Allowed

Punjab National Bank v. Messrs Dhillon Automobiles and Another

DRT10 Dec 2024OA/580/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application for recovery of dues from automobile dealers who failed to repay sanctioned loan facilities. The court fixed uniform interest at 8% p.a. and directed the issuance of a Recovery Certificate.

What did the court decide?

Declaration of liability to pay Rs. 22,27,002.10p with costs and simple interest at 8% p.a.; issuance of Recovery Certificate; liberty to attach and sale personal assets if dues remain unsatisfied.

Punjab National Bank versus Messrs Dhillon Automobiles and… — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.580/2024

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PRESIDED OVER BYMRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 30.03.2024

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DATE OF DECISION: 10.12.2024

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Punjab National Bank, A body corporate, constituted under the Banking Companies (Acquisition & Transfer of Undertaking) Act, 1970, having its Head Office at Plot No.4, Sector-10, Dwarka, New Delhi carrying on its business of Banking throughout India and Inter Alia, one of its branch office known as Circle Stressed Assets Targeted Resolution Action (SASTRA) Centre Patiala, at 2^nd Floor, Opposite Improvement Trust Building, Chhoti Baradari, District Patiala, Punjab-147001 through its Senior Manager-cum-General Power of Attorney Sh. Paramjeet Singh Sapra.

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……..Applicant Versus 1. M/s Dhillon Automobiles, through its Proprietor, Sh. Gurwinder Singh S/o Sh. Pavittar Singh having GST number 03CQDPS4840M1ZK, R/o Nabha Road, V.P.O. Amargarh, Tehsil Malerkotla, District Sangrur(Pb)-148022.

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2. Sh. Gurwinder Singh S/o Sh. Pavittar Singh, Proprietor M/s Dhillon Automobiles, R/o V.P.O. Amargarh, Tehsil Malerkotla, District

Sangrur(Pb)-148022.

….……Defendants

Advocates:

Argued by Sh. Vinod Verma, Advocate for 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 under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.22,27,002.10p (Rupees Twenty Two Lacs Twenty Seven Thousand Two and Ten Paise Only). The Original Application has been filed through Sh. Paramjeet Singh Sapra, Senior Manager-cum-General

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Power of Attorney of the applicant, who is competent to institute the Original Application vide Power of Attorney dated 28.11.2013, which is Annexure A2 to this OA.

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The brief facts of the OA are that the defendants had approached the applicant for the grant of CC Limit under CGTMSE of Rs.15.00 Lacs vide Loan application to this OA & further for GECL of Rs.2,98,800.00. Thereafter defendants approached the applicant for renewal of CC Limit of Rs.15.00 Lacs.

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The applicant sanctioned CC Limit under CGTMSE of Rs.15.00 Lacs vide Sanction Letter dated 20.12.2019, which is Annexure A3 to this OA and further sanctioned GECL of Rs.2,98,800.00 vide Sanction Letter dated 26.06.2020, which is Annexure A6 to this OA. Thereafter applicant sanctioned the renewal of CC Limit to Rs.15.00 Lacs vide Sanction Letter dated 29.06.2021, which is Annexure A8 to this OA.

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Defendant no.1 had hypothecated its movable assets i.e. Hypothecated the entire stock of new /old bikes, Scooters, Parts and others related items, receivables and other current assets vide Agreement for Hypothecation dated 01.01.2020, which is Annexure A4 to this OA

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Documents executed:- Gazette Notification dated 04.03.2020, which is Annexure A1 to this OA; Agreement for Overdraft dated 01.01.2020, which is Annexure A5 to this OA; Master Agreement dated 26.06.2020 & 29.06.2021, which are Annexures A7 & A9 to this OA; Balance Confirmation letter dated 04.01.2022, which is Annexure A10 to this OA; Demand Notice dated 18.04.2022 with postal receipt, Which is Annexure A11 to this OA; and Statement of Account with certificate dated 10.03.2024, which are Annexures A12 & A13 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 both the loan accounts there was a debit of Rs.22,27,002.10p, which is recoverable and the defendants were served recall notices but they did not repay the

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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 07.12.2024. 7. In support of the OA, affidavit of Sh. Paramjeet Singh Sapra, Senior Manager, Punjab National Bank has been filed. 8. Heard arguments and perused record. 9. It was argued by learned 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 Annexure A1 to A13 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 loan 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.22,27,002.10p (Rupees Twenty Two Lacs Twenty Seven Thousand Two and Ten Paise Only) along with interest from the 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 in relief clause has claimed interest @10.05%p.a. in CC Limit and interest @9.25%p.a. in GECL plus penal interest @2.00%p.a. with monthly rest in both from 25.02.2024 till the realization.

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The Tribunal is of the considered opinion that sometimes inappropriate 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 defendant, quantum of loan and prevalent market

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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 @08.00%p.a. in both 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.22,27,002.10p (Rupees Twenty Two Lacs Twenty Seven Thousand Two and Ten Paise Only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in both 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 23.01.2025.

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Copy of this order be given dasti to the applicant 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.

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Pronounced by me in the open Tribunal .

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Dated: 10.12.2024.

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

Punjab National Bank v. Messrs Dhillon Automobiles and Another

Case brief

What is this about?

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Punjab National Bank v. Messrs Dhillon Automobiles and Another

Case brief

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