Allowed

Canara Bank v. Ramachandraiah

DRT15 Feb 2024OA/559/2022

Case brief

AI extract

What is this about?

The DRT allowed an OA filed by Canara Bank for recovery of Rs. 14.69 crores against four agricultural borrowers who were in default. The defendants were dismissed for default, and the bank was directed to recover dues via sale of mortgaged properties and assets.

What did the court decide?

Directed defendants to pay Rs. 14.69 crores with future interest. Bank granted liberty to recover by sale of schedule properties and personal assets; Recovery Certificate to be issued.

Canara Bank versus Ramachandraiah — Execution and Attachment | DRT (2024)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 15^th Day of February 2024

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Present: SMT. S. V. GOWRAMMA

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Hon’ble Presiding Officer

OA NO.559/2022

BETWEEN:

Canara Bank,

Hi-Tech Agricultural Finance Branch, “M” Block, Unity Building, J. C. Road, Bangalore 560002, represented by Its Chief Manager Sri V. Chandrasekaran.

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…APPLICANT .

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AND:

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Sri B. M. Ramachandraiah, S/o B. L. Mallappa, Aged about 74 years,

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Smt. Sharadamma @ Shivamma, W/o, Sri B. M. Ramachandraiah, Aged about 71 years,

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Sri B. R. Vishwanatha, S/o, B. M. Ramachandraiah, Aged about 39 years,

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Sri B. R. Bhaskar

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S/o, Sri B. M. Ramachandraiah, Aged about 31years, Nos. 1 to 4 are residing at M. G. Road, Kollur New Badavane,

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Near Venkateshwara Kalyana Mantapa, Srinivasapura Town,

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Kolar District 563 135. …DEFENDANTS

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OA No.559/2022

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Counsel on record/appeared for:

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Applicant : Sri. K.Aswathanarayana Defendants Nos.1 to 4 : Ex-parte.

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FINAL ORDER

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The present Original Application (OA) is filed on 28-04-2022 under section 19 of the Recovery of Debts due to Banks and Financial Institutions Act 1993 for recovery of a sum of Rs.14,69,56,621.25/- (Rupees Fourteen Crores Sixty Nine Lakhs Fifty Six Thousand Six Hundred Twenty One and Paisa Twenty Five 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

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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 submits that the Defendant Nos. 1 and 2 are the husband and wife and Defendant Nos. 3 and 4 are their sons. That the Defendants were carrying on the activities of agriculture and Poultry in the land. The Defendants had approached the Applicant bank and applied for various credit facilities from time to time. The details of the Loan facilities availed by the defendants from the applicant bank are :

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OA No.559/2022

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i) The Applicant Bank, Term Loan of Rs.1,60,00,000/-(Rupees One Crore Sixty Lakhs) granted to the Defendants on 17.8.2016-Vide Sanction Memorandum dated 17.08.2016, for the purpose of construction of Poultry shed, purchase of Plants and machineries for commercial Broiler Poultry unit of 68000 birds under Poultry/Duck Rearing Loan A/c No. 2373862000017 and loan Documents were executed on 26.08.2016,

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ii) The Applicant Bank, Term Loan of Rs.550.00 Lakhs (Rupees Five Hundred Fifty Lakhs) granted to the Defendants on 17.08.2016, for the purpose of Installation of Solar Roof Top under Agriculture Term Loan A/c No. 2373891000081 and the loan documents were executed by the defendants on 26.08.2016.

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iii) The Applicant Bank, Agriculture Term Loan of Rs 1,60,00,000/(Rupees One Crore Sixty Lakhs) enhanced to Rs.7,10,00,000/(Rupees Seven Crores Ten Lakhs), on 07.09.2016 under Agriculture Term Loan A/c No. 2373891000083 and the loan Documents were executed by the defendants on 07.09.2016.

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vi) The Applicant Bank, Working Capital Limits of Rs.62,42,000/-(Rupees Sixty Two Lakhs Forty Two Thousand only) under Open Cash Credit Loan Account No. 2373261005133 was granted to the defendants on 17.8.2016 and loan Documents were executed by the defendants on 07.07.2017.

