PUNJAB NATIONAL BANK vs M/s Golden Wooden Mart And Ors on 14 February 2020

**J U D G M E N T**

**(Delivered on 14^th February 2020)**

The Applicant is a body corporate constituted under the Banking Companies Acquisition and Transfer of Undertakings) Act V of 1970 having its Head Office at 7, Bhikhaiji Cama Place, Africa Avenue, New Delhi- 110 607 and carrying on banking business, inter-alia, at Sevoke Road, Siliguri, PIN-734001, West Bengal.

The facts in brief, giving rise to the present application as pleaded are as under.

The defendant No. 1 carries on the business of wooden furniture through its proprietor being the defendant No. 2. The defendant No. 3 guaranteed the repayment of the outstanding dues in the loan account of the defendant No. 1. Further the defendant No. 2 mortgaged his immovable property with the applicant bank as security for the dues of the defendant No. 1.

Siliguri

(Contd...)

On 3.09.2012 the defendant No. 2 as the sole proprietor of M/s. GOLDEN WOODEN MART, being the defendant No. 1 applied to the applicant bank for credit facilities to meet the working capital requirements of his concern and at the request of the said defendant the applicant bank on 8.9.2012 sanctioned a Cash Credit (Hyp.) limit for Rs. 40.00 lakhs to M/s. GOLDEN WOODEN MART, the defendant No. 1.

On 8.9.2012 in consideration of grant of the aforesaid Cash Credit limit and also to secure the amount outstanding thereunder, the defendant No. 2 as the sole proprietor of the defendant No. 1 executed an Agreement of Hypothecation of Goods and Book Debts to secure Cash Credit facility.

The defendant No. 3 stood as guarantor and executed agreement of guarantee on 8.9.2012 to secure the liability undertaken by the said defendant No. 1.

In order to secure the liability of M/s. GOLDEN WOODEN MART under the said facility, on 8.9.2012 the defendant No. 2 created mortgage by deposit of title deed being Deed No. 6643 for the year 1975 in respect of his right and interest over the property being land measuring 0.06 acre with construction thereon in Mouza Siliguri, Plot No. 567, Khatian No. 542/1, JL No. 110/88 at Gurung Busty, SMC, Ward No. III, P.O. Pradhan Nagar, District Darjeeling, Pin 734 003.

The defendant No. 1 executed a Balance and Security Confirmation Letter confirming the balance on 29.03.2014.

It is the contention of the applicant bank that due to defaults committed by the defendant No. 1, the account became irregular. Due to non payment of the dues by the defendants and non service of the interest due and accrued in the said account, under the Reserve Bank of India policy guidelines the said account of defendant No. 1 was declared as a Non Performing Asset account on 30.06.2014.

Thereafter, the applicant bank by letters dated 7.2.2014, 14.6.2014 and 18.06.2014 called upon the defendants to regularize the account. On 31.07.2014 the applicant caused a notice to be issued and sent out to the defendants herein under the provisions of Section 13(2) the Securitization and Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 demanding a sum of Rs. 42,05,284/- from the defendants.

The defendant No. 2 challenged the SARFAESI actions of the applicant bank under Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of

Siliguri

(Contd...)

Security Interest Act, 2002 being SA No. 286 of 2015 before this Ld. Tribunal which is pending adjudication.

By letters dated 5.11.2014 and 21.01.2015 the defendant No.1 through its proprietor being the defendant No. 2 sought for time to repay the outstanding dues in the account of the defendant No. 1. However the defendant No. 1 failed to fulfill its commitment.

Despite due notice and knowledge that there was a default to pay the said sum of Rs.50,00,224/- due as on 30.11.2015 as stated in the last preceding paragraph and further interest on the said sum, the defendants made no effort to pay the lawful claim of the applicant or regularize the said account. The applicant states that in the facts and circumstances of the case, the said defendants are liable and bound to pay the claims of the applicant bank made in this application with further interest and costs.

After giving credit to the said loan Accounts of the defendant for all sums of moneys paid and/or received there is now due and owing by the said defendants jointly and severally to the Applicant Bank in the said Term Loan Account a total sum of Rs. 50,00,224.00 as on 30.11.2015.

The defendants, despite the service of summons through paper publication, neither appeared nor filed any written statement against the claim of the applicant bank. Hence, the defendants were ordered to be proceeded ex-parte on 26/9/2019.

