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Judgment
This is an Original Application under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 initiated by the applicant against the defendant praying for issuance of Recovery Certificate to the tune of Rs. 11,59,747/- together with interest, cost and other usual reliefs.
The brief facts of the case as made out in the Original Application by the applicant bank is that on or about 2nd June, 2012, one Shri Masudul Islam Mellick, Proprietor of M/s M M Embroidary, being the Defendant No.1, approached the branch of the Applicant Bank for availing of a Cash Credit (Hypothecation) limit to the tune of Rs. 10,00,000/- under CORP LAGHU UDYAMI CREDIT CARD SCHEME for extension of business purposes and for that matter executed certain documents. The Applicant Bank having given due consideration and alter proper scrutiny of the application submitted by the Borrower Shri Masudul Islam Mellick, being the Defendant No. 1, backed by guarantee provided by the Guarantor Shri Ansar Mallick aslias Ansar Ali Mallick, being the Defendant No. 2, accorded a sanction of the Cash Credit (Hypothecation) limit to the tune of Rs. 10,00,000 to the Borrower, repayable within a year at 12.25% rate of interest over and above the Base Rate of 10.50% or such other rate as may be prescribed by the Bank from time to time vide its sanction letter dated 19th June, 2012.
The defendants on acceptance of the terms and conditions as contained in the sanction letter dated 19.06.2012 and as stipulated in Annexure-'B' of the said letter sanctioning the Term Loan facility, executed certain documents backed by a guarantee in the form of a Demand Promissory Note for Rs. 10,00,000/- as stipulated in Annexure-'D', with a promise to pay a total sum of Rs. 10,00,000/- to the Applicant Bank on demand with interest thereon with monthly rest.
The defendants to secure the said Cash Credit facilities created a letter of Guarantee and Hypothecation Agreement of Goods and Debts along with consent clause and letter of undertaking not to alienate hypothecated goods for due payment of Rs. 10,00,000/- with the Applicant, annexed and marked as 'D' and 'E'.
The defendant as borrower had executed the following banking documents:
i) One Demand Promissory Note for Rs. 10,00,000/- dated 19.06.2012.
ii) Letter of Continuity dated 19.06.2012 for an amount of Rs. 10,00,000/-.
iii) Letter of Guarantee dated 19.06.2012 for an amount of Rs. 10,00,000/-.
iv) Hypothecation Agreement of Goods & Debts dated 19.06.2012 for an amount of Rs. 10,00,000/-.
The defendant had agreed to pay interest at 12.25% over and above the Base Rate with a minimum of 10.50% per annum with monthly rests. Rate of interest is subject to change from time to time as per Bank's Guidelines.
The defendant availed of the aforesaid Cash Credit loan facilities provided by the applicant Bank and duly enjoyed the money but miserably failed and neglected to operate the said account in compliance of the terms and conditions governing the said sanction order and as such the loan accounts became irregular. In spite of repeated reminders and requests the defendants failed and neglected to regularize the same and as a result of which the account became NPA on 31.09.2014. Finding no other alternatives the Applicant Bank had to recall the loans and advance and served upon a demand notice dated 7th December, 2014 through its advocate under Section 13(2) of the SARFAESI Act, 2002 demanding a payment of Rs. 10,17,475/-towards the loan outstanding as on 30.09.2014. The Borrower being the Defendant No. 1 and the Guarantor being the Defendant No. 2 simply ignored the Demand Notice served on 07.12.2014. Therefore, finding no other way to recover the dues, the applicant bank had filed this Original Application for recovery of a sum of Rs. 11,59,747/- due against the defendant as on 31.10.2015.
Notices were issued to the defendant to show cause as to why the relief prayed for by the applicant bank be not granted. After issuance of the notice, the defendant appeared through their Counsel and prayed time for filing of W.S. But no W.S. was filed on behalf of the sole defendant as a result of which they were proceeded ex-parte vide order dated 30.08.2019 of this Tribunal. The Tribunal had no other option but to hear ex-parte against the defendant.
I have heard the learned Counsel for the applicant bank and have perused the relevant documents.
