Punjab National Bank vs M s Mayas Beauty and Wellness Centre on 18 March 2026

FINAL ORDER

1. This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendants’ seeking issuance of a Recovery Certificate for recovery of a sum of Rs.1,06,62,341.46p together with interest at the rate of 12.05% per annum with monthly rests plus 2% penal interest from the date of the application till the date of realisation along with costs of the application and for sale of schedule mentioned properties.

2. The subject matter of the case is the Term Loan availed by the defendants from the Applicant Bank.

3. It is the case of the applicant that the 1st defendant is a Partnership firm represented by its Partners, the defendants 2 and 3, engaged in the business of beauty and wellness clinic approached the applicant for grant of credit facilities for purchasing equipments for aesthetical services. It is also the case of the applicant that the applicant considering the request of the 1st defendant sanctioned a Term loan of Rs.80 lakhs on 28.9.2017 repayable in 60 Equated Monthly Installments of Rs.1,33,334/- starting after moratorium period of six months. It is stated that the defendants executed the Term Loan Agreement and Hypothecation of Assets to secure Term Loan on 28.9.2017.

4. It is also the case of the applicant that the 2nd defendant deposited the title deeds of her property more fully described in the schedule to the OA with the applicant bank with an intention to create equitable mortgage over the same and confirmed the same by executing Memorandum of Deposit of Title deeds dated 28.9.2017 registered as Doc. No.6359 of 2017, SRO, Virugambakkam.

5. It is also the case of the applicant that the defendants were highly irregular in repayment and failed to regularize the loan account despite repeated demands and hence the loan account was classified as NPA on 31.12.2018. It is further stated that the applicant thereafter issued a demand notice dated 04.01.2019 under Section 13(2) of the SARFAESI Act calling upon the defendant to clear the outstanding dues followed by Possession Notice under Section 13(4) of the SARFAESI Act on

30.04.2019, but the defendants did not come forward to clear the dues. Hence the present OA is filed for recovery of its dues.

6. Summons was taken out to the defendants returned with endorsement “Unclaimed” and hence the same was treated as sufficient service. As the defendants were absent continuously and as there was no representation for the defendants on 07.12.2021, they were set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 13 documents, which were marked as Ex. A-1 to A-13 on 7.12.2023, however, Ex. A-5 was marked subject to proof and relevancy being a photocopy. The Ld. Counsel for Applicant Bank made his submissions on 25.02.2026 and thereafter the matter stood till this date for passing final orders.

7. The following issues arise for consideration in the matter: - (a) Whether the applicant had succeeded in proving the liability of the defendants?

(b) What order as to cost of the proceedings need be passed?

These issues are considered together.

8. Heard the Ld. Counsel for the applicant, perused the OA averments and the record placed before the Tribunal.

9. The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-13 along with the proof affidavit. The documents produced in evidence are all found admissible. The proof affidavit of the applicant bank remained unchallenged and rebutted. Therefore, on careful consideration of proof affidavit along with exhibits filed on behalf of the applicant bank, besides the material placed before the Tribunal, the Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendants. Further, the statement of accounts in respect of the loan account produced and certified under the Banker’s Book Evidence Act, clearly indicates that the amount claimed by the applicant is due from the defendants. It is clear from the statement of accounts that penal interest is not capitalized.

10. In view of the foregoing, it is clearly evident that the application filed by the applicant bank is well within the period of limitation and this Tribunal possesses the territorial and pecuniary jurisdiction to entertain this OA.

11. In view of the fact that the loan facility availed by the defendant is a term loan and the applicant has claimed interest at contractual rate till the date of filing of the OA, this Tribunal is of the view that the pendente lite interest can be awarded at reduced rates and prayer for penal interest rejected.

12. In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, TA is disposed off in the following manner: - (a) TA No.116 of 2023 stands allowed.

(b) Applicant is permitted to realize a sum of Rs.1,06,62,431.25p with further interest @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 after deducting all the amounts received / realized by them during the pendency of OA and also by selling the schedule property and other assets of the defendants.

(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendants 2 and 3 are personally liable for all such amounts due as ordered above.

(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 15 days from the date of receipt of the copy of the order.

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

13. Communicate a copy of the order to the parties concerned in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993. Sd/-

(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 18th day of March, 2026)

EXHIBITS MARKED BY APPLICANT BANK

S. No. Date Description of Documents Exhibit Nos.

1. 06.09.2017 Partnership deed of the 1st defendant registered as Doc. No.258/2017, SRO, Virugambakkam A-1

2. 28.09.2017 Sanction letter issued by applicant A-2

3. 28.09.2017 Term Loan agreement by 1st defendant A-3

4. 28.09.2017 Hypothecation of assets by 1st defendant A-4

5. 28.09.2017 Memorandum of Deposit of Title deeds by 2nd defendant registered as Doc. No.6359/2017, SRO, Virugambakkam A-5

6. 03.10.2017 Letter of Intent A-6

7. 04.01.2019 Demand notice issued under Section 13(2) of the SARFAESI Act by applicant. A-7

8. 30.04.2019 Possession notice issued under Section 13(4) of the SARFAESI Act by applicant A-8

9. 09.08.2019 Willful default notice by applicant A-9

10. 27.08.2019 Reply notice by 2nd defendant A-10

11. 11.10.2019 Rejoinder given by bank A-11

12. Statement of Accounts A-12

S. No. Date Description of Documents Exhibit Nos.

13. Certificates under Bankers’ Book Evidence Act. A-13

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DESCRIPTION OF PROPERTY

SCHEDULE – A

All that piece and parcel of land and building comprised at No.110, Saligramam Village, Division No.113, Block No.10, in Old Survey No.178/1, T.S. No.38 and now bearing Old Door No.8, New Door No.15, North Mada Street, Vadapalani, Chennai – 600 026 Bounded on the North by

: Road South by

: House belonging to Ponnamal East by

: Land of Govinda Maistry and West by

: Land of Kanniappa Maistry The property admeasures East to West 23 feet and South to North 40 feet and totally admeasure an extent of 920 sq. ft. of land together with building thereon lying within the Registration District of South Chennai and Sub Registration District of Virugambakkam.

Sd/-