Allowed

Indian Bank v. Rare India Exim Pvt. Ltd.

DRT12 Feb 2024TA/121/2022

Case brief

AI extract

What is this about?

DRT-III, Chennai allowed a transfer application filed by Indian Bank for recovery of debts and interest from three respondents. The court authenticated the loan documents and decreed recovery of the principal amount with interest.

What did the court decide?

Recovery of Rs.1,00,59,915.90 plus interest @ 13.55% p.a., and permission to sell schedule properties.

Indian Bank versus Rare India Exim Pvt. Ltd. — Contract and Commercial Disputes | DRT (2024)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI Dated this 12^th day of February, 2024

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PRESENT: SHRI T. RAJESH PRESIDING OFFICER

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T.A. No. 121 of 2022

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(Old OA. No. 274/2020-DRT-I, Chennai)

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INDIAN BANK

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Erstwhile ALLAHABAD BANK IFSC: ALLA0211042 Rep. by its Senior Manager Anna Nagar Branch F 48, New. No. 54,1^st Avenue Anna Nagar East, Chennai-600102.

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... Applicant

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M/s RARE INDIA EXIM Pvt. Ltd. Rep. by its Directors CIN No. U74900TN2014PTC095178 PAN No. AAGCR8230E, Regd. Off No.4, Manikeswari Road, Kilpauk Chennai-600010.

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Mr. A.K. SHAMSUDEEN, S/o Mr. Abdul Khader, PAN No: AAIPS7788M; DOB:29.06.1963 Flat No. B4, Block-2 “Srivari Touch Stone Apartments” No.10, Vasu Street, Kilpauk Chennai-600010

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3 . Mrs. SURAYA BANU,

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W/o Mr. A.K.Shamsudeen PAN NO: FKTPS0146; DOB: 24.09.1975 Flat NO. B4, Block-2 “Srivari Touch Stone Apartments” No.10, Vasu Street Kilpauk, Chennai-600010 … Defendants

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Counsel for Applicant : M/s. S. Pandurangan Defendants : Exparte

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…

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ORDER

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The above Transfer Application is filed under section 19 of the Recovery

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of Debts and Bankruptcy Act seeking recovery of Rs.1,00,59,915.90P with further interest from the date of filing of the TA also by allowing the same to be recovered from the defendants jointly and severally and also by sale of the schedule mentioned properties.

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The above original application is filed before the DRT-I and stood transferred to this Tribunal and renumbered as above.

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The case of the Applicant Bank can be encapsulated as follows:

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The 1^st defendant company being the borrower and defendants 2 and 3 being the guarantors/ directors had applied for and availed a cash credit facility for Rs.1,00,00,000/-.

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It is also stated that theabove facilities were availed after execution of necessary loan documents by defendants obliging themselves to repay the amount promptly and regularly, without fail.

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Apart fromexecution of the necessary loan documents, the 2^nd defendant had created security by way of equitable mortgage over the schedule mentioned properties and also by hypothecation of movables.

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Even though the defendants had obliged themselves to repay the amount promptly and regularly, they failed to do so resultingdefaults in the account and the same being declared as NPAon 04.06.2019.

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The Applicant Bank’s officials had on many occasions approached the defendants requesting them to regularize the account and also sent several reminders and despite all these, no effort was made by the defendants to get the account regularized over to pay back the amount. Even as no repayment was made despite repeated requests, the Applicant Bankhad caused to issue a demand notice dated 06.06.2019 requiring repayment of the amount due in the account.

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It is also the case of the Applicant Bank that despite repeated reminders and requests, the defendants had failed to make the repayment forcing the Applicant Bank to file this TA seeking recovery of the amount due in the account with further interest and cost.

