PUNJAB AND SIND BANK vs M/s A.S. International on 8 April 2019

FINAL ORDER

This original application has been filed by the applicant bank, on 05.01.1998 through Shri. Balwinder Singh Sokhi- Branch Manager under Section 19 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 against the defendants for recovery of a sum of Rs.30,62,163.00(Rupees Thirty Lacs Sixty-Two Thousand One Hundred and Sixty-Three Only) along with costs, pendentelite and future interest @ 20.5% per annum with quarterly rests from the date of filling of this O.A. till the realization of this O.A.

2. The brief facts of the case are that the defendant no. 1 is the proprietorship concern of defendant no. 2 whereas defendant no. 3, 4 & 5 stood as the guarantors for the loan. At the request of the defendant no. 2 the applicant bank sanctioned the Packing Credit Advance limit of Rs.17.00 lacs against irrevocable L.S and FOBLC limit of Rs.17.00 lacs on 05.01.1995. In order to avail the aforesaid facility, the sole defendant executed, on 06.01.1995, certain loan documents such as Demand Promissory Note, Letter of Waiver, Letter of non-agriculturalist etc.

3. It has been further submitted by the applicant bank that the export bill bearing No. FOBC/11/C-100441/95 for US $50,400.00 drPW on M/s Modern Wax Art Emporium, Sharjah, U.A.E was returned unpaid by Middle East Bank, A Subsidiary of Emirates Bank International Limited vide their letter dated 25.01.1996. In Packing Credit advance of Rs. 17,000.00 the defendants have failed to adjust the account in spite of repeated demands.

4. It has been submitted by the applicant bank that in order to secure the aforesaid loan facility the defendants mortgaged property in favour of the applicant bank namely: Bearing no. 2151, Chah Indira Dr. H.C.Sen Road, Delhi owned by defendant no. 5.

5. It has further been submitted by the applicant bank that after availment of the aforesaid loan facility the defendants did not maintain the financial discipline and inspite of various demands of the applicant bank the defendants failed to regularize the account and in view of the same the account became irregular and declared as N.P.A. Thereafter, the applicant bank issued legal notice dated 16.06.1997 under Registered A.D but the defendants failed to regularize the account leaving no option to the applicant bank except to file the present original application against the defendants.

5. Notices were issued to the legal heirs of defendant no.5, they put appearance through counsels and filed their joint written statement. However, no written statement has been filed on behalf of the other defendants.

6. In their joint written statement, the legal heirs of the defendant no. 5 have raised the objection that the defendant no. 5 neither availed the loan facility from the applicant bank nor executed any letter of guarantee. They also stated that the defendant no. 5 did not mortgage the property in question in favour of the applicant bank. The legal heirs of the defendant no. 5 that the abovementioned property has been sold by the defendant no. 5 on 13.04.1993, which is much prior to the sanctioning of the loan on 05.01.1995 and accordingly prayed for the dismissal of the present O.A against the defendant no.5.

7. It has further been submitted on behalf of the defendants that to prove their case the counsels for the defendant no. 5 had called for the cross-examination of the signatures of the defendant no. 5 from CFSL, Delhi, which was eventually decided in the favour of the defendant no. 5.

8. To prove its case, the applicant bank leads its evidence by filling the affidavit of PW- 1 Mr. Ravinder Singh Sidana, Manager of the applicant bank who has exhibited the documents which includes Demand Promissory Note which is exhibited as EX PW1/1, Letter of Waiver as EX PW 1/2, Letter of Non- Agriculturist as EX PW 1/3, Letter of Penal Interest as EX PW 1/4, Letter of Authorizing the bank to recall the entire loan amount as EX PW 1/5, Letter of Hypothecation of goods as EX PW 1/6, Packing Credit Agreement as EX PW 1/7, Affidavit/undertaking as EX PW 1/8, Letter of continuing guarantee by defendant no. 3& 4 as EX PW 1/9 & 10, Letter of guarantee by defendant no. 5 as EX PW 1/11, confirmation of mortgage of equitable mortgage property as EX PW 1/12, Copy of legal notice as EX PW 1/13 and Letter dated 16.06.1997 as EX PW 1/14.

9. To prove its case, the applicant bank leads its evidence by filling the affidavit of PW- 2 Mr. Balvinder Singh Sokhi, Senior Manager of the applicant bank who has exhibited the documents i.e., Statement of accounts of the defendants along with certificate from the Banker’s Book of Evidence which is exhibited as EX PW 2/1 & 2.

10. In the present matter, the defendant no.5, since deceased, who is being represented by her legal heirs Rajesh Gupta & Pradeep Gupta, have disputed signatures over the loan document and it is being argued that the signatures of Saroj Gupta, i.e., defendant no.5 never gave any guarantee or created equitably mortgaged of the property-in-question. In this respect, the Ld. Counsel for the defendant no.5 has relied upon the CFSL report, who had examined the admitted signatures of Saroj Gupta with the disputed signatures that is available on the loan documents. The CFSL

Report placed on record clearly shows that Saroj Gupta’s signatures over the loan documents are not matching with the standard signatures available on the sale deed, as well as that of the document/statement made in the Civil Suit no. 590 of 1995. The said report clearly proves on record that the Saroj Gupta, i.e., defendant no.5 did not put her signatures over the loan documents. Therefore, it is not duly proved on record by the applicant bank that the equitable mortgage was duly created in the favour of the applicant bank by the defendant no.5 and that she even stood as guarantor/mortgagor with respect to the loan facility availed by the defendant no.1 & 2. The present petition filed against defendant no.4 stands abated vide order dated 05.04.2002. So far as the factum of the loan facility availed by the defendants is concerned, the documents placed on record by the applicant bank have duly proved the fact that the defendant no. 1 & 2 availed the loan facility and that the defendant no.

stood as guarantor. Accordingly, the present T.A stands allowed against the defendant no.1 to 3, who are jointly or severally liable to pay the same. Accordingly, the bank is entitled to recover its entire dues alongwith pendentelite and future interest as agreed between the parties from the defendant no.1 to 3 who are jointly or severally liable to pay the same.

11. In view of the above facts and circumstances, this Tribunal is of the view that the defendants have failed to convince this Tribunal and this Tribunal do not find any merit and reject the contentions of the defendants as baseless. I hereby allow this O.A. as the applicant bank has proved its claim beyond reasonable doubt from the defendant no.1 to

3.

ORDER

(i) . I allow this OA and direct the defendants no. 1 to 3, to pay to the applicant bank jointly or severally, within a period of 30 days, a sum of Rs.30,62,163.00(Rupees Thirty Lacs Sixty- Two Thousand One Hundred and Sixty-Three Only) together with costs and future interest @ 20.5% per annum from the date of filing of this O.A. till the date of realization; failing which the aforesaid amount shall be recovered from the sale of the movable and immovable properties the defendants no. 1 to 3.

(ii) . The recovery certificate be issued forthwith and be sent to the Recovery Officer-I, Debts Recovery Tribunal-III Delhi.

(iii) . Parties are directed to appear before the Recovery Officer-I, DRT-III, Delhi on 10.05.2019.

(iv) . Copies of final order be sent to all concerned free of cost.

File be consigned to records.

(DHARMINDER SINGH) PRESIDING OFFICER DRT-III, DELHI (Pronounced in open court) Dated:08.04.2019. PD