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OA No.559/2022

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v) The Applicant submits that with regard to the Term Loan of Rs.1,60,00,000/-(Rupees One Crore Sixty Lakhs) granted to the Defendants under Poultry/Duck Rearing Loan A/c No. 2373862000017, for construction of Poultry Shed, Purchase of Plant and Machinery for Commercial Broiler Poultry Unit of 68000 birds. The defendants have executed the following Documents in favour of the Applicant bank. The Applicant is herewith producing the following Documents.

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Date	Particulars of the Document
18.07.2016	Comprehensive Application-Cum-Appraisal Report for Farm Development submitted by the Defendants in favour of the Applicant for the Term Loan of Rs. 160.00 Lakhs.
17.08.2016	Sanction Memorandum issued by the Applicant in favour of the Defendants.
26.08.2016	Memorandum of Agreement for Agricultural Loans executed by the Defendant No.1 in favour of the Applicant in respect of Agriculture Term Loan of Rs. 160.00 Lakhs
26.08.2016	Common Hypothecation Agreement executed by the Defendant No.1 in favour of the applicant in respect of Agriculture Term Loan of Rs. 160.00 Lakhs.
26.08.2016	Guarantee Covering Letter executed by the Defendant No.2-Smt. Sharadamma in favour of the Applicant.
26.08.2016	Guarantee Agreement executed by the Defendant No.2-Smt. Sharadamma in favour of the Applicant in respect of Agricultural Term loan of Rs. 160.00 Lakhs.

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OA No.559/2022

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26.08.2016	Guarantee Covering Letter executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant
26.08.2016	Guarantee Agreement executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant in respect of Agricultural Term loan of Rs. 160.00 Lakhs.
26.08.2016	Letter of Attestation/Declaration executed by the Defendant No.1 in favour of the Applicant.

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vi) The above said Term Loan of Rs. 160 Lakhs shall be repayable within 8 years 11 monthly including initial Moratorium period of 8 months for instalments from the date of disbursement. The Defendants have agreed to pay Interest at 10.80% per annum compounded half yearly Plus Penal Interest at 2% per annum on over dues loan accounts on delayed payments for over dues period.

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The Applicant produced herewith the Statement of Account dated 11.04.2022 in respect of Poultry/Duck Rearing Loan A/c. No. 2373862000017 of the defendants and they are liable to pay a sum of Rs.1,66,47,712.73 (Rupees One Crore Sixty Six Lakhs Forty Seven Thousand Seven Hundred Twelve and paise Seventy Three only) as on 11.04.2022 inclusive of interest calculated up to 31.03.2022. The defendants are liable to pay subsequent interest at 10.90% per annum compounded half yearly from 01.04.2022 to 26.04.2022 in a sum of Rs.1,17,915.94 Paise (Rupees One Lakh Seventeen Thousand Nine Hundred Fifteen and Paise Ninety Four only). Thus, the defendants are liable to pay a Total sum of Rs.1,67,65,628.67Ps (Rupees One Crore Sixty Seven Lakhs Sixty Five Thousand Six Hundred Twenty Eight and Paise Sixty

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OA No.559/2022

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Seven only), inclusive of interest calculated up to the date of Original Application in respect of Poultry/Duck Rearing Loan A/c. No. 2373862000017 of the Defendants/borrowers.

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The Applicant submits that with regard to the Term Loan of Rs.550.00 Lakhs (Rupees Five Hundred Fifty Lakhs) granted to the defendants under Agriculture Term Loan A/c No. 2373891000081, for Installation of Solar Roof Top. The Defendants have executed the following Documents in favour of the Applicant bank.

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Date	Particulars of the Document
18.07.2016	Comprehensive Application-Cum-Appraisal Report for Minor Irrigation/Farm Development/ Land Development Activities, submitted by the Defendants in favour of the Applicant
17.08.2016	Sanction Memorandum issued by the Applicant in favour of the Defendants, sanctioning Agriculture Term Loan of Rs. 550.00 Lakhs.
23.08.2016	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the Applicant for Rs. 1,60,00,000/-(rupees One Crore Sixty Lakhs only).
23.08.2016	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the Applicant for Rs. 5,50,00,000/-(Rupees Five Crore Fifty Lakhs only) for the purpose of Installation of Solar Roof Top.
23.08.2016	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the

