Allowed

Canara Bank v. M/S Kashish Enterprises

DRT1 Mar 2025OA/5/2024

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an application by Canara Bank for recovery of a non-performing term loan and OCC limit against M/s Kashish Enterprises and proprietor Vijay Kumar. The Tribunal addressed the interest rate exercisewhat discretion vested in ordering 8% p.a. and issued a Recovery Certificate. The judgment orders the recovery of the principal amount, joint and several liability, and per

What did the court decide?

Recovery Certificate to be issued; Defendants liable to pay Rs.57,33,561.27p with 8% p.a. interest; Sale of mortgaged properties; Attachment and sale of personal assets if owed remains unsatisfied.

Canara Bank versus M/S Kashish Enterprises — Contract and Commercial Disputes | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.5/2024 PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 23.09.2023

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DATE OF DECISION: 01.03.2025

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Canara Bank, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at J.C. Road, Bangalore, and inter alia a branch office at SCO No. 3 & 4, Sector 19-C, Chandigarh represented through its Authorized Signatory/General Power of Attorney Ms. Harpreet Kaur, Manager.

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……..Applicant

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Versus

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M/s Kashish Enterprises, through its Proprietor Sh. Vijay Kumar, Shop No. 5, Guga Madi Road, near Bank of India, Dhanas, Chandigarh-160014

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Sh. Vijay Kumar S/o Sh. Bhim Sen, proprietor M/S Kashish Enterprises, R/o House No. 2360, Sector 24-C, Chandigarh-160023

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………Defendants

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Advocates:

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Argued by Sh. Nitin Gupta, Advocate for the applicant (through VC) 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.57,33,561.27p (Rupees Fifty Seven Lacs Thirty Three Thousand Five Hundred Sixty One and Paisa Twenty Seven only). The Original Application has been filed through Ms. Harpreet Kaur, Manager who is competent to institute the Original Application vide General Power of Attorney dated 16.11.2017, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant No.1 through its Proprietor i.e. defendant no.2 h ad approached the applicant for the grant of Term Loan of Rs.73.00 Lacs and OCC Limit of Rs. 5.00 Lacs

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vide Loan Application dated 30.03.2021, which is Annexure A2 to this OA.

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The applicant sanctioned Term Loan of Rs.73.00 Lacs and OCC Limit of Rs. 5.00 Lacs vide Sanction Letter dated 30.03.2021, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant No. 2 had mortgaged his immovable properties i.e. Booth No. 3 & 4 (Ground & First Floor) measuring 2½ Marlas situated near Royal Palace, Village Sante Majra, Hadbast No. 186, Tehsil Kharar, District SAS Nagar, Mohali, Punjab vide Letter evidencing deposit of Title deed bearing No. 2020-21/15/1/14774 dated 31.03.2021 along with its English Translation, which is Annexure A14 to this OA. Documents executed:- Common Hypothecation Agreement dated 15.12.2018, which is Annexure A5 to this OA; Cash Credit Agreement, Specimen Signature Card, Letter of Proprietorship, Request for Overdraft facilities, Take Delivery Letter to DPN, Pronote, Letter of Undertaking re: Loans/advances, Guarantee Covering Letter, Undertaking not to divert bank borrowing letter all dated 30.03.2021, which are Annexures A4, A6 to A13 to this OA; Letter of Overdue dated 24.11.2022, 05.12.2022, 21.12.2022, 09.02.2023, 09.03.2023 and 17.03.2023, which is Annexure A15 to this OA; Legal Notices dated 03.08.2023 with Postal Receipts, which is Annexure A16 to this OA Statement of account along with Certificate of Banker’s Book of evidence act, which are Annexures A17 & A18 to this OA.

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The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in both the loan accounts there was a debit of Rs.57,33,561.27p, 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.

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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 14.02.2025. 7. In support of the OA, affidavit of Ms. Harpreet Kaur, Manager, Canara Bank has been filed. 8. Heard arguments and perused record.

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It was argued by learned counsel through Video conferencing 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 A18 to this OA, it is proved that the defendants approached applicant for availing of the loan facilities which were 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, both the accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum Rs.57,33,561.27p (Rupees Fifty Seven Lacs Thirty Three Thousand Five Hundred Sixty One and Paisa Twenty Seven only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of both the accounts.

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In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @11.90%p.a. plus penal interest @2.00%p.a. with yearly rests from date of filing this OA 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

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exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @8.00%p.a. in both the loan accounts 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.57,33,561.27p (Rupees Fifty Seven Lacs Thirty Three Thousand Five Hundred Sixty One and Paisa Twenty Seven only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in both the loan accounts from 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.

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Parties to appear before Learned Recovery Officer of this Tribunal on 03.04.2025.

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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.

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Pronounced by me in the open Tribunal .

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Dated: 01.03.2025

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

Canara Bank v. M/S Kashish Enterprises

Case brief

What is this about?

What did the court decide?

Canara Bank v. M/S Kashish Enterprises

Case brief

What is this about?

What did the court decide?

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