Allowed

Canara Bank (Erstwhile Syndicate Bank) v. Mr. S. Annamalai (Borrower)

DRT9 Feb 2024TA/125/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the Transfer Application filed by Canara Bank. The bank sought a Recovery Certificate for dues exceeding Rs. 1 crore along with interest and sale of schedule properties. The claim was verified as uncontradicted. Reliefs were granted for recovery from borrowers and guarantors.

What did the court decide?

Recovery Certificate issued for Rs. 1,18,00,821.59 plus future interest. Sale of schedule properties authorized. Defendants made jointly and severally liable.

Canara Bank (Erstwhile Syndicate Bank) versus Mr. S. Annamalai… — Money Laundering | DRT (2024)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI Dated this 9^th day of February, 2024

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PRESENT: SHRI T.RAJESH PRESIDING OFFICER

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T.A.No.125 of 2023

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(Old OA.No.23/2020-DRT-I, Chennai)

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Canara Bank (Erstwhile Syndicate Bank) Tirupattur Branch, 65, Chetty Street, Tirupattur – 635 601 IFSC : SYNB0006251

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...Applicant

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Mr. S. Annamalai (Borrower) S/o Late Subramani Gounder 10/9B, Karuppanur Road, Tirupattur, Vellore District Tamil Nadu – 635 601

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Mr. S Venkatesan (Guarantor for 1^st Loan) S/o. Mr. Subramani, 30/19, Dharmaraja Koil 3^rd Street, Tirupattur Taluk, Vellore District

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Mr. K. Vijayarangan (Guarantor for 1^st Loan) S/o Mr. Kasi, No. 538, Kumaran Nagar, Jammanapudhur (Post), Tirupattur Taluk. Vellore District Alternative Address:

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Mr. K. Vijayarangan (Guarantor) S/o Mr. Kasi, No. 325, Poonkulam, Jammanapudhur (Post) Tirupattur Taluk, Vellore District …Defendants

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Counsel for Applicant : M/s. K. V. Subramanian Associatez Defendants : Exparte. ……

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ORDER

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The above Transfer Application is filed Under Section 19 of the Recovery of DebtsAnd Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for Rs.1,18,00,821.59/-with further interest from the date of filing of the TA and also by allowing the same to be recovered from defendants jointly and severally and also by sale of the schedule properties.

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The above Original Application was filed before the DRTI,Chennaiand stood transferred to this Tribunal and renumbered as above.

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The case of the applicant can be encapsulated as follows: The 1^st defendant being the borrower had applied for and availed the following creditfacilities from the erstwhile syndicate Bank which got amalgamated with the applicant bank. The 2^nd and 3^rd defendant stood as guarantors for the first credit facility.

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Sl no	Credit facility	amount
1.	Term loan / Synd MSE	Rs. 10,00,000/-

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2.	OSL -Synd Vahan	Rs.11,84,080/-
3.	Other Secured Liabilities / Term loan	Rs.70,00,000/-

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

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5. Apart from execution of the necessary loan documents, the 1^st defendant had created security by way of equitable mortgage over the schedule properties. The vehicle loan availed by applicant was secured by hypothecation.

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6. Even though the defendants had obliged themselves to repay the amount promptly and regularly, they failed to do so resulting in defaults in the account and the same being declared as NPAon 30.06.2017.

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The applicant’s officials had on many occasions approached the defendants requesting them to regularize the account and despite the same, 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 had caused to issue a demandnoticedated 31.08.2016 and legal notice dated 07.09.2019for repayment of the amount due in the account.

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

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Evenas the defendants failed to enter appearance, they were set exparte on 15.06.2022.

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The Applicant had let in evidence through AW1 who had sworn to a Proof Affidavit in terms of the pleadings in the TA and also produced Exbs A1 to A42 and got the same marked as evidence.

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Heard the counsel for the applicant and considered the contentions as taken in the 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 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 case put forth by the applicant in the Application remains unrebutted. The evidences tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible. From the statement of accounts as produced by the applicant, it is evident that the amounts as claimed

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in the TA is outstanding in the accounts, which the applicant is entitled to get recovered from the defendants and their assets (including the scheduled property).The claim of the applicant is well within the period of limitation and there is no Capitalization of penal interest.The prayer for penal interest is not allowed.

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In view of the findings as entered above:

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i. TA No: 125 of 2023 stands allowed.

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ii. Applicant is permitted to recover atotal amount ofRs. 1,18,00,821.59/-(Rupees One Crore Eighteen Lakhs Eight Hundred Twenty One and Paisa Fifty Nine Only/-), i.e. with future and pendentelite interest(i) @ 10.75% per annum on Rs. 8,98,951.85/- from defendants 1 to 3,(ii) @ 10.15% per annum on Rs.10,88,582.11from 1^st defendant and (iii)@ 11% on Rs.98,13,287.63/- from 1^st defendant,from the date of filing of the TA till realization,as aforementioned after giving credit to all the amount recovered and received during the pendency of the TA.

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iii. It is made clear that the defendants D1, D2 and D3 are personally liable for all such amounts due in the 1^st Loan account, whereas D1 is personally liable for all such amounts due in the 2^nd and 3^rd Loan Accounts.

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iv. The schedule mentioned immovable properties to be proceeded against and sold in recovery of 1^st and 3^rd credit facilitiesand if the sale proceeds are not sufficient;D1, D2, D3 and their assets are liable to be proceeded against in case of the 1^st Loan and D1 along with his assets is to be proceeded against in the case of the 3^rd Loan.

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v. The due in the 2^nd credit facility of Vehicle Loan of Rs.10,88,582.11/- is to recovered from 1^st defendant personally and also by proceeding against the hypothecated vehicle.

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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 is allowed to realize cost of the proceeding 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 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 9^th day of February, 2024)

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

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Canara Bank (Erstwhile Syndicate Bank) v. Mr. S. Annamalai (Borrower)

Case brief

What is this about?

What did the court decide?

Canara Bank (Erstwhile Syndicate Bank) v. Mr. S. Annamalai (Borrower)

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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