Bank Of Baroda vs DATTU KUSHABA on 1 March 2019

1. Mr. Dattu Kushaba Gaikwad, Post : Jivhale, Tal : Niphad,Dist Nashik - 422302

2. Mr. Rajendra Dashrath Kalarnkar, Post : Mohadi, Tal : Dindori,Dist Nashik-422207

3. Mr. Parashram Dattu Gaikwad, Post : Jiwhale, Tal : Niphad, Dist Nashik-422302 ) ) ) Defendant No. 1 Defendant No. 2 Defendant No. 3 Present : Ms. Rekha Nair, Advocate, Counsel for Applicant Bank Defendants remained ex-parte This Original Application (OA) is filed by Applicant under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 ("RDDB Act") (since changed to "Recovery of Debts and Bankruptcy Act, 1993") against the Defendants for the recovery of a sum aggregating to Rs. 15,89,629/- (Rupees Fifteen lacs Eighty Nine thousand Six hundred and Twenty Nine only) in respect of the various credit facilities mentioned in the OA alongwith cost, charges, pendente lite future interest as stated therein from the date of filing of this OA till its realisation.

Parties : Applicant is a Bank within Sec. 2(d) of the RDDB Act and lender of credit facilities to Defendant No. 1. Defendant No. 2 and 3 provided additional security for the credit facilities availed by Defendant No. 1 from the Applicant by way of personal guarantee. Factual matrix :

1. (a) As per OA, Applicant provided to Defendant No. 1, credit facilities in the form of Term Loan (for Vehicle) of Rs. 2,90,000/- ("TL(V)"), Crop Loan of Rs. 1,50,000/- ("CL") and Agricultural Term Loan of Rs. 5,40,000/ - ("ATL")("TL(V)", "CL" and "ATL" are hereinafter collectively referred to as "Credit Facilities") based on the documentation and security creation by him and Defendant No. 2 and 3 providing additional security of joint and several personal guarantee. Credit Facilities were also secured by mortgage security in respect of Defendant No. l's agricultural land located in Post Jivhale, Taluk Niphad, District Nashik, by Defendant No. 1 executing Declaration under Sec. 5 of Maharashtra Provision of Facilities for Agricultural Credit by Bank Act, 1974 and getting the same registered with SRO, Dindori besides getting the Declaration registered in the 7 / 12 Register under Maharashtra Land Revenue Code, 1966.

(b) As per the OA, Defendant No. 1 failed and neglected to make payment of principal amount, interest and other monies in respect of the Credit Facilities as and when the same fell due. It is further averred that Defendant No. 1 also committed defaults in observance and performance of the terms and conditions of the Credit Facilities. Consequently, Applicant issued Recall Notice to the Defendants, calling upon them to repay the entire outstanding amount of the Credit Facilities. On the failure of the Defendants to repay, the OA has been filed.

2. (a)Tribunal, after satisfying itself of the OA being within limitation and falling within its territorial jurisdiction as per RDDB Act, ordered issue of Summons to Defendants.

(b) Transfer Notices to the Defendants were sent by Registered Post with Acknowledgement Due. As per the Download from Computerised Postal Articles Delivery Tracking System, the postal covers were delivered on the respective Defendants. Applicant filed Service Affidavit to that effect.

(c) As Defendants did not appear either in person or through advocate and file Written Statements, the Defendants were set ex-parte on 31/10/2018 by an Order of the Tribunal. Proceedings :

3. As directed by the Tribunal, Applicant filed, through Shri. Rahul M Girase, Manager, Claim Affidavit enclosing various Documents as Annexures (which have been taken on record by the Tribunal and marked as "Exhibits") and also filed Certified Statement of Account together with the Certificate issued under Information Technology Act, 2000 and Certificates under Bankers Books of Evidence Act, 1891, as Annexures (which are marked as Exhibit "23" & "28"). Of the Documents filed as Exhibits and gone through by the Tribunal, the following are found relevant for the Tribunal to consider and dispose of the OA on merit. S. No. Facility Document Exhibit

1. Term Loan (Vehi.) Rs. 2,90,000/-) Loan Proposal and Branch Manager's Report (Office Copy) "12"

Demand Promissory Note (Original) "13"

Hypothecation Agreement (Original) "14"

Personal Guarantee of Def 3 & 2 (Original) "15"

2. Crop Loan Loan Proposal and Branch Manager's "17" (Rs. 1,50,000/-) Report (Office Copy)

3. Agri. Term Loan D P Note for ATL (Original) "18"

(Rs. 5,40,000/-) D P Note for CL (Original) "19"

Hypothecation Agreement (Original) "20"

Personal Guarantee of Def 3 & 2 "21"

(Original)

4. Common for all Mortgage by way of Declaration by "16" Credit Facilities Def 1 and Regd with SRO, Niphad (Original) with 7/12 Extract Recall Notice (Office' Copy) "22" Observation on Evidences provided& Claim made

4. The Statement of Account filed by the Applicant, certified as per Bankers Books of Evidence Act, 1891, tallied with claim in OA. Further, the case of the Applicant is based on various Documents (including the above referred Exhibits) filed alongwith Claim Affidavit, which is a sworn Statement, which has gone unchallenged. In my view, there is no question of disbelieving the Exhibits and Claim Affidavit and other evidences let in by the Applicant and the Applicant has proved its case beyond reasonable doubt to the extent of sanctioning the Credit Facilities, completing Documentation and disbursement of the Credit Facilities.

