Allowed

Central Bank of India v. Avtar Singh and Others

DRT5 Aug 2024OA/656/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an application by Central Bank of India for recovery of outstanding agricultural loan dues totaling Rs. 35,34,313.00 from three borrowers and a guarantor proceeding ex-parte. The court granted interest at 8% p.a. and authorized recovery via sale of mortgaged or personal assets under SARFAESI Act.

What did the court decide?

Recovery of Rs.35,34,313.00 with costs and future simple interest @8.00% p.a. from date of filing till realization.

Central Bank of India versus Avtar Singh and Others — Banking and Recovery | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.656/2022

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PRESIDED OVER BYMRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 25.04.2022

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DATE OF DECISION: 05.08.2024

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Central Bank of India, a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Chander Mukhi Building, Nariman Point, Mumbai 400021 and having one of its Branch situated at Central Bank of India, Ajrawar Branch, District Patiala, Punjab through Mr. Baldev Singh, who is presently working as Chief Manager, Central Bank of India, Regional Office, K.P. Complex, Adj, Hotel Park Plaza, Ferozepur Road, Ludhiana, Punjab constituted Power of Attorney Holder of the Bank and Principal Officer.

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……..Applicant Bank

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Versus

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Mr. Avtar Singh S/o Sh. Amarjit Singh, R/o Villlage Sanaur, District Patiala, Punjab

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Mr. Paramjit Singh S/o Sh. Amarjit Singh, R/o Villlage Sanaur, District Patiala, Punjab

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Mr. Jaspal Singh S/o Sh. Jaswant Singh R/o Villlage Dhilwal, District Patiala, Punjab

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….……Defendants

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Advocates:

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Argued by Ms. Ritika Kansal, Advocate proxy for Sh. Surinder Nath Sharma, 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 bank under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.35,34,313.00 (Rupees Thirty Five Lacs Thirty Four Thousand Three Hundred and Thirteen Only). The Original Application has been filed through Mr. Baldev Singh, Chief Manager o f the applicant bank, who is

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competent to institute the Original Application vide Power of Attorney dated 08.12.2011, which is Annexure A1 to this OA.

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The brief facts of the OA are that the Defendant No.1 & 2 had approached the applicant bank for the grant of Agricultural Term Loan for Poly House of Rs.39.00 Lacs vide Loan application dated 20.08.2015, which is Annexure A2 to this OA. Defendant no.3 stood as guarantor, Guarantor’s Consent Letter dated 20.08.2015, which is Annexure A14 to this OA

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The applicant Bank sanctioned the Agricultural Term Loan for Poly House of Rs.39.00 Lacs vide Sanction Letter dated 20.08.2015, which is Annexure A5 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant no.1 & 2 had mortgaged his agriculture land measuring 15B-0B (3.15 acres) situated at Mauja Village Laleena, Hadbast No.126, Tehsil Patiala vide Declaration under Section 4(1) along with Letter to Tehsildar/Sub-Registrar for creation of charge bearing vasika no.1328 both dated 14.08.2015, which are Annexures A8 and A9 to this OA. Documents executed: - Pre Sanction Inspection Report, Due Diligence Report both dated 20.08.2015, which are Annexures A3 & A4 to this OA; Affidavit/Undertaking by Borrower and Advocate Report both dated 12.08.2015, which are Annexures A6 & A7 to this OA; Consent Clause by the borrower, Loan cum Hypothecation Agreement, Term Loan Agreement, Supplementary Agreement, Consent Clause by Guarantor and DP Note all dated 20.08.2015, which are Annexures A10 to A13 & A16 to A17 to this OA; Form of Guarantee for advances and credits generally, which is Annexure A15 to this OA ; Post Inspection Report dated 23.04.2021, which is Annexure A18 to this OA; Notice of recall of Bank’s dues by advocates dated 07.03.2022, which is Annexure A19 to this OA and Statement of Account with certificate, which is Annexure A20 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

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debit of Rs.35,34,313.00 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. Defendant nos.1 and 2 appeared though their counsel and filed their Power of Attorney on 06.03.2023 but did not filed WS. Hence, opportunity to file WS was closed and defense was struck off. Since no one appeared on behalf of defendants, they all were proceeded ex-parte on 29.05.2024.

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In support of the OA, affidavit of Mr. Baldev Singh, Chief Manager, Central Bank of India 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 A20 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 loans 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.35,34,313.00 (Rupees Thirty Five Lacs Thirty Four Thousand Three Hundred and Thirteen 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.

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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 @11.20%p.a. with monthly rests from 21.04.2022 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

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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 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.35,34,313.00 (Rupees Thirty Five Lacs Thirty Four Thousand Three Hundred and Thirteen Only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in 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.

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Parties to appear before Learned Recovery Officer of this Tribunal on 27.08.2024.

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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.

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Pronounced by me in the open Tribunal

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Dated: 05.08.2024

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

Central Bank of India v. Avtar Singh and Others

Case brief

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Central Bank of India v. Avtar Singh and Others

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