INDIAN OVERSEAS BANK vs ABDUL RAHIM on 14 June 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 a sum of Rs.14,46,582/- with further interest thereon @14.40% per annum with half yearly rests from the defendant with effect from 22.09.2015 till realization 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 a loan for purchase of land for agricultural purpose. Accordingly, the applicant sanctioned a term loan of Rs.10 lakhs to the defendant as per credit sanction advice dated 11.08.2012 under Bhoomi Lakshmi Scheme. The defendant had executed security documents on 17.08.2012. The aforesaid facility was secured by hypothecation of standing crop and future crops in 7.30 Ares of land in Re.Sy.No.359/5-2 of Palamel Village, Mavelikara Taluk and further by collaterally secured of immoveable property by deposit of title deeds in respect of an extent of 7.30 Ares in Re- Sy.No.359/5-2 of Palamel Village, Mavelikara Taluk covered under sale deed No.1914/2012 belonging to the defendant. The original of the aforesaid sale deed was deposited with the applicant bank on 08.04.2013 and the defendant executed a confirmation letter dated 09.04.2013.

2. It is submitted by the applicant that the defendant had executed revival letter dated 27.11.2014 acknowledging the liability under the term loan account. Despite the undertaking made by the defendant that he would make repayment towards the loan promptly and regularly, he failed to do so. Consequently, the account was classified as NPA on 30.06.2015. The applicant through its Advocate issued a notice dated 28.01.2015 to the defendant demanding payment of the entire amount outstanding due under the loan account. Despite receipt of the notice, the defendant failed to remit the amount. It is stated that as per the statement of account maintained by the bank, they are entitled to recover a sum of Rs.14,46,582/- under the subject loan account.

3. The defendant is duly served with summons. But he neither appeared nor was he represented and thus the defendant was set exparte on 27.03.2017.

4. The evidence on the side of the applicant bank consists of the proof affidavit of its Senior Manager, AW1 and Exts.A1 to A11.

5. 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 the affirmative

Point No.(ii):

As per final order.

Reasons:-

6. The evidence of applicant bank is adduced by its Senior Manager AW1. The affidavit by way of evidence reiterates the facts pleaded in the OA and the affidavit is corroborated by the above referred Exhibits A1 to A11 which clearly establishes the case of the applicant bank to allow the present OA. Added to this, the absence of defendant in spite of service appears to be intentional without any bonafide reasons and it appears that he remained absent as he admitted the entire case of the applicant as sought for in the present OA. In view of the above, the present OA is to be allowed with cost as sought by the applicant bank.

ORDER

(a) The OA is allowed with costs. The defendant is directed to pay a sum of Rs.14,46,582/- (Rupees fourteen lakhs forty six thousand five hundred and eight two only) with further interest on the sum of Rs.14,40,183/- (Rupees fourteen lakhs forty thousand one hundred and eight three only) @12.40% per annum with half yearly rests plus penal interest @2% per annum from 22.09.2015 to 27.09.2015 and thereafter @12.40% per annum with half yearly rests from 28.09.2015 till realization and also its costs from the defendant; (b) In the event of failure of the defendant to pay the OA claim amount, the bank is at liberty to sell the OA ‘A’ and ‘B’ schedule properties of the defendant and the sale proceeds be appropriated towards the OA claim amount as required under law;

(c) In the event of non-realization of the OA claim amount despite the sale of the mortgaged properties referred above, the bank is at liberty to proceed against the person and other properties of the defendant, as required under law; (d) Schedule ‘A’ and ‘B’ properties shown in the OA shall become part and parcel of the final order of the OA and Recovery Certificate of present OA; (e) The applicant bank shall file memo of costs within seven 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.

7. 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 14th day of June, 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 17.08.2012 Demand promissory notice for Rs.10 lakhs executed by the defendant in favour of the applicant bank. A3 17.08.2012 Letter executed by the defendant in favour of the applicant bank. A4 17.08.2012 Letter of undertaking of installments executed by the defendant in favour of the applicant bank. A5 17.08.2012 Letter of authorization executed by the defendant in favour of the applicant bank. A6

17.08.2012 Letter of hypothecation (agricultural advances) executed by the defendant in favour of the applicant bank. A7

17.08.2012 Sale deed No.1914/2012 of Nooranad SRO. A8

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

27.11.2014 Revival letter executed by the defendant acknowledging the liability under the term loan account. A10 28.01.2015 Copy of lawyer notice issued to the defendant calling upon him to pay the amount due. A10(a)

Acknowledgment card signed by the defendant evidencing the receipt of Ext.A10 lawyer notice. A11 … Certified copy of the statement of account relating to the term loan.

Defendant’s Exhibits – Nil

(PRESIDING OFFICER)

DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

Dated this the 14th day of June, 2017

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

Between Indian Overseas Bank

…Applicant Pandalam Branch. And Abdul Rahim …Defendant

FINAL ORDER