Allowed

Punjab National Bank v. M/S Smart Guide And Connect Services Pvt. Ltd.

DRT5 Jun 2025TA/1526/2023

Case brief

AI extract

What is this about?

In an ex-parte recovery application for a term loan default, the Tribunal allowed the application, directing the sale of assets to recover dues of Rs.52,93,577 along with pending interest and costs, after noting the defendant's absence.

What did the court decide?

Recovery of Rs.52,93,577 with interest and costs; liberty to sell defendant assets; issuance of Recovery Certificate.

Punjab National Bank versus M/S Smart Guide And… — Contract and Commercial Disputes | DRT (2025)

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T.A. No. 1526 of 2023

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05.06.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 05^th day of June, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 1526 of 2023

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(Originally filed before DRT- II, Chennai as OA 566/2019 and thereafter transferred to this Tribunal and renumbered as TA No 1526 of 2023)

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*Punjab National Bank, (Erstwhile Oriental Branch of Commerce), Anna Salai Branch, Represented by its Assistant Manager, R.R.L Cluster Branch, No.63, Dr. Radhakrishnan Salai, Mylapore, Chennai 600 004. ….Applicant

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(Amended vide order dated 18.04.2022 in view of merger)

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-Vs-

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M/s. Smart Guide & Connect Services Pvt Ltd,

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Represented by its Directors,

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1. Mr. Vivek Gupta, 2) Mrs. Anuradha Sanjay Agarwal,

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Flat No.1A, Fomra Vayou, New No.19,

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Old No.9, Canal Street, Plot No.A3, Kilpauk Garden Colony, Kilpauk, Chennai -600 010.

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Mr. Vivek Gupta, S/o. Shri Jai Bhagwan Gupta, Flat No.1A, Fomra Vayou, New No.19, Old No.9, Canal Street, Plot No.A3, Kilpauk Garden Colony, Kilpauk, Chennai -600 010.

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Also at:

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Flat Nos.3A and 3B, 3^rd Floor, Vayon Flats, Plot No.A3, New Door No.19, Canal Road, Kilpauk Garden Street, Kilpauk, Chennai 600 010.

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T.A. No. 1526 of 2023

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05.06.2025

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Mrs. Anuradha Sanjay Agarwal, W/o Shri Sanjay Ramniwas Agarwal, Dugar Sky Apartments, Tower 6 Vanagaram Road, Chennai. Also at: No.12, Ridhi Sidhi Sadan, Tejpal Scheme Road, No.2, Ville-parle (E), Mumbai 400 057.

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Also at: Flat No.LGF B 101 Runwal 7 Omkar Esquare, Eastern Express Highway, Opp: Sion Bhatti Signal, Sion East Mumbai, Maharashtra 400 022. …Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. K.V. Subramanian Associatez Defendants 1 to 3 were set ex-parte on 05.08.2021

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: - FINAL ORDER - :

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This original application is filed on 17.05.2019 by Erstwhile Oriental Bank of Commerce (since merged with Punjab National Bank) under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants 1 to 3, jointly and severally for recovery of a total sum of Rs.52,93,577/- (Rupees Fifty Two Lakhs Ninety Three Thousand Five Hundred and Seventy Seven Only) due in respect of Term Loan (Account No.01657025004543) repayable together with an interest @ 10.05% p.a. compounded with monthly rests, inclusive of 2% penal interest from the date of filing the OA till the date of realization in full and for costs of this Application.

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T.A. No. 1526 of 2023

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05.06.2025

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.566 of 2019, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.566 of 2019 stood transferred to this Tribunal and renumbered as TA No.1526 of 2023.

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Brief Facts of the case:

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The Applicant submits that the application is filed within the period of limitation as prescribed under Section 24 of the Recovery of Debts and Bankruptcy Act, 1993, and the subject recovery claim falls within the jurisdiction of this Tribunal.

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It is the case of the applicant bank that the 1^st Defendant is a private Limited company, represented by its Directors, 2^nd and 3^rd Defendants, who stood as Guarantors for the loan availed by the 1^st Defendant.

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It is submitted that the 1^st Defendant, represented by its Directors, approached the Applicant Bank with an Application for Term Loan Facility of Rs.70,00,000/- towards purchasing office equipment for establishing an office. The Applicant Bank, as per the Sanction Letter dated 16.02.2016, duly signed by the 1^st defendant, represented by its Directors in acceptance of sanction, sanctioned the above facility to the tune of Rs.70,00,000. For availing the credit facility, the 1^st defendant along with the 2^nd and 3^rd Defendants-Directors/Guarantor executed the following loan documents on 18.02.2016:

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T.A. No. 1526 of 2023

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05.06.2025

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(a) Agreement of Term Loan duly signed by the 1^st Defendant represented by the 2^nd and 3^rd Defendants.

