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Mistake committed by Appellate Tribunal not passing the correct final direction needs to be corrected: DRAT Delhi
The matter was heard in Debts Recovery Appellant Tribunal, Delhi which was chaired by Mr. Justice P.K. Bhasin, Chairperson in the case of M/s Soga Impex Private Limited and Others v. Canara Bank, REED 2021 DRAT Del 06208, wherein the bench held the review petition was disposed and in furtherance, allowed for the recovery of the amount from the review petitioner which will be left after wholly consideration of the undisputed amount of Rs. 1.61 crores, Rs. 5 lacs, Rs. 3.18 lacs and the amount of Rs.1,53,36,776/- which was not considered either by the banker or by the DRT. In addition, DRAT in its order dated 30.09.2021 had accepted that much money also to have been received (or recovered) when there was an auctioning done of the factory premises, plant and machinery were auctioned on 27.09.2005.
The Appellate Tribunal also directed the bank to ‘file fresh detailed calculation sheet supported by an affidavit of some senior officer within ten days and then further appropriate orders shall be passed as to whether even after taking into consideration the amount of Rs. Rs.1,53,36,776/- any amount was still recoverable from the review petitioners/appellants on the date of filing of the O.A. or excess amount stood recovered from them and whether any amount is to be returned back to them.
The bench also directed for re-listing that after ten days the appeal shall now be listed again before this Tribunal on 30.06.2021.
Background/Facts of the Case
The appellant no. 1 and other appellant were sued as the principal borrower/mortgagor and as the guarantors for the loan which respondent bank had advanced to appellant no1 respectively. That application was decreed in favour of the respondent bank while was against all the appellants/defendants for the full amount which had been claimed by the bank including cost and future interest @ 12% p.a.(simple) and they were held liable jointly and severally to pay to the bank the decretal amount.
In any case of default in payment the bank was permitted to recover the decretal amount by selling the other assets of the defendants (review petitioners herein). Feeling aggrieved, the appellants filed an appeal before this Tribunal which was partly allowed by this Tribunal vide order dated 30.09.2019 and the decretal amount was reduced by Rs.1,53,36, 776/-. Interest rate was not altered. The appellants, however, felt that this Tribunal had while disposing of the appeal partly in their favour had not dealt with a very material point which they had urged before the DRT as well this Tribunal and, therefore, the order dated 30.09.2019 needed to be modified/reviewed to rectify the error apparent on the face of the record which if corrected by this Tribunal will not only result in dismissal of the bank’s application under section 13(10) of SARFAESI Act but the review petitioners/appellants-defendants will be found to be entitled to refund of a huge amount which the bank had recovered in excess of what was actually due to it.
The issue in the matter was, whether the applicant bank is entitled to recover Rs.2,51,80,814.34? If yes, then on how much interest?
The contention for this issue was in wholly concerned to prove this issue bank has exhibited documents A1 to A23 from the perusal of all these documents, it is very much clear that defendants approached applicant bank for taking loan and bank sanctioned loan and when defendants did not pay the instalments in time, account of borrower was declared as NPA and instead of service of legal notices on defendants, they did not repay the amount of the bank and there is no reason not to disbelieve the documentary evidence produced by applicant bank. It has been mentioned that one of the mortgaged properties has been sold by the bank for a sum of Rs. 161.00 lacs. The defendants have only denied the contents of the applicant in their written statement but without any evidence, therefore, from the affidavit of bank Manager and all the documents from Ex. A1 to A23 it is proved that bank is entitled to recover Rs. 2,51,80,814.34 from defendants. Since, issue no. 1 has been decided in favour of the applicant bank, therefore, applicant bank is entitled to relief claimed in OA.
In addition to the contention, learned counsel further submitted that there was, however, no information given by the bank regarding the movable items of the value of Rs. 1.53 crores odd despite the borrowers continuously asking the bank officials to tell the them about the status of movable items. Finally, the bank adjusted the sale proceeds of Rs.1.61 crores plus a sum of Rs. 3.18 lacs allegedly transferred from current account (total Rs. 1,64,18,198/) against the total outstanding amount of Rs. 2,59,98, 972.34 in the four accounts. 8. Learned counsel further submitted that from the foregoing narration it is clear, and which position was not refuted also by the learned counsel for the bank, that the review petitioners were all along fighting for the benefit of adjustments of the auction proceeds of the factory at Ludhiana which was sold for Rs.1.61 crores, though the borrowers were claiming that value of that property was more than three crores in 2005 and another sum of Rs. 1,53,36,776/-, on account of the value of valuable movable items which were also seized by the bank officials along with factory and plant and machinery on 15.04.2005. However, submitted the counsel, neither the bank nor the DRT gave any benefit of the said value of movable items. The bank simply adjusted Rs. 1,61 crores, being the auction proceeds of factory premises, in the four loan accounts, as noticed above. However, this appellate Tribunal when approached by way of a statutory appeal, recognized the entitlement of the borrowers for the value of the movable items seized amounting to Rs.1,53,36,776/- vide final order dated 30.0.219 in appeal of the review petitioners. But an error apparent of the face of record crept in in the order dated 30.09.2019 when this Tribunal simply reduced the amount of Rs.1,53,36,776/- from the amount decreed by the DRT. Counsel submitted that the bank ought to have been directed to add Rs. 1,53,36,776 to the other amounts admittedly received by it and then to recalculate the recoverable amount and if that had been directed, this Tribunal would have found that in fact nothing was recoverable from the review petitioners and O.A. under section 13(10) was without any cause of action and instead huge amount of money would have been found to be payable to them by the bank.
Ms. Seema Gupta, learned counsel for the bank though opposed this review application but did not seriously dispute the submission of the learned counsel for the review petitioners Ms. Sudha Varshney that like the amount of Rs.1,64,18,197.66 crores were adjusted/distributed in four loan accounts the amount of Rs.1,53,36,776/-, which amount also this Tribunal has found to be the amount recovered because of the seizure of movable items of that much value though that finding was not acceptable to the bank, should have been adjusted besides a sum of Rs. 5 lacs which also admittedly was received by the bank after service of notice under section 13(2). Ms. Gupta also argued that in any event there is no error apparent on the face of record which justifies exercise of power of review by this Tribunal and the review petitioners had the remedy of appeal against the order dated 30.09.2019.
The issue was in the matter was, on recovery of Rs.2,51,80,814.34 & with an entitlement of interest. The law concerned was of SARFAESI Act and, particularly section 13(10). The contentions were explanatory in nature, the tribunal held on the issue that wholly consideration of the undisputed amount of Rs. 1.61 crores, Rs. 5 lacs, Rs. 3.18 lacs and the amount of Rs.1,53,36,776/- while questioning the non-consideration by the banker and by the DRT.