Allowed

Canara Bank v. Sri. Channa Basayya

DRT25 Apr 2024OA/1313/2022

Case brief

AI extract

What is this about?

This Order allowed an Original Application filed by Canara Bank under Section 19 of the RDBFI Act for recovery of Rs.36,27,460.94. The respondents appeared ex-parte, leaving the claim unchallenged. The Tribunal directed recovery from the respondents jointly or severally.

What did the court decide?

Recovery of Rs.36,27,460.94 with interest from the respondents jointly or severally; liberty to sell mortgaged and personal assets for realization.

Canara Bank versus Sri. Channa Basayya — Banking and Recovery | DRT (2024)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA

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AT BENGALURU

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Dated this 25^th day of April 2024

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Present: SMT. S. V. GOWRAMMA Hon’ble Presiding Officer

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OA NO.1313/2022

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BETWEEN:

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Canara Bank Maski Branch, Raichur District, Represented by its Manager Sri Parashuram L Bharamoji

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…APPLICANT

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AND

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Sri. Channa Basayya S/o. Sri.Betadayya Aged about 47 years 137/B, Sante Bazar, Maski Tq: Lingasanur, Raichur District – 581124

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Also at:

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No. 1-4-03, Near Mudugal Cross, Maski, Lingasanur, Raichur District – 581124

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Sri. Sivaramreddy Kulkarni S/o. Sri. Somashekharappa Kulkarni Aged about 34 years 2/103/A, Maski, Lingasanur, Raichur District – 581124. … DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri.Manik.BT

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Defendant Nos.1 & 2 : Ex-parte.

OA No.1313/2022

FINAL ORDER

The present Original Application (OA) is filed on 13-09-2022, under section 19 of the Recovery of Debts due to Banks and Financial Institutions Act 1993 for recovery of a sum of Rs.36,27,460.94/- (Rupees Thirty Six lakhs

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Twenty Seven Thousand Four Hundred and Sixty and Ninety Four Paisa Only) with further interest thereon from the date of filing till realization from defendants.

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The Application filed is within the period of limitation as prescribed under Section 24 of the Recovery of Debts Due to Banks and Financial Institutions Act 1993 and the subject recovery claim falls within the jurisdiction of this Tribunal.

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Brief facts of the case:

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The Applicant Bank submits that the 1^st Defendant executed a Simple Mortgage Deed for Overdraft/ Open Cash Credit of Rs.5,00,000/- (Rupee Five Lakh Only) on 05-10-2015. The same property morefully described in Schedule-I. The Applicant Bank submits that on 15-10-2015, the 1^st Defendant executed a Cash Credit Agreement of Rs.5,00,000/- (Rupee Five Lakh Only). The Applicant Bank submits that on 15-10-2015, the 1st Defendant approached the Applicant Bank seeking an Overdraft loan of Rs.5,00,000/- (Rupee Five Lakh Only) and submitted a Loan Application for the same.

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OA No.1313/2022

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The Applicant Bank submits that on 15-10-2015, the 1^st Defendant applied for Open Cash Credit- Retail Traders/Business Enterprises of Rs.5,00,000/- (Rupees Five Lakh Only) from the Applicant Bank and submitted a Loan Application for the same. The Applicant Bank submits that on 15-10-2015, the 1^st Defendant Submitted an Application and request for Overdraft Facilities of Rs.5,00,000/- (Rupees Five Lakh Only). The Applicant Bank, after due appraisal of the loan application and supporting documents sanctioned the said amount of Rs.5,00,000/- (Rupees Five Lakh Only) vide Sanction Memorandum dated 15-10-2015 at 10.40% rate of interest. The Applicant Bank submits that on 15-10-2015, the 1^st Defendant executed a Pronote of Rs.5,00,000/- (Rupees Five Lakh Only).

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The Applicant Bank submits that on 15-10-2015, the Defendants No.2, executed a Guarantee Agreement along with a Guarantee Covering Letter and Particular of Guarantor for a limit of Rs.5,00,000/- (Rupees Five Lakh Only). The Applicant Bank submits that on 15-10-2015, the 1^st Defendant executed a Supplemental Agreement for enhancement of the loan to Rs.20,00,000/- (Rupees Twenty Lakh Only). The Applicant Bank submits that the 1st Defendant executed a Supplemental Simple Mortgage Deed for Overdraft/ Open Cash Credit of Rs.5,00,000/- (Rupee Five Lakh Only) on 04-06-2016. The same property morefully described in Schedule-I.

