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Drt case filed against me for loan recovery-textile company

Querist : Anonymous (Querist) 21 May 2019 This query is : Resolved 
Hello Sir,

I am from Guindy and I am in dire need of advice from legal persons.

The case i am facing is as follows:
My brother and his cousin had planned for a Textile unit in a Textile park near Chennai and took a loan of 2 Cr from nearest branch. He received a loan under CGTMSE scheme.But he needed more money for finance, so he came to me and told about CGTMSE scheme. He tried to convince me to take loan on my and my wife's name and provide this to his business. He told me that CGTMSE scheme is collatoral free .If anything bad happens nothing will happen to me and the plant and machinery will be the cost for repay, nothing else. As he was my small brother , I got completely convinced about it.

In the background, he created a company on me and my Wife's name as proprietor which will be having sub-lease contract under his Textile mill. He then brought some documents to us and we blindly signed it.He had created even rubber stamps, business Cards of my and my wife's name. Total loan taken is 80 Lakh* 2=1.6 Cr on me and my wife's name. We never signed any other paper after related to this. He also took all the bank documents including the passbook, ATM card with him.
The brother bought a new car, created a good rapo with local politicians and enjoyed his time.
And in the next 6 months, the Textile mill got closed and he disappeared. Some time passed with distress.

One day,we saw a notice in the newspaper that bank have filed a case to DRT under RDBFI Act 1993.
We attended DRT on summoned date and received a copy of the filed case.Following things it read:
1.Loan has been defaulted of amount 1.09 Cr(including interest) each and case is filed for recovery. Plant and machinery valuation is approx 1/2 of the total loan amount.
2.Also, the case paper contains the Term Credit document which we had signed in very begining. Now, the point i noticed is that, when we signed on doc, it was having my brother's name as "Borrower's name "column. But in the case paper received from DRT, The "Borrower's name" has been changed to me and my wife's name. There is a clear sign of rubbing his name and adding me and My Wife's name.
3.In Term Credit document, Some of the signs are forged.

With this background, Following are the queries:
1.what should be my further course of action?
2.Can I say to DRT that above things happened and I dont have any role in this case
3. Will my property be confiscated?And my wife dont have any property on her name. What will happen in her case?
4.Also, i have found out that the plant and half of the machinery was on my brother's name. Some machinery on my name and there is no machinery on my Wife's name. Is there any possibility, that i can make use of his property to repay the loan on my and my wife's name.
5.What will be the worst case scenario in this situation? Will there be any criminal case filed against me and my wife?
6.Can we file any case against bank / or my brother in court?

Request you all to please provide your invaluable advices.

Dr J C Vashista (Expert) 22 May 2019
Be brief and specific for obligation of experts.
Querist : Anonymous (Querist) 22 May 2019
Reduced the size of query sir. Please have a look now and provide your invaluable advice.
PS: I have recently found out that my brother lives in Bangalore now and there he and his cousin had done simillar cases and have taken loans from some other banks of amount 2-5 Cr.
We received call from him that he is trying for One-Time-Settlement by taking such loans and repaying our loan. I am afraid i cannot believe him this time and he just faking another story.
K.K.Ganguly (Expert) 22 May 2019
1. Since it is a CTMSE loan, 75% of the loan has been insured by the Government.

2. For claiming the insured amount fromn theGovernment, the Bank shall have to show evidence that they have taken legal step against the defaulting Borrowers being you and your wife by filing the Original Application (O.A.) under Recovery of Debts Due to Banks and Financial Institution Act.

3. Since no property has been mortgaged to secure the loan provided by the Bank, you do not face any immediate loss.

4. However, the CIBIL scrore for yourself and your wife shall be spoiled completely.

5., If it is found that money has been syphoned out from youir firm/company illegally, then the Bank might lodge a police complaint agasint you and it is no point on your part to pass on the buck to your brother.
krishna mohan (Expert) 23 May 2019
Better you consult a practising lawyer specialized on loan recovery cases with all papers cited by you and right advise. But normally any assets created out of the loan will be mortgaged to Bank and hence you can check on that so that such unused new machineries are disposed of by the Bank as per procedure to recover the dues. From above facts it appears your brother is a routine cheater of bank and enjoying his life. But how come such a huge loan is not secured through collateral and your brother has not even guarantor when you got the loan for the benefit of him.
Querist : Anonymous (Querist) 24 May 2019
Thank you for reply. I am tring to have a lawyer for the case now as per your advice.
I am understanding now that he done all this because it was collatoral free CGTMSE scheme.
As you said, bank will dispose off machinery to recover loan.But the machinery cost is just 1/3 of the loan.So will bank take any action on me to recover remaining loan? like attaching the property?
Also can anyone provide some light on "├ľNE TIME SETTLEMENT"?
K.K.Ganguly (Expert) 24 May 2019
1.75% i.e. 3/4th of the loan is insured which will be paid by the Government to the Bank.

2. Remaining amopunt will be recovered by selling the Machinery.

3. So, there will hardly be any outstanding left to be recovered by the Bank for attaching your personal propertis.

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