5. The Applicant has claimed interest at the rate of 13.75% p.a. with yearly rests for all the facilities from the date of filing of the OA till its realisation. Having regards to Sec. 19(20) of the RDDB Act (which is analogous to Sec. 34 of Civil Procedure Code, 1908) the contract between the Applicant and Defendants comes to an end on the filing of the OA. Thus the Tribunal has discretion in awarding pendente lite and future interest. Considering the rate of interest charged by banks for similar facilities, I am of the opinion that interest of justice will be served if the rate interest is awarded at the rate of 12.00% p.a. on simple interest basis for all the facilities.

6. In the light of above discussions, the Original Application is being allowed and Order passed on the following terms.

ORDER

(i) This Original Application is allowed with costs and decree to be issued on the terms set out below;

(ii) There shall be a Decree in favour of the Applicant as under - (a) For Rs. 79,732/- (Rupees Seventy Nine thousand and Seven hundred and Thirty Two only) alongwith future interest at the rate of 12.00% per annum (on simple interest basiS) from the date of filing of the Original Application till the date of realisation in respect of Term Loan (Vehicle) ("Decreed Amount for TL(V)");

(b) For Rs. 2,36,024/- (Rupees Two lacs Thirty Six thousand and Twenty Four only) alongwith future interest at the rate of 12.00% per annum (on simple interest basis) from the date of filing of the Original Application till the date of realisation in respect of Crop Loan ("Decreed Amount for CL");

(c) For Rs. 12,73,874- (Rupees Twelve lacs Seventy Three thousand Eight hundred and Seventy Two only) alongwith future interest at the rate of 12.60% per annum (on simple interest basis) from the date of filing of the Original Application till the date of realisation in respect of Agricultural Term Loan ("Decreed Amount for ATL");

(iii) Defendant No. 1, the Borrower, Defendant No. 2 and 3, the Guarantors, are ordered to pay, jointly and severally, to the Applicant, within a period of 30 days, the Decreed Amount for TL(V) and, in the event of the said Defendants failing to pay and discharge the dues as directed or in the event of shortfall, the assets forming security for the Term Loan (Vehicle) (covered by Exh "14" being the moveable assets charged & Exh "16" being the immoveable properties mortgaged) be attached / taken possession of and be sold to the extent of realising the dues / shortfall, as the case may be, and in the event of further shortfall, the said Defendants be proceeded against personally by way of personal decree and business assets / personal assets / estates of Defendant No. 1 and personal assets / estates of Defendant No. 2 and 3 be attached and sold for realising the dues / shortfall, as the case may be;

(iv) Defendant No. 1, the Borrower, Defendant No. 2 and 3, the Guarantors, are ordered to pay, jointly and severally, to the Applicant, within a period of 30 days, the Decreed Amount for CL and, in the event of the said Defendants failing to pay and discharge the dues as directed or in the event of shortfall, the assets forming security for the Crop Loan, (covered by Exh "20" being the moveable assets charged & Exh "16" being the immoveable properties mortgaged) be attached / taken possession of and be sold to the extent of realising the dues / shortfall, as the case may be, and in the event of further shortfall, the said Defendants be proceeded against personally by way of personal decree, and business assets / personal assets / estates of Defendant No. 1 and personal assets / estates of Defendant No. 2 and 3 be attached and sold for realising the dues / shortfall, as the case may be;

(v) Defendant No. 1, the Borrower, Defendant No. 2 and 3, the Guarantors, are ordered to pay, jointly and severally, to the Applicant, within a period of 30 days, the Decreed Amount for ATL and, in the event of the said Defendants failing to pay and discharge the dues as directed or in the event of shortfall, the assets forming security for the Agricultural Term Loan (covered by Exh "20" being the moveable assets charged & Exh "16" being the immoveable properties mortgaged) be attached / taken possession of and be sold to the extent of realising the dues / shortfall, as the case may be, and in the event of further shortfall, the said Defendants be proceeded against personally by way

of personal decree and business assets / personal assets / estates of Defendant No. 1 and personal assets / estates of Defendant No. 2 and 3 be attached and sold for realising the dues / shortfall, as the case may be;

(vi) Based on the Original Documents placed before this Tribunal, supported by the pleadings, it is Declared that there is a valid, subsisting and enforceable mortgage over the immoveable properties described in Exh "16" in favour of the Applicant validly securing the Term Loan (Vehicle)'Crop Loan and Agricultural Term Loan;

(vii) Based on the Original Documents placed before this Tribunal, supported by the pleadings, it is Declared that there is a valid, subsisting and enforceable joint and several personal guarantee of Defendant No. 2 and 3 being Exh "16" and Exh "21" in favour of the Applicant validly securing the Term Loan (Vehicle), Crop Loan and Agricultural Term Loan;

(viii) Defendant No. 1 to 3 are directed to declare, on oath, to the Recovery Officer, Debts Recovery Tribunal - III, Mumbai, both moveable and immoveable assets of theirs as also Defendant No. 1 is directed to declare, on oath, both moveable and immoveable assets of the business carried on by him for the purpose of attachment and sale as directed under Clause (iii) and / or Clause (iv) and / or Clause (v) above;

(ix) Defendant No. 1 to 3 are injuncted from dealing with the assets described in Exh "14" and Exh "20" as also assets declared on oath as per Clause (viii) above in any manner whatsoever till the complete recovery of Decreed Amounts under Clause (ii) above;

(x) Recovery Certificates be issued forthwith as per above decrees and sent to the Recovery Officer, Debts Recovery Tribunal - III, Mumbai;

(xi) Parties are directed to appear before the Recovery Officer, Debts Recovery Tribunal - III, Mumbai;

(xii) Copies of final order be sent to all concerned free of cost and File be consigned to records. T S Asokra Presiding Officer, Debts Recoveiy Tribunal - Mumbai. (Pronounced in open Court) Dated : 1st March 2019