BANK OF BARODA vs DEEPAK DHARMAPALAN on 16 September 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.38,67,636.55/- (Rupees Thirty Eight Lakhs Sixty Seven Thousand Six Hundred Thirty Six and paise Fifty Five only) from the defendant with interest @ 14.05% p.a with monthly rests from 01.12.2015 till realization and for other connected reliefs.

2TA.No.114/2016 (O.A.No.610/2015)**BRIEF FACTS OF THE CASE**

1. The Applicant is a banking company incorporated under the Banking Companies (Acquisition of Transfer of Undertakings) Act 1980, having its head office at M.G.Road, Bangalore and having one of its branches at Edathiruthy, Thrichur. The applicant is represented by its Principal Officer and Branch Manager, Edathiruthy Branch. He is entitled to sign and verify this application and represent the bank in the proceedings.

2. It is the case of the applicant that the defendant had approached the applicant for a cash credit loan of Rs.40,00,000/-, which was sanctioned as per vide sanctioned letter dated 06.09.2013. As per the terms of sanction and as per the agreements/documents executed by the defendant in favour of the applicant, the above cash credit loan amount of Rs.40,00,000/- was to be repaid with agreed interest rate @ 14.05% p.a (floating). In addition to the above, defendant had executed an Agreement for Demand Cash Credit against Hypothecation of Stocks and Book Debts dated 06.09.2013, Hypothecation Agreement dated 06.09.2013, Letter of Repayment dated 06.09.2013, Demand Promissory Note dated 06.09.2013 and Article Agreement dated 06.03.2013.

3. After availing the cash credit facility, the defendant did not adhere to the terms and conditions of the sanction and the repayment fell overdue. The defendant had confirmed the balance in the loan account and acknowledged the liability of an amount of Rs.39,10,781.55/- as on 30.06.2015. As the defendant did not take any steps to clear the debt, the applicant bank issued a demand notice dated

17.07.2015 calling up on him to clear the entire debt. The applicant had further issued a registered lawyer notice dated 12.08.2015 which was returned with endorsement 'unclaimed'. As per the statements of accounts maintained by the applicant bank, an amount of Rs.38,67,636.55 is due from the defendant under the Cash Credit loan account No.209006211000001. Hence the applicant is constrained to file the present OA.

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 02.02.2016. The summons issued to the defendant was duly served on him and service of summons was completed as per the regulations. Inspite of receipts of summon, the defendant neither appeared nor was he represented and he chose to remain absent and hence he was declared ex-parte on 30.08.2016.

5. The evidence on the side of the applicant bank consists of the proof affidavit of its Branch Manager, AW1 and Exhibit A1 to A13 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?***

Findings:

**Point No.1: In affirmative**

**Point No.2: As per order**

**Reasons:-**

7. The case of the applicant bank regarding recovery of the sum of Rs.38,67,636.55/- claimed as due under Exts.A12 statement of account relating to the cash credit loan, less the aforesaid sum (capitalized portion) of Rs.1,321.22 i.e., Rs.38,66,315.33 as on 30.11.2015 with further interest on the sum of Rs.37,70,645.35 (after deducting the penal interest portion - Rs.95,669.98) at the rate @14.05% per annum with monthly rests from 02.12.2015 to 06.12.2015 together with interest pendente lite and post decree interest from the defendant, is proved by the proof affidavit of its Branch Manager, AW1 and Exts.A1 to A13. Added to this, the absence of defendant inspite of service of summons appears to be intentional without any bonofide reasons and it appears that he remained absent as he 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 defendant is directed pay a sum of Rs.38,66,315.33 (Rupees Thirty Eight Lakhs Sixty Six Thousand Three Hundred Fifteen and paise Thirty Three only) with future interest on the sum of Rs.37,70,645.35 (Rupees Thirty Seven Lakhs Seventy Thousand Six Hundred Forty Five and Paise Thirty Five only) at the rate @14.05% per annum with monthly rests from 02.12.2015 to 06.12.2015 and thereafter @12.05% per annum from 07.12.2015 till realization and also its costs from the defendant;

(c) 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 defendant, as required under law; (d) The applicant bank shall file memo of costs within seven days from the date of this final order; (e) 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 16^th day of September, 2017]*

**Presiding Officer**

6TA.No.114/2016 (O.A.No.610/2015)**APPENDIX**Witness for Applicant:

AW1: Joseph Bernard T.R, Branch Manager of the applicant bank.

Witness for Defendant(s): Nil

**Exhibits on the part of the applicant**

<table border="1"> <thead> <tr> <th><u>Ext.No.</u></th> <th><u>Date</u></th> <th><u>Particulars of documents</u></th> </tr> </thead> <tbody> <tr> <td>A1</td> <td>24.08.2013</td> <td>Loan application submitted by the defendant.</td> </tr> <tr> <td>A2</td> <td>06.09.2013</td> <td>Sanction letter issued by the applicant to the defendant.</td> </tr> <tr> <td>A3</td> <td>06.09.2013</td> <td>The Agreement for Demand Cash Credit against Hypothecation of stock and book debts executed by defendant in favour of the applicant.</td> </tr> <tr> <td>A4</td> <td>06.09.2013</td> <td>Hypothecation Agreement executed by the defendant in favour of the applicant.</td> </tr> <tr> <td>A5</td> <td>06.09.2013</td> <td>Letter of Repayment executed by defendant in favour of the applicant.</td> </tr> <tr> <td>A6</td> <td>06.09.2013</td> <td>Demand promissory Note for Rs.40,00,000/- executed by defendant in favour of the applicant.</td> </tr> <tr> <td>A7</td> <td>06.09.2013</td> <td>Articles of Agreement executed by defendant in favour of the applicant.</td> </tr> <tr> <td>A8</td> <td>01.07.2015</td> <td>Letter of Confirmation of Balance in Loan Account executed by defendant in favour of the applicant.</td> </tr> <tr> <td>A9</td> <td>17.07.2015</td> <td>Office copy of demand notice issued by the applicant to the defendant.</td> </tr> <tr> <td>A10</td> <td>12.08.2015</td> <td>Office copy of the lawyer notice issued by the applicant to the defendant.</td> </tr> <tr> <td>A11</td> <td></td> <td>Return cover of lawyer notice issued by the applicant to the defendant.</td> </tr> <tr> <td>A12</td> <td></td> <td>Certified copy of statement of account No.209006211000001.</td> </tr> <tr> <td>A13</td> <td></td> <td>Interest statement of loan account No.209006211000001.</td> </tr> </tbody> </table>

Defendant's Exhibits - Nil

(PRESIDING OFFICER)

**IN THE DEBTS RECOVERY TRIBUNAL-II KERALA AT ERNAKULAM**

Dated this the 16^th day of September, 2017

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

TA.No.114/2016 (O.A.No.610/2015)

**Between**

Vijaya Bank, Edathiruthy Branch Trichur.

...Applicant

**And**

Deepak Dharmapalan

...Defendant

**FINAL ORDER**