INDIAN OVERSEAS BANK vs SHAJAHAN S on 29 May 2017

FINAL ORDER

This Original Application has been filed under Section 19(1) of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 for recovery of an aggregate sum of Rs.18,17,355/- with further interest @12.40% per annum with half yearly rests on the sum of Rs.14,46,445/- and @10.40% per annum with monthly rests on the sum of Rs.3,70,910/- from the defendant and by sale of ‘A’ and ‘B’ schedule properties.

BRIEF FACTS OF THE CASE

1. The defendant had approached the applicant bank in August, 2012 seeking to avail an agricultural loan for purchase of land for agricultural purpose. Accordingly, the applicant sanctioned a term loan of Rs.10 lakhs to the defendant on 11.08.2012 under Bhoomi Lakshmi Scheme. As security for the loan, the defendant executed demand promissory notice for Rs.10 lakhs on 16.08.2012, letter dated 16.08.2012, letter of undertaking regarding repayment of installments, letter dated 16.08.2012 authorizing the applicant to recover the loan amount under Kerala Revenue Recovery Act and letter of hypothecation hypothecating the items set out in ‘A’ schedule to the OA.

2. The aforesaid facility was collaterally secured by creation of equitable mortgage by deposit of title deed in respect of 8.26 Ares of land in Palamel Village, Mavelikkara Taluk and original of sale deed No.1907/2012 of Nooranad SRO was deposited with the applicant bank by the defendant on 08.04.2013 and a letter confirming the deposit of title deed was executed on 09.04.2013.

3. The defendant availed another term loan of Rs.6 lakhs for purchase of vehicle (Swift car) as per credit sanction advice dated 03.01.2013 and the terms and conditions of the loan were acknowledged by the defendant. The aforesaid term loan was secured by executing security documents viz., demand promissory notice dated 03.01.2013, term loan agreement, letter of hypothecation hypothecating the vehicle purchased by utilizing the loan sanctioned by the applicant which is shown as item No.2 in ‘A’ schedule, letter of undertaking dated 03.01.2013 and letter of authorization dated 03.01.2013. The defendant executed revival letter dated 10.12.2014 acknowledging the liability under the loan accounts.

4. It is the case of the applicant that the applicant sent a lawyer notice dated 28.01.2015 calling upon the defendant to repay the entire amount outstanding under the agricultural term loan. Despite the receipt of notice, the defendant failed to repay the dues. On account of the default committed, agricultural term loan and vehicle loan were classified as NPA respectively on 30.06.2015 and 01.04.2015. It is stated that as per the statement of account maintained by the applicant bank, they are entitled to recover the sum of Rs.14,46,445/- under the agricultural term loan account and Rs.3,70,910/- under the vehicle loan account.

5. The defendant was duly served with summons. Though the defendant had entered appearance and sought adjournment for filing written statement, he did not file any written statement despite sufficient opportunity granted.

6. The evidence on the side of the applicant bank consists of the proof affidavit of its Senior Manager, AW1 and Exts.A1 to A19.

7. 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?

Findings:

Point No.1: In affirmative Point No.2: As per order

Reasons:

8. The case of the applicant bank regarding recovery of the sum of Rs.14,46,445/- claimed as due under Ext.A18 statement of account relating to the agricultural term loan as on 21.09.2015 with interest pendente lite and post decree interest on the sum of Rs.14,40,155/- (after deducting the penal interest portion - Rs.6,290/- ) from the defendant and by sale of item No.1 in ‘A’ schedule and ‘B’ schedule properties and the sum of Rs.3,70,910/- claimed as due under Ext.A19 statement of account relating to the term loan (vehicle) as on 21.09.2015 with interest pendente lite and post decree interest on the sum of Rs.3,70,359/- (after deducting the penal interest portion

- Rs.551/-) from the defendant and by sale of item No.2 in ‘A’ schedule property, is proved by the proof affidavit of its Senior Manager, AW1 and the documents produced along with it which are marked as Exts.A1 to A19.

