Bangalore District Court
8 vs Nil on 24 January, 2023
18
COM.O.S.1583/2022
IN THE COURT OF LXXXII ADDL.CITY CIVIL & SESSIONS
JUDGE, AT BENGALURU (CCH.83)
THIS THE 24th DAY OF JANUARY 2023
PRESENT:
SMT. SUMANGALA S BASAVANNOUR.,B.COM,L.L.M.,
LXXXII ADDL.CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
Com.O.S.No.1583/2022
BETWEEN:
State Bank of India,
Small and Medium
Enterprises Centre
(SMEC) represented by
is chief manager, Sri.
Avinash Kumar S/o Shiv
Shankar Prasad. Age: 46
years, # 13, 2A,
Munireddy Layout,
Horamavu Main Road,
Banaswadi, Bengaluru-
43,
: PLAINTIFF
(Represented by Mr. N P
Singri -Advocate)
AND
18
COM.O.S.1583/2022
M/s. Anugraha
Industries, Rep. by
its Prop: Mr. Suresh Naik
B. Age: Major, No.2,
J.P.R.Building,
Gurunanjudiah Industrial
Area, Abbigere,
Chikkabanavara,
Bengaluru-560 090.
: DEFENDANT
(Defendant is placed
exparte as 16.01.2023)
Date of Institution of the
31.10.2022
suit
Nature of the suit (suit on
pronote, suit for
Suit for recovery of money
declaration & Possession,
Suit for injunction etc.)
Date of commencement of 19.01.2023
recording of evidence
Date on which judgment 24.01.2023
was pronounced
Total Duration Year/s Month/s Day/s
00 02 24
(SUMANGALA S BASAVANNOUR),
LXXXII Addl.City Civil & Sessions Judge,
Bengaluru.
18
COM.O.S.1583/2022
JUDGMENT
This suit is filed by the Plaintiff against the defendant firm and its Proprietor directing to pay jointly and severally a sum of Rs.5,53,675/- under Cash Credit Loan facility with current and future interest at the rate of 10.40% p.a. and a sum of Rs.2,00,512/- under Term Loan facility with current and future interest at the rate of 9.65% and a sum of Rs.1,52,389/- with current and future interest at the rate of 7.40% compounded at monthly rests, from the date of suit till the date of realization.
2. The Brief facts of the Plaint are as follows:-
The Defendant firm approached the plaintiff bank for sanction of Cash Credit Loan facility and submitted an application under Pradhan Mantri Mudra Yojana Scheme for purpose of his Business at one of the Plaintiff-Bank Branch, pursuant to which the plaintiff bank sanctioned a Cash Credit Loan of Rs.5,00,000/- on 11.10.2018 for the purpose of her business is available for 12 months subject to review every 12 months, when it may be cancelled/reduced depending upon the conduct and utilisation of the advance, or as per the Bank's Scheme, with interest at the rate of 2.75% margin above MCLR which is presently 8.45% p.a. present card rate is 11.2% calculated on daily products at monthly rests. Bank shall at any 18 COM.O.S.1583/2022 time and form time to time be entitled to vary the margin based on the Credit Risk Assessment of the borrower and the MCLR at its discretion and agreeing to the terms and conditions executed a Letter of Arrangement and Agreement of Loan cum Hypothecation. Further, availed a Term Loan of Rs.2,80,000/- on 25.11.2019 and executed a Letter of Arrangement and Supplemental Agreement of Loan cum Hypothecation. The same was availlable for 24 months subject to review every 12 months, when it may be cancelled/ reduced depending upon the conduct and utilisation of the advance, or as per the Bank's Scheme. Interest at the rate of 2.75% margin above MCLR which is presently 8.05% calculated on daily product at monthly rests, Bank shall at anytime and from time to time be entitled to vary the margin based on the Credit Risk Assessment of the borrower and the MCLR at its discretioin. Agreeing to the terms and conditions the Proprietor of the defendant-firm executed above cited documents. The Proprietor of the defendant further executed a Balance Confirmation Letter and a Revival Letter dated 25.11.2019. A letter of request for standing Instructions for remittance of amount periodically in the accounts of the defendant-firm.
