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Bank of Baroda V/S Golden Tulip Minerals and Others.

    O.A. No. 491 of 2018

    Decided On, 06 February 2020

    At, Debts Recovery Tribunal Hyderabad

    By, THE HONORABLE JUSTICE: S. PRAVEENA
    By, (PRESIDING OFFICER)

    For Petitioner: Trivikram Chitturu And For Respondents: V. Dharma Suri



Judgment Text


1. The applicant bank i.e., Bank of Baroda, Cuddapah Branch filed this Original Application u/s. 19 of the Recovery of Debts and Bankruptcy Act, 19491(sic) for recovery of a sum of Rs. 62,19,897/- from the defendants jointly and severally with future interest @13.50% p.a. with monthly rests from the date of application till the date of realization together with costs and for sale of OA schedule properties.

2. The case of the applicant, in brief, is;- that 1st defendant partnership firm represented by defendants 2 to 4 as its partners availed term loan of Rs. 99 lakhs from the applicant bank. The 1st defendant on 17.04.2013 executed letter of partnership, DP Note, letter of instalments, composite hypothecation agreement and power of attorney in respect of book debts. The loan is primarily secured by hypothecation of OA schedule-B machinery. The loan is collaterally secured by way of creation of mortgage over OA schedule-1 property pertaining to 1st defendant by deposit of title deeds. The 1st defendant executed memorandum of mortgage by deposit of title deeds. The defendants executed the letter of acknowledged the debt dated 01.04.2016. The defendants failed to repay the dues and failed to service the interest. Thereupon, the applicant bank classified the loan account as NPA and issued demand notice dated 06.12.2017. The defendants due an amount of Rs. 50,88,223/- plus unapplied interest of Rs. 11,31,674/- from 30.09.2017 till date of application, hence this OA for recovery of the same.

3. The defendants 1 and 3 filed written statement which has been adopted defendants 2 and 4. The submissions of the defendants as per the written statement, in brief, are that;- The OA claim is time barred and not maintainable according to the Partnership Act and for mis-joinder of parties. The documents relied upon by the applicant bank are understamped hence they are inadmissible in evidence. The contract is unilateral contract and therefore not enforceable as held by Hon'ble Supreme Court. The loan availed is term loan and the DP Note claimed by the applicant bank does not reflect the transaction. The memorandum of deposit of title deeds is understamped and unregistered hence, inadmissible in evidence. The applicant bank obtained various blank papers including the alleged acknowledgement of debt at the time of sanction of loan. As on the date of execution of alleged acknowledgement of debt, most of the defendants were not in station at Kadapa. The overdue interest cannot be compounded as per judgment of Hon'ble Supreme Court and the interest charged by the applicant bank is legally incorrect. No notice is received by the defendants and no recall notice is ever issued. The applicant bank has not produced copy of application for advance and sanction letter which are necessary to substantiate the case of defendants. The applicant bank is not entitled any relief.

4. In order to prove its case, the applicant bank examined C. Venkata Madduleti, Senior Manager as AW-1 and marked 9 documents through him as Ex. A.1 to A.9.

5. In order to substantiate their defence, K. Venugopal Raju-3rd defendant examined as DW-1 on behalf of 1st defendant firm and in his personal capacity, K. Kumara Swamy-2nd defendant examined himself as DW-2 and D. Bhanu Prakash-4th defendant examined himself as DW-3.

6. Heard learned counsel appearing for the applicant bank. Learned counsel appearing for the defendants 1 to 4 reported that orders may be passed on merits. Perused the written arguments submitted by the applicant bank and the material brought on record.

7. It is contended by learned counsel appearing for the applicant bank that 1st defendant is a partnership firm and defendants 2 to 4 are its partners. Defendants availed term loan of Rs. 99 lakhs on 17.04.2013 from the applicant bank and executed loan documents Exs. A.2 to A.5. As a security, defendants deposited original of Ex. A.8 sale deed dated 22.08.2012. The defendants also executed Ex. A.6 acknowledgement of debt dated 01.04.2016. Defendants having availed the term loan committed default in payment of instalments. The applicant bank examined C. Venkata Madduleti, Senior Manager as AW-1 and marked 9 documents through him as Exs. A.1 to A.9. According to learned counsel, the evidence of AW-1 coupled with recitals in Exs. A.1 to A.9 amply proves the OA claim against the defendants and OA schedule properties and therefore OA deserves to be allowed.

8. It is the plea of the defendants as could be seen from the averments of written statement and chief evidence affidavits of DW-1, DW-2 and DW-3 that the OA claim is barred by limitation. The defendants did not execute acknowledgement of debt dated 01.04.2016. The mortgage deed is not properly stamped and therefore it cannot be looked into. Capitalization of overdue interest is impermissible. Defendants examined DW-1, DW-2 and DW-3 in support of their pleas and sought for dismissal of the OA claim.

9. Now, the points that arise for adjudication are:-

i) Whether the applicant bank proved the OA claim against the defendants and OA schedule properties?

ii) To what relief?

Point No. (i)-

10. The 1st defendant is a partnership firm. Defendants 2 to 4 are its partners. DW-1, DW-2 and DW-3 did not dispute the availment of term loan. They also did not dispute the deposit of Ex. A.8 original sale deed dated 22.08.2012 as a security. AW-1 speaks of 1st defendant partnership firm availing term loan of Rs. 99 lakhs and execution of loan documents by defendants 2 to 4. The documents executed by defendants 2 to 4 on behalf of the 1st defendant firm are marked as Exs. A.1 to A.5 through AW-1. Ex. A.6 is the letter of acknowledgement of debt dated 01.04.2016 and it is signed by defendants 2 to 4. DWs. 1 to 3 in their chief evidence affidavits did not specifically dispute the signatures on Ex. A.6 letter of acknowledgement of debt dated 01.04.2016. The OA is filed on 22.06.2018 whereas Ex. A.6 is executed on 01.04.2016. Therefore, OA claim is well within the limitation period.

11. The other plea advanced by the defendants is with regard to validity of the mortgage. Ex. A.7 is the memorandum of deposit of title deeds dated 17.04.2013 and it is a registered document. Such is the situation, the plea advanced by the defendants that mortgage deed is not valid does not deserve acceptance. The defendants made part payments totalling to Rs. 4,94,219/- pending the OA towards OA claim and accordingly applicant bank filed memo dated 20.06.2019 after duly certifying the same on the document. In view of the memo, part payments have to be given due credit to the OA claim.

12. The evidence of AW-1 coupled with recitals in Exs. A.1 to A.9 amply proves the OA claim minus Rs. 4,94,219/- against the defendants and OA schedule properties and accordingly OA deserves to be allowed.

Point No. (ii):-

13. In the result, the present Original Application is allowed with costs, as under:-

i) The defendants 1 to 4 jointly and severally are liable to pay to the applicant bank a sum of Rs. 62,19,897/- minus Rs. 4,94,219/- with future interest @13.50% p.a. simple from the date of filing of the OA till the date of realization;<

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br /> ii) The claim of the applicant bank is secured by way of mortgage/hypothecation of OA schedule properties and the applicant bank is entitled to proceed against the same towards realization of its debt; iii) The applicant bank is also entitled to proceed against the person and properties of defendants towards realization of its debt; iv) The applicant bank is entitled to the costs of the OA. 14. The applicant bank is directed to file cost memo within 2 weeks from the date of this Order. 15. Issue Recovery Certificate accordingly. 16. Communicate a copy of this order to the parties concerned. (Dictated to the PS, transcribed by him, corrected, signed and pronounced by me in the open court on this the 06th February, 2020).
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