The Applicant Bank in support of its case has filed evidence by way of affidavit as affirmed by Sri. Deepak Kumar Mondal, the Sr. Manager of the Applicant Bank and also relied upon the following documents:- <table border="1"> <thead> <tr> <th>Sl. No.</th> <th>Name of the documents</th> <th>Exhibit No.</th> </tr> </thead> <tbody> <tr> <td>1.</td> <td>Application for Loan</td> <td>AW-1</td> </tr> <tr> <td>2.</td> <td>Letter of Sanction dated 8/9/2012</td> <td>AW-2</td> </tr> <tr> <td>3.</td> <td>Agreement of Hypothecation of Goods and Book Debts for Rs. 40.00 lakhs</td> <td>AW-3</td> </tr> <tr> <td>4.</td> <td>Agreement of Guarantee dated 8/9/2012</td> <td>AW-4</td> </tr> <tr> <td>5.</td> <td>Deed No. 6981 for the year 1975</td> <td>AW-5</td> </tr> <tr> <td>6.</td> <td>Letter dated 10/09/2012 of the applicant</td> <td>AW-6</td> </tr> <tr> <td>7.</td> <td>Letter dated 17/9/2012</td> <td>AW-7</td> </tr> <tr> <td>8.</td> <td>Extract from title deed register</td> <td>AW-8</td> </tr> <tr> <td>9.</td> <td>Balance and Security Confirmation Letter dated 29/3/2014</td> <td>AW-9</td> </tr> <tr> <td>10.</td> <td>Demand Notices</td> <td>AW-10</td> </tr> <tr> <td>11.</td> <td>SARFAESI Notice dated 31/7/2014</td> <td>AW-11</td> </tr> </tbody> </table>

Siliguri

(Contd...)

<table border="1"> <tr> <td>12.</td> <td>Letters dated 5/11/2014 and 21/01/2015</td> <td>AW-12</td> </tr> <tr> <td>13.</td> <td>Statements of Accounts</td> <td>AW-13</td> </tr> </table>

I have heard the learned counsel for applicant bank and perused the documents and Evidence filed by applicant bank. By the said evidence on affidavit, the Applicant bank has proved its claim. It is settled law that an averment which is not denied by the opposite party i.e. defendants in the present matter, by way of filing written statement or by producing evidence must be taken by the Tribunal/ Court to have admitted by the defendants. In the present matter the defendants have neither filed written statement nor produced any evidence in their support to challenge the claim of applicant bank.

The claim of the Applicant bank is within the limitation and within the jurisdiction of this Tribunal. The applicant has sufficient cause of action for filing the instant application due to disbursement/availment of loan to/by the defendants and on default in repayment of the loan by the defendants, inspite of demands made, as per exhibited documents filed by the applicant bank.

In the above circumstances, it is ordered:

ORDER

T.O.A. No. 1017/2017 arising out of O.A. No. 563/2015 filed by the Applicant Bank is allowed against the defendants No. 1, 2 & 3 jointly and severally and it is hereby ordered that the Applicant Bank is entitled to recover from the above said defendants the total debt amount for Rs. 50,00,224.00 (Rupees fifty lakhs two hundred and twenty four) only with further interest thereon @ 12.00% p.a. with quarterly rests from the date of filing of the application till realization of entire balance.

Amount, if any, paid by the defendants in the loan accounts or amount recovered by the applicant bank, if any, made towards the loan accounts after filing of the O.A be taken into account while arriving at the exact amount of outstanding payable by the defendants.

The hypothecated properties being stocks and the mortgaged properties being the land measuring 0.06 acre with construction thereon in Mouza Siliguri, Plot No. 567, Khatian No. 542/I, J.L. No. 110/88 at Gurung Busty, SMC, Ward No. III, P.O. Pradhan Nagar, District-Darjeeling, Pin 734 003 covered under Deed No. 6981 for the year 1975 standing in the name

Siliguri

(Contd...)

of the defendant No.2, as given in the Schedule of the application, shall remain charged to the Applicant Bank and the Applicant Bank shall have paramount charge thereon.

The defendants are debarred from transferring; alienating, encumbering or disposing of the hypothecated/mortgaged properties or any other property and assets belonging to the defendants till the aforesaid adjudicated debt amount is recovered from the defendants.

The defendants are given a time of thirty days from the date of this judgment/final order for repayment of the above mentioned dues, so initiated to them. In case of failure of defendants to pay the dues within the time as aforesaid, the Applicant Bank is entitled to recover its dues by sale of the hypothecated/mortgaged property as aforesaid and is also entitled to proceed against the said defendants personally and/or personal properties to recover the dues in accordance with law.

Let the certificate of Recovery be drawn up by Learned Registrar forthwith in terms of judgment for issuance of the same against the defendants in favour of Applicant Bank under Sub-Section 7 and 22 of Section-19 of The Recovery of Debts and Bankruptcy Act, 1993 and put up the same for signature for issuance.

This judgment is signed and pronounced in the open Tribunal on this day the 14^th day of February, 2020.

Copy of the judgment/final order be given/sent to the parties.

(D.S. MAHRA)

DRT, Siliguri.

Siliguri