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The Applicant Bank submits that on 17-06-2016, The 1^st defendant executed a link letter in respect of enhancement of credit limit from

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OA No.1313/2022

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Rs. 5,00,000/- (Rupees Five Lakh only) to Rs.20,00,000/- (Rupees Twenty Lakh only). The Applicant Bank submits that on 17-06-2016, the 1^st Defendant again approached the Applicant Bank seeking an enhancement of the Open Cash Credit loan to Rs.20,00,000/- (Rupees Twenty Lakh only) and submitted a Loan Application for the same. The Applicant Bank, after due appraisal of the loan application and supporting documents sanctioned the said enhanced amount of Rs.20,00,000/- (Rupees Twenty Lakh only) vide Sanction Memorandum dated 17-06-2016 at 10.70% rate of interest.

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The Applicant Bank submits that on 17-06-2016, the Defendants No.2, executed a Guarantee Agreement along with a Guarantee Covering Letters and Particular of Guarantor for a limit of Rs.20,00,000/- (Rupees Twenty Lakhs only). The Applicant Bank submits that on 17-06-2016, the 1^st Defendant executed a Pronote of Rs.5,00,000/- (Rupees Five Lakh Only). The Applicant Bank submits that on 10-10-2018, the 1^st Defendant executed a letter of Revival in favour of the Applicant Bank with respect to the Limit of Rs.5,00,000/- (Rupees Five Lakh Only). The Applicant Bank submits that on 14-10-2018, the 1^st Defendant executed a letter of Revival in favour of the Applicant Bank with respect to the Limit of Rs.5,00,000/(Rupees Five Lakh Only)

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The Applicant Bank issued a notice dated 20-01-2019 to Defendant No. 1 with respect to the Open Credit Cash loan, calling the entire amount and directing the Defendant to pay the outstanding dues. The Applicant Bank submits that it issued a Possession Notice dated 07-02-2020 to

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OA No.1313/2022

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Defendant No.1. The Applicant Bank submits that it issued a Covering Letter to Sale Notice along with the E-Auction Sale Notice of Immovable Properties to the Defendant No 1 and 2 on 10-02-2020. The Applicant Bank submits that on 13-06-2021, the 1^st Defendant executed a letter of Revival in favour of the Applicant Bank with respect to the Limit of Rs.5,00,000/(Rupees Five Lakh Only).

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The Defendant has become a defaulter in repayment of the said loan amount with interest. The balance outstanding due for loan is Rs.36,27,460.94/- (Rupees Thirty-Six Lakhs Twenty-Seven Thousand Four Hundred and Sixty and Ninety-Four Paisa Only) as on 03-08-2022 along with unapplied interest of Rs. 4,008.00/- (Rupees Four Thousand) from 01.08.2022 to 04.08.2022] with current and future interests at 10.80% compounded half-yearly and penal interest of 2% along with monthly rests up to the date of realization. The Applicant Bank submits that the Defendants, after availing the loans, failed to repay the loan amount and committed default. However, there was no positive response from the defendants. Hence, this Original Application (OA) has been filed to recover the dues from the defendants.

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After the filing of the OA, summons was sent to the Defendants No.1 & 2 by RPAD on 24.12.2022, duly served, Acknowledgement produced. When OA was taken up on 10.04.2023, even after giving sufficient time, there was no appearance or representation from the

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OA No.1313/2022

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defendants, hence, Defendants No.1 & 2 was placed ex-parte on 10.04.2023.

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Heard the submissions of Counsels and perused the records.

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To prove the case, Sri.Parashuram.L. Bharamoji, S/o. Mr. Laxman, aged about 27 years, Manager of the Applicant Bank, has filed Affidavit by way of evidence and same was considered as evidence of AW.1 and marked as Ex.A1, and documents came to be marked as Ex.A3 to A25. As the defendants remained ex-parte, the OA claim remains unchallenged. There is no contra evidence available on record to repudiate the claim of the Applicant Bank.

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Having regard to the amount advanced, the interest applied, documents executed, the conduct and operations in the loan account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled to a final order on the following terms:-

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: O R D E R:

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The OA is allowed with costs,

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(a) The Applicant bank is allowed to recover from defendant Nos.1 & 2

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jointly or severally, a sum of Rs.36,27,460.94/- (Rupees Thirty-Six

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Lakhs Twenty-Seven Thousand Four Hundred and Sixty and

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OA No.1313/2022

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Ninety-Four paise Only) as on 03-08-2022 along with unapplied interest of Rs.4,008.00/-(Rupees Four Thousand) from 01.08.2022 to 04.08.2022] along with current and future interests at 10.80% compounded half-yearly and penal interest of 2% along with monthly rests till the date of realization.

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(b) In the event of failure of the defendants to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the schedule mentioned properties in the OA;

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d) If the sale proceeds of the schedule mentioned properties are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the defendants (both movables and immovables) to recover the balance dues as required under law;

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(e) The Applicant Bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the defendants duly considering the amounts, if any, paid by the defendants and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to

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OA No.1313/2022

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prepare Recovery Certificate for the amount to be paid by

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defendants to the applicant bank.

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(f) The Applicant Bank shall file memo of costs within ten days from the date

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of this final order.

