Allowed

Punjab National Bank v. M/S Shri Giriraj Traders

DRT23 Dec 2024TA/226/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the applicant bank's original application for recovery of dues totaling Rs. 2.68 crores from defaulting borrowers and guarantors. The Court ex-parte considered the bank's evidence and awarded interest at 12% p.a. instead of the claimed 13.25%, directing issuance of a recovery certificate.

What did the court decide?

Directed defendants to pay Rs.2,68,52,730.77 with pendentelite and future interest @12% p.a. from filing date and costs; failure permits recovery from sale of properties. Recovery certificate issued.

Punjab National Bank versus M/S Shri Giriraj Traders — Contract and Commercial Disputes | DRT (2024)

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T.A. No. 226 of 2022

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Debts Recovery Tribunal-I, Delhi 4th floor, Jeevan Tara Building, Parliament Street, New Delhi

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Presiding Officer: Shri Govind Ballabh Sharma

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T.A. No.226 of 2022

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Punjab National Bank

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Circle Sastra Center, East Delhi CSC, Pocket E, Mayur Vihar Phase II, Delhi-110091

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Applicant

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Versus

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M/s Shri Giriraj Traders Through its sole proprietor Shri Rajpal Sharma 2612/13, Punjab & Sind Bank Building 3rd Floor, Naya Bazar, Delhi-110006

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Sh.Rajpal Sharma, Proprietor Shri Giriraj Traders H.No.241, Village Mundlana, Tehsil Gohana, Sonepat, Haryana

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Sh.Sant Lal Aggarwal, Guarantor D-13, Pushpanjali Enclave Pitampura, Delhi-110034 Defendants

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Present: Ms Nishi Chaudhary, Counsel for the applicant bank

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Date of Institution: 13.06.2018 Date of Pronouncement: 23.12.2024

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FINAL ORDER

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This original application has been filed before DRT-III, Delhi & then transferred to DRT-I, Delhi by the applicant bank on 13.06.2018 through Sh.Anil Kumar Jain, authorized representative of the applicant bank under Section 19 of sd-

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T.A. No. 226 of 2022

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Recovery of Debts Due to Banks and Financial Institutions Act, 1993 against the d fendants for recovery of a sum of Rs.2,68,52,730.77 (Rupees Two Crore Sixty Eight Lacs Fifty Two Thousand Seven Hundred Thirty and paisa Seventy Seven only) as on 31.05.2018 along with pendentelite and future interest @13.25% per annum from the date of filing of this application till the date of realization along with costs. Further, the name of Sh.Murari Lal was substituted as authorized representative in place of Sh.Anil Kumar Jain, erstwhile AR for the applicant bank.

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The brief facts of the case are on the request of defendant no.1 being sole proprietorship concern of defendant no.2 vide application dated 30.12.2013, the applicant bank sanctioned Cash Credit (Pledge) facility of Rs.1000.00 lacs (Rupees Ten Crores only) @12.25% interest per annum on 06.01.2014 duly accepted against pledge of warehouse receipts of National Bulk Holding Corporation under MSME scheme. The defendant no.3 stood as guarantor for the loan facility availed by the defendant no.1 and 2.

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That in order to avail the loan facility, the defendant no.1 submitted loan application through defendant no.2 and executed Supplementary Agreement, Advance against Warehouse Receipts, Master Undertaking dated 08.01.2014 with the applicant bank. The defendant no.3 executed an Agreement of Guarantee for the dues repayment of CC limit availed by the defendant no.1 and 2.

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It has been submitted by the applicant bank that after availing the aforesaid loan facilities, the account maintained by defendants failed to main financial discipline and account became irregular due to non-service of interest charged. The

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T.A. No. 226 of 2022

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applicant bank requested the defendants to regularize the account through various letters/ reminders / notices but no efforts made by the defendants. Ultimately, the account was classified as NPA in 2015 and the applicant bank auctioned the commodities and account was regularized. The defendant no.1 executed Balance and Security Confirmation Letter dated 14.12.2015 in favour of applicant bank.

