HDFC BANK vs BYJU MATHEW MATHEW on 16 September 2017

FINAL ORDER

The applicant bank has filed Original Application [OA] on 13.04.2016 under Section 19(1) of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 for recovery of a sum of Rs.54,99,959/- with future interest @ 18% with monthly rests from the date of the application till realization and application costs from the defendants jointly and severally and by sale of properties owned by defendants.

BRIEF FACTS OF THE CASE

1. The applicant is Banking Company within the meaning of Banking Regulation Act Constituted under the Companies Act, and having its registered office at Senapati Bapat Marg Lower Parel, (West) Mumbai- 400013. The loan agreement is executed at Kottayam, the account was being operated by the defendants through Pathanamthitta branch. The Agricultural Banking Division at Choice Tower being the Regional Office is competent to represent the bank for recovery of the amount. The Manager Retail Agricultural Recovery is authorized and competent to verify the application and represent the bank and to file this application.

2. It is the case of the applicant that the 1st defendant is a businessman and an agriculturalist by profession had approached the applicant bank requesting for a Retail Agricultural Loan for the purpose of conducting agricultural activities. The applicant had sanctioned a Cash Credit facility for Rs.50,00,000/- vide sanction letter dated 24.04.2015. The 2nd defendant stood as guarantor to the loan availed by the 1st defendant. As security to the said loan the 1st defendant has created a mortgage on 24.04.2015 by way of deposit of title deed pertaining to the property having an extent of 27.92 Ares of land comprised in Sy.No.116 of Kumily Village described in schedule to the OA. After creation of mortgage by deposit of title deeds, the defendant had on 27.04.2015 executed memorandum recording past transaction of creation of mortgage by deposit of title deeds. The credit facility is further secured by the guarantee of the 2nd defendant and the 1st and 2nd defendants has executed an agreement for over draft/cash credit cum guarantee cum

hypothecation on 27.04.2015 and a demand promissory note in favour of the applicant.

3. It is stated by the applicant that the defendants did not adhere to the terms and conditions of the sanction and has committed defaults. The applicant’s officials requested the defendants to regularize the account. As the repeated demands did not yield any result, the applicant issued a demand notice calling upon the defendants to clear the entire liability. Even after the issuance of demand notice, the defendants failed to pay the outstanding amount. As per the statement of account maintained with the applicant bank, an amount of Rs.54,99,959/- is due from the defendants as on 31.03.2016.

4. After filing of the OA, the applicant bank has taken out summon as directed by the Tribunal and has filed the proof of service on 03.10.2016. The summons issued to the defendants was duly served on them and service of summons was completed as per the regulations. Inspite of receipts of summons, the defendants neither appeared nor were they represented and they chose to remain absent and hence they were declared ex-parte on 20.02.2017.

5. The evidence on the side of the applicant bank consists of the proof affidavit of its Manager (Legal), AW1 and Exhibits A1 to A6 are marked on the side of applicant and closed their side of evidence.

6. 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:-

7. The evidence of the applicant bank by way of proof affidavit of its Manager (Legal) AW1, reiterates the facts pleaded in the OA and the affidavit is corroborated by the above referred Exhibits A1 to A6 which clearly establishes the case of the applicant bank to allow the present OA. Added to this, the absence of defendants in spite of service of summons appears to be intentional without any bonafide reasons and it appears that they remained absent as they admitted the entire case of the applicant as sought for in the present OA.

8. In view of the above, the present OA is to be allowed with costs as sought by the applicant bank. 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:-

O R D E R

(a) The OA is allowed with costs.

(b) The defendants jointly and severally are directed pay the applicant a sum of Rs.54,99,959/- (Rupees Fifty four lakhs ninety nine thousand nine hundred fifty nine only) with future interest @ 11.50% per annum with monthly rests from

11.04.2016 till realization and also its costs from the defendants personally.

(c) In the event of failure of the defendants to pay the OA claim amount, the bank is at liberty to sell the OA schedule immovable property of the 1st defendant and the sale proceeds be appropriated towards the OA claim amount as required under law; (d) In the event of non-realization of the OA claim amount, the bank is at liberty to proceed against the person and other properties of the defendants as required under law.

(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.

9. 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 16th day of September, 2017]

(S.V.GOWRAMMA) Presiding Officer

A P P E N D I X Witness for Applicant: AW1: John P.Mathew, Manager (Legal) of the applicant bank.

Witness for Defendants: Nil

Exhibits on the part of the applicant

Ext.No. Date Particulars of documents

A1 24.04.2015 Sanction letter issued by the applicant to the 1st defendant setting out the terms of repayment. A2 27.04.2015 Memorandum Recording Past Transactions of Creation of Mortgage by Delivery of Title Deeds executed by the 1st defendant. A3 27.04.2015 Agreement for Over Draft/Cash Credit cum Guarantee cum Hypothecation executed by the defendants in favour of the applicant. A4 27.04.2015 Authorization/Declaration and Undertaking and Affidavit submitted by the 1st defendant. A5 08.11.2013 Sale Deed No.3283/2013 of SRO, Peerumedu. A6

Statement of accounts of loan account No.50200011398179 from 28.04.2015 to 31.03.2016 duly certified under the Bankers Book Evidence Act. Defendants’ Exhibits – Nil

(PRESIDING OFFICER)

SCHEDULE

District

: Idukki

Sub District : Peerumedu

Taluk

: Peerumedu

Village

: Kumily

Kara

: Chenkara

Panchayath : Kumily

Inam

: Pandaravaka Dry Land

Old Sy.No. :

Extent

: 27 Ares 92 Square meter DESCRIPTION OF PROPERTY

All the pieces and parcel of land having an extent of 27 Ares 92 cents of property comprised under Old Survey No.116 of Kumily Village through dated 08.11.2013 from M.K.Joy of SRO Peerumedu together with buildings, improvements thereon and all earnest attached thereto. BOUNDARIES

East : Land owned by Sajeev, Abdul Azeez and Road.

South : Chenkara Anavilasam Road.

West : Chenkara Estate

North : Land of M/s.Blue Rose Agro Plantation Pvt. Ltd.

(PRESIDING OFFICER)

IN THE DEBTS RECOVERY TRIBUNAL-II, KERALA AT ERNAKULAM

Dated this the 16th day of September, 2017

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

Between HDFC Bank Ltd. …Applicant And Byju Mathew Mathew & another

…Defendants

FINAL ORDER