STATE BANK OF INDIA vs M/S APARNA LIGHTING INDIA PVT LTD AND ORS on 27 July 2020

JUDGEMENT

This is an Original Application made under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 initiated by the applicant against the defendants praying for issuance of Recovery Certificate to the tune of Rs 5,40,13,030.07 together with interest, cost and other usual reliefs. The lnstant Original Application being Case T.A. No. 1882 of 2015 arising out of No. o.A. 772 of 2OO7 was filed on 10.09.2007 before the DRT-II, Kolkata for recovery of a sum of Rs. 5,40,13,030 07 due and payable from the defendants No. 1,2,3,4,5,6 and 7 jointly and severally towards outstanding dues as on 31'08.2007 in respect of the cash credit, term loan and bank guarantee to the tune of Rs' 4,65,OO,OOO/- sanctioned and granted by the Applicant Bank to the Borrower/Defendant No. 1. The instant O.A. No. 172 of 2007 had been flled before the DRT-II, Kolkata within the period of limitation and within the jurisdiction of the Hon'ble Tribunal. Subsequently, the O A' has been transferred to this Hon'ble DRT-III, Kolkata and renumbered as T.A. No. 1882 of 2015. The brief facts of the case as made out in the Original APplication by the applicant bank is that the defendant No. 1, which is an existing company within the meaning of the Companies Act, 1956, having lts registered omce and carrying on business at Bakrahat Road, Village & P.O. Rasapunja, District - 24-Parganas (South). The Defendant No' 1 is engaged In the business of manufacturing of GLS Lamps & Tube Lights. The Defendants No. 2, 3, 4, 5, 6 & 7 are the guarantors of the Defendant No. 1, who guaranteed payment of all indebtedness and liabilities of the said Defendant No. 1 to the applicant Bank in respect o\- of credit facilities granted to the Defendant No. 1. Sometime in the year 2001, Defendant No. 1 made a request to the applicant bank,s Industrial Finance Branch, 11, U N Brahmachari Street, Kolkata- 7000L7 for sanction of credit facilities for its business and submitted requisite information by way of exclusive hypothecation of entire stock, book debts and current assets of the firm, both present and future to secure the loan. Defendants No. 2,3,4,6 and 7 as Guarantors furnished their personal information including Deed of Guarantee on 19.03.2001 and subsequently on 27.72.2005. The Applicant Bank having given due conslderation and after proper scrutiny of the application dated 1oth August, 2OOO submitted by the Borrower, being the Defendant No. 1 backed by guarantee provided by the Guarantors being the Defendant No. 2,3,4,5,6 and 7 sanctioned a fresh Term Loan and cash credit facility for limit of Rs. 4,65,00,000/- only vide its sanction letter dated 19.02,2001 to the Borrower, to be repaid in 24 quarterly installments.

4. The defendant on acceptance of the terms and conditions as contained in the sanction letter dated 19.02.2001 and as stipulated in Annexure- 'A'executed certain documents backed by guarantee provided by the guarantors, being Defendant No. 2,3,4,5,6 and 7 submitted an agreement of Hypothecation of Goods and Assets dated 19.03.2001 for Rs. 4,65,00,000/-, as stipulated in Annexure-'A-3', with a promise to pay the entire sum of Rs. 4,65,00,000/- to the Applicant Bank on demand with interest thereon with monthly rest.

