UCO BANK vs Mr.M.Piliyarasu & Another on 31 January 2019

ORDER

1. This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants jointly and severally for recovery of a sum of

Rs.10,35,368.77p due under Loan Account No.06930510000410 availed by the first defendant and a sum of Rs.10,07,326.32p due under Loan Account No.06930510000458 availed by the second defendant together with interest at 14% per annum with monthly rests from the date of filing of the application till the date of realization in full, for sale of the schedule mentioned properties belonging to the 1st defendant, along with costs of this application.

2. Brief facts of Application are as follows: 2.1 The applicant bank submits that the 1st defendant approached the applicant bank for a loan of Rs.4.00 lakhs under Kisan Credit Card Loan for developmental activities and submitted an application on 22.3.2007. 2.2 It is submitted that the applicant considered the request of the 1st defendant and sanctioned the aforesaid loan of Rs.4.00 lakhs on 22.3.2007. The first defendant availed the said loan under Loan Account No.06930510000410 and executed loan and security documents such as Promissory Note, Hypothecation cum Agreement for Agricultural Loans, etc. on 22.3.2007. The 1st defendant had agreed to repay the said loan in 5 yearly instalments of Rs.60,000/- together with interest at 11.75% per annum with monthly rests. The 2nd defendant guaranteed the due repayment of the loan availed by the 1st defendant and executed a letter of guarantee dated 22.3.2007 in favour of the applicant bank. 2.3 It is submitted that the 2nd defendant, who is none other than the wife of 1st defendant, had simultaneously approached the applicant bank for a loan of Rs.4.00 lakhs under Kisan Credit Card Loan with an application dated 22.3.2007 for developmental activities. The applicant bank considered the request of the 2nd defendant and sanctioned a Kisan Credit Card Loan of Rs.4.00 lakhs on 22.3.2007. The 2nd defendant availed the said loan under Loan Account No.06930510000458 and executed necessary loan and security documents such as promissory note, Hypothecation cum Agreement for Agricultural loans. The 2nd defendant agreed to repay the said loan in 5 yearly instalments of Rs.60,000/- together with interest at 11.75% per annum with monthly rests. The 1st defendant had guaranteed the due repayment of the loan availed by the 2nd defendant and had executed a Letter of Guarantee on 22.3.2007 in favour of the applicant bank. 2.4 It is submitted that the 1st defendant had also offered his property morefully described in the schedule as a collateral security to the loan availed by him and his wife, who is the 2nd defendant herein and created an equitable mortgage in favour of the applicant bank and deposited the title deeds relating to the said property on 21.3.2007 and confirmed the same vide his letter dated 22.3.2007. The 1st defendant also executed a Memorandum of Deposit of title deeds on 20.3.2007. 2.5 It is submitted that after having availed the said loan facilities, the account of the defendants became irregular and the defendants failed to regularize the accounts despite reminders. However, the defendants executed balance confirmation letters on 1.2.2010 and 4.1.2013. Thereafter, the defendants did not come forward to clear the dues. Hence, the present TA.

3. Defendants remained exparte.

4. Point for consideration: Whether the applicant bank is entitled for the amount claimed in the application from the defendants? If so, at what rate of interest?

5. Point Whether the applicant bank is entitled for the amount claimed in the application from the defendants? If so, at what rate of interest? 5.1 To prove its claim, the applicant bank filed proof affidavit through its Senior Manager along with 21 documents, which are marked as Ex.A1 to A21. The proof affidavit of the applicant bank remain unchallenged and unrebutted. Therefore, on careful consideration of the material placed before the Tribunal, coupled with the proof affidavit filed on behalf of the applicant bank, I am satisfied that the applicant bank has successfully proved the TA claim against the defendants. Hence, it is held that the applicant bank is entitled for a Recovery Certificate for a sum of Rs. Rs.10,35,368.77p due under Loan Account No.06930510000410 and a sum of Rs.10,07,326.32p due under Loan Account No.06930510000458 together with pendent lite and future interest at 9% per annum (simple) from the date of filing of the application till the date of realization in full. Point is answered accordingly.

6. For the reasons stated as above, it is held that the applicant bank is entitled for a Recovery Certificate against the defendants jointly and severally for a sum of Rs. Rs.10,35,368.77p due under Loan Account No.06930510000410 and a sum of Rs.10,07,326.32p due under Loan Account No.06930510000458 together with pendent lite and future interest at 9% per annum (simple) from the date of filing of the application till the date of realization in full, for sale of the schedule mentioned properties along with costs of this application.

7. In the result, application is allowed as under:

(a) The applicant bank is entitled to recover a sum of Rs.10,35,368.77p due under Loan Account No.06930510000410 and a sum of Rs.10,07,326.32p due under Loan Account No.06930510000458 together with pendent lite and future interest at 9% per annum (simple) from the date of filing of the application till the date of realization in full, from the defendants jointly and severally.

(b) It is further ordered that in case of default of payment by the defendants, the applicant bank is entitled to sell the schedule mentioned properties and adjust the sale proceeds towards the amount due.

(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the applicant bank, the defendants are personally liable for all such amounts due.

(d) It is further ordered that any amount remitted or realized, if any, during the course of the proceedings, shall be given due credit to the loan account of the defendants.

(e) The applicant bank is entitled for costs of this application.

8. The applicant bank is directed to file costs memo within two weeks of the receipt of this order.

9. Issue recovery certificate in favour of the applicant bank in terms of this final order.

10. Communicate a copy of the order to the parties concerned in terms of Rule 16 read with Rule 2(c) of DRT (Procedure)Rules, 1993. (Dictated to stenographer (SN), transcribed by him, corrected, signed and pronounced by me in the Open Court, this 31st day of January, 2019) Sd/- (N.V.BADARINATH) PRESIDING OFFICER DRT-I, CHENNAI