FEDERAL BANK LTD. Vs. VENUS KNITTING INDUSTRIES AND ORS.
LAWS(DR)-2007-2-3
DEBTS RECOVERY APPELLATE TRIBUNAL
Decided on February 15,2007

FEDERAL BANK LTD. Appellant
VERSUS
Venus Knitting Industries And Ors. Respondents

JUDGEMENT

K.Gnanaprakasam, J. (Chairperson) - (1.) THIS regular appeal is directed as against the order dated 31.5.2006 in OA 35/2006 passed by DRT, Ernakulam.
(2.) THE appellant Bank filed the suit in OS -29/1991 before the Sub -Court, Kottarakara, Kerala for recovery of a sum of Rs. 85,609.75p in respect of Working Capital Term Loan Account and for Rs. 78,034/ - due under Cash Credit Account, for a total sum of Rs. 1,63,643.75 together with interest @ 14% p.a. with quarterly rests from the defendants jointly and severally and charge on the schedule of properties. The suit was decreed ex parte on 30.1.1996 and the same was challenged by the respondents in CRP -511/2001, and the High Court of Kerala set aside the ex -parte decree by Order dated 7.7.2004 and the suit was restored to file. That thereafter, the suit was decreed on 20.12.2004, and the judgment reads as under: In the result, the suit is decreed (A) Allowing the plaintiff to recover Rs. 85,609. 75 as shown in the memo of account 'A' with future interest at the rate of 14% per annum with quarterly rests. (B) Allowing the plaintiff to recover a sum of Rs. 78,034/ - as shown in the memo of account 'B' along with future interest at the rate of 14% per annum with quarterly rests from the defendants and their assets and charged on the mortgaged properties along with costs. As on 2006, the principal and interest found due more than Rs. 10 lakhs, and hence, the appellant Bank filed an application before the DRT, Ernakulam under Section 31(A) of the RDDB & FI Act, 1993 in OA -35/2006 for issuance of Recovery Certificate, in terms of the decree dated 20.12.2004 claiming a sum of Rs. 13,05,491/ -. The respondents did not contest the OA. But, however, the Tribunal had considered the decree and judgment passed by the Civil Court and held that the decree does not provide for payment of interest from 23.1.1991 i.e. the date of filing of the suit to 20.12.2004 the date of decree and it only provides for future interest from the date of decree at 14% p.a. with quarterly rests, and disallowed interest for the pendente lite period. On a calculation of the principal sum due on the date of suit, plus the interest from the date of decree, plus the costs awarded under the decree, works out to approximately Rs. 4 lakhs only and as it was less than Rs. 10 lakhs, the appellant cannot invoke the provisions of Section 1(4) read with Sections 17 and 18 of the RDDB & FI Act, 1993 and dismissed the OA. Aggrieved by the same, the Bank has preferred this appeal. I have heard the Authorised Officer of the appellant Bank and the learned Advocate for the respondents. The appellant filed the suit before the Civil Court in the year 1991 and it was decreed ex parte on 30.1.1996, which was challenged before the High Court in CRP -511/2001 and the High Court, by its Order dated 7.7.2004, allowed the CRP and the case was remanded and taken on file by the Sub -Court, Kottarakkara. Subsequently, the Civil Court decreed the suit by decree and judgment dated 20.12.2004, which runs as under: (A) Allowing the plaintiff to recover Rs. 85,609.75 as shown in the memo of account 'A' with future interest at the rate of 14% per annum with quarterly rests. (B) Allowing the plaintiff to recover a sum of Rs. 78,034/ - as shown in the memo of account 'B' along with future interest at the rate of 14% per annum with quarterly rests from the defendants and their assets and charged on the mortgaged properties along with costs.
(3.) THE Authorised Officer of the appellant Bank has submitted that they are entitled, not only to future interest, but also interest for the pendente lite period. The Civil Court never denied the interest for the pendente lite period. The Civil Court did not specifically say in the judgment either allowing the interest or disallowing the interest for the pendente lite period, and therefore, the appellant is entitled to recover interest for the pendente lite period also (i.e. from the date of filing of the suit till the date of decree), which would come to more Rs. 10 lakhs, and therefore, the provisions of the RDDB & FI Act, 1993 get attracted, and the CA filed by the appellant for the issuance of Recovery Certificate, is sustainable.;


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