The defendants had not contested the case of the applicant bank. Thus, the point for determination in this case is (i) whether the claim of the applicant bank is within time? (ii) Whether the defendants had utilized the loan facilities granted by the bank? (iii) Whether the defendants are liable to pay the amount due to the applicant bank or not?
The applicant bank by oral and documentary evidence has established its case. The documentary evidence comprises from Annexure/Exhibit-'A' to Annexure 'C', which are available in paper book filed by the applicant bank.
From the perusal of the documents referred above and the certified copy of the statement of account, which is filed as Annexure 'A' - 'K', it is established that the defendant had availed the financial facilities from the applicant bank and had withdrawn the amount through the account.
The oral testimony comprises of an affidavit of Mr. Shyamalendu Sardar, working as Manager of the Applicant Bank. The averments in the application and the facts stated by the witness of the applicant in his affidavit are un-rebutted.
From the perusal of the of the Statement of Accounts which is placed at pages No. 81-87, the total outstanding comes to Rs.11,59,747/- as on 31.10.2015, which the applicant bank is entitled to recover from the Defendant.
In view of the above and after considering the entire evidence-on¬affidavit of the applicant bank and the documents filed by the applicant bank, I have no hesitation to hold that the applicant bank is entitled to recover a sum of Rs.11,59,747 /- from the defendant who is liable for the same. The applicant bank shall also be entitled to pendentelite and future interest on the said amount @ 12% per annum on simple from the date of filing of the Original Application till the date of realization.
ORDER
(1) O.A. No. 992 of 2015 filed by the Applicant Bank is allowed and debt is determined with cost against the defendant. It is hereby ordered that applicant bank is entitled to recover from the defendant the total amount to the tune of Rs.11,59,747 (Rupees eleven lakhs fifty nine thousand seven hundred forty seven only) with pendentelite and future interest @ 12% per annum with simple rate of interest on the amount due from the date of filing of the Original Application, i.e. 15.12.2015 till full and final realization of the claim amount.
(2) Amount, if any, paid by the defendant in the loan account or amount, if any, recovered by the Applicant Bank after filing of the O.A. the same be taken into account while arriving at the exact amount of dues/debt payable by the defendant. Accordingly, pendentelite and future interest shall be calculated on the reduced amount.
(3) Defendant is debarred from disposing, alienating or dealing with any of the properties belonging to them till the aforesaid decretal debt is recovered from the defendant.
(4) Defendant is given a time of thirty days from the date of the Judgment/Final Order for repaying of the above mentioned dues, so intimated to them. In case the defendants fail to pay the dues within the above mentioned time, the applicant bank is entitled to recover its dues by sale of secured assets, if any. Applicant bank is also entitled to proceed against personal properties of the defendant (Both movable and immovable) and also proceed against the defendant personally to recover the dues in accordance with law.
(5) Let the Certificate of Recovery be drawn up by the Ld. Registrar forthwith in terms of Judgement for issuance of the same against the defendant in favour of the applicant bank under Section 19(22) of the Recovery of Debts and Bankruptcy Act, 1993 and put up the same for issuance of the Certificate.
(6) Ld. Recovery Officer shall realize the amount as per the Recovery Certificate from the defendant in accordance with law.
(7) Ld. Registrar of this Tribunal is directed to deliver recovery certificate in term of the final order/judgement for recovery of the sum against the defendants in favour of the Applicant Bank under Section 19 (22) of the Recovery of Debts due to the Bank and Financial Institutions Act, 1993 now known as Recovery of Debts and Bankruptcy Act, 1993.
(8) The parties are directed to appear before the Recovery Officer on 27.11.2020 for further action in accordance with law in the event the entire amount is not paid by the said date.
Accordingly, the Original Application being O.A. No. 992 of 2015 is allowed and stands disposed of.
Copy of the Judgement/Final Order be uploaded in the Tribunal's website.
File is consigned to the Record Room.
(Dictated to Steno, transcribed by him, corrected, signed and pronounced by me in the Virtual Court on this 16.10.2020)