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(b) Common Agreement duly signed by the 1^st Defendant represented by the 2^nd and 3^rd Defendants.

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(c) Agreement of Guarantee duly executed by the 2^nd Defendant. (d) Agreement of Guarantee duly executed by the 3^rd Defendant.

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The Applicant Bank submits that over a period of time, the prospects of recovery of outstanding in the credit facility seems to be remote and the account came to be recognized in the Books of the Bank as Sub-Standard, which did not envisage and healthy recovery prospects from these Defendants. It could be seen that these defendants have violated the terms and conditions agreed to as per the sanction terms and did not take any step to regularize the account and in fact they are wilful defaulters and intentionally avoiding repaying the dues.

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It is submitted that the Defendants failed and neglected to repay the Applicant Bank’s dues and the account became a Non Performing Asset (NPA) as on 31.07.2018 with respect to the Term Loan Facility Loan Account No.01657025004543, in accordance with RBI guidelines. All the steps taken by the applicant bank resulted in futility and there is no concrete action from these defendants to pay the overdue/dues. Therefore, the applicant bank issued two recall notices to these Defendants on 06.08.2018, informing the balance outstanding in the loan account and requesting them to repay the arrears of instalments. A legal

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T.A. No. 1526 of 2023

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05.06.2025

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notice was also issued to these Defendants on 27.02.2019 urging them to repay the balance outstanding in the Loan Account. All the efforts taken by the Applicant Bank to recover the dues resulted in futility. Hence the present Original Application (OA) is filed for recovery of dues from defendants.

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After the filing of the OA, summons were sent to the Defendants 1 to 3 through Registered Post with Acknowledgment Due. Summons to D1 and D2 returned unserved with postal endorsement “no such addressee”, while summons to D3 is duly served. Applicant bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 05.08.2021 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 to 3 were placed ex-parte on 05.08.2021.

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Heard the submissions of Applicant Bank and perused the records.

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To prove the case of the Applicant Bank, Mr. P. Mahendran, Chief Manager representing the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW-1 and list of documents came to be marked as Ex A-1 to A-10 . As the Defendants remained ex-parte, the OA claim remains unchallenged. There is no contra evidence available on record to repudiate the claim of the Applicant Bank.

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With regard to the amount advanced, the interest applied, the

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T.A. No. 1526 of 2023

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05.06.2025

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conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled for a final order on the following terms:

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: O R D E R :

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The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendants jointly and severally, a sum of Rs.52,93,577/- (Rupees Fifty Two Lakhs Ninety Three Thousand Five Hundred and Seventy Seven Only) due in respect of Term Loan (Account No.01657025004543) repayable together with an interest @ 10.05% p.a. compounded with monthly rests, inclusive of 2% penal interest from the date of filing the OA till the date of realization in full along with costs.

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(b) The applicant bank is at liberty to sell the personal assets of the Defendants (both movable and immovable) to recover the balance dues as required under law for which the Defendants to disclose to the Tribunal particulars of other properties or assets owned by the Defendants.

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(c) The applicant bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid

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T.A. No. 1526 of 2023

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05.06.2025

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by Defendant to the applicant bank.

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(d) The applicant bank shall file memo of costs within ten days from the date of receipt of this final order.

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(e) Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.

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A copy of this order be communicated to the parties concerned.

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to Steno (Suriya), transcribed by him, corrected, signed and pronounced by me on this the 05^th day of June, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Mr. P. Mahendran, Chief Manager representing the Applicant Bank Exhibits on the part of the Applicant:

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Sl. No.	Description of Documents	Exhibit No.
1.	Application submitted by the 1^st Defendant represented by its Directors for availing the Term Loan of Rs.70,00,000/-.	A-1
2.	Sanction Letter dated 16.02.2016.	A-2
3.	Agreement of Term Loan duly signed by the 1^st Defendant represented by the 2^ndand 3^rd Defendant dated 18.02.2016.	A-3
4.	Common Agreement duly signed by the 1^st Defendant represented by the 2^ndand 3^rd Defendant dated 18.02.2016.	A-4
5.	Agreement of Guarantee duly executed by the 2^nd Defendant dated 18.02.2016.	A-5

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T.A. No. 1526 of 2023

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05.06.2025

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6.	Agreement of Guarantee duly executed by the 3^rd Defendant dated 18.02.2016.	A-6
7.	Recall Notice issued by the Applicant Bank dated 06.08.2018.	A-7
8.	Recall Notice issued by the Applicant Bank dated 06.08.2018.	A-8
9.	Legal Notice issued to the Defendants dated 27.02.2019.	A-9
10.	Statement of Account-01657025004543	A-10

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Witness Examined for the Defendants: -Nil-

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List of Documents Exhibited for the Defendants: -Nil –

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-: SCHEDULE :-

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NIL

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

Punjab National Bank v. M/S Smart Guide And Connect Services Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. M/S Smart Guide And Connect Services Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

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