Bangalore District Court
Canara Bank vs Sri.C.Sakresha on 3 March, 2023
1 Com.O.S.No.553/2020
In the Court of LXXXIV Addl. City Civil and Sessions Judge
(CCH-85) (Commercial Court), Bengaluru
Dated this the 3rd day of March 2023
Present: Smt.H.R.Radha B.A.L., LL.M.
LXXXIV Addl. City Civil and Sessions Judge,
(CCH-85 Commercial Court) Bengaluru
Com.O.S.No.553/2020
Plaintiff Canara Bank, a body Corporate
Constituted under banking Companies
(Acquisition and transfer of undertakings)
Act 1970, having its head office at No.112,
J.C.Road, Bangalore-560002 and having
one of its branch offices called Akshaya
Nagar Branch, Bengaluru-560068, rep. by
its Manager Sri.Vijaya Kumar, S/o
M.K.Padmanabhaiah, aged about 59 years
(By Sri.K.Aswathanarayana, Adv.)
Vs
Defendant Sri.C.Sakresha, S/o Chinnappa, aged about
40 years, No.86, 5th Cross, T.G.Layout,
Ittamadu, Bangalore-560085, and doing
Hotel business in the name of "Nammura
Donne Biryani", No.116/A, 7th Main, 11th
Cross, MSRS Nagar, Bilekahalli, Bengaluru-
560076, and R/at No.30/20, 5th Cross, Near
VBB Bakery, T.G.Layout, Ittamadu, BSK 3 rd
stage, Bengaluru-560085
(Exparte)
Date of Institution 17.01.2020
2 Com.O.S.No.553/2020
Nature of the suit For recovery of business loan
Date of Commencement 03.03.2023
of recording of evidence
Date on which judgment 03.03.2023
pronounced
Total Duration YEARS MONTHS DAYS
03 01 14
LXXXIV Addl. City Civil & Sessions Judge
(CCH-85 Commercial Court) Bengaluru
JUDGMENT
This suit for recovery Rs.19,34,410.22 with interest and seizure of the hypothecated assets from the defendant and to appropriate the sale proceeds towards the outstanding liability, by selling the same, was initially assigned to CCH-42 and transferred to this court by notification dated 07.01.2023.
2. Brief facts of the plaintiff's case are that the defendant who was enjoying various credit facilities, approached them for loan of Rs.10,00,000/- for his hotel business and the same was sanctioned on 23.02.2017. The defendant agreed to repay the same in 84 EMIs of Rs.16,601/- commencing from 23.03.2017 3 Com.O.S.No.553/2020 with interest at 8.45% p.a. compounded monthly and penal interest of 2% on the overdue amount, and executed the deed hypothecating the machinery etc., as also loan agreement to adhere to the terms of sanction. On his failure to repay the amount, legal notice dated 16.08.2019 was issued but not served as the defendant had left the premises. As on 10.01.2020, including interest the defendant was liable to pay Rs.9,16,797/- and as on the date his liability was Rs.9,18,989/- under MSME Services loan account bearing No.3850768000071. 2(a). The defendant once again approached them for loan of Rs.10,00,000/- for Generator Set Hiring Business. On sanctioning the same, the defendant executed deed of hypothecation on 02.06.2017 hypothecating four Kirloskar Generators and letter of undertaking agreeing to repay the same in 84 EMIs of Rs.16,601/- commencing from 02.07.2017 with interest at 8.45% p.a. compounded monthly and penal interest of 2% on the overdue amount. On the failure to repay the amount, legal notice was sent through RPAD on 13.08.2019 but it could not be served as the defendant had left the address. As on the date of the suit, the defendant was liable to pay Rs.9,67,697.75 towards MSME Services loan account account bearing No.3850768000084.
4 Com.O.S.No.553/20202(b). The defendant was enjoying temporary over draft facility in his savings bank account No.3850101000607 during the usual course of business, for payment of interest, ATM, Can Card debits etc. By reason of not clearing the temporary over drafts in spite of repeated requests, the defendant is due a sum of Rs.47,724.47 as on 14.01.2020 including interest. Thus the outstanding dues from the defendant's side is Rs.19,34,410.22 and the same is to be recovered with interest at 12.25% on the MSME Service Loans and 16.4% p.a. on the temporary overdraft facility in the SB account, compounded monthly.
3. The defendant is placed exparte.
4. The Senior Manager of the plaintiff bank has filed affidavit in lieu of examination in chief, examined herself as Pw1 and got marked Ex.P1 to P20.
