Allowed

Canara Bank (E-Syndicate Bank) v. M/S Pret Collections

DRT21 May 2025TA/800/2022

Case brief

AI extract

What is this about?

The Tribunal disposed of an original application filed by Canara Bank against defaulting borrowers for recovery of outstanding dues. The respondent absent themselves and did not file any written statement or evidence. The applicant proved its case via documents, including loan agreements and guarantees. The Tribunal allowed the application, directing payment of the principal sum with future intere

What did the court decide?

Directed payment of Rs.2,11,87,925.62 plus future interest at 12% p.a. If unpaid, recovery to be effected by sale of hypothecated stock, book debts, and mortgaged plots.

Canara Bank (E-Syndicate Bank) versus M/S Pret… — Contract and Commercial Disputes | DRT (2025)

¶1

T.A. No.800 of 2022

¶2

Debts Recovery Tribunal-I, Delhi 4th floor, Jeevan Tara Building, Parliament Street, New Delhi

¶3

Presiding Officer: Shri Govind Ballabh Sharma

¶4

T.A. no. 800 of 2022

¶5

Canara Bank (E-Syndicate Bank) 04, Nehru House, Bahadurshah Zafar Marg I.P.Estate, New Delhi-110001 Versus

¶6

Applicant

¶7

M/s Pret Collections Through its Proprietor B-395, Ground Floor, Nirman Vihar, Delhi-110092

¶8

Also at: B-37, Sector-63, Noida, UP -201301

¶9

Sh.Ashwani Dass s/o Subhash Chand Dass (Partner/Guarantor) B-395, Ground Floor, Nirman Vihar, Shakarpur, Delhi-110092

¶10

Sh.Atul Dass s/o Subhash Chand Dass (Partner/Guarantor) B-395, Ground Floor, Nirman Vihar, Shakarpur, Delhi-110092

¶11

Sh.Subhash Chand Dass s/o Jamuna Dass (Partner/Guarantor) B-395, Ground Floor, Nirman Vihar, Shakarpur, Delhi-110092

¶12

Smt.Mithiesh Dass w/o Subhash Chand Dass (Guarantor) B-395, Ground Floor, Nirman Vihar, Shakarpur, Delhi-110092 Defendants

¶13

T.A. No.800 of 2022

¶14

Present: Sh.M.K.Jha, Counsel for the applicant Bank

¶15

Date of Institution: 09.06.2021

¶16

Date of Pronouncement: 21.05.2025

¶17

FINAL ORDER

¶18

This original application has been filed by the applicant bank on 09.06.2021 before DRT III Delhi and then transferred to DRT-I Delhi through Shri Sunil Kumar, aul^-horized representative of the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 against the defendant for recovery of a sum of Rs.2,11,87,925.62 (Rupees Two Crores Eleven Lacs Eighty Seven Thousand Nine Hundred Twenty Five & paisa Sixty Two only) as on 03.06.2021 along with pendentelite and future interest in the range of @12.20% to 17.10% per annum with monthly rests plus @2% penal interest from 03.06.2021 till the date of realization and costs.

¶19

The brief facts of the case are that at the request of defendant no.1 through its partners being defendant no.2 to 4 vide their loan application dated 17.08.2015 with relevant documents, the applicant bank sanctioned SOD limit of Rs.50.00 lacs (Rupees Fifty Lacs only) on 11.09.2015 @11.00% interest per annum which was closed on 31.12.2016.

¶20

It is submitted that defendant no.1 again approached and applicant bank sanctioned PCL/FUDP/FDBP limit of Rs.100.00 lacs @10.70% interest per annum on 28.10.2016. Further, the applicant bank sanctioned Term Loan of Rs.50.00 lacs @11.50% interest per annum on 29.05.2017. The applicant bank further sanctioned / renewed / enhanced the

¶21

T.A. No.800 of 2022

¶22

credit facility limit from Rs.100.00 lacs to Rs.115.00 lacs on 18.12.2017 and adhoc limit of Rs.25.00 lacs on 19.10.2019. The limits were sanctioned against hypothecation of stock/raw materials, Export receivables and mortgage of two open Plots at Ludhiana owned by defendant no.5 who stood as guarantor along with defendant no.2 to 4 to the credit facilities sanctioned in favour of defendant no.1 by the applicant bank.

¶23

That in order to avail the said loan facility, the defendants executed Demand Promissory Note, Composite Hypothecation Agreement, Charge and Hypothecation of Book Debts Agreement, Agreement for Charge & Hypothecation of Book Debts, Guarantee Agreements, Comprehensive Pre-Shipment & Post-Shipment Agreement, Letter of Authority, Power of Attorney for Collection of Bills, Book Debts anL! other Receivables, Letter Regarding Undrawn Limits, all dated 03.11.2016, 31.05.2017, 07.06.2017, 18.12.2017 and 19.10.2019 in favour of applicant bank.

