Allowed

Punjab National Bank v. Mr. R. Nagarajan

DRT15 Mar 2024TA/347/2022

Case brief

AI extract

What is this about?

Debt Recovery Tribunal allowed an application filed by Punjab National Bank for issuance of a recovery certificate against three respondents for agricultural loans, permitting realization of principal and reduced simple interest, with power to sell properties.

What did the court decide?

Allowed the recovery certificate application permitting realization of Rs.29,61,420.42 plus 9% simple interest and costs from respondents jointly and severally, with power to sell assets.

Punjab National Bank versus Mr. R. Nagarajan — Contract and Commercial Disputes | DRT (2024)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 15^th day of March, 2024

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.347 of 2022

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(Originally filed before DRT-I Chennai as OA No.377 of 2020 and thereafter transferred to this Tribunal and renumbered as TA No.347 of 2022)

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Punjab National Bank Punalkulam Branch Rep. by its Manager No.530/1, Main Road Thethuvasalpatti Melpathi Post Gandarvakottai Pudukottai – 613 303 … Applicant Versus

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Mr. R. Nagarajan S/o Mr. Rethinam No.18B, Ambalakara Street Ariyanipatti, Thethuvasalpatti Gandharvakottai Taluk Pudukottai – 613 303 2. Mr. R. Maniselvam S/o Mr. Rethinam No.18B, Ambalakara Street Ariyanipatti, Thethuvasalpatti Gandharvakottai Taluk Pudukottai – 613 303 3. Mr. K. Rethinam S/o Late Kalimuthu No.18B, Ambalakara Street Ariyampatti, Thethuvasalpatti Gandharvakottai Taluk Pudukottai – 613 303 …Defendants Counsel for the Applicant Bank : M/s M.L. Ganesh Counsel for Defendants : Ex-parte

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FINAL ORDER

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This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendants’ seeking issuance of a Recovery Certificate for recovery of an aggregate sum of Rs.29,61,420.42p comprising sum of Rs. 13,13,472.77p together with further interest at the rate of 9.5% per annum with yearly rests being the amount due under Agriculture Cash Credit Facility and sum of Rs.16,47,947.65p together with interest at the rate of 11.5% per annum with yearly rests being the amount due under Agriculture Term Loan Account plus 2% penal interest from the date of filing of the application till the date of realisation in full along with costs of the applicant and for sale of the schedule mentioned properties.

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The brief facts of the case is stated as follows: -

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(a) The 1^st defendant approached the applicant for grant of credit facilities for the purpose of agricultural operations by submission loan application dated 18.05.2017 and the applicant considering the said request, vide sanction dated 18.05.2017 sanctioned Agriculture Cash Credit Facility of Rs.10,50,000/- and pursuant to Loan Application dated 18.05.2017 the applicant sanctioned another Agriculture Term Loan Minor Irrigation facility of Rs.12,49,000/- on 18.05.2017. The defendants having availed the credit facilities executed necessary loan and security documents on 18.0504.2017.

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(b) It is also the case of the applicant that the defendants deposited the title deeds of the properties more fully described in schedule to the OA with the applicant bank with an intention to create equitable mortgage over the same and confirmed the same by executing Memorandum of Deposit of Title

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deeds dated 18.05.2017 registered as Doc. No.8883/2017 on the file of SRO, Gandharvakottai.

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It is the case of the applicant that the defendants defaulted in repayment despite repeated demand and hence the applicant issued letters on 26.04.2018 and 31.03.2019 to the defendants requesting them to clear the outstanding dues. As the defendants did not come forward to clear the outstanding dues, the applicant issued legal notice on 16.11.2019, but in vain.

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It is also stated that the facilities were availed after execution of necessary loan documents obliging themselves to repay the amount promptly and regularly without fail. Apart from the execution of necessary loan documents, the 1^st defendant deposited the title deeds of the schedule mentioned property with an intention to create equitable mortgage over the same and confirmed the same by executing Memorandum of Deposit of Title deeds dated 18.05.2017 registered as Doc. No.888/2017 on the file of SRO, Gandharvakottai.

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It is further stated that even though the defendants had obliged themselves to repay the amount promptly and regularly, they failed to do so resulting in default in repayment and hence the account was classified as NPA on 30.06.2019.

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It is contended by the applicant that the applicant’s officials had on many occasions approached the defendant requesting him to regularize the account and despite the same no effort was made by the defendants to get the account regularized or to pay back the amount.

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It is also the case of the applicant that despite repeated reminders and requests the defendants failed to make the repayment forcing the applicant to file this OA seeking recovery of the amount due in the account with further interest and costs.

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The defendants failed to enter appearance and hence were called absent and set ex-parte on 02.11.2021.

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The applicant had let in evidence through AW-1, who had sworn to a Proof Affidavit in terms of the pleading in the OA and also produced Exhibits A-1 to A-14 and got the same marked in evidence, however, Exhibits A-5, A-9 to A- 11 were marked subject to proof and relevancy.

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Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA 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 OA claim as against the defendants?

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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 as defendants remained ex-parte. The evidence 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 amount as claimed in the OA

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is outstanding in the account, which the applicant is entitled to get recovered from the defendants and their assets (including the schedule mentioned properties). The claim of the applicant is well within the period of limitation and there is no capitalization of penal interest.

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In view of the fact that the subject loan is an agricultural loan and the interest rates have come down the Tribunal is inclined to reject the interest with monthly rests and award simple interest at reduced rates.

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In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, TA is disposed off in the following manner: -

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(a) TA No.347 of 2022 stands allowed.

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(b) Applicant is permitted to realize an aggregate sum of Rs.29,61,420.42p together with pendente llite and future interest at the rate of 9% simple per annum from the date of filing of the application till the date of realisation in full, from the defendants jointly and severally after deducting all the amounts recovered and received by them during the pendency of OA and also by selling the schedule mentioned properties and other assets of the defendants.

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(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendants are personally liable for all such amounts due under the respective Loan Accounts.

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(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 7 days from the date of the order.

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(e) The Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of this final 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 PS, transcribed by him, corrected, signed and pronounced by me in Open Court, on this the 15^th day of March, 2024)

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

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Punjab National Bank v. Mr. R. Nagarajan

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. Mr. R. Nagarajan

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

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Case details

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