HDFC BANK vs JAMES K V on 22 August 2017

FINAL ORDER

The applicant bank has filed Original Application [OA] on 18.11.2015 under Section 19(1) of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 for recovery of a sum of Rs.10,38,319.44 with future interest @ 18% with monthly rests from the date of the application till realization and application costs from the defendants jointly and severally or by sale of properties owned 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 and even though the agreement is executed at Thrissur and the account was being operated by the respondent through Thrissur branch. The Business Division at S.L.Plaza being the Regional Office is competent to represent the bank for recovery of the amount being its regional office. The Manager (Legal) 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 being the principal borrower and 2nd defendant being the co-borrower had applied for a commercial vehicle loan of Rs.19,51,000/- for the purchase of Ashok Leyland Passenger 4/185 Bus Chasis. Since the defendants were found to be eligible for the loan, the applicant had sanctioned the same after executing loan agreement on 25.02.2013. As per the agreement the defendants agreed to pay back the amount in 48 equal monthly installments of Rs.51,390/- payable on 5th of every month commencing from 05.04.2013 and having the last pay by date on 05.03.2017. The EMI and tenure were arrived at by calculating interest at the rate of 12.01% per annum. In addition to the above, defendants had created security interest by way of hypothecation over the vehicle and also executed a demand promissory note in favour of the applicant on 25.02.2013.

3. It is stated by the applicant that the defendants did not adhere to the terms and conditions of the sanction and started defaults from payment of 2nd instalments onwards payable on 08.04.2013. Thereafter defendants had committed chronic and will defaults. The applicant’s officials on many times approached the defendants and requested them to regularize the account. Initially the defendants agreed to regularise the account, but they failed to do so. As the repeated demands did not yield any result, the applicant on 30.09.2015 issued lawyer notice calling upon the defendants to clear the entire liability. Even after the issuance of lawyer notice the defendant failed to pay the outstanding amount. As per the statement of account maintained with the applicant bank, an amount of Rs.10.38,319.44 is due from the defendant as on 28.10.2015.

4. The applicant bank has taken out the summons as directed by the Tribunal and has filed the proof of service on 16.12.2015. Summons issued to the defendants were duly served on them. But the defendants never appeared nor were represented and thus they declared exparte on 08.03.2016.

5. Along with the Original Application, the applicant bank filed IA.No.2944/2015 seeking attachment of the vehicle scheduled therein belonging to the defendants. The Tribunal on being found that there is a prima facie case in favour of the applicant bank had passed attachment in respect of the attachment schedule vehicle on 08.03.2016. But the Advocate Commissioner could not execute the order passed in IA.No.2944/2015 as the vehicle was not traceable.

6. The evidence on the side of the applicant bank consists of the proof affidavit of its Manager (Legal), AW1 and Exhibits A1 to A5 were marked on the side of applicant.

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?

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

In the affirmative

Point No.(ii):

As per final order.

Reasons:-

8. The evidence of the applicant bank by way of proof affidavit its Manager (Legal) AW1, reiterates the facts pleaded in the OA and the affidavit is corroborated by the above referred Exhibits A1 to A5 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. In view of the above the present OA is to be allowed with costs as sought by the applicant bank.

9. 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 are directed to pay a sum of Rs.10.38,319.44 (Rupees Ten lakhs thirty eight thousand three hundred nineteen and fourty four paise only) with future @ 12.01% per annum with monthly rests from 13.11.2015 till realization and also its costs from the defendants personally and by sale of vehicle attached under IA.No.2944/2015;

(c) in the event of failure of the defendants to pay the OA claim amount, the bank is at liberty to sell the vehicle attached under IA.No.2944/2015 belonging to the defendants 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, in spite of sale of the vehicle attached under IA.No.2944/2015, the bank is at liberty to proceed against the person and other properties of the defendants as required under law.

(e) vehicle attached under IA.No.2944/2015 shall become part and parcel of the final order of the OA and Recovery Certificate of present OA.

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

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

10. 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 22nd day of August, 2017]

(S.V.GOWRAMMA) Presiding Officer

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

Witness for Defendant(s): Nil

Exhibits on the part of the applicant

Ext.No. Date Particulars of documents

A1 24.01.2013 The commercial vehicle loan application submitted by the defendants. A2 25.02.2013 Loan agreement executed by the defendants along with the schedule showing tenure and mode of repayment. A3 25.02.2013 Demand Promissory Note for an amount of 19,51,000/- executed by the defendants in favour of the applicant bank A4 30.09.2015 Lawyer notice issued by the applicant to the defendants. A5

Statement of accounts of loan transaction of loan account No.3457905 from 25.02.2013 to 28.10.2015

Defendants’ Exhibits – Nil

(PRESIDING OFFICER)

ATTACHMENT SCHEDULE

AL4/185 Bus Chassis bearing Registration No.KL-08 BA 4343 Chassis No.MB1PBEYC3DPBG 6182 and Engine No.DBPZ 102115 being parked at the premises of the respondent at Kuruthukulangara (H), Parappur, Parappanangadi, Kerala-680 552. (Regional Transport Office, Civil Station, Ayyanthole, Thrissur-680 101).

(PRESIDING OFFICER)

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

Dated this the 22nd day of August, 2017

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

Between HDFC Bank Ltd. …Applicant And James K.V & another. …Defendants

FINAL ORDER