Punjab National Bank vs M/S MEHEK ENTERPRISE on 11 November 2024

1. **M/s Mehek Enterprise**, Proprietor: Mahasuma Khatun, Daughter of Abdul Hakim, Village –Purba Ichapur, P.O.- Kadambagachi, P.S.- Barasat, District – North 24-Parganas, Kolkata – 700125, West Bengal.

..... Defendant

Counsel for parties:

For the Applicant Bank : Mr. Swastik Saha, Ld. Advocate For the Defendant : *Ex-Parte*

**FINAL ORDER / JUDGMENT**

Delivered on 11.11.2024

Applicant (Punjab National Bank) erstwhile United Bank of India instituted the present Application being the Original Application No.100 of 2018 filed in DRT-3, Kolkata on 07.02.2018 against single Defendant under Section 19(1) of the Recovery of Debts & Bankruptcy Act, 1993 (amended from time to time) for recovery of Rs.23,87,670.00 (Rupees twenty three lacs eighty seven thousand six hundred seventy) as on 31.01.2018 together with further interest at the prescribed rate compounded monthly rests, till the date of payment of recovery from the defendant. 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 17.10.2019 and the same has been renumbered as T.A./45 of 2019 vide Ld. Registrar's order dated 26.10.2019.

2. United Bank of India has been merged / amalgamated into Punjab National Bank vide Gazette Notification dated March 04, 2020, issued by the Government of India published under Extraordinary Part-II, Section 3, sub-section (i) in the Gazette of India in terms of Section 9 of the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970. In view of the merger / amalgamation of United Bank of India into Punjab National Bank, the Applicant Name in this case should be read / inserted as Punjab National Bank instead of United Bank of India.

3. In accordance with the Notice dated 30.07.2020 of this Tribunal, Ld. Advocate for Punjab National Bank has filed a petition being I.A./1211 of 2021 praying for amendment of Cause Title in view of amalgamation of United Bank of India with Punjab National Bank vide G.O.I. Notification dated 04.03.2020; and in accordance with the direction of the Tribunal necessary amendment in cause title has been carried out by Ld. Advocate of the applicant Bank on 08.11.2021, such has been recorded in Ld. Registrar-in-charge's order dated 08.11.2021.

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

(i) That the Defendant approached and applied the Applicant Bank with the request to grant cash credit facility for the requirement of working capital vide loan application dated 07.09.2016; copy of loan application letter dated 07.09.2016 is annexed and marked with letter / Annexure 'A'. Upon consideration of Application, Applicant Bank was pleased to grant / sanction a cash credit facility to the limit of Rs.22,00,000/- (Rupees twenty two lacs) in favour of the defendant vide Sanction Letter dated 13.10.2016 which is duly accepted by the defendant; copy of Sanction Letter dated 13.10.2016 is annexed and marked with letter / Annexure 'B'.

(ii) In consideration of the said sanctioned cash credit facility of Rs.22.00 lakhs, the defendant executed the following security documents in favour of applicant Bank all dated 13.10.2016, are as under:-

- (a) Text of the consent clause from the borrower along with documents;

- (b) Demand Promissory Note of Rs.22,00,000/-;

- (c) Letter of Continuity;

- (d) Letter of Lien;

- (e) Hypothecation Agreement (Goods, Book Debts, Plant & Machineries).

Copy of said documents are annexed and marked with letters / Annexures 'C', 'C-1', 'C-2', 'C-3' and 'C-4' respectively.

5. The Defendant enjoyed the said cash credit facility by opening Account in Bank's Birati Branch, at Mahajatinagar, 88, Sarat Bose Road, Kolkata – 700081. However, the defendant failed and neglected to abide by the terms and conditions of the facility. The Defendant did not repay the outstanding Bank's dues and overdue interests in loan Account. In spite of repeated requests made by the applicant Bank, the defendant 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. Thereafter, Applicant Bank issued a demand notice dated 09.10.2017 upon the defendant through its Advocate demanding to pay the outstanding Bank's dues, but the defendant did not comply the said notice; copy of notice dated 09.10.2017 is annexed and marked with letter Annexure 'D'. Since the defendant failed and neglected to repay the outstanding loan amount, the applicant Bank compelled to issue demand notice U/s 13(2) of the Sarfaesi Act, 2002 dated 16.10.2017 upon the defendant calling upon him to pay a sum of Rs.22,93,683.00, but the defendant did not pay any interest to repay the Bank's dues, copy of said demand notice dated 16.10.2017 is annexed and marked with letter / Annexure 'E'. On receipt demand notice from the applicant Bank, the defendant made a representation on dated 09.12.2017 thereby replied, but denied and disputed the demanded sum and no offer was made for amicable settlement of loan account; copy of defendant's letter dated 09.12.2017 is annexed and marked with letter Annexure 'F'. Certified copies of Statement of Account along with Certificate under Bankers' Books Evidence Act, with interest calculation sheet, have been filed to show and prove the dues (Annexure 'G'), and future interest at prescribed rate with compounded monthly rests, till the date of payment or recovery from the defendant, has been prayed. Applicant Bank submitted that their claim in the Application is within limitation.

