CANARA BANK vs T.K SURESH KUMAR on 30 December 2019

FINAL ORDER

This Original Application is filed on 24.02.2014under Section 19(1) of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 for recovery of a sum of Rs.21,08,857/- due under the Housing Loan account with future interest @11.70% per annum with monthly rests plus 2% penal interest from the defendants jointly and severally and by sale of the OA Schedule property. BRIEF FACTS OF THE CASE

1. The applicant herein is a body corporate constituted under the banking companies (acquisition and transfer of undertaking) Act, 1980 having its head office at Bangalore and branches all over India including one Trivandrum Cantonment, Trivandrum District, Kerala State. The applicant is represented by its Manager and Principal Officer and Power of Attorney Holder of the Applicant, who is competent to verify and file this application for and on behalf of the Applicant.

2. The security documents were executed by the defendants on 09.03.2007 and the 1st defendant created mortgage of his property on 09.03.2007; Acknowledgement of liability executed by 1st defendant on 04.03.2011 and hence the OA filed on 24.02.2014 is within the period of limitation prescribed under S.24 of the Act. Since the amount due is more than Rs.10 lakhs and the cause of action wholly arose at Trivandrum Cantonment in Trivandrum District the OA is

maintainable and the Tribunal has jurisdiction to entertain the same.

3. According to the applicant bank, the 2nd defendant is wife of the 1st defendant. The defendants approached applicant bank for availing a housing loan of Rs.15,00,000/-, accordingly on, 09.03.2007, the bank sanctioned Rs.15,00,000/- (Rupees Fifteen lakhs only) upon accepting the terms and conditions of the loan agreement by the defendants dated 09.03.2007 whereby agreeing to repay the principal sum borrowed with interest @ 9.50% per annum and 2% overdue interest, in case of default in payment of installments, the 1st installment was agreed to be paid on or before 09.03.2008.

4. Thereafter, as security for the due repayment of the above financial assistance the 1st defendant created an equitable mortgage of his landed property on 08.03.2007, by depositing the title deed of property covered by Document No.3510/2006 dated 17.11.2006 of SRO, Karakulam along with Settlement Deed No.1801/1985 dated 28.10.1985 of SRO, Karakulam, and Release Deed No.1732/2006 dated 08.06.2006 of SRO, Karakulam with connected documents with the applicant bank, described as Schedule property to this application. The 1st defendant confirmed the deposit of title deed and creation of mortgage over the said property videLetter dated 09.03.2007.

5. It is submitted that the defendants constructed a residential building in the schedule property by utilizing the loan. Thereafter, the 1stdefendant had executed acknowledgement of

debt admitting the liability in the above said account dated 04.03.2011.

6. It is the case of the applicant that after availing the said loan, the defendants failed and violated the terms and conditions and did not properly repay the loan. Repeated requests made by the applicant bank to the defendants to clear the outstanding dues have gone in vain. Hence, applicant bank caused to issue notice dated 05.02.2014 recalling the facilities granted to the defendants and demanded payment of the amount. Even after the receipt of notice, no effort has been made by the defendants to settle the matter.

7. As per the statement of account as on 19.01.2014, a sum of Rs.20,85,007/- is outstanding in the housing loan account of the 1st defendant with interest charged upto19.01.2014. It is also submitted that applicant bank is entitled for interest accrued but not applied from 20.01.2014 to till date amounting to Rs.24,060/-. Further, a total sum of Rs.4,113/- is charged by way of Penal interest from 19.01.2014 to till date and capitalized the portion of penal interest amounting to Rs.4,323/-. Deducting the said amount of Rs.4,323/- (capitalization effect of penal interest), the defendants are liable for payment of Rs.21,08,857/- with interest and costs.

8. After filing of the OA, the applicant has taken out the summons on the defendants. However, no Vakalath, no written statement seen to be filed within stipulated time. Thereupon

when TA was taken on 19.09.2016, there was no appearance, no representation; hence defendants 1 & 2 placed exparte on the same date. Applicant Bank filed IA No.1207/2014, IA No.1170/2015 and IA No.1171/2015. IA No.1170/2015 petition to implead the 3rd defendant which stood allowed vide order dated 01.06.2017. Thereafter, When TA was taken on 29.06.2017, there was no representation for 3rd additional defendant nor 3rd additional defendant was represented hence placed exparte on the same date.

9. Subsequently, IA No.1171/2015 petition to carry out amendment in the schedule of OA as the report and sketch after inspecting property by the Advocate Commissioner disclosed that there is slight variation in the description of boundaries in the schedule of OA, hence IA was allowed vide order dated 19.08.2017 to carry out amendment in the OA within a week.

