Allowed

Punjab National Bank, v. M/S Nirmal Singh & Co. and Another

DRT3 Jan 2024OA/473/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an original application filed by Punjab National Bank to recover Rs. 49,33,071.54p from the legal heirs of a deceased sole proprietor who undertook an overdraft facility. The debtor's property had been sold under SARFAESI proceedings. The Tribunal granted simple interest at 10.00%p.a. from the filing date.

What did the court decide?

irected defendants to pay Rs.49,33,071.54p with costs and simple interest at 10.00%p.a. from filing date till realization; issued Recovery Certificate.

Punjab National Bank, versus M/S Nirmal Singh & Co. and Another — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.473/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 28.02.2022

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DATE OF DECISION: 03.01.2024

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Punjab National Bank, a body corporate and a nationalized bank constituted under the provisions of the Banking Companies (Acquisition and Transfer of Undertakings) Act No.5 of 1970 with its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi-110075 and amongst others a Branch at Raikot Chowk, Tehsil Ahmedgarh, District Sangrur, Punjab, through Sh. Ramesh Kumar Dhir, Officer and Attorney Holder presently posted at Circle SASTRA Centre, Second Floor, BSNL Building Club Road, Sangrur

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……..Applicant

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Versus

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M/s Nirmal Singh and Company, a Sole Proprietorship concern situated at Village Mohali Kalan, Grain Market, Ahmedgarh, Sangrur, through its Proprietor, Sh. Nirmal Singh S/o Sh. Sadhu Singh since deceased survived by his legal heirs as arrayed hereinunder against defendant No.2 (Borrower)

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Sh. Nirmal Singh S/o Sh. Sadhu Singh, (Sole Proprietor/Borrower) since deceased survived by following legal heirs:

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i) Smt. Harjinder Kaur (wife) ii) Sh. Yadwinder Singh (son) iii) Ms. Kulwinder Kaur (daughter)

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All R/o Village Mohali Kalan, Grain Market, Ahmedgarh, Sangrur, Punjab

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………Defendants

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Advocates:

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Argued by Sh. Umang K. Khosla, Advocate proxy for Sh. Manish Singla, 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 under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.49,33,071.54p (Rupees Forty Nine Lacs Thirty Three Thousand Seventy One and Fifty Four Paise only). The Original Application has been filed through Sh. Ramesh Kumar Dhir, Officer and Attorney holder o f the applicant bank, who is competent to institute the Original Application vide General Power of Attorney dated 29.03.2016, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant no.2 (since deceased), being the sole proprietor of defendant No.1 had approached the applicant bank from time to time for the grant of Overdraft Facility of Rs.5.00 Lacs and further for its several enhancements till the maximum limit of Rs.40.00 Lacs vide Loan Applications dated 27.05.2014, 05.12.2014 and 18.06.2015, which are Annexures A3, A7 and A11 to this OA.

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The applicant Bank sanctioned/renewed/enhanced the Overdraft Facility on various occasions as per the request of the defendants starting from Rs.5.00 Lacs till the maximum limit of Rs.40.00 Lacs vide Sanction Letters dated 28.05.2014, 05.12.2014 and 20.06.2015, which are Annexures A4, A8 and A12 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant No.2 (since deceased) had mortgaged his immovable properties i.e. total area of residential properties measuring 1530 sq. yards. situated at Village Maholi Kalan, Tehsil Malerkotla, District Sangrur, Punjab.

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The above mentioned properties have been sold by the applicant bank under the provisions of SARFAESI Act 2002 vide Sale Certificate dated 07.10.2020, which is Annexure A15 to this OA.

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Documents executed: - Gazette Notification dated 04.03.2020, which is Annexure A2 to this OA; Supplemental Agreements dated 29.05.2014, 05.12.2014 and 20.06.2015, Annexures A5, A9 and A13 to this OA; Common Agreements dated 29.05.2014, 05.12.2014 and 20.06.2015, Annexures A6, A10 and A14 to this OA; Balance and Security confirmation letters dated 23.02.2007, 17.02.2010, 04.01.2012, 24.11.2014, 03.10.2017 and 03.03.2020, which are Annexures A16 to A21 to this OA; Legal notice dated 05.02.2022, which is Annexure A22 to this OA and Statement of account duly certified, which is Annexure A23 to this OA.

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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.49,33,071.54p, 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 28.07.2023.

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In support of the OA, affidavit of Sh. Ramesh Kumar Dhir, Officer and Attorney Holder, Punjab National Ba nk has been filed. 8. 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 A23 to this OA, it is proved that the defendant no.2 (since deceased), being the sole proprietor of defendant no.1 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. Unfortunately after the death of the defendant no.2, the present defendants (legal heirs) failed to pay back the loan as per terms and conditions of the agreement between the

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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.49,33,071.54p (Rupees Forty Nine Lacs Thirty Three Thousand Seventy One and Fifty Four Paisa only) along with interest from the present 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 @10.00%p.a. besides @2%p.a. penal interest with monthly rests from 22.02.2022 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 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.49,33,071.54p (Rupees Forty Nine Lacs Thirty Three Thousand Seventy One and Fifty Four Paisa only), jointly and severally, with costs, current and future simple interest @10.00%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

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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. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 22.01.2024. 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

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

Punjab National Bank, v. M/S Nirmal Singh & Co. and Another

Case brief

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Punjab National Bank, v. M/S Nirmal Singh & Co. and Another

Case brief

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What the court decided

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