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OA No.559/2022

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	Applicant for Rs. 5,50,00,000/-(Rupees Five Crore Fifty Lakhs only) for the purpose of Installation of Solar Roof Top.
7.09.2016	Memorandum of Agreement for Agricultural Loans executed by the Defendant Nos.1 & 2 in favour of the Applicant in respect of Agriculture Term Loan of Rs. 550.00 Lakhs for Installation of Solar Roof Top.
07.09.2016	Common Hypothecation Agreement executed by the Defendant Nos.1 and 2 in favour of the applicant in respect of Agriculture Term Loan of Rs. 550.00 Lakhs

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The Defendants, said Term Loan of Rs.550 Lakhs shall be repayable within 14 years 8 months including initial Moratorium period of 8 months. The said loan shall be repayable in 55 quarterly instalments each of Rs. 9,82,000/- and 56^th quarterly instalment of Rs. 9,90,000/- commencing from May 2017. The Defendants have agreed to pay Interest at 11.70% per annum compounded half yearly Plus Penal Interest at 2% per annum on over dues loan accounts on delayed payments for over dues period.

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The Applicant Bank produced herewith the Statement of Account dated 11.04.2022, in respect of Agriculture Term Loan A/c. No. 2373891000081 of the Defendants and they are liable to pay a sum of Rs.5,48,33,807.37ps. (Rupees Five Crores Forty Eight Lakhs Thirty Three Thousand Eight Hundred Seven and Paise Thirty Seven Only) as on 11.04.2022 inclusive of interest calculated up to 31.03.2022. The Defendants are liable to pay subsequent interest at 12% per annum compounded half yearly from 01.04.2022 to 26.04.2022 in a sum of

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OA No.559/2022

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Rs.4,21,745.49Ps/- (Rupees Four Lakhs Twenty One Thousand Seven Hundred Forty Five and Paise Forty nine only). Thus, the defendants are liable to pay a total sum of Rs.5,52,55,552.86 ps. (Rupees Five Crores Fifty Two Lakhs Fifty Five Thousand Five Hundred Fifty Two and paise Eighty Six only), inclusive of interest calculated up to the date of Original Application in respect of Term Loan A/c. No. 2373891000081 of the Defendants/borrowers.

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The Applicant Bank submits that with regard to the Term Loan of Rs.1,60,00,000/-(rupees One Crore Sixty Lakhs) enhanced to Rs.7,10,00,000/-(Rupees Seven Crores Ten Lakhs), under Agriculture Term Loan Account No. 2373891000083 The defendants have executed the following Documents in favour of the Applicant bank.

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Date	Particulars of the Document
07.09.2016	Common Hypothecation Agreement executed by the Defendant Nos.1 and 2 in favour of the applicant in respect of enhanced Agriculture Term Loan of Rs. 550 Lakhs.
07.09.2016	Supplemental Common Hypothecation agreement executed by the Defendant No.1 in favour of the Applicant in respect of enhancement of Agriculture Term Loan from Rs.160.00 Lakhs to 710.00 Lakhs
07.09.2016	Guarantee Covering Letter executed by the Defendant No.2 No.2-Smt. Sharadamma in favour of the Applicant.
07.09.2016	Guarantee Agreement executed by the Defendant No.2-Smt. Sharadamma in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 710.00 Lakhs.

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OA No.559/2022

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07.09.2016	Guarantee Covering Letter executed by the Defendant No.3 Sri. B. R. Vishwanath in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 710.00 Lakhs.
07.09.2016	Guarantee Covering Letter executed by the Defendant No.3 Sri. B. R. Vishwanath in favour of the Applicant.
07.09.2016	Letter of Attestation/Declaration by Sri Vishwanath. B. R. Defendant No.3

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The Defendants shall repayable within 14 years 8 months including initial moratorium period of 8 months. The Loan shall be repayable in 55 quarterly instalments each of Rs. 9,82,000/- and 56^th quarterly instalment of Rs. 9,90,000/-commencing from May 2017. The Defendants have agreed to pay interest at 11.70% per annum compounded half yearly plus 2% per annum on over dues loan accounts on delayed payments for over dues period.

