Canara Bank vs Mr. Mohammed Mubeen. A on 29 December 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 for recovery of a sum of Rs.20,10,398.43p with further interest at the rate of 10.50% per annum with monthly rests plus 2% penal interest from the date of filing of the OA till the date of realization in full along with costs of this application.

2. The above Original Application is filed before DRT-I Chennai and stood transferred to this Tribunal and renumbered as above.

3. The case of the applicant can be encapsulated as follows: - The defendant approached the applicant bank for grant of credit facility by submitting application dated 05.11.2015 for purchase of printing machineries (Digital Printers) for doing business in the name and style of Magic Printers and the applicant bank considering the said request the applicant sanctioned Synd MSE Term Loan of Rs.23,50,000/- on 5.11.2015. The defendant executed necessary loan and security documents on 5.11.2015.

4. It is further stated that even though the defendant had obliged to repay the amount promptly and regularly, they failed to do so resulting in default in repayment and hence the account was classified as NPA on 30.04.2019.

5. It is also the case of the applicant that despite repeated reminders and requests the defendant failed to make the repayment forcing the applicant to issue recall notice on 02.02.2017, a legal notice on 18.4.2017 and subsequently file this OA seeking recovery of the amount due in the account with further interest and costs.

6. The defendant remained absent and hence was set ex-parte on 27.01.2020.

7. The applicant had let in evidence through AW-1, who had sworn to a Proof Affidavit in terms of the pleading in the OA and also produced Exhibits A-1 to A-7 and got the same marked in evidence.

8. Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

9. The following issues arise for consideration in this matter: -

(i) Whether the applicant had succeeded in proving the OA claim as against the defendant?

(ii) What orders are to be passed?

Both these issues are gone into and decided together.

10. The case put forth by the applicant in the Application remains unrebutted as defendant remained ex-parte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible. From the statement of accounts as produced by the applicant, it is evident that the amount as claimed in the OA is outstanding in the account, which the applicant is entitled to get recovered from the defendant and his assets. The claim of the applicant is well within the period of limitation and there is no capitalization of penal interest.

11. In view of the fact that the subject loan is a loan facility availed by the defendant for its business purpose and the applicant has charged interest at contractual rates till the date of filing of the OA and further as the interest rates have come down, this Tribunal is inclined to reject the prayer for allowing interest with monthly rests and award simple interest at reduced rates.

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 and the default committed by the defendant, which the applicant is entitled to realize. Hence, TA is disposed off in the following manner: - (a) TA No.480 of 2022 stands allowed.

(b) Applicant is permitted to realize a sum of Rs.20,10,398.43p with future and pendentelite interest @10% p.a., simple from the defendant and his assets, from the date of filing of the OA till realization, after deducting all the amounts received by them during the pendency of OA.

(c) It is made clear that the defendant is personally liable for all such amounts due under the Loan Accounts.

(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 7 days from the date 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. (Dictated to PS, transcribed by him, corrected, signed and pronounced by me in Open Court, on this the 28th day of December, 2023) Sd/- (T. RAJESH) PRESIDING OFFICER DRT-II, CHENNAI