Further, the defendant-firm availed GECL Loan facility of Rs.1,48,000/- on 07.07.2020 which was to be repaid in 36 18 COM.O.S.1583/2022 monthly installments of Rs.4,200/- each, with the first installment commencing on July 2021 and the last installment falling due on June 2024, with 12 months moratorium with interest at the rate of 0.75% margin above MCLR which is presently 7.05% p.a. and present card rate is 7.80% p.a., agreeing to the same executed a Letter of Arrangement and Supplemental Agreement of Loan cum Hypothecation. It is relevant to state that, the Proprietor of the defendant executed a Revival Letter. The defendant failed to adhere to various terms and condition mentioned iln the agreement and has committed defaults. The defendant has not made payments as agreed and the dues of the bank accumulated. In spite of several requests the defendant did not regularise the account. The Plaintiff Bank thus approached Pre Institution Mediatioin Centre, filed a Petition in PIM 1510/2022 calling upon defendant to pay the amount due and for clearing the entire outstanding balance. The defendant evaded receiving notice. The Plaintiff Bank got issued a Legal Notice calling upon the defendant to make the Payment. The same is returned as Refused. Despite all this the defendant did not turn up to settle the account. The defendant-firm being the borrower and represented by its Proprietor for the loan availed are liable to pay jointly and severally the amounts due to the Plaintiff Bank.
18COM.O.S.1583/2022 The defendant-firm made last payment of Rs.11,000/- on 10.08.2021 and there-after remained defaulter and present outstanding dues of loan of the defendant payable to Plaintiff Bank under Cash Credit is Rs.5,49,425/- including interest till date, which is not applied to the account extract as per the guidelines issued by the Reserve Bank of India for income recognition purpose. Thus the amount now due under account of the defendant to the Plaintiff Bank is as under Cash Credit Loan Account No:38008923463.
Outstanding amount as per the Rs. 4,99,173=00. extract as on: 21.04.2022:
Accrued Interest up to 21.04.2022 Rs. 36,088=00. Accrued Penalty Interest up to Rs. 14,164=00.
21.04.2022:
PIM 1510/2022: Rs. 3,000=00
Legal Notice: Rs. 1,250=00
Total Rs. 5,53,675=00
Under Term Loan Account No.38970957145 Outstanding amount as per the Rs. 1,77,507=00.
extract as on: 21.04.2022:
Accrued Interest up to 21.04.2022 Rs. 20,590=00.18
COM.O.S.1583/2022 Penal Interest up to 21.04.2022 Rs. 2,415=00.
Total Rs. 2,00,512=00
Under GECL Account No.39470716778
Outstanding amount as per the Rs. 1,44,490=00.
extract as on: 21.04.2022:
Accrued Interest up to 21.04.2022: Rs. 7,899=00.
Total Rs. 1,52,389=00
Thus, the defendant-firm and its Proprietor are totally liable to pay jointly and severally a sum of Rs.9,06,576/-. The bank has maintained the statement of account and the certified copy of the account extract of the loan account of defendant- firm.
3. Inspite of paper publication, the Defendant has not appeared before this court, after waiting for 30 days, i.e., the time limit for filing written statement, he was placed ex-parte on 16.01.2023.
4. The Plaintiff has examined PW-1 and got marked Ex.P.1 to Ex.P.16. I have heard the arguments of the Advocate for the Plaintiff.18
COM.O.S.1583/2022
5. Based on the above pleadings of the Plaintiff, the following points arise for my consideration :-
1. Whether the Plaintiff is entitled for the Suit Claim from the Defendant ?
2. What Order ?
6. My findings on the above Points are as under:
1. Point No.1 :- In the Partly Affirmative.
2. Point No.2 :- As per the final Order for the following reasons.
REASONS
7. Point No.1 :- The Plaintiff Bank substantiate of this case examined its Manager NPA SMEC Smt. Sikanya S.P. as PW.1. PW.1 in her evidence reiterated averments of the Plaint, and got marked Ex.P.1 to Ex.P.16.
