CANARA BANK vs DSR ENTERPRISES on 28 March 2024

FINAL ORDER

1. The Application is filed under Section 19 (1) of the Recovery of Debt And Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for Rs. 1,10,50,904.73p due in the credit facility of agricultural term loan availed by the 1st defendant partnership firm through 2nd and 3rd defendant, its partners from erstwhile Syndicate Bank, which got amalgamated with Applicant herein.

2. The above OA was originally filed before DRT-I and got transferred to this Tribunal and renumbered as above.

3. The applicant contends that the credit facilities of Rs. 97,00,000/- was availed by the 1st defendant partnership firm represented by the 2nd defendant who had also executed the mortgage as collateral security, whereas the 3rd defendant who is the other partner of the 1st defendant firm had duly signed the loan documents.

4. The Applicant further contents that despite availing the credit facility by obliging to pay back the amount, the defendant failed in compliance of the same and all the efforts of the Applicant to make the defendants pay back the amount failed forcing the Applicant to file this Application.

5. The summons issued to the 2nd and 3rd defendant returned as “unclaimed” and held to be sufficient service. Paper publication was taken out in respect of 1st defendant. Since the defendants failed to enter appearance they were called absent and set ex-parte on 1.12.2021.

6. The Applicant let in evidence through AW1, filed proof affidavit in conforming with pleading and got marked Ext A1 to A13.

7. Heard the counsel for the applicant and considered the contention as taken in the TA in the light of documentary evidence and proof affidavit. The following issues arise for consideration in this matter: -

(i) Whether the Applicant had proved the OA claim?

(ii) What orders are to be passed? Both these issues are decided together.

8. The Applicant evidence remained un-rebutted and hence proved. The documents produced by the Applicant are found to be admissible and are sufficient to produce TA claim. Hence the Applicant is found to be entitled for the TA claim. The TA claim is made within limitation and there is no capitalization of penal interest. Since the credit facility is for agricultural purpose and TA claim is arrived at by calculating interest at agreed rate, pendente lite and future interest is awarded at the rate of 10% simple.

9. In view of the above, the following order is passed: - (a) TA No.658 of 2023 stands allowed.

(b) Applicant is permitted to recover an amount of Rs.1,10,50,904.73p with future and pendente lite interest @ 10 % simple per annum from the date of filing of the TA till realization, after giving credit to all the amount recovered and received during the pendency of the TA from the defendants 2 and 3 personally and also by proceeding against and selling their assets including the scheduled mortgaged properties and hypothecated assets. It is made clear that the assets of the 1st defendant firm are also liable to be proceeded against.

(c) A Recovery Certificate is to be drawn and issued to the recovery Officer to enable recovery of the as per the above terms.

(d) Applicant is allowed to realize cost of the proceedings for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the order.

10. Communicate a copy of the order to the parties concerned in terms of section 19(21)(i) of the RDB Act, read with Rule 6 of DRT (Procedure) Rules, 1993. (Dictated to PS, transcribed by him, corrected, signed and pronounced by me in Open Court, on this the 28th day of March, 2024) Sd/- (T. RAJESH) PRESIDING OFFICER DRT-II, CHENNAI