10. The Tribunal vide order dated 19.08.2017 in IA No.1207/2014 ordered conditional attachment of IA schedule property restrained defendants 1 and 2 from transferring or charging the attachment schedule property by way of sale, gift or assignment. Applicant bank filed PA on 24.09.2018 along with 15 documents.

11. The evidence on the side of the applicant bank consists of the proof affidavit of its Manager, AW1 and Exhibits A1 to A15 is marked on the side of applicant and closed their side of evidence.[

12. 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?

13. The claim put forth by the applicant bank in the OA was not refuted by the defendants despite sufficient opportunity granted and as such, the OA remained uncontested. The case of the applicant bank regarding recovery of the sum of Rs.21,08,857/- claimed as due under Ext.A13 statement of account relating to the Housing Loan account No.0819619016515 as on 24.02.2014 with interest pendent-lite and post decree interest on the sum of Rs.21,04,744/- from the defendants jointly and severally, and by sale of the scheduled property, is proved by the proof affidavit of AW1 and Exts.A1 to A15.

14. Having regard to the amount advanced, the interest applied and the default committed, I am of the view that the applicant bank is entitled to get interest pendente-lite and post- decree interest @11% per annum.

O R D E R

15. The OA is allowed with costs.

(a) The applicant bank is allowed to recover the sum of Rs.21,08,857/- (Rupees Twenty One Lakhs Eight

Thousand Eight Hundred and Fifty Seven only)due under the Housing Loan account with future interest on the sum of Rs.21,04,744/-(Rupees Twenty one lakhs four thousand seven hundred and forty four only) @ 11% per annum from 25.02.2014 till realization and also its costs from the defendants jointly and severally and by sale of Scheduled property.

(b) In the event of failure of the defendants to pay the aforesaid amount, the bank is at liberty to sell the assets of the defendants (both movable and immovable) and the sale proceeds be appropriated towards the OA claim amount as required under law.

(c) The applicant bank shall file the latest memo of calculation of OA amount together with interest costs etc., to be paid by the defendant duly considering the amounts if any paid by the defendant and or amount realised by sale of assets etc., during the intervening period after filing the OA enabling the office to prepare recovery certificate for the amount to be paid by defendants to the applicant bank.

(d) Scheduled property shall be appended to this final order.

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

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

16. 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 30th day of December, 2019]

(S.V.GOWRAMMA)

PRESIDING OFFICER

A P P E N D I X

Witness for Applicant: AW1: A Rajesh, Manager of Applicant Bank.

Witness for Defendants: Nil

Exhibits on the part of the applicant

Ext.No.

Particulars of documents A1

: Loan agreement dated 09.03.2007

A2

: Sale Deed No.3510 of 2006 dated 17.11.2006, SRO Karakulam A3

: Settlement Deed No.1801 of dated 28.10.1985 of SRO, Karakulam

A4

: Release Deed No.1732 of

dated 08.06.2006 of SRO, Karakulam

A5

: Encumbrance Certificate No.233/2007 dated 17.01.2007

A6

: Possession Certificate No.351/2007 dated 01.02.2007

A7

: Location Certificate No.351/2007 dated 02.01.2007

A8

: Location sketch No.351/2007 A9

: Land Tax receipt No.0096684 dated 11.01.2007 A10

: Letter evidencing deposit of title deed and creation of mortgage dated 09.03.2007

A11

: Acknowledgement of debt admitting the liability dated 04.03.2011

A12

: Notice dated 05.02.2014

A13

: Statement of Account relating to the Housing Loan facility of the defendants duly certified under Banker’s Book Evidence Act A14

: Power of attorney dated 30.07.2008

A15

: Power of attorney dated 24.02.2014

Defendants Exhibits – Nil

[PRESIDING OFFICER]

SCHEDULE

District

: Trivandrum

Sub District

: Karakulam

Taluk

: Nedumangadu

Farka

: Nedumangadu

Village

: Aruvikkara

Panchayath

: Aruvikkara

Re.Sy.No.

: 482/2, Block 40,

New Re-survey 333/12-3

Extent

: 2.02 ares (5 cents)

Description All that parts and parcel of land in various Re-Survey nos. 482/2, Block 40, New Re-survey 333/12-3 of Aruvikkara Village extending 2.02 ares(5 cents) as described in document no. 3510 of 2006 of SRO, Karakulam and other improvements including building therein.

Boundaries

North

: Pathway

South

: Property of Neelakandan Nair

West

: Property of Krishna Pillai

East

: Property of Neelakandan

PRESIDING OFFICER