INDIAN BANK vs M/S P S FASHION on 3 December 2024

1. 1. **M/s P.S. Fashion**, proprietorship concern of Md. Parvez, having its office and carrying on business at 16/A, Charial Bachilor Road, 2^nd Lane, Budge Budge, Kolkata – 700137, West Bengal.

2. 2. **Md. Parvez**, proprietor of M/s P.S. Fashion, having its office and carrying on business at 16/A, Charial Bachilor Road, 2^nd Lane, Budge Budge, Kolkata – 700137, West Bengal.

..... Defendants

Counsel for parties:

For the Applicant Bank : Mr. Saudip Pal Choudhuri.

For the Defendants : *Ex-Parte***FINAL ORDER / JUDGMENT**

Delivered on 03.12.2024

Applicant, Indian Bank instituted the present Application being the Original Application No.805 of 2018 filed in DRT-3, Kolkata on 15.10.2018 against two Defendants under Section 19(1) of the Recovery of Debts & Bankruptcy Act, 1993 (amended from time to time) for recovery of Rs.60,26,780.00 (Rupees sixty lacs twenty six thousand seven hundred eighty) as on 01.10.2018 together with further interest thereon @ 14.95% per annum with quarterly rests, till realization of the entire due in full. 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 30.10.2019 and the same has been renumbered as T.A./437 of 2020 vide Ld. Registrar's order dated 02.07.2020.

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.2 being the proprietor of defendant No.1 approached and applied before the applicant Bank for credit accommodation. At the request of defendant No.1, applicant Bank was pleased to grant / sanction a Cash Credit facility to the limit of Rs.48,00,000/- (Rupees forty eight lacs) in favour of the defendant No.1, vide sanction letter dated 12.06.2015 on certain terms and conditions mentioned in the sanction letter. Copy of sanction letter dated 12.06.2015 is annexed and marked with Letter 'A'.

(ii) In acknowledgement of granting the said credit facility of Rs.48.00 lakhs, the defendant No.2 being the proprietor of defendant No.1 executed and delivered the following security documents all dated 12.06.2015:

- (a) Declaration by sole proprietor;

- (b) Copy of the single / joint DPN of Rs.48.00 lakhs;

- (c) Disposal of proceeds letter of Rs.48.00 lakhs;

- (d) Agreement of Hypothecation of movables;

- (e) Agreement for open cash credit;

- (f) Consent letter from the borrower for disclosure of information;

- (g) Declaration by the borrower on details of relatives.

Copies of said documents are annexed and marked with Letter 'A-1' to 'A-7' respectively.

(iii) The defendants acknowledged and admitted said credit facility by way of Balance Confirmation letter dated 01.06.2018. Copy of said confirmation letter dated 01.06.2018 is annexed and marked with letter 'A'8'.

3. The Defendants enjoyed and utilized the said credit facility by opening Account in Bank's Kiddirpore Branch, 4, Ram Kamal street, Kolkata – 700023. 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. Since the defendants did not pay any attention to regularize the Account inspite of repeated requests made by the Applicant Bank, the Account became out of order and was classified as N.P.A. Considering aforesaid default and violation of the terms and conditions of the credit facility, the applicant Bank was compelled to issue demand Notice dated 02.10.2018 upon the defendants through its Ld. Advocate demanding to repay the outstanding Bank's dues, but the defendants has failed and neglected to comply with the said notice; copy of said demand notice dated 02.10.2018 is annexed and marked with Letter 'A-9'. 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 'A-10'), and future interest @ 14.95% per annum from 02.10.2018 with quarterly rests, till realization of the entire due in full, has been prayed. Applicant Bank submitted that their claim in the Application is within limitation.

4. The notices / summons were sent to the Defendants No.1 & 2 by the Tribunal; service of Notices / summons upon the Defendants by postal service has not been successfully effected, such has been recorded vide Ld. Registrar's order dated 12.09.2023. At the request of Ld. Advocate of the applicant Bank, Ld. Tribunal is directed to serve the summons upon both the defendants by way of paper publication; and Ld. Advocate for applicant Bank has brought on record the affidavit of service on publication dated 26.02.2024 upon the Defendants No.1 & 2 along with relevant portion of paper cuttings in two newspapers, namely (i) 'The Statesman' in English and (ii) 'Yugasankha' in Bengali, both dated 08.12.2023, such has been recorded vide Ld. Registrar-in-Charge's order dated 26.02.2024. 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 20.06.2024. Ld. Advocate of the applicant Bank has submitted arguments on 20.06.2024.

5. Applicant Bank has filed the evidence-on-affidavit affirmed by Sumsit Kumar, Officer and Constituent Attorney of Bank's Kiddyropore Branch, 4, Ram Kamal Street, Kolkata – 700023 along with the copy of original documents executed by the Defendants. I.A./31 of 2023 along with put-up I.A./30 of 2023 dated 10.01.2023 has been filed by the applicant bank with a prayer to allow verification of original documents; the said I.A.s were allowed and disposed of vide order dated 16.01.2023. 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 Mr. Islam Ali Mallick, Asstt. Manager of Bank's Kiddyropore Branch, Kolkata – 700023 on 30.01.2023, such has been recorded in Ld. Registrar's order dated 30.01.2023. The documents produced by the applicant Bank are exhibited and annexed as Annexure / Exhibit 'A' & 'A-1' to 'A-10'.

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.48,00,000/- vide sanction letter dated 12.06.2015. Applicant Bank has proved the hypothecated movable assets; morefully described in Agreement of movables at page 24 to 37, Annexure 'A-4' of the original application.

7. On the point of limitation, Loan has been sanctioned on 12.06.2015; documents have been executed on 12.06.2015; original Application has been filed on 15.10.2018. Further, the defendants acknowledged and admitted said credit facility by way of Balance Confirmation letter dated 01.06.2018 in favour of applicant Bank. 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 (inclusive of accrued interest and other charges as calculated upto 01.10.2018) for a sum of **Rs.60,26,780.00** (Rupees sixty lacs twenty six thousand seven hundred eighty) as on 01.10.2018, which is the amount claimed by the applicant Bank in the original Application, and the defendants No.1 & 2 are, jointly and/or severally, 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 @ 14.95% per annum, while in the sanction letter dated 12.06.2015 the rate of interest applicable as per rating for 2014, has been mentioned. Therefore, in my view, the *pendente lite* & future rate of interest @ 12% per annum, with quarterly rests, from 02.10.2018, 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./437 of 2020 (arising out of O.A./805 of 2018) deserves to be allowed; hence allowed.

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

ORDER

(i) T.A./437 of 2020 (arising out of O.A./805 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.60,26,780.00** (Rupees sixty lacs twenty six thousand seven hundred eighty) due and payable, inclusive of interest and other charges as calculated upto 01.10.2018; and interest for the period *pendente lite* and future rate @ 12% per annum, with quarterly rests, from 02.10.2018, 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. Accordingly, the *pendente lite* and future interest shall be calculated on the reduced amount.

(iii) The defendants No.1 & 2 are debarred from transferring, alienating, encumbering or disposing of the hypothecated movable assets; morefully described in Agreement of movables at page 24 to 37, Annexure 'A-4' of the original application, as under –

"*Hypothecated movable assets.*"

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

(iv) The 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 properties, as aforesaid. Applicant Bank is also entitled to proceed against personal properties of the Defendants No.1 & 2 both moveable and immoveable and also proceed against the Defendant No.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 the 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./437 of 2020 (arising out of O.A./805 of 2018) is allowed and stands disposed of.**

This order is dictated and corrected by the undersigned and pronounced on this the 03^rd day of December, 2024.

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

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

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