5. To secure the said cash credit loan facilities, certain personal guarantee Agreements were executed and Title Deeds were deposited as collateral security on 21.03.2001 on behalf of the defendant No. 1, and the Defendant No. 2,3,4,5,6 and 7 executed Deed of Guarantee dated 19.3.2001 and again on 21.12.2005 in favour of the applicant

6. for Rs. 4,65,00,000/- agreeing to pay interest @ L2.75o/o per annum with monthly rests and deposited several Title Deeds of immovable properties situated at Rasapunja Mouza, P.S. Bishnupur, District - 24 Parganas (South), which would be kept as security as stipulated in Annexure -'A-9' to Annexure -'A-15'. To secure the loan with the applicant, the Defendant No. 1 along with Defendants No. 2,3,4,5,6 & 7 jointly and severally agreed and guaranteed for payment of Rs. 4,65,00,000/- together with interest thereon or on such sum as might be due @ L2,75o/o per annum with monthly rests. The Defendants No. 2,3,4,5,6 & 7 agreed to make payment and discharge on demand of all amount due and payable by the Defendant No. 1 to the applicant at any time in respect of Cash Credit loan facilities availed of by the Defendant No' 1 as stipulated in Annexure - '8-6'. The Defendants No. 1, 2, 3, 4, 5, 6 & 7 as borrowers had executed the following banking documents: l) Agreement for Hypothecation dated 19.03.2001 and 21.12.2005. ii) Deed of Conveyance relating to properties so mortgaged.

iil) Personal Guarantee executed by the defendants No. 1, 2, 3, 4, 5, 6 & 7 on 19.03.2001 and 21.L2.2005. The defendant No. 1 enjoyed the money from the aforesaid loan but failed to operate both the Cash Credit and Term Loan accounts effectively and as a result of which the loan accounts became irregular NPA and for which the Applicant had issued letter dated 02.07.2007 under section 13(2) of the SARFAESI Act, 2002 demanding a payment of Rs. 5,33,54,864.56 towards the loan outstanding as on 30.06.2007. The Borrower being the Defendant No. 1 and the Guarantors being the Defendant No. 2,3,4,5,6 & 7 failed and neglected to pay their

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10. outstanding amount in spite of Legal Notice served on 02.07.2007 as stipulated in Annexure -'E'. A sum of Rs. Rs.5,40,13,030.07 is due against the defendant which the defendant had not paid despite repeated demands and requests. Finding no other way to recover the dues of the bank, the applicant bank had filed this Origtnat Application for the recovery of the aforesaid amount and for the issuance of Recovery CertiRcate against the defendants. Notices were issued to the defendant to show cause as to why the relief prayed for by the applicant bank be not granted. After issuance of the notice, the defendant appeared through their Counsel and prayed time for filing of W.S. But no W.S. was filed on behalf of the sole defendant as a result of which they were proceeded ex-parte vide order dated 03.01.2020 0f this Tribunal. The Tribunal had no other option but to hear ex-parte against the defendants. O.A. Defendant No. 1 was in liquidation. The report of the Omcial Liquidator attached with High Court of Calcutta vide Order dated 14th February, 2019, was filed on 20th March, 2019. The Official Liquidator in his report stated that the Hon'ble High Court of Catcutta has alowed the O.A. Applicant to dispose of the security belonging to O.A. Defendant No. 1 under the provision of SARFAESI Act, 2002. The Liquidator further stated that the property is yet to be sold by the O.A. Applicant. The Official Liquidator furnished the list oF claimants at Annexure-A of the stated report, which is taken on record. I have heard the learned Counsel for the applicant bank and have perused the relevant documents. L2. The defendant had not contested the case of the applicant bank. Thus, the point for determination in this case is (i) whether the claim 11, d-

13. of the applicant bank is within time? (ii) Whether the defendant had utilized the loan facilities granted by the bank? (iii) Whether the defendant is liable to pay the amount due to the applicant bank or not? The applicant bank by oral and documentary evidence has established its case. The documentary evidence comprises from Annexure/Exhibit- 'A' to Annexure'H', which are available in paper book filed by the applicant bank. From the perusal of the documents referred above and the certified copy of the statement of account, which is filed as Annexure'F', it is established that the defendant had availed the financial facilities from the applicant bank and had withdrawn the amount through the account. The oral testimony comprises of an affidavit of Shri Dilip Outta Roy, working as Chief Manager of the Applicant Bank. The averments in the application and the facts stated by the witness of the applicant in this affidavit are un-rebutted.

