State Bank of India vs Mr. P. Panneerselvam on 22 September 2023

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 defendant seeking issuance of a Recovery Certificate for recovery of a sum of Rs.25,42,835/- together with interest at the rate of 12% per annum with half yearly rests from the date of filing of the OA 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 agricultural loans availed by the defendant from the applicant bank.

3. It is the case of the applicant that at the request of the defendant vide Loan Application dated 23.06.2006 for grant of Agricultural Term Loan and KCC

facility, the applicant vide sanction dated 23.06.2006 sanctioned Agricultural Term Loan of Rs.5,88,000/- repayable in 9 half yearly installments of Rs.65,333/- from July 2007 and KCC Limit of Rs.50,000/- repayable on or before December 2006 and the defendant executed necessary loan documents on 23.06.2006.

4. It is also the case of the applicant that at the request of the defendant vide loan application dated 04.05.2010 for grant Agricultural Cash Credit (ACC) Loan, the applicant vide arrangement letter dated 04.05.2010 sanctioned a sum of Rs.46,000/- and defendant executed necessary loan documents on 04.05.2010.

5. It is the further case of the applicant that the defendant deposited the title deeds of the schedule mentioned property with the applicant bank on 24.06.2006 with an intention to create equitable mortgage over the same and confirmed the same by executing Memorandum of Deposit of Title deeds dated 23.06.2006 registered as Doc. No.1274 of 2006, SRO, Gandarvakkottai.

6. It is the case of the applicant that the defendant committed default in repayments and failed to regularize the loan accounts despite repeated request and hence the loan account was classified as NPA on 30.09.2013.

7. It is the case of the applicant that after availing the loan, the defendant was irregular in remitting the loan amount. The efforts of the applicant bank to make the defendant to settle the loan did not yield any result, and hence the applicant approached this Tribunal seeking issuance of a Recovery Certificate allowing recovery of the amount due in the account.

8. Summons were taken out to the defendant and the same was served. As there was no representation on behalf of the defendant on 23.01.2020, the defendant was called absent and set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 20 documents, which were marked as Ex. A-1 to A-20 on 22.06.2023. The Ld. Counsel for Applicant Bank made his submissions on 09.08.2023 and thereafter the matter stood till this date for passing final orders.

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

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

These issues are considered together.

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

11. The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-20 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 defendant. 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 defendant. It is clear from the statement of accounts that penal interest is not capitalized.

12. 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.

13. In view of the fact that the loan facility availed by the defendant is an agricultural 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 and future interest can be awarded at reduced rates.

14. 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, OA is disposed off in the following manner: - (a) TA No.137 of 2023 stands allowed.

(b) Applicant is permitted to realize a sum of Rs.25,42,835/- together with interest at the rate of 8% per annum (simple) from the defendant, from 11.03.2019 till date of realization after deducting all the amounts received by them during the pendency of OA, and also by selling the schedule mentioned properties 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 defendant is personally liable for all such amounts due.

(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 7 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.

15. 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. (Dictated to PS, transcribed by him, corrected, signed and pronounced by me in Open Court on this the 22nd day of September, 2023) Sd/- (T. RAJESH) PRESIDING OFFICER DRT-II, CHENNAI