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Bank of India V/S Sarita Designers & Computer Education and Others.

    OA No. 432 of 2013
    Decided On, 26 November 2016
    At, Debts Recovery Tribunal Chandigarh
    For Petitioner: G.S. Anand, Advocate

Judgment Text

1. This is an application under section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act for the recovery of Rs. 19,63,426.00 with interest and costs.

2. Summon was issued and publication was done. The defendants were declared ex parte vide order dated 23.04.2014.

3. In support of OA affidavit of Sh. B.N. Shukla, Principal Officer, has been filed with the OA proving the annexures. Thereafter, Ms. Pooja Anand, Senior Branch Manager exhibited the documents Ex. A-2 to A-14, A-21 to A-27, A-31 and A-32 and Mark A-30 on 24.04.2015 and exhibited the documents Ex. AW 1/15 to AW 1/20, AW 1/28, AW 1/29 and Mark AW 1/1 on 23.09.2015.

4. Defendant No. 1 applied for Term Loan(TL) and Cash Credit loan vide application Ex. A-2. Demand Promissory Note for Rs. 60,000.00 is Ex. A-3. Agreement of hypothecation of moveable assets is Ex. A-4. Continuing security bond is Ex. A-5. Letter of lien is Ex. A-6. Letters of declaration, undertaking and authority are Ex. A-7 and Ex. A-8. Agreement of term loan and hypothecation of movable assets/goods/plant & machinery is Ex. A-9. Supplemental term loan agreement is Ex. A-12 and the declarations towards end use is Ex. A-10. The guarantee letters executed by late Sh. Diwan Chand Garg are Ex. A-13 and Ex. A-14. The registered sale deed deposited by defendant No. 3 is Ex. AW 1/15. Oral assent of the defendant No. 3 regarding creation of equitable mortgage is Ex. AW 1/16. Relevant portion of the attendance register signed by defendant No. 3 is Ex. AW 1/17. The registered sale deed deposited by defendant No. 4 is Ex. AW 1/18. Oral assent of the defendant No. 4 regarding creation of equitable mortgage is Ex. AW 1/19. Relevant portion of the attendance register signed by defendant No. 4 is Ex. AW 1/20. Letters of acknowledgement of debt and securities in respect of the loans are Ex. A-21 to Ex. A-27 and AW 1/28.

5. Due to failure of the defendants to make regular payment, the present application has been filed. The legal notice sent to the defendants is Ex. AW-1/29. Copy of judgment and decree passed in Learned Civil Court, Rajpura by one Pradeep Kumar against the applicant and defendants herein was dismissed and the same is Mark A-30. The statements of accounts are Ex. A-31 and Ex. A-32. The net amount due is Rs. 19,63,426.00 as on 06.05.2013.

6. The bank has claimed interest @ 14.50% p.a. in Cash Credit Account and @14.50% p.a. in Term Loan Account both with monthly rests from 06.06.2013 till the realization. The Tribunal has the powers to exercise its discretion and grant rate of interest after filing of the claim application. This Tribunal is of the view that the bank is entitled to @ 12.00% p.a. simple rate of interest on reducing balance on the claimed amount in this OA. This Tribunal which is exercising its powers under section 19 (2) of the RDDBFI Act, thinks fit and proper to award above rate of interest on the ground that the borrower/defendants herein took the loan facility for CC and Term Loan and adversity of the borrower has been considered by this Tribunal. The bank has not filed any evidence regarding diversion of funds and has also not brought any evidence that the defendants had sufficient liquid means to pay the alleged dues of the bank. Further the account of the borrower is not a running account at this stage because the bank has already filed the present OA and further the bank has also not filed any evidence that borrower has misutilized the same. Therefore the above rate is awarded by this Tribunal.

Further the rate of interest claimed by the bank, though may be contractual, but according to their pleadings and documents, the same keep in varying from time to time, therefore, the rate of interest with same figure may not be justifiable in the facts and circumstances of the case and as such above rate of interest is being awarded by this tribunal. In the facts and circumstances of the case and keeping in view the law laid down by Hon'ble Supreme Court of India and various Hon'ble High Courts and also looking into the prevalent rate of interest with the bank, in my view it would be appropriate to grant pendente lite and future interest @ 12% p.a. simple on reducing balance, from 06.06.2013 till its realization with costs.

7. For the foregoing reason the original application is allowed and the applicant shall be:-

"i. Entitled to recover from the defendants jointly and severally the sum of Rs. 19,63,426.00 with simple interest @ 12.00% p.a. from 06.06.2013 onwards until recovery on reducing balance with costs.

ii. The above amount shall be recovered from the sale of hypothecated goods/mortgaged properties (if not sold earlier under the provisions of SARFAESI Act) and in case there are unsatisfied dues, the same shall be recovered by attaching person

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al assets of the defendants as prescribed in the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (Act 51 of 1993) in accordance with law." 8. A Recovery certificate shall be issued in above terms. 9. Defendants are directed to appear before the Recovery Officer on 03.02.2017. Copy of the judgment be sent to the parties as per Rule and after due compliance, record be consigned to record room date 26.11.2016. Judgment dated, signed and pronounced in the open court on 26.11.2016.