Allowed

Canara Bank v. Sri. Prabhakar H. Avaraddi

DRT5 Feb 2024OA/1462/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an Original Application filed by Canara Bank against two borrowers for recovery of outstanding loan dues totaling approx. Rs. 46.36 lakhs arising from Horticulture Plantation and Farm Machinery loans, granting interest and authorizing recovery from schedule property.

What did the court decide?

Recovery of Rs. 46,36,544/- plus interest, with liberty to sell schedule properties and personal assets for balance dues.

Canara Bank versus Sri. Prabhakar H. Avaraddi — Contract and Commercial Disputes | DRT (2024)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 5^th Day of February, 2024

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

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OA. No.1462/2022

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BETWEEN:

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Canara Bank, RON Branch, Dr. L. R. Radder Building, First Floor, Old Santhe Bazar, Ron, Gadag Dist., Karnataka – 582 209. Represented by its Sr. Manager and PA Holder Sri. Shubhranshu Shukla … APPLICANT

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AND:.

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Sri Prabhakar H. Avaraddi Aged about 39 years, S/o. Hanumaradappa

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Sri Shambulingappa H. Avaraddi Aged about 42 years, S/o. Hanumaradappa

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Both are residents of: Abbigeri Village and PO Ron Taluk, Gadag District - 582 209 ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri. HSR & Associates Defendant No.1 & 2 : Exparte.

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FINAL ORDER

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The present Original Application (OA) is filed on 13.09.2022 under

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OA. No. 1462/2022

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section 19 of Recovery of Debts and Bankruptcy Act 1993 for recovery of a sum of Rs.46,36,544/- (Rupees Forty-Six Lakhs Thirty-Six Thousand Five Hundred and Forty-Four Only) with further interest thereon from the date of filing the Application till realization from the Defendants.

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The application filed is within the period of limitation as prescribed under Section 24 Recovery of the Debts and Bankruptcy Act 1993 and the subject recovery claim falls within the jurisdiction of this Hon’ble Tribunal.

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Brief facts of the case:

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It is the case of the applicant bank where in the Defendant No. 1 & 2 are brothers (borrower) had approached the applicant bank seeking for Horticulture Plantation Loan of Rs.2,99,000/- (Rupees Two Lakhs NinetyNine Thousand Only) an loan application dated 22.08.2006 for the purpose of Pomegranate Plantation. After considering the proposal of the Defendant

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No. 1 & 2 applicant bank sanctioned the for Farm Machinery Loan of Rs.2,99,000/- (Rupees Two Lakhs Ninety-Nine Thousand Only) vide Sanction Memorandum dated 22.08.2006. The Defendants have agreed to repay the Loan is payable in 08 Yearly Instalments of Rs.10,000, Rs.30,000/-, Rs.70,000/-, Rs.80,000/- and Rs.1,09,000/-, first of such instalments commencing from 30.08.2009 and to pay interest and other charges separately as and when due. The Defendants have agreed to pay interest @11.75% p.a. compounded half yearly and a penal interest of 2% p.a. on the overdue amount .

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OA. No. 1462/2022

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3.1. The defendants executed necessary loan documents in favour of the applicant bank as security for the due repayment of the loans, interest, cost and charges, and Defendant No. 1 & 2 executed Memorandum of Agreement for Agricultural Loans dated 22.08.2006 and Letters of Revival dated 14.05.2009, 16.08.2011, 31.12.2013, 07.09.2016, 05.07.2019, and 01.07.2022 in favour of the Applicant Bank.

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Further, the Defendant No. 1 & 2 had approached the applicant bank seeking for Farm Machinery Loan of Rs.4,24,000/- (Rupees Four Lakhs Twenty-Four Thousand Only) an loan application dated 22.09.2006 for the purpose of purchase of Tractor and Trailer. After considering the proposal of the Defendant No. 1 & 2 applicant bank sanctioned the for Farm Machinery Loan of Rs.4,24,000/- (Rupees Four Lakhs Twenty-Four Thousand Only) vide Sanction Memorandum dated 22.09.2006. The Defendants have agreed to repay the loan in 16 Half-Yearly Instalments of Rs.27,000/- each for the first 15 instalments and the last and 16^th instalment of Rs.19,000/-, and to pay interest and other charges separately as and when due. The Defendants have agreed to pay interest @ 10.50% p.a. compounded half yearly and a penal interest of 2% p.a. on the overdue amount.

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4.1. The defendants executed necessary loan documents in favour of the

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applicant bank as security for the due repayment of the loans, interest, cost and charges, and Defendant Ns. 1 & 2 executed Memorandum of

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OA. No. 1462/2022

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Agreement for Agricultural Advances dated 31.09.2006 and Simple Mortgage Deed for Agricultural Advances dated 29.09.2006 registered as RON-1-01646-2006-07 stored in CD No. ROND10 before the Sub-registrar Ron and Letters of Revival dated 01.09.2009, 22.08.2011, 25.09.2013, 06.09.2016, 05.07.2019, and 20.06.2022 in favour of the Applicant Bank.