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The Applicant Bank produced the Statement of Account dated 20.04.2022, in respect of Agriculture Term Loan A/c. No. 2373891000083 of the Defendants and they are liable to pay a sum of Rs.6,66,25,785.25ps.(Rupees Six Crores Sixty Six Lakhs Twenty Five Thousand Seven Hundred Eighty Five and Paise Twenty Five only) as on 20.04.2022 inclusive of interest calculated up to 31.03.2022. The Defendants are liable to pay subsequent interest at 12% per annum compounded half yearly from 01.04.2022 to 26.04.2022 in a sum of Rs.5,08,779.82 ps (Rupees Five Lakhs Eight Thousand Seven Hundred Seventy Nine and paise Eighty Two only). The Defendants are liable to pay

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OA No.559/2022

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a Total sum of Rs.6,71,34,565.07 ps/-(Rupees Six Crores Seventy One Lakhs Thirty Four Thousand Five Hundred Sixty Five and Paise Seven only), inclusive of interest calculated up to the date of Original Application in respect of Agriculture Term Loan A/c. No. 2373891000083 of the Defendants/borrowers.

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The Applicant submits that with regard to the Working Capital Limits of Rs.62,42,000/-(Rupees Sixty Two Lakhs Forty Two Thousands only), under Open Cash Credit Account No.2373261005133. The defendants have executed the following Documents in favour of the Applicant bank. The Applicant is herewith producing the following Documents:

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Date	Particulars of the Document
05.07.2017	Registered Simple Mortgage Deed for Agricultural Advances
	executed by the Defendant Nos. 1 to 4 in favour of the Applicant for the enhanced Loan Limit of Rs. 62,42,000/- (Rupees Sixty Two Lakhs Forty Two Thousand only).
07.07.2017	On Demand Promissory Note For Rs. 62,42,000/-(Rupees Sixty Two Lakhs Forty Two Thousand only) executed by the Defendant Nos. 1 and 2 in favour of the Applicant
07.07.2017	Supplemental Common Hypothecation Agreement executed by the Defendant No.1 in favour of the Applicant in respect of the
	enhanced Loan Limit from Rs. 710.00 Lakhs to Rs. 7,72,42,000/-
07.07.2017	Guarantee Covering Letter executed by the Defendant No.2- Smt. Sharadamma in favour of the Applicant.

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OA No.559/2022

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07.07.2017	Guarantee Agreement executed by the Defendant No.2-Smt. Sharadamma in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 7,72,42,000/-.
07.07.2017	Guarantee Covering Letter executed by the Defendant No.3- Sri B. R. Vishwanatha in favour of the Applicant.
07.07.2017	Guarantee Agreement executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 7,72,42,000/-.
07.07.207	Guarantee Covering Letter executed by the Defendant No.4- Sri B. R. Bhaskar in favour of the Applicant.
07.07.2017	Guarantee Agreement executed by the Defendant No.4-Sri B. R. Bhaskar in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 7,72,42,000/-.
07.09.2016	Letter of Attestation of the thumb impression of Defendant No.2 executed by the Defendant No.3 in favour of the Applicant.

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The said OCC limit is tenable for one year from the date of sanction. The Defendants have agreed to pay Interest at 10.80% per annum compounded monthly Plus Penal Interest at 2% per annum on over dues loan accounts on delayed payments for over dues period. The Applicant submits that as security for repayment of the above said loans with interest the defendants have hypothecated Livestock (Poultry birds), inventories, (feeds, medicines etc) and other consumable stores and spares (Poultry project) under working capital Loan and Civil constructions (Poultry Project), Plant and Machineries (Poultry project), Solar project-plant and

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OA No.559/2022

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machineries, under Term Loan in favour of the Applicant bank under the above said agreements.

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As security for repayment of the above said loans with interest and costs the defendants have mortgaged their immovable property Simple Mortgage Deeds for Agricultural Advances, dated 23.08.2016, 23.08.2016, 23.08.2016, and Simple Mortgage deed for Agricultural Advances dated 05.07.2017 in favour of the Applicant Bank.

