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Judgment
This Original Application has been filed under Section 19(1) of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 for recovery of a sum of Rs.25,43,849/- due under Cash Credit Loan account with further interest on sum of Rs.25,10,598.07/- @13.75% per annum with monthly rests from 18.05.2018 and costs of this OA proceeding till realisation from the defendants jointly and severally and by sale of 'A' Schedule property.
BRIEF FACTS OF THE CASE
The applicant bank herein is Corporation Bank, a body Corporate constituted under the Banking Companies (Acquisition & Transfer of undertakings) Act, 1980, having its Head Office at Mangalore and branches at all over India including Malakkallu Branch, Kasaragod District. The Branch Manager to the Malakkallu Branch of the Applicant is fully competent to sign and verify this application and conversant with the facts of the case.
The applicant granted cash credit facility to the defendants on 13.04.2012, liability of debt was admitted by way of Acknowledgement of Debt (AOD) letter executed by defendant dated 10.09.2014 and 03.06.2017. Hence the OA presented by the applicant bank on 18.05.2018 is within the period of limitation prescribed under S.24 of the Act. Since the amount due is more than Rs.10 lakhs and the OA is filed by applicant bank's Malakkallu Branch, Kasaragod District, the OA is maintainable and the Tribunal has jurisdiction to entertain the same.
According to the applicant bank, the 1st defendant is the borrower and 2nd defendant is the co-borrower approached the applicant bank for a Mortgage Loan facility in order to meet their urgent family requirements and accordingly as per the request applicant sanctioned a Cash Credit facility of Rs. 23,00,000/-(Rupees Twenty three lakhs only) on 30.03.2012 with specific terms and conditions. Accordingly, as a security for repayment of amounts due there under, the defendants executed necessary security/loaning documents viz., Demand Promissory Note for Rs.23,00,000/- dated 13.04.2012 through which the defendants had agreed to repay the said amount with interest @ 14.75% per annum compounded with monthly rests and Take delivery dated 13.04.2012.
As collateral security towards the above cash credit facility, the 1st defendant deposited the Original title deeds and connected documents with the applicant bank relating to 19.50 cents of land in Re.Survey No. 129/1 of Kallar Village, Kasaragod District of Settlement Deed document No.2901/2000 dated 14.12.2000 of Rajapuram S.R.O along with Basic Tax receipt No. 9816614 dated 28.12.2011 and Possession Certificate No. 238/2012 dated 17.02.2012 and Location Certificate No.132/2012 dated 17.02.2012.
After availing the cash credit facility, the defendants failed to adhere the terms and conditions governing grant of the loan facility and committed default in repayment of the amounts due under, wherein the account was classified as NPA on 31.03.2014. In spite of repeated request made by the applicant bank to repay the dues have been of no avail. Hence, Applicant bank issued Ext.A9 Demand Notice dated 01.04.2014 demanding to repay the entire loan amounts. Even though the defendant promised to make substantial payment, he failed and neglected to do so.
The defendants also admitted the liability by way of letter of Acknowledgement of Debt dated 10.09.2014 and 03.06.2017.
According to the applicant bank, as per the Ext.A12 statement of accounts kept by him, an amount of Rs.25,43,849/- is due under the cash credit loan account No. CMTCC/01/120001(560331000011189) with interest applied upto 15.05.2018. Thus the applicant bank is entitled to recover the sum of Rs.25,43,849/-, with interest and costs. Applicant Bank has charged Rs.33,250.93/- as total penal interest in this account which is not capitalized.
The defendants were duly served with summons on 14.07.2018. No vakalath, no written statement despite sufficient time granted. The defendants remained absent and are not represented and as such, they were set exparte on 11.12.2018.
The evidence on the side of the applicant bank consists of the proof affidavit of its Manager, AW1 and Exts.A1 to A12.
Heard arguments of the applicant bank and perused the records of the case. The following points arise for my consideration:
(i) Whether the applicant is entitled to get the reliefs prayed for in the OA?
(ii) What order?
The case of the applicant bank regarding recovery of the sum of Rs.25,43,849/- claimed as due under statements of account relating to the cash credit account as on 15.05.2018 together with interest pendent-lite and post-decree interest on the sum of Rs.25,10,598.07/- (less Rs.33,250.93/- as penal interest) towards the amounts claimed as due under the OA from the defendants jointly ans severally is proved by the proof affidavit of its Manager, AW1 and Exts.A1 to A12. Even otherwise the whole case of the applicant bank is based on the documentary evidence and the witness has duly proved all the documents exhibited by him.
It is quite evident from the documents placed on record by the applicant bank that defendants have availed the cash credit facility from the applicant bank and have failed to repay the dues of the applicant bank. Added to this, the absence of defendant, inspite of service of summons appears to be intentional without any bonafide reasons and it appears that they did not contest the matter as they admitted the entire case of the applicant as sought for in the present OA. In view of the above, the present OA is to be allowed with costs as sought by the applicant bank.
Having regard to the amount advanced for meeting their urgent family requirements, the interest applied and the default committed, I am of the view that the applicant bank is entitled to get pendente-lite and post-decree interest @13% per annum for the amount due under Cash Credit Account.
ORDER
The OA is allowed with costs.
The applicant bank is allowed to recover the sum of Rs.25,43,849/- (Rupees Twenty five lakhs forty three thousand eight hundred and forty nine only) due under Cash Credit loan account No.CMTCC/01/120001 (560331000011189) with further interest on sum of Rs.25,10,598.07/- (Rupees Twenty five lakhs ten thousand five hundred ninety eight and Paisa seven only) @13% per annum from 18.05.2018 till realization and also its costs from the defendants jointly and severally and by sale of schedule 'A' property.
In the event of non-realization of the OA claim amount despite the sale of schedule 'A' property, the bank is at liberty to proceed against the other properties of the defendants both movable and immovable, as required under law.
The schedule 'A' to the OA shall be appended to this final order.
Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.
The Registry is directed to communicate copy of the order to the parties concerned by speed post or registered post with AD.