STATE BANK OF INDIA vs SRI HIMADRI SINHA on 8 October 2024

Page.No.

KOLKATA DEBTS RECOVERY TRIBUNAL NO. 2

ORDER SHEET

(Continuation)

T.A./31 of 2020

State Bank of India

Case No. \_\_\_\_\_

Vs

Sri Himadri Sinha & Anr.

<table border="1"> <thead> <tr> <th data-bbox="110 196 188 261">Date of Order</th> <th data-bbox="188 196 768 261">Order with Signature</th> <th data-bbox="768 196 884 261">Office action with date and dated Signature of parties when necessary</th> </tr> </thead> <tbody> <tr> <td data-bbox="110 261 188 906"> 18<br/> 08.10.2024 </td> <td data-bbox="188 261 768 906"> <p>Counsel for the parties:</p> <p>Ms. Ahana Rakshit, Ld. Advocate representing Mr. Anirban Pramanick, Ld. Counsel for the applicant Bank.</p> <p>None for the defendants.</p> <p>T.A./31 of 2020 (arising out of O.A./463 of 2018) is allowed and disposed of.</p> <p>Final order / Judgment is in separate sheet of 6 pages.</p> <p>File be consigned to record room.</p> <p>Order be uploaded on the Tribunal's website.</p> <br/> <div style="text-align: right;"> <br/> (Arbind Madhav)<br/> Presiding Officer<br/> DRT-2, Kolkata </div> </td> <td data-bbox="768 261 884 906"></td> </tr> </tbody> </table>

1

TA/31 of 2020 – DRT-2/Kol

**DEBTS RECOVERY TRIBUNAL - 2, KOLKATA**

Jeevan Sudha Bldg. 07^th Floor, 42/C, J.L. Nehru Road, Kolkata – 700071

Before Shri Arbind Madhav, Presiding Officer **T.A. No. 31 of 2020**

(arising out of O.A./463 of 2018)

In the matter of -

**State Bank of India** (formerly State Bank of Bikaner & Jaipur), a banking institution and a body corporate constituted, incorporated and formed by and under the provisions of the State Bank of India Act, 1955 and carrying on their banking business, *inter-alia*, amongst others at their Azad Hind Bagh Branch; 1, Abhay Guha Road, P.S.- Burtolla, Kolkata – 700006, represented by Small & Medium Enterprises City Credit Centre, commonly known as "SMECCC", 1, Stand Road, Samridhi Bhawan, Annexe Building, 4^th Floor, P.S.- Hare Street, Kolkata – 700001.

..... Applicant Bank

-Versus-

- 1. **Sri Himadri Sinha**, Son of Late Panchanan Sinha, carrying on business as proprietor under the name and style of M/s Saini Fabricators from 16, Biplabi Pulin Das Street, Kolkata – 700009.

- 2. **Ms. Sharmistha Bose**, Widow of Late Aloke Kumar Bose, residing at 28B, Nayan Chand Dutta Street, Kolkata – 700006.

..... Defendants

Counsel for parties:

For the Applicant Bank : Mr. Anirban Pramanick, Ld. Advocate For the Defendant : *Ex-Parte*

**FINAL ORDER / JUDGMENT**

Delivered on 08.10.2024

Applicant, State Bank of India (formerly State Bank of Bikaner & Jaipur), instituted the present Application being the Original Application No.463 of 2018 filed in DRT-3, Kolkata on 05.06.2018 against two Defendants under Section 19(1) of the Recovery of Debts & Bankruptcy Act, 1993 (amended from time to time) for recovery of Rs.14,41,164.00 (Rupees fourteen lacs forty one thousand one hundred sixty four).as on 08.05.2018 together with further interest @ 18% per annum, till realization of the entire dues. Subsequently, the instant case has been transferred to DRT-2, Kolkata vide the Hon'ble Chairperson DRAT, Kolkata's direction vide letter No.4/6/DRAT/KOL/2018(pt.) dated 16.09.2019, such has been recorded vide Ld. Registrar, Kolkata DRT-3's Order dated 24.10.2019 and the same has been renumbered as T.A./ 31 of 2020 vide Ld. Registrar's order dated 04.11.2019.