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The applicant bank again classified the account as NPA on 15.06.2017 as per RBI guidelines due to non-adjustment of the account despite reminder letter dated 27.10.2016, 05.05.2017 and 24.05.2017 but defendants neglected. The applicant bank issued recall notice on 14.07.2017 for Rs.5,11,75,874/- as on 30.06.2017. The applicant bank finally auctioned the pledge goods for Rs.2,19,87,830/- & Rs.62,53,128/- on 19.09.2017 and 28.09.2017 respectively and now approached this tribunal for recovery of remaining dues.

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Notices of this O.A. were issued to the defendants and despite of proper service, the defendants have chosen to absent from the proceedings. As per order dated 03.03.2020, the defendants have been proceeded ex-parte as they have not appeared before the Tribunal and even written statement, evidence and affidavit of assets have not been filed by the defendants.

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In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Sh.Murari Lal, authorized representative of the applicant bank who has proved the documents as Power of Attorney Exhibit AW/1, Loan Application dated 30.12.2013 Exhibit AW/2, Original Sanction Letter dated 06.01.2014 Exhibit AW/3, Original Acceptance Letter Exhibit AW/4, Supplementary Agreement Exhibit AW/5,

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T.A. No. 226 of 2022

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Advance against Warehouse Receipts Exhibit AW/6, Master Undertaking Exhibit AW/7, Agreement of Guarantee Exhibit AW/8, Recall Notice Exhibit AW/9, Letter dated 25.07.2017 Exhibit AW/10(colly), Reminder Letters Exhibit AW/11(colly), NPA Certificate Exhibit AW/12, Recall Notice Exhibit AW/13, Details of Commodities Auctioned Exhibit AW/14, Statement of Account Exhibit AW/15, Certificate as per Bankers Books Evidence Act Exhibit AW/16, Outstanding Dues Statement Exhibit AW/17, Balance and Security Confirmation Letter dated 14.12.2015 Exhibit AW/18.

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The applicant bank has fully corroborated the averments made in the O.A. Even otherwise the whole case of the applicant bank is based on the documents and the same have been duly approved.

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The case filed by the applicant bank gone unrebutted and there is no question of disbelieving the case of the applicant bank and the applicant bank has proved its case beyond reasonable doubts.

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As per the provision of Section 19(20) of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 which is analogous to Section 34 of CPC, on filing of the suit/claim, the contract between the parties comes to an end and the Court/Tribunal has a discretion to award the same depending upon the circumstances of each case. Same principle has been laid down by the Hon'ble Apex Court in the case of Central Bank of India Vs. Ravindra & Others. Taking stock of all the circumstances and keeping in view that there is a drastic fall in rates of interest globally and domestically, I am of the opinion that interest of justice will be served if the interest at the rate of 12% p.a. is awarded.

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511-

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T.A. No. 226 of 2022

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In the light of the above discussions, the Original Application deserves to be allowed.

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ORDER

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I, allow this OA and direct the defendants to pay to the applicant bank, jointly or severally, within a period of 30 days, a sum of Rs.2,68,52,730.77 (Rupees Two Crore Sixty Eight Lacs Fifty Two Thousand Seven Hundred Thirty and paisa Seventy Seven only) together with pendentelite and future interest @12.00% per annum from the date of filing of this application till the date of realization and costs; failing which the aforesaid amount shall be recovered from the sale of movable and immovable properties of the defendants.

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ii) The recovery certificate be issued forthwith and be sent to the Recovery Officer, Debt Recovery Tribunal-I, Delhi.

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iii) Parties are directed to appear before the Recovery Officer, DRT I, Delhi on 21.02.2025.

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iv) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost.

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(GOVIND BALLABH SHARMA) PRESIDING OFFICER DRT-I, DELHI

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(Dictated and pronounced in open court) Dated: 23.12.2024