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(g) Recovery Certificate shall be drawn up and issued to the Recovery

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Officer in terms of the final order.

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14. A copy of this order be communicated to the parties concerned.

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[Dictated to the (GS), transcribed by him, corrected and signed by me on this the 25^th day April 2024].

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Sd/-

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PRESIDING OFFICER DRT-II, BENGALURU

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Sri. Parashuram. L. Bharamoji, Manager of the Applicant Bank.

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Exhibits on the part of the Applicant:

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Sl. No	PARTICULARS	EXHIBITS
1.	Copy of the Simple Mortgage Deed of Rs.5,00,000/- (Rupee Five Lakh Only) on 05-10-2015.	A3
2.	Copyof the Cash Credit Agreement dated 15-10-2015	A4
3.	Copy of the Loan Application of Rs.5,00,000/- (Rupee Five Lakh Only)dated 15-10-2015	A5

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	Copy of the Common Application form Retail	A6
4.	Traders/Business Enterprises of Rs.5,00,000/- (Rupees Five Lakh Only)dated 15-10-2015
	Copy of the request for Overdraft Facilities of	A7
5.	Rs.5,00,000/- (Rupees Five Lakh Only) dated 15-10-2015
	Copy of the Sanction Memorandum for the OCC Loan	A8
6.	of Rs.5,00,000/- (Rupees Five Lakh Only) dated 15-10-2015
7.	Copy of a Pronote of Rs.5,00,000/- (Rupees Five Lakh Only)dated 15-10-2015	A9
8.	Copy of a Guarantee Agreement along with a Guarantee Covering Letters and Particular of Guarantor for a limit of Rs.5,00,000/- (Rupees Five Lakh Only)dated 15-10-2015	A10
9.	Copy of a Supplemental Agreement Rs. 5,00,000/- (Rupee Five Lakh Only)dated 15-10-2015	A11
10.	Copy of Supplemental Simple Mortgage Deed for Overdraft/ Open Cash Credit of Rs.5,00,000/- (Rupee Five Lakh Only)on 04-06-2016	A12
11.	Copy of a link letter in respect of enhancement of credit limit from Rs. 5,00,000/- (Rupees Five Lakh only) to Rs.20,00,000/- (Rupees Twenty Lakh only) dated 17-06-2016	A13
12.	Copy of an enhancement application for the Open Cash Credit loan of Rs.20,00,000/- (Rupees Twenty Lakh only)dated 17-06-2016	A14
13.	Copy of the Sanction Memorandum for the OCC Loan enhancement of Rs.20,00,000/- (Rupees Twenty Lakh only)dated 17-06-2016	A15
14.	Copy of a Guarantee Agreement along with a Guarantee Covering Letter and Particular of Guarantor for a limit of Rs.20,00,000/- (Rupees Twenty Lakh only)dated 17-06-2016	A16
15.	Copy of a Pronote of Rs.20,00,000/- (Rupees Twenty Lakh only)dated 17-06-2016	A17
16.	Copy of a Letter of Revival for account no. 0545261000276 dated 10-10-2018	A18
17.	Copy of a Letter of Revival for account no. 0545261000276 dated 14-10-2018	A19

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OA No.1313/2022

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18.	Copyof a Demand Notice dated 20-01-2019	A20
19.	Copy of the Notice under section 13(2) of the SARFAESI ACT 2002,to borrower dated 18-10-2019	A21
20.	Copy of a Possession Notice under section 13(4) of the SARFAESI ACT 2002,dated 07-02-2020.	A22
21.	Copy of a Covering Letter to Sale Notice along with the E-Auction Sale Notice dated 10-02-2020	A23
22.	Copy of a Letter of Revival for account no. 0545261000276 dated 13-06-2021.	A24
23.	Copy of the Statement of Accounts with run date 03- 08-2022 for the a/c no. 0545261000276.	A25

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Witness Examined for the Defendants:

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-Nil –

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List of Documents Exhibited for the Defendants:

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-Nil –

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SCHEDULE-I

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Plot bearing Grampanchayat No. 5-6-145/11, 5-6-145/12, 5-6-145/13, 5-6-145/14 & 5-6-145/15 belonging to Sri. Channe Basayya (Defendant No. 1) situated at Kamblimatt Layout, Maski Taluk, Raichur District bearing:

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Survey No.	Extent	Village	District	Boundaries
	E x W 30 feet	Kamblimatt Layout	Raichur	E : Plot No.16
213/4	and N x S 40 feet.	Maski, Lingasugur taluk,		W : Plot No. 10 N : Road S : N.A. Land of Mallayya

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PRESIDING OFFICER DRT-II, BENGALURU

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Sd/-

Canara Bank v. Sri. Channa Basayya

Case brief

What is this about?

What did the court decide?

Canara Bank v. Sri. Channa Basayya

Case brief

What is this about?

What did the court decide?

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