Allowed

Bank of Baroda v. M/S Gur Kripa Distributors and Others

DRT29 Aug 2024OA/423/2022

Case brief

AI extract

What is this about?

The DRT allowed an application filed by Bank of Baroda under the RDB Act against borrowers and guarantors for recovery of loan dues. The court found the defendants failed to meet repayment terms and classified the account as NPA. It was decreed they must pay the principal amount with 8% simple interest and the recovery certificate was issued.

What did the court decide?

Decreed payment of Rs.37,83,592.00 with 8% simple interest and costs; issued Recovery Certificate under SARFAESI Act.

Bank of Baroda versus M/S Gur Kripa Distributors and Others — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.423/2022 PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 14.11.2021

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DATE OF DECISION: 29.08.2024 Bank of Baroda, (Erstwhile Vijaya Bank), a Public Sector Banking and Financial Services Company having its Head Office at Baroda Bhavan, R C Dutt Road, Alkapuri, Baroda-390007 and a branch office among others near Cheema Chowk, M.S.M.E Branch, Ludhiana-141003 through its Authorized Officer and duly constituted Power of Attorney Holder Sh. Sachin Garg presently posted as Assistant Manager, at M.S.M.E Cheema Chowk Branch, Ludhiana.

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	……..Applicant Bank Versus
1.	M/s Gur Kirpa Distributors, office at # B-XXI-3656/1A, Street No.14, New Janta Nagar, Duba Road, Ludhiana-141003.
	2^ndAddress:B-4/1369, Mohalla Bhardwaj, Missan Chowk, Near Daresi Road, Ludhiana, Punjab-141008 through its Proprietor Mr. Gurpreet Singh S/o Sh. Gopal Singh, age 44 years # B-XXI- 3656/1A, Street No.14, New Janta Nagar, Daba Road, Ludhiana- 141003.
	3^rdAddress:6504/5, New Janta Nagar, St No.4, Gill Market, near ITTA Wala Chowk, Ludhiana, Punjab-141001
2.	Sh. Gurpreet Singh S/o Sh. Gopal Singh, B-XXI-3656/1A, St No.14, New Janta Nagar, Daba Road, Ludhiana-141003. (Applicant)
3.	Sh. Gopal Singh S/o Sh. Ujjagar Singh, B-XXI-3656/1A, St No.14, New Janta Nagar, Daba Road, Ludhiana-141003. (Co-Applicant & Guarantor)
4. Ad	Mrs. Varinder Kaur W/o Sh. Gurpreet Singh B-XXI-3656/1A, St No.14, New Janta Nagar, Daba Road, Ludhiana-141003. (Guarantor) .……Defendants vocates:

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Argued by Sh. Kaveesh, Advocate proxy for Sh. S.K. Dhir, Advocate for the applicant (through VC) 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 Institutions Act, 1993, against the defendants for recovery of Rs.37,83,592.00 (Rupees Thirty Seven Lacs Eighty Three Thousand Five Hundred Ninety Two only). The Original Application has been filed through Sh. Sachin Garg, Assistant Manager o f the applicant bank, who is competent to institute the Original Application vide Power of Attorney dated 25.11.2016, which is Annexure A1 to this OA. 2. The brief facts of the OA are that the defendants no.1 through its proprietor i.e. defendant No.2 and defendant no.3 had approached the applicant bank for the grant of CC Limit of Rs.15.00 Lacs dated 10.03.2012, which is Annexure A2 to this OA. Further approached for its enhancement from Rs.15.00 Lacs to Rs.30.00 Lacs and thereafter for further enhancement from Rs.30.00 Lacs to Rs.35.00 Lacs to this OA. Later Defendant no.1 approached the applicant bank for renewal of CC Limit of Rs.35.00 Lacs. Defendant No.4 stood as Guarantor. 3. The applicant Bank sanctioned the CC Limit of Rs.15.00 Lacs vide Sanction Letter dated 16.03.2012, which is Annexure A3 to this OA. Further sanctioned its enhancement from Rs.15.00 Lacs to Rs.30.00 Lacs and thereafter enhanced to Rs.35.00 dated 24.12.2015, which is Annexure A18 to this OA. Later the applicant bank renewed the CC Limit of Rs.35.00 Lacs vide Letter for Renewal of CC Hypothecation of stock and debt book limit dated 12.06.2018, which is Annexure A27 to this OA and the terms and conditions were duly accepted by the defendants. 4. Defendants No.4 had mortgaged her immovable properties i.e. Residential property measuring 50Sq. yards bearing MC No.B-XXI3656/1A, Village Gill-1, Habast No.263, New Janta Nagar, Daba Road, Ludhiana, Punjab vide Equitable Mortgaged of Sale Deed bearing