¶24

That in order to secure the loan facilities, the defendant no.5 created equitable mortgage of following two properties by Confirmation or Creation of Second / Subsequent Equitable Mortgage dated 03.11.2016 by depositing title deeds dated 21.03.2016 along with Affidavit with the applicant bank and further extended at the time of renewal/enhancement of limits viz.:

¶25

Plot No.60, Block B, Lalton Ka Village Anand Enclave, Tehsil & Distt. Ludhiana, Punjab measuring 450 sq.yds ;

¶26

Plot No.59, Block B, Lalton Kalan-I, Village Anand Enclave, Tehsil & Distt. Ludhiana, Punjab measuring 450 sq.yds. 5V-7 rPI

¶27

T.A. No.800 of 2022

¶28

It has been submitted by the applicant bank that after availing the aforesaid loan facilities, the defendants failed to maintain financial disciplined and comply with the terms and conditions of sanction and neglected to pay outstanding dues in time to the applicant bank. Ultimately, the applicant bank classified the account as NPA on 05.02.2020 as per RBI guidelines and issued legal notice dated 04.06.2021 but defendants did not respond the notice. Hence, the applicant bank has approached this Tribunal for recovery of their dues.

¶29

Notices of this O.A. were issued to the defendants and despite of proper service, the defendants have chosen to absent from the proceedings. As per order dated 24.09.2024, the defendants have been proceeded ex-parte as not appeared before the Tribunal and even no written statement, evidence and affidavit of assets has been filed by the defendants.

¶30

Notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 dated 05.02.2020 was issued and dui': served upon the defendants.

¶31

In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Shri Sunil Kumar, authorized representative of the applicant bank who has proved the documents as General Power of Attorney Ex.AW-1/1, Gazette Notification Ex.AW-1/2, Loan Application Ex.AW-1/3 & Ex.AW1/34, KYC Documents Ex.AW-1/4(colly), Sanction Letter Ex.AW-1/5, AW-1/6, AW-1/24, AW-1/35, AW-1/48 & AW-1/49, Demand Promissory Note Ex.AW-1/7, Composite Hypothecation Agreement Ex.AW-1/8, AW-1/27, AW-1/37 and Ex.AW-1/50, Charge & Hypothecation of Debts Agreement Ex.AW-1/9, Guarantee Agreement Ex.AW-1/10, Ex.AW-1/28 to

¶32

T.A. No.800 of 2022

¶33

Ex.AW-1/31, AW-1/38 to AW-1/41 & Ex.AW-1/51, Comprehensive Pre-Shipment & Post-Shipment Agreement Ex.AW-1/11, Letter of Authority Ex.AW-1/12, Power of Attorney Ex.AW-1/13 & AW-1/32, Ex.AW-1/42^{1Letter reg.} Undrawn Limits Ex.AW-1/14, Title Deeds, Confirmation or Creation of Second Equitable Mortgage, Affidavit Ex.AW-1/15 to 22 & Ex.AW-1/52, Transfer of Account Ex.AW-1/23, Undertaking Ex.AW-1/25, Request Letter for Loan Ex.AW-1/26, Confirmation of Equitable Mortgage Ex.AW-1/33(colly), Charge & Hyp. of Debts Ex.AW-1/36, Annexure 10 Ex.AW-1/43, Affidavits Ex.AW-1/44 to Ex.AW-1/45, Letters handing over title deeds Ex.AW-1/46 & Ex.AW-1/47, Demand Notice Ex.AW-1/53, Recall Notice Ex.AW-1/54, Statement of Account Ex.AW-1/55, Certificate under 65-B(2) of Indian Evidence Act Ex.AW-1/56, Certificate u/s 2A(b) of Banker's Books Evidence Act Ex.AW1/57.

¶34

10.^{The applicant bank has fully corroborated the averments} made in the O.A. Even otherwise the whole case of the applicant bank is based on the documents and the same have been duly proved.

¶35

11.^{The case filed by the applicant bank gone unrebutted and} there is no question of disbelieving the case of the applicant bank and applicant bank has proved its case beyond reasonable doubts.

¶36

As per the provision of Section 19(20) of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 which is analogous to Section 34 of CPC, on filing of the suit/claim, the contract between the parties comes to an end and the Court/Tribunal has a discretion to award the same depending

¶37

¶38

T.A. No.800 of 2022

¶39

upon the circumstances of each case. Same principle has been laid down by the Hon'ble Apex Court in the case of Central Bank of India Vs. Ravindra & Others. Taking stock of all the circumstances and keeping in view that there is a drastic fall in rates of interest globally and domestically, I am of the opinion that interest of justice will be served if the interest at the rate of 12% p.a. is awarded.

¶40

In the light of the above discussions, the Original Application deserves to be allowed.

¶41

ORDER

¶42

I, allow this OA and direct the defendants to pay to the applicant bank, jointly or severally, within a period of 30 days, a sum of Rs.2,11,87,925.62 (Rupees Two Crores Eleven Lacs Eighty Seven Thousand Nine Hundred Twenty Five & paisa Sixty Two only) as on 03.06.2021 together with pendentelite and future interest @12.00% per annum with monthly rest from date of filing of this application till the date of realization, failing which the aforesaid amount shall be recovered from the sale of hypothecated stock, book debts etc. and thru sale of mortgaged :

¶43