Allowed

Indian Bank v. M/s.a.v.Constructions

DRT1 Mar 2024TA/239/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's application for a recovery certificate. The court found the claim proved based on un-rebutted evidence regarding a loan facility and liabilities of the partners and legal heirs.

What did the court decide?

Issuance of a Recovery Certificate to recover Rs.3,01,46,175.77 along with pendentelite and future interest at 12% p.a. (simple) from the defendants.

Indian Bank versus M/s.a.v.Constructions — Banking and Recovery | DRT (2024)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI Dated this 1^st day of March, 2024

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PRESENT: SHRI T.RAJESH PRESIDING OFFICER

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TA.No.239 of 2022

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(Old OA.No.50/2022 - DRT-I, Chennai)

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Indian Bank, Koyambedu Branch, No.76/20, Sri Ayyappa Nagar, Chinmaya Nagar, Chennai – 600 092. Transferred to Stressed Assets Management Branch, (SAMB), (IFSC No.IDIB000A113), 2^nd Floor, Zonal Office Buildings, 55, Ethiraj Salai, Wellington Estate, Egmore, Chennai – 8. Rep. by its Chief Manager.

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… Applicant.

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Vs.

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M/s.A.V.Constructions, Represented by its Partners, Mr.A.Dinesh and Mr.S.Manoj Kumar, Flat No.F1, 1^st Floor, West Gangai Amman Koil Street, Madhuravoyal, Chennai – 600 095.

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Mr.S.Manoj Kumar,

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PAN No.AVZPM8433B, Partner & Legal Heir of Late S.Durga, S/o.Mr.S.Lingam, No.17B, Guruvappa Street, Ayanavaram, Chennai – 600 023.

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Mr.A.Dinesh,

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PAN No.ASNPD0960F, Managing Partner, S/o.R.Alagar, Flat No.F1, Plot No.73/58, 1^st Floor, West Gangai Amman Koil Street, Alapakkam Road, Madhuravoyal, Chennai – 600 095.

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Mrs.S.Bhavaniswari, D/o.Late N.S.Lingam, No.17B, Guruvappa Street, Ayanavaram, Chennai – 600 023.

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Ms.S.Saranya, D/o.Late N.S.Lingam, No.17B, Guruvappa Street, Ayanavaram, Chennai – 600 023. … Defendants. Counsel for Applicant : M/s.M.L.Ganesh. Defendants : Exparte.

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ORDER

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The Application is filed Under Section 19 (1) of the Recovery of Debts

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And Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for Rs.3,01,46,175.77 due in Open Cash Credit facility availed by the defendants.

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The Applicant contends that the 1^st defendant partnership firm represented by 2^nd and 3^rd defendants as its partners availed Open Cash Credit facility to the tune of Rs.3,50,00,000/- for which defendants 2, 3 and Mrs.Durga (late) stood as guarantors for the said

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loan. It is also stated that the said facilities were secured by mortgage of schedule mentioned properties by defendants 2, 3 and Mrs.Durga (late). It is further secured by hypothecation of stocks/book debts.

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It is also stated that the above facilities were availed after execution of necessary loan documents by defendants 1 to 3 and Mrs.Durga (late) obliging themselves to repay the amount promptly and regularly, without fail.

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The Applicant further contends that despite availing the credit facility by obliging to pay back the amount, the defendants 1 to 3 and Mrs.Durga (late) failed in compliance of the same and all the efforts of the Applicant to make them pay back the amount failed forcing the Applicant to file this Application. The applicant further contends that one of the guarantor/mortgagor Mrs.Durga had died intestate and the legal heirs are arrayed as defendants 2, 4 and 5. Since the 2^nd defendant had already executed loan security documents in favour of applicant bank, the 4^th and 5^th defendant as legal heirs are jointly and severally liable to repay the outstanding loan amount by applying the principle of doctrine of pious obligation.

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Summons was taken out and as the defendants failed to appear they were set exparte on 10.08.2022.

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The Applicant let in evidence through AW1, filed proof affidavit in

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confirmation with the pleadings and got marked Exhs.A1 to A34.

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Heard. The following issues arise for consideration:

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i) Whether the Applicant had proved the TA claim?

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ii) What orders are to be passed?

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Both these issues are decided together.

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The Applicant’s evidence remains un-rebutted and hence proved. The documents produced by the Applicant are found to be admissible and are sufficient to prove the TA claim. Hence the Applicant is found to be entitled for the TA claim. The TA claim is made within limitation and there is no capitalization of penal interest. Since the OA claim is arrived at by calculating interest at agreed rate which is on the higher side, pendentelite and future interest is awarded @12% p.a. (simple).

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In view of the above

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i) TA No.239/2022 stands allowed.

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ii) Applicant is permitted to recover an amount of Rs.3,01,46,175.77 (Rupees Three Crores One Lakh Forty Six Thousands One Hundred Seventy Five and Paise Seventy Seven only) with future and pendentelite interest @12% p.a. (simple) from the date of filing of the TA till realization from the

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defendants and by sale of hypothecated stocks/book debts and also by sale of schedule mentioned property after giving credit to all the amounts recovered and received during the pendency of the TA. However, the defendants 1 to 3 are personally liable to the TA claim and also by sale of their assets, the liability of defendants 4 and 5 are limited to the extent of assets inherited

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from Mrs.Durga, deceased guarantor/ mortgagor.

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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 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 terms of

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

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(Dictated to PA, transcribed by him, corrected, signed and pronounced by me in the Open Court, this 1^st day of March, 2024)

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

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Indian Bank v. M/s.a.v.Constructions

Case brief

What is this about?

What did the court decide?

Indian Bank v. M/s.a.v.Constructions

Case brief

What is this about?

What did the court decide?

What the court decided

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