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The Applicant Bank submits that the Defendants, after availing the said facilities, failed to repay the loan amount and committed default. The Applicant bank issue a Legal Notice dated 01.06.2022 calling upon the defendants to repay the entire outstanding loan amount.in respect of both loans. 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 Defendant Nos.1 & 2 Registered Post with Acknowledgment Due the same is duly served on 28.03.2023. Therefore, service held sufficient. When OA was taken up on 19.07.2023 even after giving sufficient time, there was no appearance or representation from the Defendants; hence, Defendant Nos.1& 2 were placed exparte on 09.01.2024.

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Heard the submissions of Applicant Bank and perused the records.

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To prove the case of the Applicant Bank, Sri. Shubhranshu Shukla

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S/o Ashok Shukla, Senior Branch Manager, has filed Affidavit by way of evidence and same was considered as evidence of AW.1 and marked as

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OA. No. 1462/2022

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Ex.A1, the list of Document came to be marked as Ex.A2 and documents

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came to be marked as Ex.A3 to A28. As the Defendant remained ex-

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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, the

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conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled to a

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final order on the following terms:

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: O R D E R:

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9. The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from Defendants to pay an

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amount of Rs.46,36,544/- (Rupees Forty-Six Lakhs Thirty-Six Thousand Five Hundred and Forty-Four Only) consisting of:

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i. Horticulture Plantation liability of Rs.8,91,195/- (Rupees eight lakh ninety one thousand one hundred and ninety five only) carries interest @

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10.85% p.a. compounded half yearly from the date of OA till the date of realization.

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ii. Farm Machinery liability of Rs.27,45,349/- (Rupees twenty seven lakh

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forty four thousand three hundred and forty nine only) carries interest @

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OA. No. 1462/2022

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13.95% p.a. compounded half yearly from the date of OA till the date of realization.

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

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order;

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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 defendant (both movable and immovable) respectively 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 defendant duly considering the amounts, if any, paid by the defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the

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amount to be paid by the respective defendants to the applicant bank.

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(f) The applicant bank shall file memo of costs within ten days from the

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date of this final order.

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OA. No. 1462/2022

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

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[Dictated to the (CS), transcribed by her, corrected and signed by me on this the 5^th Day of February 2024].

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Sd/DRT-II, BENGALURU

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PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Sri. Shubhranshu Shukla S/o Ashok Shukla, Senior Branch Manager, of Applicant Bank.

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Exhibits on the part of the Applicant:

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Exhibit Nos.	Particulars of Documents	Date
A1	Applicant Evidence
A2	List of Documents.
A3	Loan Application submitted by the Defendants to the Applicant Bank for Horticulture Plantation Loan	22.08.2006
A4	Memorandum of Agreement for Agricultural Advances executed by the Defendants in favour of the Applicant Bank for Horticulture Plantation Loan	22.08.2006
A5 to A10	6 Nos. Letters of Revival executed by the Defendants in favour of the Applicant Bank.	14.05.2009 16.08.2011 31.12.2013 07.09.2016 05.07.2019 01.07.2022
A11	Loan Application submitted by the Defendants to the Applicant Bank for Farm Machinery Loan	22.09.2006
A12	Sanction Memorandum issued by the Applicant Bank for Farm Machinery Loan	-

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OA. No. 1462/2022

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A13	Memorandum of Agreement for Agricultural Advances executed by the Defendants in favour of the Applicant Bank for Farm Machinery Loan	31.09.2006
A14	Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos.01 and 02 in favour of the Applicant Bank	29.09.2006
A15	Registration Certificate of the Tractor bearing Registration No. KA26/T-8233	09.01.2007
A16	Registration Certificate of the Trailer bearing Registration No. KA26/T-8234	09.01.2007
A17 to A22	6 Nos. Letters of Revival executed by the Defendants in favour of the Applicant Bank	01.09.2009 22.08.2011 25.09.2013 06.09.2016 05.07.2019 20.06.2022
A23 to A26	02 Nos. of Legal Notices issued by the Applicant Bank to the Defendants along with two postal acknowledgement cards	01.06.2022
A27 & A28	02 Nos. of Certified Account Extract of the Defendants maintained by the Applicant Bank in usual and ordinary course of business in respect of Horticulture Loan and Farm Machinery Loan	26.07.2022

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Witness Examined for the Defendants: -Nil -

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List of Documents Exhibited for the Defendants: -Nil -

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SCHEDULE A PROPERTY

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The Defendants are the owners of the following agricultural lands situated at Yarebellari Village, Ron Taluk, Gadag District, Karnataka – 582 102

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Sl. No.	Sy. Nos.	Extent A – G	Boundaries
			East by : Land of Malashetti
1.	181/2A	06-20	West by : R. S. No. 181/2A North by : Land of Suresh Avaraddi
			South by : Land Keriyavar
2.	181/2B	07-05	East by : Land of Malashetti West by : Land of R. S. No. 181/1

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OA. No. 1462/2022

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North by : Land of R. S. No. 181/2A South by : Land Keriyavar

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SCHEDULE B PROPERTY

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Tractor & Trailor bearing Registration No. KA26/T8233 and KA26/T8234 standing in the name of Defendant No. 02 and the lien of the Applicant Bank noted in the Certificate of Registration.

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Sd/-

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PRESIDING OFFICER

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DRT-II, BENGALURU

Canara Bank v. Sri. Prabhakar H. Avaraddi

Case brief

What is this about?

What did the court decide?

Canara Bank v. Sri. Prabhakar H. Avaraddi

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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