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Vasika No.2393, dated 02.07.2014, along with Jamabandi and their translations, which is Annexure 30 to this OA.

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Documents executed:- Demand Promissory Note, Agreement of Hypothecation, Letter of Guarantee, Power of Attorney(Book Debts) Letter of Continuity, General undertaking, Letter of General Lien and Set-off for borrowing arrangements from the borrowers, all dated 19.03.2012, which are Annexures A4 to A10 to this OA; Demand Promissory Note, Agreement of Hypothecation, Letter of Guarantee, Power of Attorney(Book Debts) Letter of Continuity, General undertaking, Letter of General Lien and Set-off for borrowing arrangements from the borrowers all dated 26.07.2014, which are Annexures A11 to A17 to this OA; Linkage Letter, Demand Promissory Note, Agreement of Hypothecation, Letter of Guarantee, Letter of Continuity, General undertaking, Letter of General Lien and Set-off for borrowing arrangements from the borrowers all dated 28.03.2016, which are Annexures A19 to A22, A24 to A26 to this OA; Power of Attorney(Book Debts), which is Annexure 23 to this OA; Demand Promissory Note, Letter of Continuity, both dated 19.06.2018, which are Annexures A28 & A29 to this OA; Letter of acknowledgment both dated 19.06.2016 & 28.01.2020, which is Annexures A31 to this OA; Legal Notices dated 15.09.2020 along with postal receipts, which is Annexure A32 to this OA; Reminder Letter dated 01.10.2020, which is Annexure A33 to this OA; Demand Notice u/s 13(2) of SARFASEI Act along with postal receipts dated 22.04.2021 which is Annexure A34 to this OA and Statement of Account, Interest Certificate and Bankers Certificate along with Certificate, which are Annexure A35, A36 & A37 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.37,83,592.00, 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.

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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 22.07.2024.

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In support of the OA, affidavit of Sh. Sachin Garg, Assistant Manager, Bank of Baroda (erstwhile Oriental Bank of Commerce) has been filed.

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Heard ex parte arguments and perused record.

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It was argued by learned proxy counsel through video Conferencing that in view of the documentary evidence brought on record which had gone unrebutted, the applicant bank had proved its case. From the perusal of all the Annexures A1 to A37 to this OA, it is proved that the defendants approached applicant bank 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 bank. 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 bank is entitled to recover a sum of Rs.37,83,592.00 (Rupees Thirty Seven Lacs Eighty Three Thousand Five Hundred Ninety Two only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of both the accounts. 10. In so far as pendent elite and future rate of interest is concerned, the applicant bank in relief clause has claimed interest @8.35%p.a. from 26.10.2021 till the realization.

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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

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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. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.37,83,592.00 (Rupees Thirty Seven Lacs Eighty Three Thousand Five Hundred Ninety Two only) 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 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. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 21.09.2024. 15. 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: 29.08.2024 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Bank of Baroda v. M/S Gur Kripa Distributors and Others

Case brief

What is this about?

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Bank of Baroda v. M/S Gur Kripa Distributors and Others

Case brief

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