ENCORE ASSET RECONSTRUCTION COMPANY PVT. LTD (ASSIGNOR ALLAHABAD BANK) vs SMT. CHRISTINE on 28 February 2025

FINAL ORDER

1. The present Transfer Application in (short) TA has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 for 2 TA/847/2017

seeking issuance of Recovery Certificate against the defendants for Rs.13,24,581.29 (Rupees Thirteen Lakh Twenty Four Thousand Five Hundred Eighty One and Twenty Nine Paise Only) with further interest thereon from the date of filing the Application till realization from the Defendants.

2. It is the case of the applicant that, after filing of the present OA, the lender bank namely Allahabad bank assigned the loan accounts of the defendants together with the hypothecated movables the brief particulars of which are stated in the OA, mortgaged immovable properties which are more fully described in schedule A of the OA and Guarantees obtained to secure the loan facilities to Encore Asset Reconstruction Pvt. Ltd. The defendant No.1 is the borrower and defendant No.2 is the guarantor. The defendants have availed Term loan of Rs.10.50 lakhs against Rent Receivables under ALL Bank Rent Scheme on 29.12.2012.

3. It is also the case of the applicant that, in view of the above financed amount, the defendants have executed necessary loan documents apart from the creation of security interest by way of mortgage over the Schedule properties.

4. It is further contended that, despite availing the credit facilities, agreeing to service the loan account promptly and regularly, the defendants failed in complying the same, resulting in 3 TA/847/2017

default in repayment and consequentially turning the loan account as NPA.

5. In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the account.

6. After filing of the OA, summons was sent to the Defendant through RPAD and the same was duly served to Defendants No.1 and 2 and have filed vakalath through counsel. Though sufficient opportunity is given to the defendants but not chosen to file the written statement within stipulated time and hence the chances of written statement was closed. Thereafter the defendants filed IA.No.549/2020 a petition to recall the Order dated 22.09.2017 and this Tribunal vide order dated 08.02.2022 dismissed the IA.

7. The applicant let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A3 to A17 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:

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i) Whether the applicant had succeeded in proving the OA claim as against the defendants? ii) What order 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 defendants remained exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facility as stated in the OA, creation of security interest as claimed by the applicant bank and the defaults committed in the account. The liability of the defendants and the claim of the amount due is also proved by the above documents. The claim of the applicant is well within the limitation.

11. During the course of the proceedings, the applicant bank has filed Report on sale of the mortgaged properties of Defendants was sold in an auction held on 02.09.2019 pursuant to sale notice dated 31.07.2019 issued to the defendants. The immovable property more fully described in Schedule –A – I was sold for sale consideration of Rs.2,27,00000/- and Schedule – A- II was sold 5 TA/847/2017

for sale consideration of Rs.1,13,00000/-. Thus, a total sum of Rs.3.40 Crores was realized and out of the sale proceeds a sum of Rs.10,20,000/- was credited to loan account of the defendant No.1 and as on 31.01.2024 a further sum of Rs.16,14,290/- is due and the outstanding in the loan account of defendant No.1 which the defendants are jointly and severally liable to repay along with interest at the rate of 13.15% per annum with monthly rests. The memo of calculations showing the amount credited and the outstanding dues is produced along the report on sale.

12. Hence in view of the above finding which cover both the issues raised in this manner, this Tribunal is of the view that TA is liable to be allowed.

13. Taking into consideration the facts that the credit facility is availed for business purpose and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the TA can be allowed with a reduced interest rate to simple.

14. In the result, TA.No.847/2017 stands allowed, i) The applicant is allowed to recovery an aggregate sum of Rs.1324581-29(Rupees Thirteen Lakhs Twenty Four Thousand Five Hundred and Eighty One and Twenty Nine Paisa only) at 6 TA/847/2017

14.70% p.a. (simple) for term loan from the date of filing OA till the realization, after giving credit to all the amount recovered and received during the pendency of the OA including the sum of Rs.10,20,000/- realized by way of sale of schedule A-I and A-II properties on the respective date.

ii) If the sale proceeds are not found sufficient to cover the amount due and payable to the applicant bank, the defendants jointly, severally and personally and their other assets are liable for all such amounts due under the loan accounts.

iii) The applicant bank is allowed cost of the proceeding which applicant to file cost memo within 7 days from the date of receipt of the order.

iv) The Recovery Certificate to be drawn in terms of this order and transferred to Recovery for execution.

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 the Stenographer (PR), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 28th Day of February 2025]. Sd/- (T. RAJESH) PRESIDING OFFICER

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ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Smt. Padma Kumar S, Director and Authorized signatory of the applicant. Exhibits on the part of the Applicant: Annexure Particulars A1 Applicant Evidence A2 List of Documents A3 Letter of sanction dated 29.01.2012 A4 Agreement of Term loan cum Hypothecation dated 31.12.2012 A5 General Power of Attorney dated 27.02.2013 A6 Demand Promissory note dated 31.12.2012 by defendant No.1 A7 Letter for waving presentment of Promissory note dated 31.12.2012 A8 Deed of Guarantee dated 31.12.2012 by defendant No.2 A9 Memorandum of Deposit of Title Deeds dated 03.02.2010 by defendant No.1 A10 Supplemental Memorandum of Deposit of Title Deeds dated 30.01.2013 by defendant No.1 and 2 A11 Memorandum of deposit of title deeds dated 19.05.2009 by defendant No.2 A12 Supplemental memorandum dated 10.06.2010 by defendant No.2

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A13 Letter of confirmation in respect of Equitable Mortgage dated 27.01.2014 by defendant No.1 and 2 A14 Legal notice dated 20.07.2016 A15 Reply by defendants dated 29.07.2016 A16 Statement of account No.50138639039 A17 Certificate under Bankers book of Evidence Act

Sd/- (T. RAJESH) PRESIDING OFFICER