Allowed

Punjab National Bank v. Mohan Singh and Another

DRT21 Jan 2025OA/1152/2023

Case brief

AI extract

What is this about?

The DRT allowed the bank's application for recovery. The Tribunal reduced the claimed interest rate to 8% p.a. based on market conditions and accepted the defendants' situation, ordering joint and several liability with rights to execute the loan through sale of mortgaged or personal assets.

What did the court decide?

Declarations of joint and several liability to pay Rs.40,96,190.34p with simple interest at 8% p.a., issuance of Recovery Certificate, and liberty to recover via sale of mortgaged or personal assets.

Punjab National Bank versus Mohan Singh and Another — Contract and Commercial Disputes | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1152/2023 PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 06.09.2023

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DATE OF DECISION: 21.01.2025

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Punjab National Bank, a body corporate and a nationalized Bank constituted under the provisions of the Banking Companies (Acquisition & Transfer of Undertaking) Act 5 of 1970 with its Head Office at Plot No.4, Dwarka, New Delhi 110075 and amongst others a branch at Jagraon, Tehsil Jagraon, District Ludhiana, Punjab through Sh. Rajesh Kumar Bagga, Officer and Attorney Holder posted at Circle Sastra Centre, Ludhiana.

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(Transferee Bank from erstwhile Oriental Bank of Commerce)

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……..Applicant

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Versus

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Sh. Mohan Singh S/o Sh. Sarwan Singh, R/o House No.90, Village Swaddi Khurd, Tehsil Jagraon, District Ludhiana, Punjab-142026 (Borrower/Mortgagor)

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Sh. Azadwinder Singh S/o Sh. Mohan Singh, R/o House No.90, Village Swaddi Khurd, Tehsil Jagraon, District Ludhiana, Punjab142026 (Co-Borrower).

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….……Defendants

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Advocates:

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Argued by Sh. Manish Singla, Advocate for the applicant Defendants are ex-parte

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FINAL ORDER

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Present Original Application was instituted by the applicant under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.40,96,190.34p (Rupees Forty Lacs Ninety Six Thousand One Hundred Ninety and Thirty Four Paise only). The Original Application has been filed through Sh. Rajesh Kumar Bagga, Officer and Attorney Holder, who is competent to institute the Original Application vide Power of Attorney, which is Annexure A1 to this OA.

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2. The brief facts of the OA are that the defendants had approached
the applicant for the grant of OGC Limit of Rs.20.00 Lacs vide Loan
Application dated 30.08.2012, which isAnnexure A3to this OA.
3. The applicant sanctioned the OGC Limit of Rs.20.00 Lacs vide
Sanction Letter dated 30.08.2012, which isAnnexures A4to this OA and the terms and conditions were duly accepted by the defendants.
4. Defendant No.1 had mortgaged his immovable properties i.e. total agricultural land measuring 14K-11Msituated at Village Gujjaran,
Tehsil Jagraon & District Ludhiana, Punjab vide Registered Mortgaged
Deed bearing vasika No. 2859 dated 05.09.2012,which isAnnexure
A6to this OA.
Documents executed:- Copy of Amalgamation Scheme/Gazette
notification dated 04.03.2020, which isAnnexure A2to this OA; Copy of Agreement for Hypothecation of Existing and Future Crops/Movable Assets/Live Stock to Secure a Cash Credit Account of Oriental Green
Card dated 11.09.2012, which isAnnexure A5to this OA; Copies of
Balance and Security Confirmation Letters dated 30.06.2015,
13.09.2017, 20.06.2018 and 07.09.2020, which areAnnexures A7 to
A10to this OA; Copy of Recall Notice dated 27.01.2020, which is
Annexure A11to this OA and Statement of account duly certified dated 31.03.2023, which isAnnexure A12to this OA. 5. The loan account became irregular and was classified as NPA and
after adjusting debit and credit entries in loan account there was a debit of Rs.40,96,190.34p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount,
therefore, the applicant requested to accept the application and to issue Recovery Certificate accordingly.
6. The defendants were served notices to appear before this Tribunal
but no one appeared on behalf of defendants and they were proceeded ex-parte on 24.06.2024.
7. In support of the OA, affidavit of Sh. Rajesh Kumar Bagga, Officer
and Attorney Holder, Punjab National Bank,has been filed. 8. Heard arguments and perused record.

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It was argued by learned counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant had proved its case. From the perusal of all the Annexures A1 to A12 to this OA, it is proved that the defendants approached applicant for availing of the loan facility which was granted to them and for that they had executed all the relevant documents in favour of the applicant. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.40,96,190.34p (Rupees Forty Lacs Ninety Six Thousand One Hundred Ninety and Thirty Four Paise only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the account. 10. In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @11.50%p.a. along with penal interest @2.00%p.a. with half yearly rests from 01.04.2023 till the realization.

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The Tribunal is of the considered opinion that sometimes in appropriate cases the prerogative of mercy is the brightest jewel in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including nature of the mortgaged property, undertaking of the defendants, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yester years, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @8.00%p.a. in the loan account from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.40,96,190.34p (Rupees Forty Lacs Ninety Six Thousand One Hundred Ninety and Thirty Four Paise only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in the loan account from

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the date of filing of OA till the date of realization of the amount. Accordingly, the applicant shall be entitled to recover aforesaid amount from the sale of hypothecated/mortgaged properties of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the applicant still remain unsatisfied, it shall be entitled to recover the same by attachment and sale of personal assets of the defendants. The applicant is at liberty to enforce the claim through due process of law.

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Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 03.03.2025. 15. Copy of this order be given dasti to the applicant and be sent to defendants through registered/speed post and this order be also uploaded on the official website of this Tribunal and record be consigned. Pronounced by me in the open Tribunal . Dated: 21.01.2025.

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Punjab National Bank v. Mohan Singh and Another

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Punjab National Bank v. Mohan Singh and Another

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