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The applicant produced herewith the Statement of Account dated 11.04.2022, in respect of Open Cash Credit Loan A/c. No. 2373261005133 of the defendants and they are liable to pay a sum of Rs.77,81,344/(Rupees Seventy Seven Lakhs Eighty One Thousand Three Hundred Forty Four only) as on 11.04.2022 inclusive of interest calculated up to 31.03.2022. The defendants are liable to pay subsequent interest at 12.80 % per annum compounded monthly from 01.04.2022 to 26.04.2022 in a sum of Rs.19,530.65ps (Rupees Nineteen Thousand Five Hundred Thirty and Paise Sixty Five only). Thus, the defendants are liable to pay a total sum of Rs.78,00,874.65ps (Rupees Seventy Eight Lakhs Eight Hundred Seventy Four and Paise Sixty Five only), inclusive of interest calculated up to the date of Original Application in respect of Open Cash Credit Loan A/c. No. 2373261005133 of the Defendants/borrowers.

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The Applicant submits that the Defendants have executed Letter of Revivals dated 22.03.2019 in favour of the Applicant confirming the above said loans, execution of loan documents, acknowledging the amounts due

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OA No.559/2022

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by clients’ bank and continuance of securities in favour of the bank till the repayment of all the amounts due by the defendants to the Applicant are discharged. The Applicant submits that the Defendants are chronic defaulters in the matter of repayment of the above said loans with interest, in spite of repeated requests, personal contacts made by the Applicant Bank, they failed to pay the amounts due by them. Finally the applicant got issued Legal Notice dated 23.12.2019 to the Defendants.

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Calling upon the Defendants to clear the entire liability due to the Applicant Bank together with interest in respect of the aforesaid loans. In spite of the said legal notices to the defendants have failed and neglected to pay the amounts due by them to the Applicant Bank. Hence, without any alternative the applicant has filed the above original application against the Defendants for recovery of the amounts due by the defendants to the Applicant Bank.

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The Applicant submits that the 1^st Defendant submitted a Letter dated 28.01.2019 in favour of the Applicant Bank, requesting the applicant bank to re-structure the loan accounts accorded under the Sanction Memorandum dated 17.08.2016. The Applicant submits that the defendants have offered additional Security of the immoveable properties of Sri B. R. Vishwanath in addition to the existing mortgage of the immoveable properties and executed Supplemental Simple Mortgage Deed dated 20-08-2020 in favour of the applicant up to the loan limits of Rs.260 Lakhs, for the purpose of construction of Poultry Farm.

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OA No.559/2022

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The Applicant submits that, in terms of the direction of the Honorable High Court of Karnataka, the applicant re-structured the Loan accounts of the defendants. The Sanction Memorandum dated 30.12.2020 issued by the applicant in favour of the Defendants by extending repayment tenure by four years and eleven months i.e. up to March 2036 from January 2031. The details are found in the sanction Letter. The Letter of Undertaking executed by the borrower/defendants for restructuring of loan dated 30.12.2020 in favour of the Applicant. The Debt Restructuring Agreement dated 30-12-2020 executed by the Defendants in favour of the Applicant. The Debtor Creditor Agreement dated 30-12-2020 executed by the Defendant in favour of the Applicant. The Defendants have executed Supplemental Simple Mortgage Deed dated 31-12-2020 in favour of the applicant, under which the Mortgagors have continued the mortgage of the schedule properties as security for the existing term and working capital loans in favour of the applicant for the loans availed by defendant Nos. 1 and 2 for the purpose of Installing solar Power plant and construction of poultry farms by incorporating the financial requirement to the extent of Rs.13,22,42,000/- (Rupees Thirteen Crores Twenty Two Lakhs Forty Two Thousand only). The Defendants have agreed that the securities and documents executed by them in favour of the Applicant Bank shall hold good and available for the restructure debt also.

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The Applicant in spite of restructuring the loan accounts and granting sufficient time and opportunity to the defendants to repay the loans in

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OA No.559/2022

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terms of the Restructured Agreement, the defendants have failed and neglected to repay the loans in terms of the restructured agreements and they have committed default in repayment of the loans. The Applicant Bank submits that the Defendants are liable to pay a total sum of Rs.14,69,56,621.25 (Rupees Fourteen Crores Sixty Nine Lakhs Fifty Six Thousand Six Hundred Twenty One and paise Twenty Five onl y) as on the date of the O.A.

