Allowed

Indian Bank v. Mess Thai Fastners

DRT7 Jun 2024OA/931/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the Original Application filed by Indian Bank against three respondents for recovery of an outstanding loan amount of Rs. 1,69,87,720.00. The court, exercising discretion, decreed recovery of the principal sum with simple interest at 8% per annum and directed the issuance of a Recovery Certificate.

What did the court decide?

The respondents are declared liable to pay Rs. 1,69,87,720.00 with costs and simple interest @8% p.a. A Recovery Certificate is issued.

Indian Bank versus Mess Thai Fastners — Contract and Commercial Disputes | DRT (2024)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.931/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 17.07.2023

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DATE OF DECISION: 07.06.2024

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Indian Bank, a body corporate, constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Corporate Office at PB No.5555, 254-260, Avvai Shanmugam Salai, Royapettah, Chennai and its Branches throughout India and amongst other branches one of its Branch Office at Bhai Randhir Singh Nagar, Ludhiana through its constituted attorney Sh. Amarjeet Singh, Chief Manager, Indian Bank, Zonal Office, Dugri, Ludhiana through his authorized signatory Sh. Abhinav Bajpai, Branch Manager, Indian Bank, Bhai Randhir Singh Nagar, Ludhiana and who is also the principal officer of the plaintiff/applicant bank

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……..Applicant

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Versus

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M/s Thai Fastners, B-XXIX, Plot No.458/2, Sua Road, Giaspura, G.T. Road, Ludhiana through its partners Sh. Sandeep Maheshwari and Smt. Palak Sharma

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Sh. Sandeep Maheshwari, Partner of M/s Thai Fastners, R/o H.No.9, Street No.1, Corporation Colony, Hambran Road, Ludhiana

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Smt. Palak Sharma Partner of M/s Thai Fastners, R/o H.No.9, Street No.1, Corporation Colony, Hambran Road, Ludhiana

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………Defendants

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Advocates:

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Argued by Sh. Ashok Kumar Verma, counsel 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.1,69,87,720.00 (Rupees One Crore Sixty Nine Lacs Eighty Seven

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Thousand Seven Hundred and Twenty only). The Original Application has been filed through Sh. Amarjeet Singh, Chief Manager and Sh. Abhinav Bajpai, Branch Manager of the applicant bank, who was competent to institute the Original Application vide Power of Attorney of Sh. Amarjeet Singh, Chief Manager dated 13.10.2014 and Letter of Authorization in name Sh. Abhinav Bajpai, Branch Manager dated 17.06.2023, which are Annexures A1 and A2 to this OA.

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The brief facts of the OA are that defendant No.1 through its partners i.e. defendant Nos.2 and 3 had approached the applicant bank for the grant of Cash Credit Limit (OCC Limit) of Rs.45.00 Lacs and Medium Term Loan-I of Rs.38.50 Lacs. Further for its enhancement of Cash Credit Limit (OCC Limit) to Rs.90.00 Lacs, Medium Term Loan-II of Rs.43.50 Lacs. Thereafter defendant No.1 through its partners i.e. defendant Nos.2 and 3 had approached the applicant bank from time to time for grant of GECL of Rs.26.87 Lacs and GECLS (extension) of Rs.13.00 Lacs.

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The applicant sanctioned the Cash Credit Limit (OCC Limit) of Rs.45.00 Lacs and Medium Term Loan of Rs.38.50 Lacs, both covered under CGTMSE, vide Sanction Letter dated 16.08.2016, which is Annexure A3 to this OA and further enhanced the Cash Credit Limit (OCC Limit) to Rs.90.00 Lacs and sanctioned a fresh Medium Term LoanII of Rs.43.50 Lacs, both covered under CGTMSE, vide Sanction Letter dated 12.06.2017, which is Annexure A9 to this OA and further granted IND-GECLS-Covid-19 Loan of Rs.26.87 Lacs vide Sanction Letter dated 22.06.2020, which is Annexure A17 to this OA and thereafter sanctioned a IND-GECLS 1.0 (extension) Loan of Rs.13.00 Lacs vide Sanction Letter dated 02.11.2021, which is Annexure A23 to this OA and the terms and conditions were duly accepted by the defendants. 4. Defendant No.1 through its partners i.e. defendant Nos.2 and 3 had hypothecated its movable properties i.e. Book Debts, Stocks, Goods, Produce, Merchandise, Stock stored or to be stored from time to time, Plant and machinery in premises at Plot no.3007, Street No.11,

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New Janta Nagar Ludhiana and B-29/93/1AB, Street no.2, Daba Road, Ludhiana vide agreements of hypothecation (Form No.D-101) dated 19.08.2016, 16.06.2017, 23.06.2020, 03.11.2021, which are Annexures A6, A7, A12, A13, A19 and A25 to this OA. Documents executed:- D.P. Notes and Medium term loan agreement all dated 19.08.2016, which are Annexures A4, A5 and A8 to this OA; D.P. Notes, Medium term loan agreement and Agreement of guarantee all dated 16.06.2017, which are Annexures A10, A11, A14 and A15 to this OA; Letter of acknowledgment of debt dated 13.08.2019 and 17.08.2019, which is Annexure A16 to this OA; D.P. note, Term loan agreement and Agreement of guarantee all dated 23.6.2020, which are Annexures A18, A20 and A21 to this OA; Letter of acknowledgment of debt-cum-security dated 30.09.2021, which is Annexure A22 to this OA; D.P. note, Term loan agreement and Agreement of guarantee all dated 03.11.2021, which are Annexures A24, A26 and A27 to this OA; Legal notice dated 26.05.2023 along with postal receipt, which is Annexure A27/1 to this OA and Statements of accounts with certificates, which are Annexures A28 to A32 to this OA. 5. The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.1,69,87,720.00, 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. 6. The defendants were served summons to appear before this Tribunal but no one appeared on behalf of defendants and were proceeded ex-parte on 10.04.2024. 7. In support of the OA, affidavit of Sh. Abhinav Bajpai, Branch Manager, Indian Bank has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant

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bank had proved its case. From the perusal of all the Annexures A1 to A32 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 loans 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.1,69,87,720.00 (Rupees One Crore Sixty Nine Lacs Eighty Seven Thousand Seven Hundred and Twenty only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the dues.

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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 @16%p.a. plus penal interest @2.00%p.a. with monthly rests from 06.07.2023 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 @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.

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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.1,69,87,720.00 (Rupees One Crore Sixty Nine Lacs Eighty Seven Thousand Seven Hundred and Twenty only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in all the loan

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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. 13. Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 25.06.2024.

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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. Pronounced by me in the Open Tribunal .

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Dated: 07.06.2024

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

Indian Bank v. Mess Thai Fastners

Case brief

What is this about?

What did the court decide?

Indian Bank v. Mess Thai Fastners

Case brief

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What did the court decide?

What the court decided

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