HDFC BANK vs REJI V on 4 January 2019

FINAL ORDER

The applicant bank has filed Original Application [for brevity referred as “OA”] on 25.08.2015 under Section 19(1) of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 for recovery of a sum of Rs.10,07,788.52/- with interest @ 12.50% per annum with monthly rests and overdue interest @ 2% per month from 10.07.2015 till realization from the defendants and by sale of their personal assets. BRIEF FACTS OF THE CASE

1. The applicant is a company incorporated under the companies Act 1956 and a banking company within the meaning of Banking Regulations Act,1949 engaged in the business of banking and is a bank as defined u/s.2(d) of the RDDBFI Act, 1993 having its registered office at Mumbai and one of its branches at Trivandrum. The applicant is represented by its Deputy Manager, Regional Office, S.L.Plaza, Palarivattom, Ernakulam -18 who is empowered to represent the applicant by way of Board Resolution dated 23.04.2015.

2. The defendants availed the loan on 29.09.2014 and have executed necessary loan documents. The present OA is filed on 25.08.2015 within the period limitation prescribed under Section 24 of the RDDBFI Act 1993.

3. It is the case of the applicant that 1st defendant is the borrower and the 2nd defendant is the co-borrower approached the applicant’s Trivandrum Branch and submitted an application dated 11.09.2014 for availing a credit facility of Rs.10 lakhs for purchase of Tata-model Truck (1109). After processing the application, the applicant bank sanctioned an amount of Rs.10 lakhs on 29.09.2014 inclusive of the processing charge, stamp duty etc., and disbursed an amount of Rs.9,98,600/- on 29.09.2014.

4. The defendants have availed the loan and executed demand promissory note and loan agreement on 29.09.2014. As per the loan agreement, defendants had agreed to repay the loan amount in 48 equated monthly installments of Rs.26,580/- along with interest of 12.50% fixed rate and the repayment was also started from 05.11.2014.

5. It is the further case of the applicant that defendants defaulted the monthly installments and all the cheques issued by them were returned dishonored. Accordingly, the applicant was forced to recall the loan account and issued loan recall/legal notice through its lawyer to the defendants. The notice issued to the 1st defendant was returned as “unclaimed” and the notice issued to the 2nd defendant was duly served on him. Insptie of said notice defendants have not repaid the dues. As on 09.07.2015 an amount of Rs.10,07,788.52 is due from the defendants. Hence, the applicant is constrained to file this OA for recovery of the said amount.

6. After filing of the OA, the applicant bank has taken out the summons as directed by the Tribunal and has filed the proof of service on 04.01.2016. Accordingly service of summons is completed as per the regulations. Inspite of service of summons, defendants neither appeared nor represented and they chose to remain absent and hence they were declared ex-parte on 14.06.2016.

7. The evidence on the side of the applicant bank consists of the proof affidavit of its Manager, AW1 and Exhibits A1 to A13 is marked on the side of applicant and closed their side of evidence.

8. During the pendency of the OA, applicant bank has filed IA.No.2373/2015 petition to appoint an Advocate Commissioner to take possession of the hypothecated vehicle. The Tribunal after hearing the IA, found there is a prima face case of the applicant allowed the IA by appointing an Advocate commissioner to take possession of the hypothecated vehicle. However, the applicant bank could not trace the vehicle as per the submission made by their counsel on 12.11.2015 and hence vehicle could not be taken possession.

9. Heard arguments of the applicant bank and perused the records of the case. The following points arise for my consideration:

(i) Whether the applicant is entitled for the reliefs prayed for in the OA?

(ii) What order?

My findings on the above points are as follows:- Point No.(i):

In affirmative

Point No.(ii):

As per final order.

Reasons:-

10. The evidence of the applicant bank by way of proof affidavit of its Manager AW1, reiterates the facts pleaded in the OA and the affidavit is corroborated by the above referred Exhibits A1 to A13 which clearly establishes the case of the applicant bank to allow the present OA. Added to this, absence of defendants, inspite of service summons appears to be intentional without any bonafide reasons and it appears that they did not contest the matter as they admitted the entire case of the applicant as sought for in the OA. Even otherwise, the whole case of the applicant bank is based on the documentary evidence and the witness has duly proved all the documents exhibited by him. It is quite evident from the documents placed on record by the applicant bank that defendants have availed the financial assistance from the applicant bank and have failed to repay the dues of the applicant bank.

11. Having regard to the amount advanced, the interest applied, the conduct and operations in the account and the default committed, I am of the view that the applicant bank is entitled to get a final order on the following lines:-

ORDER

12. The OA is allowed with costs.

(a) Defendants are jointly and severally directed to pay the applicant bank a sum of Rs.10,07,788.52 (Rupees Ten lakhs seven thousand seven hundred eight eight and paise fifty two only) due under the Light Commercial Vehicle loan Account No.29689565 and UCIC:92831999 together with future interest thereon at the rate of 12.50% per annum from 10.07.2015 till realization.

(b) In the event of failure of the defendants to pay the OA claim amount, the bank is at liberty to proceed against the personal assets of the defendants both movable and immovable as required under law.

(c) The applicant bank shall file memo of costs within ten days from the date of this final order.

(d) Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.

13. The Registry is directed to communicate copy of the order to the parties concerned by speed post or registered post with AD. [Dictated to the Steno, transcribed by him, corrected by me and then pronounced in the open court on this the 4th day of January, 2019]

(S.V.GOWRAMMA) Presiding Officer

A P P E N D I X Witness for Applicant: AW1: Shyam Menon, Manager of the applicant bank.

Witness for Defendants: Nil

Exhibits on the part of the applicant Ext.No.

Particulars of documents A1

: Loan application form submitted by the defendants dated 11.09.2014. A2

: Demand Promissory Note dated 29.09.2014 executed by the defendants in favour of the applicant. A3

: Loan agreement dated 29.09.2014 executed by the defendants. A4

: Loan recall/legal notice issued to the 1st defendant dated 11.07.2015. A5

: Loan recall/legal notice issued to the 2nd defendant dated 11.08.2015. A6

: Postal receipt of the notice issued to the 1st defendant. A7

: Postal receipt of the notice issued to the 2nd defendant. A8

: Return cover on the notice issued to 1st defendant. A9

: Acknowledgement card on the notice issued to the 2nd defendant. A10 : Certified copy of the statement of account for the period from 12.09.2014 to 10.07.2015 duly certified under Banker’s Books of Evidence Act. A11 : Certified copy of the Foreclosure statement dated 09.07.2015 duly certified under Banker’s Books of Evidence Act. A12 : Certificate under Section 2A of the under Banker’s Books of Evidence Act. A13 : Certificate under Section 2A(b) & (c) of Bankers Book Evidence Act. (not marked)

Defendants Exhibits – Nil

[PRESIDING OFFICER]

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

Dated this the 4th day of January, 2019

Present: S.V.Gowramma, B.A., LL.B Presiding Officer

Between HDFC LTD Bank Ltd. …Applicant And Reji

…Defendants & another

FINAL ORDER