2. The brief facts of the case as set out by the Applicant Bank in its Original Application, as under:

(i) That the Defendant No.1 is the borrower and the defendant No.2 is the guarantor of the loan account. On 25.01.2010 the defendant No.1 had applied and approached before State Bank of Bikaner & Jaipur, Azad Hind Bagh Branch, P.S.- Burtolla, Kolkata – 700006 which has now merged into State Bank of India as per the Gazette of India notification dated 22.02.2017 with effect from 01.04.2017 for cash credit facility aggregating to a sum of Rs.7,50,000/- for expansion of business; and in pursuant of the above, applicant Bank was pleased to grant / sanction a Cash Credit facility to a sum of Rs.7,50,000/- (Rupees seven lacs fifty thousand) in favour of the defendants vide letter of arrangement dated 01.02.2010. At the time of sanctioning of said credit facility, the applicable rate of interest was @ 12.25% per annum with monthly rests. The primary security for the advance was hypothecation of stocks and all other current assets, LIC policies and FD of Rs.3.94 lacs. Copy of letter of arrangement dated 01.02.2010 is annexed and marked with letter 'A' and Exhibit AW-1.

(ii) In respect of aforesaid cash credit facility of Rs.7.50 lakhs, the defendant executed the following security document dated 23.05.2016:

- (a) Agreement of Loan-cum-hypothecation;

- (b) Consent Clause;

- (c) Letter of continuity;

- (d) D.P. Note & D.P. Note Delivery Letter.

Copy of said document is annexed and marked with Letter 'B', 'C', 'D' & 'E' Exhibit – AW-2 to AW-5 respectively.

(iii) In consideration of the applicant having agreed and/or granting the said cash credit facility of Rs.7.50 lacs to the defendants, the defendant No.2 guaranteed payment of all present and future indebtedness and liabilities of the defendants by executing an Agreement of Guarantee, and the said guarantee is a continuing guarantee. The said defendant No.2 executed the following documents on 01.02.2010:

- (a) Guarantee Agreement;

- (b) Consent Clause.

The said documents is annexed and marked with Letters 'F' & 'G' and Exhibit AW-6 & AW-7 respectively.

(iv) In the year 2011, the defendant No.1 had again applied before the applicant Bank (SBBJ) for enhancement of existing cash credit facility for aggregating sum of Rs.15,00,000/-. Upon consideration of the application, the applicant Bank was pleased to grant / enhance the existing cash credit facility aggregating to a sum of Rs.15,00,000/- (Rupees fifteen lacs) vide sanction letter dated 15.11.2011. At the relevant point of time, the applicable rate of interest was @ 14.25% per annum with monthly rests. The primary security for the enhanced C.C. facility was hypothecation of charge over current assets as well as machinery and tools, Lien of F.D., LIC policy and personal guarantee. Copy of sanction letter dated 15.11.2011 is annexed and marked with letter 'H' and Exhibit AW-8.

(v) In respect of the said enhanced cash credit facility of Rs.15.00 lacs, the defendant No.1 had executed and delivered to the applicant Bank the following documents on 15.11.2011 by way of security, acknowledgement of debt and promise to pay the dues with certain terms and conditions:

- (a) Supplementary Agreement for increase in the overall limit;

- (b) Supplementary Agreement of Hypothecation of Goods and assets for increase in the overall limit;

- (c) Supplementary Agreement of pledge of goods and assets for increase in overall limit;

- (d) Consent Clause;

- (e) D.P. Note and D.P. Note Delivery letter.

Copies of said documents dated 15.11.2011 are annexed and marked with Letters 'I', 'J', 'K', 'L' & 'M' and Exhibit AW-9 to AW-13 respectively.

(vi) In consideration of the applicant having agreed and/or granting the said enhanced credit facility of Rs.15.00 lacs to the defendants, the defendant No.2 guaranteed payment of all present and future indebtedness and liabilities of the defendants by executing an Agreement of Guarantee, and the said guarantee is a continuing guarantee. The said defendant No.2 executed the following documents on 15.11.2011 in favour of applicant Bank:

- (a) Supplemental Deed of Guarantee for increase in overall limit;

- (b) Consent Clause.

