Allowed

Indian Bank v. M/s.Thirumalai Stores

DRT7 Feb 2024TA/537/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the Transfer Application filed under Section 19 RDB Act seeking recovery of a loan of Rs.49,43,298.53 plus interest from the borrowers and guarantors, permitting sale of mortgaged properties and issuance of a Recovery Certificate.

What did the court decide?

Recovery of Rs.49,43,298.53 with interest at 16.95% from respondents; sale of schedule property; issuance of Recovery Certificate.

Indian Bank versus M/s.Thirumalai Stores — Contract and Commercial Disputes | DRT (2024)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI

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Dated this 7^th day of February, 2024

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PRESENT: SHRI T.RAJESH PRESIDING OFFICER

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T.A.No.537 of 2023

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(Old OA.No.432/2019-DRT-I, Chennai)

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Indian Bank, Panruti Branch, Rep. by its Branch Manager, P.B.No.17, No.15, Kumbakonam Road, Panruti, Cuddalore District. Pincode – 607 106.

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… Applicant.

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Vs.

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M/s.Thirumalai Stores, Rep. by its Proprietor, Mr.P.Panneerselvam, Cuddalore Road, Panruti.

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Mr.P.Panneerselvam, S/o.Late M.Pachaiyappan, No.97, V.O.C. Street, Panruti – 607 106.

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Mrs.P.Radjalachuumy, W/o.Mr.P.Panneerselvam.

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Mr.P.Gunasekaran, S/o.Late M.Pachaiyappan.

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Mrs.Devaki, W/o.Late M.Pachaiyappan.

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Mrs.Geetha, W/o.Mr.Velmurugan. D/o.Late M.Pachaiyappan.

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Mrs.Latha, W/o.Mr.Kurinjivalavan. D/o.Late M.Pachaiyappan.

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Mrs.Sudha, W/o.Mr.Mohanraj, D/o.Late M.Pachaiyappan.

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2 to 8 are residing at No.97, V.O.C. Street, Panruti – 607 106.

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M/s.Axis Bank Ltd., Rep. by its Manager, No.6, St.Angel Street (Opp. to Immaculation Conception Cathedral), Pondicherry – 605 001. … Defendants. Counsel for Applicant : M/s.P.V.Muralidhar. Defendants 1 to 4 and 6 to 9 : Exparte. 5^th Defendant : Deceased.

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ORDER

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The above Transfer Application is filed Under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for Rs.49,43,298.53 with further interest from the date of filing of the TA and by allowing the same to be recovered from the defendants jointly and severally and also by sale of schedule mentioned properties.

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The above Original Application is filed before the DRT-I, Chennai and stood transferred to this Tribunal and renumbered as above.

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The case of the applicant can be encapsulated as follows:

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The 1^st defendant represented by its proprietor, the 2^nd defendant being the borrower, 4^th defendant being the guarantor and defendants 2, 4 and one Mr.Pachiyappan being the mortgagor had applied for and availed cash credit facility from time to time since 2004 and the same was enhanced to Rs.15,00,000/-. The 3^rd defendant also availed cash credit facility from time to time since 2004 and the same was enhanced to Rs.15,00,000/- on the guarantee of one Mr.Pachaiyappan, father of 2^nd defendant and 4^th defendant. The defendants 2, 4 and Mr.Pachiyappan had extended their mortgages to the said limit also.

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It is also stated that the above 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 from execution of the necessary loan documents, the 2^nd and 4^th defendants and Mr.Pachiyappan whose LR’s are defendants 2, 4, 6 to 8 had created security by way of equitable mortgage over the schedule mentioned properties. It is stated that one of the mortgagor M.Panchiyappan died on 15.02.2017 leaving 2^nd defendant and defendants 4 to 8 as LRs.

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Even though the defendants had obliged themselves to repay the amount promptly and regularly, they failed to do so resulting defaults

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in the account and the same being declared as NPA with effect from 03.10.2017.

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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. It is also stated that a simple mortgage is created in favour of 9^th defendant by deceased mortgagor.

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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 amount due in the account with further interest and cost.

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Even as D1 to D4, D6 to D8 failed to enter appearance, they were set exparte on 02.01.2020 and D5 was deceased. Even though D9 entered appearance, said defendant was set exparte on13.10.2023 for non-filing of reply statement. The applicant has filed a memo on 02.01.2020 stating that D2, D4 and D6 to D8 are the LRs of deceased D5 and the same is recorded vide proceedings dt.02.01.2020.

¶34

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 Exhibits A1 to A29 and got the same marked as evidence.

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Heard the counsel for the applicant and considered the contentions

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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 as defendants 1 to 4 and 6 to 8 remains exparte and 5^th defendant was deceased. Even though 9^th defendant entered appearance no defense evidence is forthcoming. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidence 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 TA is outstanding in the account, which the applicant is entitled to be 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.

¶43

In view of the findings as entered above

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i) TA No.537of 2023 stands allowed.

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ii) Applicant is permitted to recover an amount of Rs.49,43,298.53 (Rupees Forty Nine Lakhs Forty Three Thousands Two Hundred Ninety Eight and Paise Fifty Three only) with future and pendentelite interest @16.95% with monthly rests from the date of filing of the TA till realization from the defendants 1 to 4 and 6 to 8 and their assets after giving credit to all the amounts recovered and received during the pendency of the TA. The liability of defendants 6 to 8 is limited to the extent of assets inherited from deceased Mr.Pachaiyappan and also the assets inherited by 5^th defendant from Mr.Pachaiyappan.

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iii) The schedule property to be proceeded against and sold and if the sale proceeds are not sufficient the defendants 1 to 4, 6 to 8 and their other assets are liable to be proceeded against. However the liability of 6^th to 8^th Defendants is limited to the extent of assets inherited from deceased Mr.Pachaiyappan and also the assets inherited by 5^th defendant from Mr.Pachaiyappan. iv) The 9^th defendant’s right is to be adjudicated before appropriate forum as the lis before this Tribunal is only as to the entitlement of applicant to get the amount recovered.

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v) 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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vi) 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

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

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(Procedure) Rules, 1993.

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(Dictated to PA, transcribed by him, corrected, signed and pronounced by me in the Open Court, this 7^th day of February, 2024)

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Sd./-

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

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Indian Bank v. M/s.Thirumalai Stores

Case brief

What is this about?

What did the court decide?

Indian Bank v. M/s.Thirumalai Stores

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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