DENA BANK Vs. FEENA PETROPRODUCTS LIMITED
DEBTS RECOVERY APPELLATE TRIBUNAL
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Harihar P.Chaturvedi, -
(1.) THE Bank has filed the present application against the defendants for recovery of Rs. 1,38,35,487.83p. which was granted to the D1 company under (a) Cash Credit Hypothecation and (b) Letter of Credit DA/DP and interest thereof. THE Bank has also sought a prayer for issue of recovery certificate for the above said amount along with contractual rate of interest at 19.09% with quarterly rests and also sought for sale of hypothecated and mortgaged properties and further reliefs in favour of the Bank those are necessary to render justice.
(2.) The applicant Bank is a nationalised Bank having its registered office at Mumbai and one of its branches amongst others at Nungambakkam, Chennai 600 034 and is represented by the branch manager in the present OA.
The first defendant is a private limited company, of which defendants 2 to 4 are directors. The D5, The Tamilnadu Industrial Investment Corporation Ltd. is a state financial institution and is impleaded only as a proforma party and no relief is sought against the 5th defendant.
(3.) IT is the case of the Bank that D1 company approached the applicant Bank for getting financial assistance. The applicant Bank considered the said request and sanctioned certain credit facilities on individual and personal guarantee of D2 to D4 and granted Cash Credit Hypothecation Limit of Rs. 50.00 lakhs and Letter of Credit DA/DP limit of Rs. 100.00 lakhs on 22.7.1997. To evidence proof of the loan facilities availed, D1 company has executed necessary loan agreement documents and defendants 2 to 4 executed letter of continuing guarantee. IT is further submitted by the Bank that to secure the loan, defendants 2 to 4 deposited their title deeds relating to their respective properties with an intent to create equitable mortgage in favour of the Bank oh 2.11.1996. The first defendant company also represented by the D3 Mr. A.S.K. Newton deposited its title deeds relating to property mentioned in the schedule Of the OA with an intent to create equitable mortgage and the first defendant also created second charge in favour of the Bank over all its other assets including the goods, book debts, movables, immovables, plant and machinery described in the schedule and this charge was duly registered with the Registrar of Companies. The Bank further contended that the first charge holder in respect of items under second schedule is the D5 (TICC) and second charge is created in favour of the Bank. The Bank further pleaded that in case the D5 is selling these items for recovery of its dues, the D5 is liable to pay the excess amount of the sale proceeds to the applicant Bank. The Bank further pleaded the D1 company also hypothecated its movables as security which are described in the schedule of the OA.;
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