BANK OF BARODA (DENA BANK) vs M/S. LOGIC TRANSWARE INDIA PVT. LTD. on 25 January 2024

J U D G M E N T

1. The present OA has been filed by the Applicant for recovery of a sum of Rs. 7,35,50,113/- (Rupees Seven Crores Thirty Five Lakh Fifty Thousand One Hundred Thirteen Only) along with further interest at the rate of 12.90% p.a. with monthly rests plus 2% penal interest from the date of filing of this application till the date of realization.

2. Facts as succinctly set out in the OA are that Defendant No.1 is private limited company and the principal borrower. Defendant No. 2 to 4 are the guarantors having guaranteed to the Applicant the due repayment of the amount outstanding under the credit facility granted by Applicant to the Defendant No.1.

3. It is stated that the Defendant No. 1 approached the Applicant for a Cash Credit facility for a limit of Rs.700 Lakh and the same was sanctioned by the Applicant vide its sanction letter dt.07.09.2012 and the terms and conditions were duly accepted by the Defendants.

4. It is also stated that in order to secure the aforesaid said Cash Credit facility the Defendants executed the following documents in favour of the Applicant Bank:- a. Demand Promissory Note dt.18.09.2012 executed by the Defendant No.1.

b. Letter of Continuing Security dt.18.09.2012.

c. General Letter of Lien and Set-off for Borrowing Arrangements dt.18.09.2012.

d. Agreement of Hypothecation (Goods, Books-Debts and other Moveable Assets) dt.18.09.2012.

e. General Undertaking dt.18.09.2012.

f. Power of Attorney dt.18.09.2012.

5. It is also stated that the Defendant No.1 were also executed the Resolution passed by the Board of Directors of the Defendant No.1 which was held on 05.09.2012.

6. Further, in order to secure the aforesaid Cash Credit facility the Defendant No. 2 to 4 executed a joint letter of guarantee and General letter of Lien and set off dt.18.09.2012 in favour of the Applicant.

7. It is further stated that on 08.10.2012 Defendant No.2 has created the Mortgage by depositing the original title deeds in respect of immovable properties being (1) Unit No. 301, situated on the 3rd floor of the building known as “The Avenue”, International Airport Road, Opp, the Leela Hotel, Andheri Kurla Road, Andheri (East), Mumbai- 400069. (2) Unit No. 302, situated on the 3rd floor of the building known as “The Avenue”, International Airport Road, Opp, the Leela Hotel, Andheri Kurla Road, Andheri (East), Mumbai-400069. (3) Industrial Gala No. 106 situated on the 1st Floor in Sai Commercial Centre, BKS, Devashi Marg, Deonar, Govandi (E), Mumbai –

400069. (4) Type Transit Godown No. 91 situated in Truck Terminal Complex, Sector, 4E Kalamboli, Navi Mumbai belonging to the Defendants No.1 and also deposited with the Applicant the Original title deeds in respect of immovable property being the office No. 125 situated on the 1st floor in Sai Commercial Centre, BKS Devashi Marg, Deonar, Govandi (E), Mumbai in favour of the Applicant. The Applicant has also recorded creation of the said equitable mortgage in memorandum of entry dt.08.10.2012.

8. It is also stated that on the same day i.e. 08.10.2012, the Defendant No. 4 also created the Mortgage by depositing the original title deeds in respect of the immovable property being the Flat No. 02 situated on the 2nd Floor of B wing Jimmy Prak-II, Plot No. 19, Sector 19-A, Nerul, Navi Mumbai in favour of the Applicant. The Applicant has also recorded creation of the said equitable mortgage in memorandum of entry dt.08.10.2012.

9. It is further stated that the in respect of the said mortgages the Defendant No. 2 & 4 have also executed the separate Declaration all dt.08.10.2012.

10. However, after availing the said Cash Credit Facility, the Defendants failed to adhere to the terms and conditions of the Sanction of aforesaid Credit Facility and neglected to make the payment to the Applicant bank. Therefore, the account was declared as NPA on 08.01.2014 and further the Applicant issued the Demand Notice dt.10.01.2014 called upon the Defendant to make the payment of the outstanding dues but the Defendants failed to pay the dues. Hence, the present OA has been filed.

11. Notices were issued to the Defendants. Defendant No. 1 to 4 put their appearance through counsel, however, no WS has been filled.

12. The Applicant Bank has produced all the Original Loan documents and other relevant documents along with their Claim Affidavit filed on 02.07.2015 through the Chief Manger Mr. Sharadkumar Balaji Rewatkar.

13. I have heard the Ld. Counsel for the Applicant Bank and perused the record.

14. The witness of the Applicant Bank has fully corroborated the averments made in the OA, even otherwise the whole case of the Applicant Bank is based on documents and the witness has duly proved all these documents as against the Defendants. In my view there is no question of disbelieving the evidence led by the Applicant Bank and the Applicant Bank has proved its case beyond reasonable doubt. The liability of Defendant No.1 to 4 are joint and several.

15. In the light of above discussions, the Original Application deserves to be allowed against the Defendant No. 1 to 4 are jointly and severally.

16. The Applicant claiming penal interest @2% p.a. in respect of Cash Credit facility however, the same is hereby decline.

O R D E R

(i) I allow the present OA and direct the Defendant No. 1 to 4 to pay to the Applicant Bank, jointly and severally, within a period of 60 days, a sum of Rs. 7,35,50,113/- (Rupees Seven

Crores Thirty Five Lakh Fifty Thousand One Hundred Thirteen Only) along with further interest at the rate of 12.90% p.a. from the date of filing of the present OA till its realization.

(ii) Failing which the aforesaid amount shall be recovered from the sale of Hypothecated/Mortgage assets and other personal moveable and immoveable assets of the Defendants.

(iii) Defendants is hereby directed not to deal with his properties till further direction of Ld. Recovery Officer.

(iv) Defendants shall also pay the cost and expenses of the OA.

(v) Recovery Certificate be issued forthwith and be sent to the Recovery Officer of this Tribunal. Copy of this order be sent to the parties as per rules. File be consigned to record.

Place: Mumbai.

(Dr. Rekha G. Dhakar) Date : 25.01.2024

Presiding Officer,

DRT-1, Mumbai