6. The Notice / summons was sent to the sole Defendant by the Tribunal; service of Notice / summons upon the Defendant by postal service has been successfully completed, and Ld. Advocate of the applicant Bank has filed the S/R on affidavit dated 15.09.2022 thereby observed that summon was received by sole defendant on 06.08.2022, such has been recorded vide Ld. Registrar's order dated 15.09.2022. Despite service, the defendant did not appear nor filed the written statement; thus, the defendant was ordered to be proceeded *ex-parte* vide order dated 22.03.2024. Ld. Advocate of the applicant Bank has submitted arguments on 22.03.2024.

7. Applicant Bank has filed the evidence-on-affidavit affirmed by Manoj Kumar Biswas, Senior Manager of erstwhile Bank's Birati Branch, P.S.- Airport, Kolkata – 700081, Dist.- North 24-Parganas along with the copies 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 Manoj Kumar Biswas, Senior Manager of erstwhile Bank's Birati Branch, Kolkata – 700081, Dist.- North 24-Parganas on 11.03.2019, such has been recorded in Ld. Registrar, DRT-3's order dated 11.03.2019. The documents produced by the Applicant Bank are exhibited and annexed at 'A' to 'H'.

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

8. 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 limit of Rs.22.00 lakhs. Applicant Bank has proved the hypothecated movable assets of the defendant; described in Schedule 'X' at page 50 and para 3A at page 3 of the original application.

9. On the point of limitation, Loan has been sanctioned on 13.10.2016; documents have been executed on 13.10.2016; original Application has been filed on 07.02.2018. As such, the original Application appears to have been filed well within the period of limitation.

10. Applicant Bank stated that the outstanding balance in cash credit Account (inclusive of accrued interest and other charges calculated upto 31.01.2018) is **Rs.23,87,670.00** (Rupees twenty three lacs eighty seven thousand six hundred seventy) as on 31.01.2018, which is the amount claimed by the applicant Bank in the original Application, and the sole defendant is liable to repay the said amount to the applicant Bank with *pendente lite* and future interest, till realization of entire dues. I allow the claim as made by the applicant Bank in the original Application. Applicant Bank has prayed future interest at the prescribed rate with compounded monthly rests from 01.02.2018, while in Demand Promissory Note dated 13.10.2016 the rate of interest @ 9.45% per annum with monthly rest, has been mentioned. Therefore, in my view, the *pendente lite* & future rate of interest @ 9.45% per annum, with quarterly rests, from 01.02.2018, is allowed.

11. 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. Hence, the O.A./T.A. being T.A./45 of 2019 (arising out of O.A./100 of 2018) deserves to be allowed; hence allowed.

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

ORDER

(i) T.A./45 of 2019 (arising out of O.A./100 of 2018), filed by the Applicant Bank, is allowed and debt is determined with cost against the Defendant. It is hereby ordered that the Defendant is hereby directed to pay the total debt amount of **Rs.23,87,670.00** (Rupees twenty three lacs eighty seven thousand six hundred seventy) due and payable, inclusive of interest and other charges as calculated upto 31.01.2018; and interest for the period *pendente lite* and future rate @ 9.45% per annum, with quarterly rests, from 01.02.2018, till realization of the entire sum due and recoverable.

(ii) Amount, if any, paid by the Defendant 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 Defendant. Accordingly, the *pendente lite* and future interest shall be calculated on the reduced amount.

(iii) The defendant is debarred from transferring, alienating, encumbering or disposing of the hypothecated movable assets, described in Schedule 'X' at page 50 and para 3A at page 3 of the original application; "ALL THAT the Defendant present and furniture and fixture, goods, produce, merchandise, book debts, bills, money receivables, plant and machineries, tools, equipments, implements, spare parts, stores and all other assets, rights at whichever they may be situated at including its place of business at Village – Purba Ichapur, Post Office – Kadambagachi, Police Station – Barasat, District – North 24-Parganas, Kolkata – 700125, West Bengal, India or wherever the same might be are remaining hypothecated to United Bank of India as a security for payment of its claim."

The Defendant is also debarred from transferring, alienating, encumbering or disposing any other property(s) either movable or immovable and assets belonging to him till the aforesaid adjudicated debt amount are recovered from the Defendant.

(iv) The defendant is 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 Defendant fails to pay the dues within the above mentioned time, the Applicant Bank is entitled to recover its dues by sale of secured properties, as aforesaid. Applicant Bank is also entitled to proceed against personal properties of the Defendant both moveable and immovable and also proceed against the Defendant 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 sole Defendant 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 the Defendant, 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./45 of 2019 (arising out of O.A./100 of 2018) is allowed and stands disposed of.**

This order is dictated and corrected by the undersigned and pronounced on this the 11^th day of November, 2024.

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

(Arbind Madhav) 1.24 Presiding Officer DRT-2, Kolkata

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