Allowed

Canara Bank v. Messrs Nanak Chand Ram Chand and Others

DRT2 Jan 2025OA/615/2023

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed Original Application for recovery of Rs.1.02 Crore. Defendants failed to appear. Tribunal awarded principal and reduced uniform simple interest of 8% p.a. and directed issuance of Recovery Certificate.

What did the court decide?

Recovery order for Rs.1,02,95,797.97 with 8% simple interest; Issuance of Recovery Certificate; Enforcement via SARFAESI Act/Auction of personal assets.

Canara Bank versus Messrs Nanak Chand Ram Chand and Others — Banking and Recovery | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.615/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 12.04.2023

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DATE OF DECISION: 02.01.2025

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Canara Bank, a body corporate with perpetual succession constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act, 1970, having its head office at 112, J.C. Road Bangalore and branch Office at various places in India including a branch at SCO No.4147, Abohar Road Near New Grain Market, Sri Muktsar Sahib, Punjab through its Senior Manager-cum-Authorized Signatory Sh. Rakesh Kumar.

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……..Applicant

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Versus

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M/s Nanak Chand Ram Chand, through its Proprietor Sh. Manu Kant Khera R/o SCF No.173-A, New Grain Market, Near Water Tank, District Sri Muktsar Sahib (Pb)-152026.

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Sh. Manu Kant Khera, S/o Sh. Surinder Kumar Khera, Proprietor M/s Nanak Chand Ram Chand R/o SCF No.173-A, New Grain Market, Near Water Tank, District Sri Muktsar Sahib (Pb)-152026.

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Second Address : House bearing MC No.B-0300480, situated at Patti Pujaria, Near Bajaj Clinic, Abohar Road, District Sri Muktsar Sahib (PB)-152026.

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Third Address : H.No. 612, Main Bazar, Dhannumal Street, District Sri Muktsar Sahib (Pb)-152026.

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Sh. Surinder Kumar Khera S/o Sh. Ram Chand, R/o Patti Pujaria, Near Bajaj Clinic, Abohar Road, District Sri Muktsar Sahib (PB)152026.

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Second Address : H.No. 612, Main Bazar, Dhannumal Street, District Sri Muktsar Sahib (Pb)-152026.

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………Defendants

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Advocates: Present Ms. Ashmita Goel, Advocate proxy for Sh. P.K. Arora, counsel for the applicant Defendants are ex-parte

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FINAL ORDER 1. 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.1,02,95,797.97p (Rupees One Crore Two Lacs Ninety Five Thousand Seven Hundred Ninety Seven and Ninety Seven Paisa only). The Original Application has been filed through Sh. Rakesh Kumar, Senior Manager of the applicant, who is competent to institute the Original Application vide Authority Letter dated 13.09.2022, which is Annexure A1 to this OA. 2. The brief facts of the OA are that the defendant No.1 through its proprietor i.e. defendant nos.2 w as already availing CC Limit of Rs.30.00 Lacs and had again approached the applicant for its enhancement upto Rs.70.00 Lacs. Further, defendant no.1 through its Proprietor again approached the applicant for the Term Loan-I (GECL) of Rs. 12.00 Lacs and Term Loan-II (GECL) of Rs.9.00 Lacs. 3. The applicant sanctioned the Cash Credit Limit of Rs.70.00 Lacs vide Sanction Letter dated 15.03.2018 which is Annexure A2 to this OA. Thereafter the applicant sanctioned the Term Loan-I (GECL) of Rs. 12.00 Lacs and Term Loan-II (GECL) of Rs.9.00 Lacs vide Sanction Letters and Offer Letter dated 05.08.2020, 09.11.2021 & 28.11.2021 which are Annexures A7, A10 & A11 to this OA and the terms and conditions were duly accepted by the defendants. 4. Defendant no.2 & 3 had mortgaged their immovable properties detailed as under: (i) Commercial Shop No.173, Admeasuring 277.77 Sq. Yards situated at New Grain Market, Near Water Tank, District Sri Muktsar Sahib, Punjab vide Registered Sale deed bearing vasika no. 4947

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dated 23.03.2005 along with its translations, which is Annexure A14 to this OA. (ii) Residential House bearing MC No.B-0300480 admeasuring 278 Sq. Yards situated at Patti Pujaria, near Bajaj Clinic, Abhoar Road, District Sri Muktsar Sahib, Punjab vide Equitable Mortgage of Transfer Deeds bearing Vasika Nos.4301 & 3611 dated 21.02.2018 & 22.12.2017 and Jamabandi for the year 2010-11 along with their translation which are Annexures A15, A16 & A17 to this OA. Documents executed:- Link Letter dated 29.03.2018 which is Annexure A3 to this OA; Common Hypothecation Agreement, Agreement for Advance Against Book Debts and Guarantee Agreement dated 29.03.2018 which are Annexures A4, A5 & A6 to this OA; Undertaking and Supplemental Letter of Guarantee both dated 05.08.2020 which are Annexures A8 & A9 to this OA; D.P. Note, D.P. Note Delivery Letter dated 28.11.2021 which are Annexures A12 & A13 to this OA; Confirmation Letter dated 05.08.2020 which is Annexure A18 to this OA; Revival Letter dated 01.02.2021 which is Annexure A19 to this OA; Notice U/s 13(2) dated 02.06.2022 which is Annexure A20 to this OA and Statements of accounts along with the certified which are Annexures A21 to A23 to this OA. 5. 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.1,02,95,797.97p, 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 12.04.2024. 7. In support of the OA, affidavit of Sh. Rakesh Kumar, Senior Manager, Canara Bank has been filed.

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Learned proxy counsel present has not advanced any arguments. Perused record.

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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 A23 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, all 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 of Rs.1,02,95,797.97p (Rupees One Crore Two Lacs Ninety Five Thousand Seven Hundred Ninety Seven and Ninety Seven Paisa 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 @9.40%p.a. along with penal interest @2.00%p.a. with monthly rests in all loan accounts, from 16.02.2023 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 all 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.

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In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.1,02,95,797.97p (Rupees One Crore Two Lacs Ninety Five Thousand Seven Hundred Ninety Seven and Ninety Seven Paisa 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.

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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 03.02.2025. 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.

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Pronounced by me in the open Tribunal . Dated: 02.01.2025 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Canara Bank v. Messrs Nanak Chand Ram Chand and Others

Case brief

What is this about?

What did the court decide?

Canara Bank v. Messrs Nanak Chand Ram Chand and Others

Case brief

What is this about?

What did the court decide?

What the court decided

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