Copy of said documents dated 15.11.2011 are annexed and marked with Letters 'N' & 'O' and Exhibit AW-14 & AW-15 respectively.

(vii) The defendants had executed Revival Letters dated 03.10.2014 and 23.08.2017 for revival of the aforesaid loan account; copy of said Revival Letters dated 03.10.2014 & 23.08.2017 are annexed and marked with Letter 'P' & 'Q' and Exhibit AW-16 & AW-17 respectively.

3. The Defendants availed and enjoyed the cash credit facility by opening Account in Bank's 'Azad' Hind Bag Branch, 1, Abhay Guha Road, Kolkata – 700006. However, the defendants failed and neglected to abide by the terms and conditions of the facility. The Defendants did not repay the outstanding Bank's dues and overdue interests in loan Account. In spite of repeated requests and personal contact made by the Applicant Bank, the defendants failed to regularize the loan Account. Since the defendant did not pay any attention to regularize the Account, the Account became out of order and was classified as N.P.A. on 27.09.2017. Thereafter, applicant Bank finding no other alternative issued a legal notice dated 22.05.2018 by its Advocate demanding payment of a sum of Rs.14,41,164/- inclusive of accrued interest calculated upto 08.05.2018, but the defendants did not comply the said notice; copy of Advocate's letter is annexed and marked with letter 'S' and Exhibit AW-19. Certified copies of Statement of Account along with Certificate under Bankers' Books Evidence Act, with Statement of Claim, have been filed to show and prove the dues (Letter 'R' and Exhibit AW-18), and future interest @ 18% per annum together with costs etc. till realization, has been prayed. Applicant Bank submitted that their claim in the Application is within limitation.

4. The notice / summons was sent to the Defendants by the Tribunal; service of Notice / summons upon the Defendants by postal service / hand delivery was successfully delivered, vide order dated 05.05.2022. Despite service, the defendants did not appear nor filed the written statement; thus, both the defendants were ordered to be proceeded *ex-parte* vide order dated 01.04.2024. Written notes of arguments has been filed on behalf of applicant Bank on 20.08.2024 wherein stated the brief facts of this case as has been narrated in the original application. Ld. Advocate of the applicant Bank has submitted arguments on 27.09.2024.

5. Applicant Bank has filed the evidence-on-affidavit affirmed by Diptendu Kumar Rakshit, Deputy Manager of Bank's SMECCC, 1, Strand Road, Samriddhi Bhawan, Annexe Building, Kolkata – 700001 along with the copy of original documents executed by the Defendant. Original documents have been produced by the Applicant Bank; the same have been verified with copies of the documents annexed with O.A. and after verification the original documents have been returned to Sri Gauranga Prasad Dey, CCO of Bank's SARB, 2/1, Russel Street, Kolkata on 700071 on 08.03.2019, such has been recorded in Ld. Registrar, DRT-3's order dated 08.03.2019. Such has been recorded vide Ld. Registrar's order dated 08.03.2019. The documents produced by the Applicant Bank are exhibited and annexed at 'AW-1' to 'AW-19'.

I have heard the Ld. Advocate of the Applicant Bank and perused the records.

6. Evidence-on-affidavit, filed by Applicant Bank, has remained unchallenged, un-rebutted and its veracity cannot be put to dispute. Applicant Bank has corroborated the averments made in the O.A. Applicant Bank has proved the sanction of cash credit facility of Rs.15.00 lakhs. Applicant Bank has proved the hypothecated movable assets, described in 'Schedule' at page 16 of the O.A.

7. On the point of limitation, Loan has been sanctioned on 01.02.2010 and subsequently enhanced the same on 15.11.2011, security documents have been executed on 01.02.2010 & 15.11.2011; and original Application has been filed on 05.06.2018. Further, the defendants had executed Revival Letters dated 03.10.2014 and 23.08.2017 for revival of the aforesaid loan account. As such, the original Application appears to have been filed well within the period of limitation.

