The DRT allowed an application filed by Canara Bank against M/s Chana Industries Limited and other defendants for recovery of a debt of Rs.1,13,11,763.49. The court granted uniform simple interest at 8.00% per annum and issued a Recovery Certificate.
Recovery of Rs.1,13,11,763.49 with simple interest @8.00% p.a. and issue of Recovery Certificate.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH
ORIGINAL APPLICATION NO.581/2024 PRESIDED OVER BY MRIDULESH KUMAR SINGH
DATE OF INSTITUTION: 18.02.2024
DATE OF DECISION: 15.02.2025
Canara Bank, constituted under Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Central Office at 112, J C Road, Banglore and inter alia a branch office at Dholewal, Cheema Chowk, Ludhiana through its General Attorney Sh. Himanshu Sood, Manager, Canara Bank, branch office, Dholewal, Cheema Chowk, Ludhiana, Punjab.
……..Applicant
Versus
Advocates:
Argued by Sh. R.S. Bhatia, Advocate for the applicant (through VC) Defendants are ex-parte
2
FINAL ORDER
3
is Annexure A32 to this OA. The applicant further sanctioned restructuring of the limits i.e. FITL to Rs.2.45 Lacs, WCTL to Rs.34.50 Lacs, GECL of Rs.10.00 Lacs and OCC of Rs.50.00 Lacs Sanction Letters dated 21.07.2021 which are Annexures A40 & A41 to this OA. The applicant also sanctioned WCTL Loan of Rs.15.00 Lacs vide Sanction letter dated 11.11.2021, which is Annexure A54 to this OA and also sanctioned renew of Working Capital Limit of Rs.50.00 Lacs vide Sanction letter dated 04.05.2020, which is Annexure A67 to this OA and the terms and conditions were duly accepted by the defendants.
Documents executed:- Memorandum of Association dated 16.06.1995, which is Annexure A2 to this OA; Company Data dated 06.04.2021, which is Annexure A3 to this OA; Resolution dated 28.06.2017, which is Annexure A5 to this OA; Composite Hypothecation Agreement, Power of attorney, Letter of Undertaking, Agreement of Guarantee all dated 07.07.2017, which are Annexures A6 to A18 to this OA; Letter of Renewal dated 04.12.2018, which is Annexure A19 to this OA; Composite Hypothecation Agreement, Letter of Undertaking, Agreement of Guarantee all dated 29.01.2020, which are Annexures A22 to A30 to this OA; Resolution dated 13.07.2020, which is Annexure A33 to this OA; Common Hypothecation Agreement, Letter of Undertaking, Agreement of Guarantee all dated 24.07.2020, which
are Annexures A34 to A37 to this OA; Agreement of Guarantee dated 22.07.2020, which is Annexure A38 to this OA; Resolution
4
dated 12.07.2021 and 15.07.2021, which are Annexures A42 & A43 to this OA; Composite Hypothecation Agreement, Request for overdraft, Letter of Renewal, Link Letter, Debt Restructuring agreement, Letter of Undertaking, Agreement of Guarantee all dated 21.07.2021, which are Annexures A44 to A53 to this OA; Resolution dated 09.11.2021, which is Annexure A55 to this OA; Common Hypothecation Agreement, Demand Promissory Note, Take Delivery, Letter of Undertaking all dated 11.11.2021, which are Annexures A56 to A65 to this OA; Link letter dated 17.11.2021, which is Annexure A66 to this OA; Resolution, Request for Overdraft, Letter of Renewal, Letter of Undertaking, Link letter, Letter from the Guarantor all dated 04.05.2020, which are Annexures A68 to A80 to this OA; Letters dated 07.07.2017, 24.07.2020, 21.07.2021 and 11.11.2021, , which are Annexures A83 to A86 to this OA; Details of Charges, which is Annexure A87 to this OA; Acknowledgement of Debt and Security dated 28.02.2020, 24.07.2020, 21.07.2021 and 04.05.2020, which are Annexures A88 to A91 to this OA; Reminders dated 01.09.2020, 14.10.2022, 01.09.2022 and 15.10.2022, which are Annexures A92 to A95 to this OA; Legal Notices dated 27.07.2023 with Postal Receipts, which is Annexure A96 to this OA; Possession Notice dated 04.10.2023, which is Annexure A97 to this OA and Statements of accounts, which are Annexures A98 to A102 to this OA.
5
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
6
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.1,13,11,763.49p (Rupees One Crore Thirteen Lacs Eleven Thousand Seven Hundred Sixty Three and Paisa Forty Nine only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in all 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.
Pronounced by me in the open Tribunal . Dated: 15.02.2025
3 issues framed by the court
Whether the original application under Section 19 of the RDBFI Act should be allowed for recovery of the outstanding debt.
Whether interest rates should be modified to a uniform simple rate.
Whether a Recovery Certificate should be issued against the defendants.
2 provisions across 2 enactments
Canara Bank
M/s Chana Industries Limited
Sh. Swaranjeet Singh Chana
Sh. Harbans Singh
Smt. Barjinder Jit Kaur
Mridulesh Kumar Singh
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
