Allowed

Canara Bank v. M/s. Ayisha Bag House Footwear

DRT21 Mar 2024TA/566/2022

Case brief

AI extract

What is this about?

This order allowed an application by Canara Bank for a recovery certificate under the RDB Act. The court found the bank's evidence sufficient and untreated defendants, delineating recovery of the principal with 9% simple interest and costs.

What did the court decide?

Recovery of Rs. 68,51,550.64 plus future interest at 9% p.a. and costs via Recovery Certificate.

Canara Bank versus M/s. Ayisha Bag House Footwear — Insurance | DRT (2024)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI Dated this 21^st day of March, 2024

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PRESENT: SHRI T.RAJESH PRESIDING OFFICER

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T.A.No.566of 2022

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(Old OA.No.523/2019-DRT-I, Chennai)

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Canara Bank Erstwhile Syndicate Bank No. 11/2783, South Rampart, Opp. Thilagar Thidal, Thanjavur – 613 009 …Applicant

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Vs.

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M/s. Ayisha Bag House Footwear, Rep. by its Proprietor Mr. H. O. Muzib Rahman, No. 6, Selvam Nagar, M. C. Road, Thanjavur.

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Mr. H. O. Muzib Rahman, S/o. O. N. M. Haroon Rasheed, No. 8, IInd Street, Mangalapuram, Medical College Road, Thanjavur.

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Mr. O. A. Akbar Ali, No. 49A, Attumanthai Vaikolkara Street, East Gate, Thanjavur – 9 ...Defendants

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Counsel for Applicant : M/s. V. Suthakar Defendants : Exparte ……

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ORDER

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The Application is filed Under Section 19(1) of the Recovery of Debts And Bankruptcy Act,1993 seeking for issuance of a Recovery Certificate for a total sum of Rs.68,51,550.64Pdue underthe Cash Credit A/c along with future interest and costs.

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

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The Applicant Bank contends thata Cash Credit Facility of Rs. 36,00,000/- was availed by the 2^nd Defendant – Proprietor on behalf of the 1^st Defendant – Proprietorship Concern. The 3^rd Defendant stood as the Guarantor. It is also stated that the facilities are secured by mortgage of schedule mentioned properties.

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

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The Applicant Bank further contends that despite availing the credit facilities by obliging to pay back the amounts, the defendants failed in compliance of the same and all the efforts of the Applicant Bank to make the defendants pay back the amounts failed, forcing the Applicant Bank to file this Application.

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Summons was taken out and as defendants failed to enter appearance, theywere set exparte on 02.05.2023.

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The Applicant Bank let in evidence through AW1, filed proof affidavit in confirmation with the pleadings and got marked Exhs.A1 to A10.

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Heard. The following issues arise for consideration.

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i. Whether the Applicant Bank 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 Bank’s evidences remain un-rebutted and hence proved.The documents produced by the Applicant Bank are found to be admissible and are sufficient to prove the TA claim. Hence the Applicant Bank 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 TA claim is arrived at by calculating interest at agreed rate, which is on the higher side,prayer formonthly restsis declined and interest is awarded at 9% p.a. (simple).During the pendency of the TA, the applicant has filed a part satisfaction memo stating that the schedule mentioned properties were sold under SARFAESI Act and realized a sum of Rs.10,70,000/- and the same is recorded.

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In view of the above:

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i. TA. No: 566of 2022 stands allowed.

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i. Applicant Bank is permitted to recover an amount of Rs.68,51,550.64/-(Rupees Sixty Eight Lakhs Fifty OneThousand FiveHundred Fifty and Sixty Four PaisaOnly/-)together with future and pendentelite interest @ 9%p.a. (simple)from the date of filing of the TA till realization from the defendants jointly and severally and also personally against the 2^nd and 3^rd defendants and also by proceeding against the assets of the defendants after giving credit to all the amounts recovered and received during the pendency of the TA including the amount of part satisfaction already recorded for Rs. 10,70,000/-.

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ii. It is further ordered that any amount remitted or realized during the pendency of the proceedings, shall be given due credit to the loan account of the defendants.

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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 Bank 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

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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 21^st day ofMarch, 2024)

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

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Canara Bank v. M/s. Ayisha Bag House Footwear

Case brief

What is this about?

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Canara Bank v. M/s. Ayisha Bag House Footwear

Case brief

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