PUNJAB AND SIND BANK vs Sh. Manipal Singh on 13 May 2025

FINAL ORDER

This original application has been filed by the applicant bank, on 28.02.2014 through Sh. R.K. Nagra, Senior Manager at Roshanara Road Branch and Sh. Ashok Mahajan, Senior Manager, ARB-II Branch, M Bloc( Connaught Place of the applicant bank, under Section 19 ofthe RDB Act, 1993 against the defendants for recovery of a sum of Rs.32,52,499/- together with cost, charges and pendentellite and future interest @ 16.5 o/o p.a. from date of filing of this O.A. till the realization in full. I

2. The brief facts of the case are that at the request of the defendant no.1, the applicant bank sanctioned,

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ODP Limit Facility of Rs,25,00,000/- for business requirements, vide sanction letter dated 30.03.2011, against the equitable motgage of immovable property bearing SFS Flat No. 28, Third Floor (with Scooter Garage), in Pocket No. GH-13, Zone G17M, situated at Paschim Vihar, New Delhi-l10087. The defendant no.1 executed all necessary loaning documents on 30.03.2011. The defendant nos' 2 & 3 had executed their personal and continuing guarantee in favour of the applicant bank on 30.03.2011' The defendant no.2 had delivered and deposited the original title deeds of aforesaid mortgage property, in favour of applicant bank on 30.03.2011. It is submitted that the applicant bank had made personal visit at the moftgaged property and were surprised to see the seal of the defendant no.4, Punjab National Bank at the mortgaged property. As such the applicant bank had issued letter dated 25.09.2013 to the defendant no'4 informing it that the propefi in question had been mortgaged with the applicant bank by Smt' Ruchi Singh, defendant no.2 and not to unilaterally proceed with the property. However, further it came to the knowledge of the applicant bank that that defendant no.4 is bent upon to put the property in question to auction causing serious prejudice to the right and interest of the applicant bank as a secured creditor' Therefore, the applicant bank was constrained to file its SA bearing no. 395/2013 against the defendant no'4 and other defendant no.1 to 3. The Honble Tribunal was pleased to direct the defendant no'4, Punjab National Bank not to appropriate the sale proceeds without the prior permission of this Hontle Tribunal vide its order dated 29.10.2013. $.

3. It is further submitted that the defendants enjoyed and utilized the Loan facility, but failed to maintain the financial discipline and failed to repay the due amounb. The applicant bank requested the defendants to regularize the loan account by visits and letters, but there was no response from the defendants, hence the account was classified as NPA on 3t.L2.2012. Therefore, the applicant bank served a notice dated 04.05.2013 to the defendant nos. 1 to 3, demanding the amount due as on that date, but failed to recover the same. Thus, the present O.A. is preferred by the applicant bank to re@ver its dues.

4. On notice by this Tribunal, the defendant nos. 1 & 2 put appearance through counsel but failed to file WS. Thereafter, they stopped appearance in the matter. Accordingly, defendant nos. 1 & 2 were proceeded against ex-parte on 10.07.2017. The defendant no.3 failed to put appearance at all, despite publication. Accordingly, defendant no.3 was proceeded against exparte on 04.01.2016. The defendant no.4 put appearance through counsel and filed Written Statement.

5. In their written statement the defendant no.4 has denied the facts mentioned in the OA. It is submifted that the defendant no.4 has already filed an O.A. bearing No. OA- 23120L4 against M/s Golden-O-Plast, a proprietorship concern of defendant no. 2 as well as defendant no. 3 herein for the recovery of Rs.1,29,04,5371- along with pendentelite and future interest as well as costs against the said company. Similarly, the defendant has also filed another O.A. bearing No. TRA- tt6l20l5 ag?in$ M/s D. V. Polypack CI

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h/t. Ltd., another connecting matter of the said parties of which the defendant no. 2 herein the director and the defendant no. 3 herein the guarantor which is for recovery of Rs.93,88,196/- along with pendent-lite and future interest as well as costs. In order to secure the Cash Credit (Hypothecation & Book Debt) Facilities of Rs.117 Lacs sanctioned to M/s Golden-O-Plast and Cash Credit (Hypothecation & Book Debt) Facilities of Rs.90 Lacs sanctioned to M/s D.V. Polypack Ltd. the defendant no. 2 as proprietor of M/s Golden-O-Plast, amongst other securities also created equitable mortgage in respect of Property consists of SFS Flat no.28, Third Floor (with scooter garage), Pocket GH-13, Zone t7, Paschim Vihar, New Delhi 110087 and deposited the original Sale Deed dated 09.03.2010 duly registered in the office of Sutr Registrar-IlA, Punjabi Bagh, New Delhi, with the defendant no.4 on 3L.t2.2010. The said borrower failed to maintain the said accounts regular despite repeated requests and reminders of the answering defendants, both the said CC account with the defendant were declared as Non-Performing Assets on 30.05.2012 with an outstanding of Rs.1,06,76,0061- against Golden-O- Plast. The defendant thereafter served the notice under Section 13(2) of the SARFAESI Act vide notice dated 23.07.2012 separately. The said borrower and the guarantor failed to comply with the said notice, the defendant bank issued notices under Section 13(4) of the SARFAESI Act dated 08.10.2012 by virtue of which the symbolic possession in respect of the said property was taken over by the defendant. Against the said action of the defendant bank, M/s Golden O Plast filed and M/s D. V. Polypack Limited filed S.A. No. 9/2013 titled as Golden O Plast Vs. PNB and S.A. No. 8/2013 I

