Indian Bank vs Mr. R. Kamalakar 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. 37,52,629.51 (Rupees Thirty Seven Lakhs Fifty Two Thousand Six Hundred

Twenty Nine and Fifty One paisa only) due in the mortgage loan availed for agricultural purpose.

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 the agricultural credit facility of Rs.25,00,000/- , which subsequently revised and reduced to 24,00,000/- was availed by the defendant 1 and 2. 3rd defendant stood as a guarantor for the credit facility. Apart from the above, another short term loan for Rs.2,00,000/- was also availed by defendants. It is also stated that the facility is secured by mortgage of schedule properties.

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 the accounts were classified as NPA on 30.6.2015 and 31.3.2016 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 defendants had filed their reply statement inter alia contending as follows: The original facility was sanctioned for trade finance with higher interest rate. It is also stated that in respect of the subject matter credit facilities the applicant had obtained signatures in blank documents. It is also further contended that the claim is time barred and that the acknowledgment of debt was created after the expiry of period of limitation. A specific contention is taken to the effect that there is no binding guarantee by the 3rd defendant and further that the equitable mortgage as claimed by the bank is unenforceable. The issuance of demand notice is also disputed. Another contention taken by the defendants is that the entire liability is discharged under various wavier schemes introduced by the government.

6. The Applicant let in evidence through AW1, filed proof affidavit in conforming with pleading and got marked Ext A1 to A29.

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

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

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

8. The applicant had adduced evidence by filing the proof affidavit in terms of the pleadings of the TA and had produced the documents evidencing the execution of loan document by the defendants obliging themselves to abyed by the terms of the lending. The defendant had filed a reply statement and also filed a counter proof affidavit in terms of the reply statement, the existence of loan agreement is not disputed as the only contention taken is that the applicant obtained signature in blank papers. This contention can only be treated as a lame excuse or a trivial defence.

9. The next contention taken by the defendant that the claim is time barred is also to be rejected as admittedly there is deposit of title deeds for the purpose of mortgage. Even though the defendant is contending that the mortgage is not valid the same will not hold good as there is no dispute as to the deposit of documents for the purpose of creation of mortgage. Since the facility is secured by mortgage, the period of limitation is 12 years and hence the contention of the defendant in this regard is liable to be rejected.

10. The next contention taken by the defendant is that the entire facility is cleared by government schemes is not supported by any evidence. No documentary evidence is produced to prove the existence of any such scheme and in the absence of the same, this contention is also declined.

11. 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 produce TA claim. Hence the Applicant is to be found entitled for the TA claim. However in respect of the claim as against the 3rd defendant it is to be noted that the guarantee executed by 3rd defendant is for the over draft facility of 25,00,000/- admittedly the credit facility was reduced to 24,00,000/- vide exhibit 34 sanction ticket dated 30.3.2016, which evidences that the said facility is a fresh disbursement. By no stretch of imagination the guarantee agreement executed on 23.12.2013 of Rs.25,00,000/- will extend to a subsequent credit facility disbursed on 30.3.2016. Even though a clause of the guarantee agreement states that it will “ remain in operation in respect of all subsequent transaction” the same is not sufficient to bind the 3rd defendant with the liability and hence the TA claim as against 3rd defendant is liable to be rejected.

12. The TA claim is made within limitation and there is no capitalization of penal interest. Since the TA claim is arrived at by calculating interest at agreed rate and taking note of the fact that the facility is agricultural one, pendente lite and future interest is awarded at 9% simple.

13. In view of the above, the following order is passed: - (a) TA No.110 of 2022 stands allowed.

(b) Applicant is permitted to recover an amount of Rs.37,52,629.51p (Rupees Thirty Seven Lakhs Fifty Two Thousand Six Hundred Twenty Nine and Fifty One paisa only) with future and pendente lite interest @ 9% simple P.A 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 defendants 1 and 2 jointly, severally and personally and also by proceedings against their assets including the schedule properties. The prayer for grant of relief against 3rd defendant is rejected.

(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 proceeding for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the order.

14. 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