidavit of Sh. Ravinder Kumar, Senior Manager, Punjab National Bank has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant

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bank had proved its case. From the perusal of all the Annexures A1 to A65 to this OA, it is proved that the defendants approached applicant bank for availing of the loan facilities which were granted to them and for that they had executed all the relevant documents in favour of the bank. The defendants failed to pay back the loans as per terms and conditions of the agreement between the parties. Subsequently, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.6,22,27,732.61p (Rupees Six Crores Twenty Two Lacs Twenty Seven Thousand Seven Hundred Thirty Two and Sixty One Paisa 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.

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In so far as pendent elite and future rate of interest is concerned, the applicant bank in relief clause has claimed interest; (i) @10.40%p.a. with monthly rests in respect of CC Limit facility; (ii) @9.25%p.a. with monthly rests in respect of working capital term loan under GECL facility; (iii) @9.85%p.a. with monthly rests in respect of Demand Loan under CECF facility and (iv) @10.05%p.a. with monthly rests in respect of Car Loan facility from 01.02.2023 till the realization. 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 @9.25%p.a. in all the loan accounts from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly.

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In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.6,22,27,732.61p (Rupees Six Crores Twenty Two Lacs Twenty Seven Thousand Seven Hundred Thirty Two and Sixty One Paisa only) jointly and severally, with costs, current and future simple interest @9.25%p.a. in all the loan accounts from the date of filing of OA till the date of realization of the amount. Accordingly, the applicant bank 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 bank 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.

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Any other application pending stands disposed of.

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Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 12.04.2024.

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Copy of this order be given dasti to the applicant bank 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. Pronounced by me in the open Tribunal Dated: 03.04.2024

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Punjab National Bank v. M/s Spintex Woolen Mills and Others

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/s Spintex Woolen Mills and Others

Case brief

What is this about?

What did the court decide?

What the court decided

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