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16. From the perusal of the Statement of Account which is at Annexure'F' the total outstanding comes to Rs. 5,40,13,030.07 as on 31.08.2007, which the applicant bank is entitled to recover from the defendant. In view oF the above discussion and after considering the entire evidence-on-affidavlt of the appllcant bank and the documents filed by the applicant bank, I have no hesltation to hold that the appllcant bank is entitled to recover a sum of Rs. 5,40,13,030.07l- from the defendants who are liable for the same. The applicant bank shall also be entitled to pendentelite and future interest on the said amount @ 12.75o/o per annum with monthly rests simple from the date of filing of the Original Application till the date of realization.

ORDER

(1) T.A. No. 1882 of 2015 fited by the Appticant Bank is a owed and debt is determined with cost against the defendant. It is hereby ordered that applicant bank is entitled to recover from the defendants the total amount to the tune of Rs.5,40,13,030.07l- (Rupees five crores forty lakhs thirteen thousarrd thirty and paise seven only) with pendentelite and future interest @ 12.75o/o per annum with monthly rests with simple on the amount due from the date of Rling of the Original Application, i.e. 10.09.2007 till full and finat reatization of the claim amount.

(2) Amount, if any, paid by the defendant in the loan accounts or amount, if any, recovered by the Applicant Bank after filing of the O.A. the same be taken into account while arriving at the exact amount of dues/debt payable by the defendants. Accordingly, pendentelite and future interest shall be calculated on the reduced amount.

Defendants are debarred from disposing, alienating or dealing with any of the properties belonging to them till the aforesaid decretal debt is recovered from the defendants. Defendant are given a time of thirty days from the date of the Judgement/Final Order for repaying 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 assets, if any. Applicant bank is also entitled to proceed against personal properties of the defendants (both movable and immovable) and also proceed against the defendants personally to recover the dues in accordance wlth Law.

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(5) Let the Certlflcate of Recovery be drawn up by Ld. Reglstrar forthwith in terms of Judgement for issuance of the same against defendants in favour of the applicant bank under Sectlon 19 (22) of the Recovery of Debts and Bankruptcy Act, 1993 and put up the same for issuance of the Certificate.

(6) Ld. Recovery Officer shall realize the amount as per the Recovery Certificate from the defendants in accordance with law.

(7) Ld. Registrar of this Tribunal is directed to deliver recovery certificate in term of the final order /judgement for recovery of the sum against the defendants in favour of the Applicant Bank under Section 19 (22) of the Recovery of Debts due to the Bank and Financial Institutions Act, 1993 now known as Recovery of Debts and Bankruptcy Act, 1993.

(8) The parties are directed to appear before the Recovery Officer on 16.10.2020 for further action in accordance with law in the event the entire amount is not paid by the said date. Accordingly, the Original Appllcation being T.A. No. 1882 of 2015 is allowed and stands disposed of. Copy of the Judgement/Final Order be uploaded in the Tribunal's webslte. File is consigned to the Record Room. (Dictated to Steno, transcribed by him, corrected, signed and n pronounced by me in the virtual Court on lhis the L'l ';l').'L' ,20?0) zA.k aat^P*rt ANIL KUMAR CHATURVEDI PRESIDING OFFICER.

Order Sheet (Continuation) Case No. TA No. 1aa2 of 2019 State bank of India Vs. M/s Aparna Lighting (India) Pvt. Ltd. & Ors. Date of

Order

order with signature Offiae actlon with date and alated Signature of parties when OrdcLNa. r - s4n)4l|b. order pronounced (Vide separate sheets). In the result, T.A. No. 1882 of 2015 is allowed with costs. Issue Recovery Certiflcate accordingly. A.k"cAryltlLz, (A.K.Chaturvedl) Presiding Officer DRT-3,Kolkata