9. Having regard to the amounts advanced, the interest and penal interest applied and the chronic default committed, I am of the view that the applicant bank is entitled to get interest pendente-lite and post-decree interest @12.40% per annum with half yearly rests on the agricultural term loan and @10.40% per annum with monthly rests on the term loan (vehicle), as prayed for.

ORDER

10. The OA is allowed with costs. The applicant bank is allowed to recover:-

(i) the sum of Rs.14,46,445/- (Rupees fourteen lakhs forty six thousand four hundred and forty five only) due under the agricultural term loan account with further interest on the sum of Rs.14,40,155/- (Rupees fourteen lakhs forty thousand one hundred and fifty five only) @12.40% per annum with half yearly rests from 22.09.2015 till realisation from the defendant and by sale of item No.1 in ‘A’ schedule and ‘B’ schedule properties;

(ii) the sum of Rs.3,70,910/- (Rupees three lakhs seventy thousand nine hundred and ten only) due under the term loan (vehicle) account with further interest on the sum of Rs.3,70,359/- (Rupees three lakhs seventy thousand three hundred fifty nine only) @10.40% per annum with monthly rests from 22.09.2015 till realisation from the defendant and by sale of item No.2 in ‘A’ schedule property; and

(iii) also its costs from the defendant and by sale of ‘A’ and ‘B’ schedule properties.

11. ‘A’ and ‘B’ schedules to the OA shall be appended to this order.

12. The applicant bank shall file memo of costs within seven days from the date of this final order.

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

11. 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 PS, transcribed by her, corrected by me and then pronounced in the open court on this the 29th day of May, 2017]

(S.V.GOWRAMMA)

Presiding Officer

A P P E N D I X

Witness for Applicant: AW1: George Thomas, Senior Manager of the applicant bank.

Witness for Defendant(s): Nil

Exhibits on the part of the applicant

Ext.No. Date Particulars of documents

A1 11.08.2012 Credit sanction advice issued by the applicant sanctioning agricultural term loan of Rs.10 lakhs to the defendant. A2 16.08.2012 Demand promissory notice for Rs.10 lakhs executed by the defendant in favour of the applicant bank. A3 16.08.2012 Letter executed by the defendant in favour of the applicant bank. A4 16.08.2012 Letter of undertaking executed by the defendant in favour of the applicant bank. A5 16.08.2012 Authorization letter executed by the defendant in favour of the applicant bank. A6

16.08.2012 Letter of hypothecation (agricultural advance) executed by the defendant in favour of the applicant bank. A7

17.08.2012 Sale deed No.1907/2012 of Nooranad SRO. A8

09.04.2013 Letter executed by the defendant confirming the deposit of title deed with the applicant bank. A9

03.01.2013 Credit sanction advice sanctioning a term loan of Rs.6 lakhs to the applicant for purchase of vehicle. A10 03.01.2013 Demand promissory notice for Rs.6 lakhs executed by the defendant in favour of the applicant bank. A11 03.01.2013 Letter executed by the defendant for collecting the principal and interest in EMIs. A12 03.01.2013 Letter of hypothecation executed by the defendant in favour of the applicant bank. A13 20.05.2013 Printout obtained from the website of Motor Vehicles Department showing the details of vehicle and the hypothecation noted in favour of applicant. A14 03.01.2013 Letter of undertaking executed by the defendant in favour of the applicant bank. A15 03.01.2013 Letter of authorization executed by the defendant in favour of the applicant bank. A16 10.12.2014 Revival letter executed by the defendant acknowledging the liability under the loan accounts. A17 28.01.2015 Copy of lawyer notice issued to the defendant by the applicant calling upon him to pay the amount due under the agricultural term loan account. A17(a) 30.01.2015 Postal acknowledgment signed by the defendant evidencing the receipt of Ext.A17 lawyer notice. A18 … Certified copy of the statement of account relating to the agricultural term loan. A19 … Certified copy of the statement of account relating to the term loan (vehicle loan).

Defendant’s Exhibits – Nil

(PRESIDING OFFICER)

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

Dated this the 29th day of May, 2017

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

T.A No.30/2016 (O.A No.457/2015) Between Indian Overseas Bank

…Applicant And Shajahan.S …Defendant

FINAL ORDER