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titled as D.V. Polypack Limited Vs. PNB and the said SAs were dismissed for non-prosecution. It is further submitted that the applicant herein has also filed a S.A. bearing No. 395/2014 titled as "Punjab & Sind Bank Vs. Punjab National Bank and Ors." in which the defendant has filed its reply. Not only this, several SAs have also been filed by other banks and the replies to the same have also been filed by the defendant bank and this Hon'ble DRT-III was pleased to allow the Joint auction with respect to the property involved in this matter. It submitted that Mrs. Ruchi Singh has created mortgage with respect her propefi in favour of the defendant. However, the mortgage if any created by her in favour of the applicant bank, the applicant bank may be put to strict proof of the same. Even otherwise, as per the submission of the applicant the mortgage if any created in its favour by Mrs. Ruchi Singh, though denied, is defective and bad in law as the moftgage created by her favour of defendant is much prior to the alleged mortgage in favour of the applicant bank. It is further submitted that the mortgage created in favour of the applicant bank is not a valid mortgage as the defendant no. 2 herein had already created equitable mortgage in respect of the said property in favour of the defendant to secure the Cash Credit (Hypothecation & Book Debt) Facility of Rs. 117 Lacs. Thus, the OA filed by the applicant bank against the defendant is not maintainable and is liable to be dismissed.

6. The applicant bank as well as defendant no.4 have filed their respective evidence.

7. The main contention of the Ld. counsel of the applicant bank Punjab and Sind Bank is the defendant no.l has availed the credit limit.and has mortgaged the (\

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subject property bearing SFS flat no. 28, third floor with scooter garage in Pocket GH-13, Zone G17M situated at Paschim Vihar, New Delhi on 30.03.2011. It is submitted that the defendant no.1 failed to maintain the financial discipline and therefore, the account of the defendant no.1 has been declared as NPA. Demand notice was also sent to the defendant no.1 but the defendant no.1 has failed to make the payment. Therefore, it is submitted that the OA may be allowed. On the other hand the Ld. counsel for defendant no.4 Punjab National Bank has submitted that the defendant no.1 has availed a loan from the defendant no.4 and executed mortgage ofthe propefi SFS flat no. 28, third floor with scooter garage in Pocket GH-13, Zone G17M situated at Paschim Vihar, New Delhion 31.12.2010 and has also deposited the original title deeds of the above mentioned property. It is submitted that the defendant no.1 has failed to maintain the financial discipline and therefore, the account of the defendant no.l has become NPA. It is submitted that the defendant no.4 has filed the OA bearing no. OA 2312014 against the defendant no.1 and defendant no.2 & 3 for the recovery of the amount due along with pendentelite and future interest. Therefore, it is submitted that the charge of the Punjab National BanVdefendant no.4 is prior to the applicant bank as the mortgage executed in favour of the defendant no.4 is of 13.12.2010 whereas the mortgage of the same propefty has been created by the defendant no.l in favour of the applicant bank on 30.03.2011. Therefore, the applicant cannot recover any amount from the mortgaged property. In this regard I have perused the record. From perusalofthe record it is clear that the mortgage executed in favour of defendant no.4 is of 13.12.2010 whereas the mortgage <A

created in favour of the applicant bank is of 30.03.2011. Therefore, the charge of defendant no.4 is prior to the applicant bank and in such circumstances the first charge is of defendant no.4. In such circumstances the OA cannot be decreed against the defendant no.4.

8. It is clear that the applicant has proved his case against the defendant no.1 to 3 and it is clear that defendant no.1 has taken loan from the applicant bank and defendant no.2 and 3 stood as guarantor of the loan. The defendant no.1 has failed to maintain financial discipline and therefore, the account of the defendant no.1 has been declared as NPA and the notice under Section 13(2) ofthe SARFAESI Act has been issued. The demand notice has also been issued against the defendant no.l to 3 but the defendant no.1 to 3 has failed to repay their debt and therefore, the OA of the applicant is liable to be allowed against defendant no.1 to 3.

ORDER

1) I hereby allow this T.A. of the Applicant Bank and direct the defendant nos. 1 to 3 to pay jointly and severally to the applicant bank within 30 days from today, a total principal sum of Rs.32,52,499/- along with cost, expenses and interest @ L3.30o/o from the date of filing of this OA which has become T.A. till the date of realization.

2) In case of failure to deposit the above amount within the stipulated period, the same shall be recovered from the excess amount received from the EA

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sale of the property bearing SFS Flat No. 28, Third Floor (with Scooter Garage), in Pocket No. GH-13, Zone Gl7M, situated at Paschim Vihar, New Delhi- 110087 by defendant no.4. It is hereby made clear that firstly the charge of the defendant no.4 shall be satisfied against the above mentioned property and the excess amount, if any, will be paid to the applicant bank. In case of shoft fall, the same shall be recovered from sale of personal movable and immovable assets of the defendant nos. 1to 3.

3) Recovery Certificate be issued fotthwith and be sent to Recovery Officer, Debts Recovery Tribunal-Il, Delhi.

4) The registry of this Tribunal is hereby directed to issue free copy ofthe order and send the same to both the parties.

5) Parties are direct to appear before the Ld. Recovery Officer, DRT-II, Delhi on L4.07.2025. Pending IAs, if any, stand disposed of. File be consigned to records. ! gAi'"'. Date : 13.05.2025 (SUSHIL rufinn RASTOGI) PRESIDING OFFICER DRT-II, Delhi This judgement has been signed, dated and pronounced in open couft. Date : 13.05.2025 g-"\ ( r\ t' ' (susHrl KUMAR nnsrdCrl PRESIDING OFFICER DRT-II, Delhi T