INDIAN OVERSEAS BANK vs Vijayakumar 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. 53,13,673/- (Rupees Fifty Three Lakhs Thirteen Thousand Six Hundred Seventy Three only) due in the Term loan under Subha Gruha Housing loan availed by the 1st defendant.

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

3. The applicant contends that a Home loan for Rs.40,00,000/- was availed by the 1st defendant for the purchase of a Residential flat being constructed by the 2nd defendant. It is also stated that the amount was transferred to the 2nd defendant.

4. The Applicant further contents that despite availing the credit facility by obliging to pay back the amount, the 1st defendant failed in compliance of the same. The 2nd defendant had not completed the construction and did not execute the sale deed, despite receipt of the entire amount. The applicant further contends that both the defendants had colluded with each other for the purpose of disbursement of the credit facility with the malafide injunction. It if further contended that the loan account is classified as NPA on 30.3.2017 and recall notices were issued to the 1st defendant on 27.11.2017 and 2.1.2019. Since all the efforts of the Applicant to make the defendants pay back the amount , the applicant is forced to file this Application.

5. The 1st defendant filed a reply statement contending that, it is the applicant bank colluded with 2nd defendant and informed the 1st defendant about the project stating that the same is approved by the bank. Hence according to the 1st defendant, it is the bank officials who lured the 1st defendant to get in to the transaction. The applicant had also failed to follow the mandate for the periodic disbursement of the loan amount in relation to the completion of construction. Hence according to the 1st defendant there was no mandate to disburse the entire amount.

6. The paper publication was taken out as against 2nd defendant and the 2nd defendant was set exparte on 8.6.2022.

7. The Applicant let in evidence through AW1, filed proof affidavit in conforming with pleading and got marked Ext A1 to A11. Even though sufficient opportunity was given to the defendant to adduce evidence no proof affidavit was filed.

8. Heard, the following issues arise for consideration: -

(i) Whether the Applicant had proved the TA claim as against both the defendants?

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

9. The applicant had filed their proof affidavit in consonance with the pleadings of the TA and had also produced documentary evidence proving the execution of loan documents by the 1st defendant and execution of the construction agreement between the defendants. Even though the 1st defendant had filed a reply statement alleging the failure of the applicant bank to stick on to the disbursement schedule, the same will no way absolve the liability of the 1st defendant. It is also to be noted that no prayer for set off is raised by the 1st defendant. Even after being given with sufficient opportunity, no defence evidence was let in as no counter proof affidavit is filed. The Applicant’s evidence remain un-rebutted and hence proved. The documents produced by the Applicant are found to be admissible and are sufficient to prove TA claim. Hence the Applicant is to be found entitled for the TA claim.

10. Even though the applicant had raised the claim against 2nd defendant on the premise that the loan amount is disbursed to the 2nd defendant, no document is forthcoming to prove the obligation of the 2nd defendant to remit the amount. The construction agreement executed between the defendants is not sufficient to fasten the liability against the 2nd defendant.

11. The TA claim is made within limitation and there is no capitalization of penal interest. However taking note of the fact that TA claim is arrived at by calculating interest at the agreed rate and despite availing the credit facility, the 1st defendant did not get the property pendente lite and future interest is awarded at 8% simple.

12. In view of the above, the following order is passed: - (a) TA No. 911 of 2023 stands allowed.

(b) Applicant is permitted to recover an amount of Rs.53,13,673/- (Rupees Fifty Three Lakhs Thirteen Thousand Six Hundred Seventy Three only) with future and pendente lite interest @ 8% simple per annum from the date of filing of the OA/TA till realization, after giving credit to all the amount recovered and received during the pendency of the OA/TA, from the 1st defendant personally and his assets. I 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 proceeding for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the 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 6 of DRT (Procedure) Rules, 1993. (Dictated to PS, transcribed by him, corrected, signed and pronounced by me in the Open court, this the 28th day of March, 2024)

Sd/- (T. RAJESH) PRESIDING OFFICER DRT-II, CHENNAI