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The defendant entered appearance and filed their reply statements. The 1^st and 2^nd defendants filed their reply statement contending that the bank had not disbursed the entire sanctioned amount of Rs.1,00,00,000. It is also contended that the bank had obtained signature in blank papers and the defendants were not informed as to the applied rate of interest. It is also stated that as per the statements of accounts furnished by the Applicant Bank, only an amount of Rs.85,46,913.90 was outstanding as on 07.11.2019 and that, evidences that the amounts remitted were not duly given credit to by the applicant. The defendants further contents that they were made to sign the documents without disclosing the contents there is. The signature in the acknowledgement of debt is also disputed and on that basis defendants 1 and 2 contends that the claim is time barred.

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The 3^rd defendant filed the reply statement contending that she is not involved in the affairs of the company as being a Pardanashianwomen. Only as the bank insisted her signatures, she was

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made to sign the documents, the contents of which were not explained to her. Only as she was informed that her signatures are formality being director, she signed the documents. The 3^rd defendant had also reiterated the contention of other defendants in their reply statement as to the dispute regarding outstanding and applied rate of interest.

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Even though the Defendants entered appearance and filed reply statement, they failed to file counter proof affidavit and failed to appear hence, subsequently they were set exparte on 12.02.2024and the matter was heard exparte.

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The Applicant Bank had let in evidence through AW1 who had filed the Proof Affidavit in terms of the pleadings in the TA and got marked Exbs A1to A29.

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Heard the counsel for the Applicant Bank and considered the contentions as taken inthe TA in the light of documentary evidence and proof affidavit.

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The following issues arise for consideration in this matter.

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i) Whether the Applicant Bank had succeeded in proving the TA claim?

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ii) What orders are to be passed?

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Both these issues are gone into and decided together.

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The documents produced by the Applicant Bank includes the loan application, sanction letter, acknowledgement of sanction, Demand Promissory note, and General letter of hypothecation which evidences that the Applicant Bank’s case that the defendants had applied for and availed the credit facility by executing necessary loan documents. The letters of guarantee dated 25.06.2015 evidences that the defendants 2 and 3 stood as guarantors for the said credit facility.The creation of Mortgage is also proved by Exhs. A12, A14, A15 and A16, the sale deed, Letter confirming the deposit of Title deeds, MODT and the certification of registration charges, respectively proved the Mortgage.

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The denial of defendants about the execution of the signatures in the Acknowledgement of Debt is to be rejected. The defendant failed to let in any evidence, though sufficient opportunity was given.

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The evidence tendered by the Applicant Bank remains uncontroverted and undisputed. The evidence put forth by the Applicant Bank were found admissible. From the statement of accounts as produced by the Applicant Bank, it is evident that the amount as claimed in the TA is outstanding in the account, which the Applicant

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Bank is entitled to get recovered from the defendants and their assets (including the scheduled mentioned property).The claim of the Applicant Bank is well within the period of limitation and there is no Capitalization of penal interest. Since, the TA claim has been arrived at by calculating interest at agreed rate which is on the higher side, prayer for monthly rests is declined.

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In view of the finding as entered above

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i) TA No: 121/2022 stands allowed . ii) Applicant Bank is permitted to recover anamount of Rs.1,00,59,915.90P (Rupees One Crore Fifty Nine Thousand Nine Hundred Fifteen and Ninety Paisa Only) with future and pendentelite interest @ 13.55%p.a.(simple) from the date of filing of the TA till realization from thedefendants personally and from their assets including the schedule mentioned properties after giving credit to all the amount recovered and received during the pendency of the TA.

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iii) A Recovery Certificate is to be drawn and issued to the Recovery Officer to enable recovery of the amounts as per the above terms.

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iv) Applicant Bank is allowed to realize cost of the proceedings for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the order.

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Communicate a copy of the order to the parties concerned in

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terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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(Dictated to PA-2, transcribed by him, corrected, signed and pronounced by me in the Open Court, this 12^th day of February, 2024)

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Sd/- (T. RAJESH) PRESIDING OFFICER DRT–II, CHENNAI

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Indian Bank v. Rare India Exim Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

Indian Bank v. Rare India Exim Pvt. Ltd.

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

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