8. In the decision reported in A.I.R. - 2000 - Karnataka - 234 (Syed Ismail vs. Smt. Shamshia Begum), the Hon'ble High Court of Karnataka has held as follows :-
"3. The impugned order does not 18 COM.O.S.1583/2022 disclose the nature of pleading placed by the plaintiff and whether there is prima facie material to grant a decree in his favour. A judgement in favour of the plaintiff is not automatic. The Court has to consider the case of the plaintiff and grant a decree in his favour. The learned trial Judge has not referred to the pleadings of the plaintiff and the documents produced by him to substantiate even a prima facie case for grant of a decree in his favour. Therefore, the judgement and decree in favour of the plaintiff is not automatic on failure of the opposite party to put his defence. The Court can grant a judgement in favour of the party only upon consideration of the case of the plaintiff including appreciation of pleadings and evidence."
9. The averments of the Plaint, evidence of PW.1 and Ex.P.1 to Ex.P.12 discloses that the Defendant firm approached the plaintiff bank for sanction of Cash Credit Loan facility and submitted an application under Pradhan Mantri Mudra Yojana Scheme for purpose of his Business at one of the Plaintiff-Bank Branch, pursuant to which the plaintiff bank sanctioned a Cash Credit Loan of Rs.5,00,000/- on 11.10.2018 for the purpose of her business is available for 12 months subject to review every 12 months, when it may be cancelled/reduced depending upon the conduct and utilisation of the advance, or as per the Bank's Scheme, with interest at the rate of 2.75% margin above MCLR 18 COM.O.S.1583/2022 which is presently 8.45% p.a. present card rate is 11.2% calculated on daily products at monthly rests. Bank shall at any time and form time to time be entitled to vary the margin based on the Credit Risk Assessment of the borrower and the MCLR at its discretion.
10. As per the terms and conditions of sanctioned letters, the Defendant has executed a Letter of Arrangement and Agreement of Loan cum Hypothecation at Ex.P.2 and Ex.P.3. Further, availed a Term Loan of Rs.2,80,000/- on 25.11.2019 and executed a Letter of Arrangement and Supplemental Agreement of Loan cum Hypothecation at Ex.P.4 and Ex.P.5. The same was availlable for 24 months subject to review every 12 months, when it may be cancelled/ reduced depending upon the conduct and utilisation of the advance, or as per the Bank's Scheme. Interest at the rate of 2.75% margin above MCLR which is presently 8.05% calculated on daily product at monthly rests, Bank shall at anytime and from time to time be entitled to vary the margin based on the Credit Risk Assessment of the borrower and the MCLR at its discretion. Agreeing to the terms and conditions the Proprietor of the defendant-firm.
11. The Proprietor of the defendant further executed a Balance Confirmation Letter and a Revival Letter dated 18 COM.O.S.1583/2022 25.11.2019 at Ex.P.6 and Ex.P.7.
12. The defendant-firm availed GECL Loan facility of Rs.1,48,000/- on 07.07.2020 which was to be repaid in 36 monthly installments of Rs.4,200/- each, with the first installment commencing on July 2021 and the last installment falling due on June 2024, with 12 months moratorium with interest at the rate of 0.75% margin above MCLR which is presently 7.05% p.a. and present card rate is 7.80% p.a., agreeing to the same executed a Letter of Arrangement and Supplemental Agreement of Loan cum Hypothecation at Ex.P.9 and Ex.P.10. The Proprietor of the defendant executed a Revival Letter at Ex.P.11.
13. The defendant failed to adhere to various terms and condition mentioned in the agreement and has committed defaults. The defendant has not made payments as agreed and the dues of the bank accumulated. In spite of several requests the defendant did not regularise the account. The Plaintiff Bank got issued a Legal Notice at Ex.P.12 calling upon the defendant to make the Payment. The defendant evaded receiving notice.
14. From Ex.P.14 the Statement of account of Cash Credit loan speaks to the effect that total amount payable Rs. 5,53,675/- towards principle amount from 21.04.2022. The 18 COM.O.S.1583/2022 plaintiff claimed the interest for current and future interest at the rate 10.40% per annum. However by considering the interest prevailing, it is proper to award interest @ 10% per annum from the date of suit till realization.
