Allowed

Canara Bank v. Messrs Loveleen Traders and Others

DRT13 Dec 2024OA/614/2022

Case brief

AI extract

What is this about?

The DRT allowed the bank's application for recovery of a defaulted loan of Rs. 27,06,079.88p. The court issued a recovery certificate, reduced the interest rate to 8% p.a., and authorized recovery through sale of mortgaged assets under SARFAESI provisions.

What did the court decide?

Issued Recovery Certificate; directed defendants to pay Rs. 27,06,079.88p with interest at 8% p.a.; authorized recovery from sale of hypothecated/mortgaged properties.

Canara Bank versus Messrs Loveleen Traders and Others — Execution and Attachment | DRT (2024)

¶1

DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

¶2

ORIGINAL APPLICATION NO.614/2022 PRESIDED OVER BY MRIDULESH KUMAR SINGH

¶3

DATE OF INSTITUTION: 25.03.2022

¶4

DATE OF DECISION: 13.12.2024

¶5

Canara Bank, having its head office at: J.C. Road, Bangalore-560002 (Karnataka). Having its branch office at: Sirhind Road, Branch Patiala. Through its Attorney Holder Sh. Gagandeep Singh.

¶6

……..Applicant

¶7

Versus

¶8

M/s Loveleen Traders, Shop No.139-A, Guru Nanak Nagar, Patiala through proprietor Jasloveleen Singh.

¶9

Sh. Jasloveleen Singh S/o Sh. Jarnail Singh, resident of H.No.22, Baba Deep Singh Mohalla, Gawaliya Wali Gali, New Basti Badungar, Patiala proprietor of M/s Loveleen Traders.

¶10

Sh. Jarnail Singh S/o Sh. Pritam Singh, resident of H.No.22, Baba Deep Singh Mohalla, Gawaliya Wali Gali, New Basti Badungar, Patiala.

¶11

………Defendants

¶12

Advocates: Argued by Sh. Hemant Nanda, Advocate for the applicant (through VC) Defendants are ex-parte

¶13

FINAL ORDER

¶14

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.27,06,079.88p (Rupees Twenty Seven Lacs Six Thousand Seventy Nine and Eighty Eight Paisa only). The Original Application has been filed through Sh. Gagandeep Singh, Authorized Representative o f the applicant, who is competent to institute the Original Application vide General Power of Attorney dated 18.04.2017, which is Annexure A1 to this OA.

¶15

¶16

The brief facts of the OA are that the defendant No.1 through its proprietor i.e. defendant no.2 had approached the applicant for the grant of CC Limit of Rs.24.00 Lacs vide Loan Application dated 02.03.2020, which is Annexure A2 to this OA. 3. The applicant sanctioned the Cash Credit Limit of Rs.24.00 vide Sanction Letter dated 11.03.2020, which is Annexure A4 to this OA and the terms and conditions were duly accepted by the defendants. 4. Defendants had hypothecated their movable and mortgage of immoveable properties as under:-

¶17

a) Hypothecation of stocks of Raw Material, Work in Progress, Finished goods etc.

¶18

b) Property/ House no.22, measuring 00B-02B i.e. 98 Sq. Yds. Situated at Gali Baba Deep Singh Nagar, Bandungar, Tehsil and District Patiala, Punjab vide Equitable Mortgage Sale Deed bearing vasika no.6388 dated 14.07.2003 and 18.06.2020, along with its translation and Letter to Sub-Registrar for creation of Charge which are Annexures A11 and A12 to this OA.

¶19

Documents executed:- Letter of Proprietorship, Acknowledgment Letter, Cash Credit Agreement, Request for Overdraft Facilities, Pronote, Guarantee Agreement and Guarantee Covering Letter dated 11.03.2020, which are Annexures A3, A5 to A10 to this OA; Legal Notice dated 25.01.2021 with Postal Receipts, which is Annexure A13 to this OA and Statements of accounts along with certificate which is Annexures A14 to this OA.

¶20

The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in both the loan account there was a debit of Rs.27,06,079.88p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant requested to accept the application and to issue Recovery Certificate accordingly.

¶21

¶22

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 29.09.2023. 7. In support of the OA, affidavit of Sh. Gagandeep Singh, Authorized Representative, Canara 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 had proved its case. From the perusal of all the Annexures A1 to A14 to this OA, it is proved that the defendants approached applicant for availing of the loan facility which were granted to them and for that they had executed all the relevant documents in favour of the applicant. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, both the account of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.27,06,079.88p (Rupees Twenty Seven Lacs Six Thousand Seventy Nine and Eighty Eight 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. 10. In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @12.75%p.a. with half yearly rests from 01.02.2022 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

¶23

¶24

just and appropriate to grant uniform simple interest @8.00%p.a. in both 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.27,06,079.88p (Rupees Twenty Seven Lacs Six Thousand Seventy Nine and Eighty Eight Paisa only) jointly and severally, 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 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 applicant 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.

¶25

Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 29.01.2025. 15. 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. Pronounced by me in the open Tribunal .

¶26

Dated: 13.12.2024

¶27

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

Canara Bank v. Messrs Loveleen Traders and Others

Case brief

What is this about?

What did the court decide?

Canara Bank v. Messrs Loveleen Traders and Others

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Punjab National Bank versus Lakhvir Alias Lakhveer Singh

Punjab National Bank versus Sajjan Singh

Punjab National Bank versus Gurpreet Singh

Canara Bank versus M/S Jass Designers and Another

Hdfc Bank Limited versus Gurpreet Singh and Another

Bank of India versus Kunda Singh and Others