Allowed

Punjab National Bank, v. M/S Kumar Fastners and Another

DRT3 Jan 2024OA/439/2022

Case brief

AI extract

What is this about?

In an ex-parte recovery application under S. 19 RDDBFI Act, 1993, the tribunal enforced a loan default by M/s Kumar Fastners and individuals Vijay Kumar Aggarwal and Bhavna Aggarwal against Punjab National Bank, directing payment of principal, interest, and authorizing recovery measures.

What did the court decide?

Applicants entitled to recover Rs.58,36,363.32 plus costs and future simple interest at 10% p.a. Recovery Certificate issued. Release of personal assets for attachment.

Punjab National Bank, versus M/S Kumar Fastners and Another — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.439/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 24.02.2022

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DATE OF DECISION: 03.01.2024

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Punjab National Bank, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi110075 and its Branch Office at Punjab National Bank, Jamalpur Awana, Ludhiana, Punjab-141003, through its Authorised Representative, Sh. Ravinder Kumar, Senior Manager, Sastra Punjab National Bank, Site 5, First Floor, Ferozepur Road, Ludhiana-142023

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……Applicant

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Versus

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M/s Kumar Fastners, 512/13, 10A, Site No.3, Shanti Nagar, Sua Road, Giaspura, Ludhiana-141001

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Sh. Vijay Kumar Aggarwal S/o Sh. Brij Mohan Aggarwal, R/o B-34, 1486, Near PSEB Haibowal Kalan, Rajesh Nagar, Ludhiana-141001

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Smt. Bhavna Aggarwal W/o Sh. Vijay Aggarwal R/o B-34, 1486, Near PSEB Haibowal Kalan, Rajesh Nagar, Ludhiana-141001

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……Defendants

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Advocates:

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Argued by Sh. Rehan Chaudhary, counsel proxy for Sh. Krishan Kumar, counsel 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 Institutions Act, 1993, against the defendants for recovery of Rs.58,36,363.32p (Rupees Fifty Eight Lacs Thirty Six Thousand Three Hundred Sixty Three and Thirty Two Paisa only). The Original

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Application has been filed through Sh. Ravinder Kumar, Senior Manager of 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 nos.2 and 3 being the partners of defendant no.1 were already availing a Term loan of Rs.18.00 lacs and further approached the applicant bank for the grant of Cash Credit Limit of Rs.16.00 Lacs and later for the enhancement of the limit to Rs.40.00 Lacs and also for a Term Loan under GECL facility of Rs.8.00 Lacs vide Loan Applications dated 28.03.2012, 08.03.2013 and 27.08.2020, which are Annexures A2, A5 and A9 to this OA.

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The applicant Bank sanctioned the Cash Credit Limit of Rs.16.00 Lacs and further enhanced it to Rs.40.00 Lacs and also sanctioned a Term Loan of Rs.8.00 Lacs under GECL facility vide Sanction Letters dated 07.04.2012, 11.03.2013 and 27.08.2020, which are Annexures A3, A6 and A10 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendants had hypothecated their movable properties i.e. stocks and book debts of nut, bolts etc. vide Agreement of Hypothecation of Assets dated 07.04.2012, which is Annexure A4 to this OA.

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Documents executed: - Supplemental Agreement dated 26.08.2016, which is Annexure A7 to this OA; Balance and Confirmation Letters dated 17.03.2020, which is Annexure A8 to this OA; Agreement for working capital term loan dated 28.08.2020, which is Annexure A11 to this OA; Master Agreement dated 28.08.2020, which is Annexure A12 to this OA; Agreements of Guarantee dated 28.08.2020, which is Annexure A13 (colly) to this OA; Notices dated 22.07.2021 under Section 13(2) of the SARFAESI Act along with its postal receipts, which is Annexure A14 (Colly) to this OA; Legal Notice dated 12.02.2022 along with its original postal receipts, which is Annexure A15 (Colly)

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to this OA and Statement of accounts along with its certificate under Section 2A of the Banker’s Books of Evidence Act, 1872 and Certificate under Section 65B of the Indian Evidence Act, 1872, which is Annexure A16 (colly) to this OA.

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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.58,36,363.32p (Rupees Fifty Eight Lacs Thirty Six Thousand Three Hundred Sixty Three and Thirty Two Paisa only), 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 31.07.2023.

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In support of the OA, affidavit of Sh. Ravinder Kumar, Senior Manager, Punjab National Bank 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 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 A16 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.58,36,363.32p (Rupees Fifty Eight Lacs Thirty Six Thousand Three Hundred Sixty Three and Thirty Two Paisa only) along with interest from the

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defendants, jointly and severally, from the date of filing of the present Original Application till realization of the accounts.

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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 @10.60%p.a. plus additional @2%p.a. penal interest from 01.02.2022 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 @10.00%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.58,36,363.32p (Rupees Fifty Eight Lacs Thirty Six Thousand Three Hundred Sixty Three and Thirty Two Paisa only) jointly and severally, with costs, current and future simple interest @10.00%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. 12. Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 23.01.2024. 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: 03.01.2024 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Punjab National Bank, v. M/S Kumar Fastners and Another

Case brief

What is this about?

What did the court decide?

Punjab National Bank, v. M/S Kumar Fastners and Another

Case brief

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