15. Ex.P.15 the Statement of account of Term loan speaks to the effect that total amount payable towards principle amount of Rs. 2,00,512/- from 21.04.2022. The plaintiff claimed the interest for current and future interest at the rate 9.65% per annum from the date of suit till realization.
16. Ex.P.16 the Statement of GECL account speaks to the effect that total amount payable towards principle amount of Rs. 1,52,389/- from 21.04.2022. The plaintiff claimed the interest for current and future interest at the rate 7.40% per annum from the date of suit.
17. The above mentioned transactions commenced from 11.10.2018 and the last payment was made by the Defendant on 10.08.2021 and the suit filed on 31.10.2022 is within the limitation period.
18COM.O.S.1583/2022
18. In this case in spite of paper publication, the Defendant is not appeared and denied the claim of the Plaintiff Hence, it shows the Defendants admitted the case of the Plaintiff. The evidence of PW.1 and Ex.P.1 to Ex.P.16 are remained unchallenged. Therefore, the Plaintiff is entitle for recovery of the suit claim of Cash Credit loan amount of Rs. 5,53,675/- with interest @ 10% per annum, under the term loan amount of RS. 2,00,512/- with interest at 9.65% and under the GECL amount of Rs, 1,52,389 with interest at 7.40% per annum from the date of suit till realization. Hence, I answer this Point in " Partly Affirmative".
19. Point No.2 : -Therefore, I proceed to pass the following Order.
ORDER The Suit of the Plaintiff is decreed in part with cost.
The Defendant is hereby directed to pay total aggregate sum of Rs.9,06,576/- together with interest as mentioned below.
A sum of Rs. 5,53,675/- for Cash Credit facility account No.38008923463 along with 18 COM.O.S.1583/2022 interest 10% per annum from the date of suit till the realization.
A sum of Rs. 2,00,512/- for term loan account No. 38970957145 along with interest 9.65% per annum from the date of suit till the realization.
A sum of Rs. 1,52,389/- for GECL account No. 39470716778 along with interest 7.40% per annum from the date of suit till the realization.
Draw Decree accordingly.
The Office is directed to send copy of this Judgment to Plaintiff and Defendant to their email ID as required under Order XX Rule 1 of the Civil Procedure Code as amended under Section 16 of the Commercial Courts Act.
( Dictated to the Stenographer, typed by her directly on computer, verified and then pronounced by me in open Court on this the 24th day of January, 2023).
(SUMANGALA S BASAVANNOUR), LXXXII Addl.City Civil & Sessions Judge, Bengaluru.
18COM.O.S.1583/2022 ANNEXURE LIST OF WITNESSES EXAMINED ON BEHALF OF THE PLAINTIFF PW-1 Smt.Sukanya S.P. LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE PLAINTIFF Ex.P.1 Loan application dtd.06.09.2018 Ex.P.2 Letter of Arrangement dtd.11.10.2018 Ex.P.3 Agreement of loan cum hypothication dtd.11.10.2018 Ex.P.4 Letter of arrangement dtd.25.11.2019 Ex.P.5 Supplemental agreement of loan cum hypothication dtd.25.11.2019 Ex.P.6 Balance confirmation letter dtd.25.11.2019 Ex.P.7 Revival letter dtd.25.11.2019 Ex.P.8 Letter of request for standing instructions Ex.P.9 Letter of Arrangement dtd.07.07.2020 Ex.P.10 Supplemental agreement of loan cum hypothication dtd.07.07.2020 Ex.P.11 Revival letter dtd.07.07.2020 Ex.P.12 Office copy of legal notice dtd.18.07.2022 Ex.P.13 Unserved RPAD, opened in open court, notice marked as Ex.P.13(a) Ex.P.14 Statement of loan account under cash credit facility Ex.P.15 Statement of account under term loan facility (05 pages) Ex.P.16 Statement of account under GECL facility with certificate 18 COM.O.S.1583/2022 LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENDANT NIL LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE DEFENDANT NIL (SUMANGALA S BASAVANNOUR), LXXXII Addl.City Civil & Sessions Judge, Bengaluru.