In an ex-parte hearing, the Delhi Bench of the Debts Recovery Tribunal allowed the bank's application for recovery of outstanding dues aggregating over Rs.43 Lacs with interest fixed at 8% per annum.
Recovery of Rs 43,36,575.38 along with joint and several liability and uniform simple interest at 8% p.a. from filing date till realization.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH
ORIGINAL APPLICATION NO.746/2023
PRESIDED OVER BYMRIDULESH KUMAR SINGH
DATE OF INSTITUTION: 22.05.2023
DATE OF DECISION: 07.08.2024
Union Bank of India, a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai and having a Branch office inter-alia at, SDPH Ludhiana Branch, Chauri Sarak, Ludhiana, through duly authorized person and attorney holder Sh. Balbir Singh Ralhan, Branch Manager.
……..Applicant
Advocates:
Argued by Sh. Amod Kumar Thakur, Advocate proxy for Sh. R.K. Chauhan, Advocate for the applicant Defendants are ex-parte
FINAL ORDER
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| Original Application vide Power of Attorney dated 19.06.2002, which is Annexure A1to this OA. |
|---|
| 2. The brief facts of the OA are that the defendant no.1 through its proprietor i.e. defendant no.2 had approached the applicant bank for |
| the grant of CC Limit of Rs.3.00 Lacs and further approached the applicant bank from time to time for its several enhancements up to |
| Rs.25 Lacs. Later defendant no.1 through its proprietor i.e. defendant no.2 |
| approached the applicant bank for grant of Term Loan under UGECL of |
| Rs.5.00 Lacs and further for Term Loan under CELC of Rs.2.50 Lacs to |
| this OA. |
| 3. The applicant Bank sanctioned the CC Limit of Rs.3.00 Lacs and |
| further from time to time sanctioned its several enhancements up to |
| Rs.25 Lacs. Later, applicant bank sanctioned the Term Loan under UGECL of |
| Rs.5.00 Lacs and further sanctioned Term Loan under CELC of Rs.2.50 Lacs vide Sanction Letter dated 18.07.2020, which isAnnexure A67 |
| to this OA and the terms and conditions were duly accepted by the |
| defendants vide Standard terms and conditions for working |
| capital(Annexure- |
| 4. Defendant No.2 & 3 had mortgaged their immovable properties |
| detailed as i.e. |
| (i) MC No.B-IX-434, measuring 100 square yards situated at |
| Mohalla Bazarian, Chauri Sark, Ludhiana vide Equitable Mortgage of |
| Title Deed bearing vasika no.16642 dated 16.02.2004 and vasika |
| no.26265 dated 11.03.1998 and along with their translations,which is |
| Annexure A7 & A10to this OA. |
| (ii) MC No.B-IX-433/3, measuring 50 square yards situated at |
| Mohalla Bazaria, Chauri Sark, Ludhiana videTitle Deed bearing vasika |
| no.16444 dated 16.02.2004 and vasika no. 24876 dated 23.02.1998 |
| and along with their translations,which isAnnexure A8 & A11to this OA. |
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Documents executed:- Demand Promissory Note of Rs.3.00 Lacs, Hypothecation agreement of Goods and Debts, Letter of Undertaking and Letter of Guarantee all dated 04.03.2005, which are Annexure A2, A4 to A6 to this OA; Letter of Continuity, which is Annexure A3 to this OA; Memorandum of deposit of title deed dated 03.03.2005, which are Annexure A9 & A12 to this OA; Demand Promissory note of Rs.5.00 Lacs, Letter of Continuity, Hypothecation agreement of goods and debts, Annexure-1 (Consent Clause to be executed by borrowers), Letter of undertaking by borrowers, Letter of undertaking not to alienate hypothecated goods, Letter of Guarantee and Link Letters regarding extension of mortgage, all dated 21.06.2006, which are Annexure A13 to A21 to this OA; Demand Promissory note of Rs.8.00 Lacs, Letter of Continuity, Hypothecation agreement of goods and debts, Letter of undertaking by borrowers, Letter of undertaking not to alienate hypothecated goods, Annexure-1, Letter of Guarantee and Declarations regarding extension of Equitable mortgage all dated 06.07.2009, which are Annexure A22 to A28, A30 and A31 to this OA; Annexure-II, which is Annexure A29 to this OA; Demand Promissory note of Rs.15.00 Lacs, Hypothecation agreement of goods and debts, Letter of undertaking not to alienate hypothecated goods, Agreement on rate of interest, Debit Balance confirmation and acknowledgement Letter, Letter of Guarantee, Annexure-|| by Guarantor and Supplementary Memorandums all dated 17-12-2014, which are Annexures A32, A34, A36, A37, A40, A41, A42, A44, A46, A48 and A50 to this OA; Letter of Continuity, Letter of undertakings by borrowers and Declarations regarding extension of Equitable mortgage, which are Annexure A33, A35, A39, A43, A45, A47 and A49 to this OA; Demand Promissory note of Rs.25.00 Lacs, Interest agreement, Text of consent clause, Letter of undertaking not to alienate hypothecated goods, Letter of Guarantee, Annexure-|| by Guarantor, Declarations regarding extension of Equitable mortgage and Supplementary Memorandums, all dated 06.05.2017 which are
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Annexures A51, A53, A55 to A66 to this OA; Letter of Continuity, Hypothecation agreement of goods and debts, which are Annexures A52 and A54 to this OA; Request cum undertaking letter for disbursement, Demand Promissory note of Rs. 5.00 Lacs, General term loan agreement of Rs.5.00 Lacs, Demand Promissory note of Rs.2.50 Lacs, General term loan agreement of Rs.2.50 Lacs, Composite Hypothecation deed for all the credit facilities, Ad-02 by borrower, Annexure-1, Memorandums of entry regarding extension of mortgage all dated 23.07.2020, which are Annexure A68, A69, A71, A72 to A81 to this OA, Letters of Continuity, which are Annexure A70,A73 to this OA, Valuation reports both dated 09.03.2017 which are Annexure A82 & A83 to this OA, Letters dated 11.07.2019, 17.01.2020, 07.03.2020, 08.02.2021 and 02.03.2021, which are Annexures A84 to A91 to this OA; Demand notice U/s 13(2) of SARFAESI Act dated 05.04.2022 with postal receipts, which is Annexures A92 to this OA; Proposal for settlement/reconstruction dated 01.10.2022, which is Annexures A93 to this OA; Reply by bank to the proposal for settlement/reconstruction dated 02.11.2022 with postal receipts, which is Annexures A94 to this OA; Statements of Accounts of C.C Limit, UGECL Term loan and CELC Term loan with Certificates u/s 65 of Indian Evidence act, which are Annexures A95 to A100 to this OA. 5. The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in all loan accounts there was a debit of Rs.43,36,575.38, 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. 6. 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 09.07.2024.
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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
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just and appropriate to grant uniform simple interest @8.00%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. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.43,36,575.38 (Rupees Forty Three Lacs Thirty Six Thousand Five Hundred Seventy Five And Paise Thirty Eight Only) jointly and severally, with costs, current and future simple interest @8.00%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. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 30.08.2024. 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: 07.08.2024 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh
3 issues framed by the court
Whether the applicant bank is entitled to recover the outstanding dues of Rs.43,36,575.38 from the defendants.
Whether the Tribunal can modify the claimed rate of interest to a uniform simple interest rate.
Whether the defendants are liable to pay the recovery amount jointly and severally.
3 provisions across 3 enactments
Union Bank of India
M/s V.O. Maggo Hosiery
Sanjay Maggo
Kavita Maggo
Mridulesh Kumar Singh
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