8. Applicant Bank has stated that the outstanding balance in Cash Credit Account as on 08.05.2018 (Interest applied upto 27.09.2017) is Rs.12,98,631.56 and accrued interest calculated from 28.09.2017 to 08.05.2018 is Rs.1,42,532.44 has been added / debited in the Account; thus the outstanding claim amount comes to **Rs.14,41,164.00** (Rupees fourteen lacs forty one thousand one hundred sixty four) as on 08.05.2018, which is the amount claimed by the applicant Bank in the original Application, and the defendant is liable to repay the said amount to the applicant Bank with *pendente lite* and future interest, till realization. I allow the claim as made by the applicant Bank in the original Application. Applicant Bank has prayed future interest @ 18% per annum, while at the time of sanctioning of Loan the applicable rate of interest was @ 12.25% and 14.25% per annum, with monthly rests. Therefore, in my view, the *pendente lite* & future rate of interest @ 13% per annum, with quarterly rests, from 09.05.2018, is allowed.

9. The matter also falls within the territorial as well as pecuniary jurisdiction of this Tribunal. The Applicant Bank has proved to claim made in the O.A./T.A. The T.A. being T.A./31 of 2020 (arising out of O.A./463 of 2018) deserves to be allowed; hence allowed.

11. In view of the above, I pass the following order :-

ORDER

(i) T.A./31 of 2020 (arising out of O.A./463 of 2018), filed by the Applicant Bank, is allowed and debt is determined with cost against the Defendants No.1 & 2. It is hereby ordered that the Defendants No.1 & 2 are hereby directed to pay, jointly and / or severally, the total debt amount of **Rs.14,41,164.00** (Rupees fourteen lacs forty one thousand one hundred sixty four) due and payable, inclusive of interest and other charges calculated upto 08.05.2018; and interest for the period *pendente lite* and future @ 13% per annum, with quarterly rests, from 09.05.2018, till realization of the entire sum due and recoverable.

(ii) Amount, if any, paid by the Defendants in the loan account or amount, if any, recovered by the Applicant Bank after filing of the Original Application, the same may be taken into account while arriving at the exact amount of dues/debt payable by the Defendants No.1 & 2. Accordingly, the *pendente lite* and future interest shall be calculated on the reduced amount.

(iii) Defendants No.1 & 2 are debarred from transferring, alienating, encumbering or disposing of the hypothecated movable assets, described in Schedule at page 16 of the original Application, as under:

*"Stocks and book debts lying at M/s Saini Fabricators, 16, Biplabi Pulin Das Street, Kolkata - 700009 "*

The Defendants are also debarred from transferring, alienating, encumbering or disposing any other property(s) and assets belonging to them till the aforesaid adjudicated debt amount are recovered from the Defendants No.1 & 2.

(iv) Defendants No.1 & 2 are given a time of forty-five days from the date of this Final Order/ Judgment for repayment 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 property(s), as aforesaid. Applicant Bank is also entitled to proceed against personal properties of the Defendants both moveable and immoveable and also proceed against the Defendants No.1 & 2 personally to recover the dues, in accordance with law.

(v) Let the Certificate of Recovery be drawn up by Ld. Registrar forthwith in terms of Final Order / Judgment for issuance of the same against the Defendants No.1 & 2 in favour of Applicant Bank under Section 19(22) of the Recovery of Debts and Bankruptcy Act, 1993 (amended from time to time) and put up the same for signature for issuance.

(vi) Ld. Recovery Officer shall realize the amount as per the Recovery Certificate from Defendants No.1 & 2, in accordance with law.

(vii) Ld. Registrar of this Tribunal is directed to place Recovery Certificate in terms of this Final Order / Judgment under section 19(22) of the Act of 1993.

**Accordingly, the Original Application, being T.A./31 of 2020 (arising out of O.A./463 of 2018) is allowed and stands disposed of.**

File be consigned to Record room.

This order is dictated and corrected by the undersigned and pronounced on this the 08^th day of October, 2024.

Copy of the Final Order / Judgment be uploaded on the Tribunal's Website.

8.10.24 (Arbind Madhav) Presiding Officer DRT-2, Kolkata

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