5. Heard arguments.
6. The points that arise for my consideration are:
1. Whether the plaintiff is entitled for a sum of Rs.19,34,410.22/- from the defendant with interest as prayed?
2. What order?5 Com.O.S.No.553/2020
7. My findings on the above points are Point No.1: In the affirmative Point No.2: As per final order for the following REASONS
8. Point No.1: Pw1, the Senior Manager of the plaintiff bank has filed affidavit reiterating that the bank sanctioned business loan of Rs.10,00,000/- each on 23.02.2017 and 02.06.2017 vide Ex.P2 and P11, at the request of the defendant for carrying on hotel business and generator set hire business as per the loan application at Ex.P1 and P10 respectively. The defendant undertook to repay the same in 84 installments with interest and hypothecated the assets by executing hypothecation deeds and undertakings at Ex.P3, P4, P12 and P13 respectively.
9. Pw1 also states that the defendant enjoyed temporary overdraft facility in SB account bearing No.3850101000607. On his failure to adhere to the repayment terms, legal notices at Ex.P5 and P14 were issued on 16.08.2019 and 13.08.2019 through RPAD as evidenced from Ex.P6 to P8 and Ex.P15 to P18 respectively but could not be served as he had left the address.
10. To prove the outstanding balance, the plaintiff relies on Ex.P9, P19 and P20, certified statement of accounts extracts in 6 Com.O.S.No.553/2020 respect of MSME Services loan account bearing No.3850768000071, 3850768000084 and the SB account with temporary overdraft facility. The defendant has failed to contest the suit even after service of summons and therefore I do not find any reason to discard the evidence of Pw1 with regard to the loan transactions of the defendant, execution of hypothecation deeds and letter of undertakings or to discard the entries in the statement of accounts extracts which reflect the fact that the outstanding dues have remained unpaid.
11. In the above circumstances, the point for consideration is answered in the affirmative holding that the plaintiff is entitled to recover from the defendant a sum of Rs.19,34,410.22 rounded off to Rs.19,34,410/- with current and future interest at 10% p.a., cost of the proceedings and notice charges of Rs.5,000/-. The plaintiff is at liberty to recover the same by seizure and sale of the hypothecated machinery/ equipment/ generators.
12. Point No.2: In the result, I pass the following ORDER The suit is decreed with cost.
7 Com.O.S.No.553/2020
The plaintiff is entitled to Rs.19,34,410/- from the defendant with interest at 10% p.a. from the date of suit till the date of realization and notice charges of Rs.5,000/-.
Further, the plaintiff is at liberty to recover the same by seizure and sale of the hypothecated machinery/ equipment/ generators.
Draw decree accordingly.
Issue copy of the judgment through e-
mail as provided U/o XX Rule 1 of CPC, if mail ID is furnished.
(Dictated to the court hall Data Entry Assistant typed by her directly on the computer, corrected and then pronounced by me in the open court on this the 03rd day of March 2023) (H.R.Radha) LXXXIV Addl.City Civil and Sessions Judge, (CCH-85 Commercial Court) Bengaluru ANNEXURE List of witnesses examined for the Plaintiff:
Pw1 Shantha Lakshmi L. 8 Com.O.S.No.553/2020 List of documents marked for the plaintiff:
Ex.P1 Defendant's loan application dated 23.02.2017 for hotel business purpose Ex.P2 Sanction memorandum Ex.P3 Agreement of loan cum deed of hypothecation with particulars of machinery executed by the defendant Ex.P4 Letter of undertaking Ex.P5 Office copy of legal notice dated 16.08.2019 Ex.P6 to P8 Three unserved RP covers Ex.P9 Certified statement of accounts extract in respect of MSME services A/c No.3850768000071 with certificate under the provisions of Bankers' Book Evidence Act Ex.P10 Loan application submitted by the defendant on 02.06.2017 for purchasing four sets of power generators Ex.P11 Sanction memorandum Ex.P12 Agreement cum deed of hypothecation with particulars of hypothecated assets Ex.P13 Letter of undertaking Ex.P14 Office copy of legal notice dated 13.08.2019 Ex.P15 & P16 Two postal receipts Ex.P17 & P18 Two unserved RP covers Ex.P19 Certified statement of accounts extract in respect of MSME services A/c No.3850768000084 with certificate under the provisions of Bankers' Book Evidence Act Ex.P20 Certified statement of accounts extract in respect of the defendant's SP A/c No.3850101000607 with certificate under the provisions of Bankers' Book Evidence Act 9 Com.O.S.No.553/2020 to show that the defendant has drawn the loan amounts and he has TOD on the said account List of witnesses examined for the defendant: NIL List of documents marked for the defendant: NIL (H.R.Radha) LXXXIV Addl.City Civil and Sessions Judge, (CCH-85 Commercial Court) Bengaluru