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A	Poultry/Duck No.237386200	Rearing 0017	Loan	A/c	Rs. 1,67,65,628.67ps
B	Agriculture No.237389100	Term 0081	Loan	A/c	Rs. 5,52,55,552.86ps
C	Agriculture No.237389100	Term 0083	Loan	A/c	Rs.6,71,34,565.07ps
D	Open Cash	Credit	Loan	A/c	Rs. 78,00,874.65ps
	No.237326100	5133
			Total Am	ount	Rs.14,69,56,621.25

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The Defendants are liable to pay the amounts as stated above, but failed and neglected to pay in spite of repeated requests and demands made to them and hence this application for recovery of the aforesaid amounts due by them with future interest and costs. 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 to 4 by RPAD on 16.06.2022 duly served Acknowledgement

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OA No.559/2022

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produced. When OA was taken up on 09.12.2022, even after giving sufficient time, there was no appearance or representation from the defendants, hence, Defendants No.1 to 4 was placed ex-parte on 09.12.2022.

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Heard the submissions of Counsels and perused the records.

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To prove the case, Mr. V.Chandrasekaran S/o. K.Venkatachalam, aged about 39 years, Chief 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 A55. 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

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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) i) The Applicant bank is allowed to recover from defendants No.1 to 5 jointly or severally to pay a sum Directing the Defendants to pay to the Applicant Bank jointly and severally the aforesaid Total sum of Rs.14,69,56,621.25 (Rupees Fourteen Crores Sixty Nine Lakhs

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OA No.559/2022

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Fifty Six Thousand Six Hundred Twenty One and paise Twenty Five only) together with costs comprised of :

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ii) Current interest at 10.90% per annum compounded half yearly in respect of Poultry/Duck Rearing Loan A/c No.2373862000017 on the sum of Rs.1,67,65,628.67ps (Rupees One Crore Sixty Seven Lakhs Sixty Five Thousand Six Hundred Twenty Eight and Paise Sixty Seven only) and

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iii) Current Interest at 12.00 % per annum compounded half yearly on the Agriculture Term Loan A/c No.2373891000081 on the sum of Rs.5,52,55,552.86ps(Rupees Five Crore Fifty Two Lakhs Fifty Five Thousand Five Hundred Fifty Two and paise Eighty Six only) and iv) Current Interest at 12.00% per annum compounded half yearly in respect of Agriculture Term Loan A/c No.2373891000083 on the sum of Rs.6,71,34,565.07ps (Rupees Six Crores Seventy One Lakhs Thirty Four Thousand Five Hundred Sixty Five and Paise Seven only) and

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v) Current interest at 12.80% per annum compounded monthly in respect of Open Cash Credit Loan A/c No.2373261005133 on the sum of Rs.78,00,874.65ps (Rupees Seventy Eight Lakhs Eight Hundred Seventy Four and Paise Sixty Five only) from the Defendants from this date until payment.

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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 prepare Recovery Certificate for the amount to be paid by defendants to the applicant bank.

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(f) The applicant bank shall file memo of costs within ten days from the date of this final order.

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(g) Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.

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

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[Dictated to the (GS), transcribed by her, corrected and signed by me on this the 15^th day of February 2024]

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OA No.559/2022

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(S.V.GOWRAMMA) 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.V. Chandrasekaran S/o. Sri. K.Venkatachalam, Chief Manager of the Applicant Bank.

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Exhibits on the part of the Applicant:

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Date	Description of the Documents	Exhibits
18.07.2016	Comprehensive Application-Cum-Appraisal Report for Farm Development/ Land Development Activities, submitted by the Defendants in favour of the Applicant for the Term Loan of Rs. 160.00 Lakhs for construction of poultry farm unit.	A3
17.08.2016	Sanction Memorandum issued by the Applicant in favour of the Defendants, sanctioning Agriculture Term Loan of Rs. 160.00 Lakhs	A4
26.08.2016	Memorandum of Agreement for Agricultural Loans executed by the Defendant No.1 in favour of the Applicant in respect of Agriculture Term Loan of Rs. 160.00 Lakhs.	A5
26.08.2016	Common Hypothecation Agreement executed by the Defendant No.1 in favour of the applicant in respect of Agriculture Term Loan of Rs. 160.00 Lakhs.	A6

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26.08.2016	Guarantee Covering Letter executed by the Defendant No.2-Smt. Sharadamma alias Shivamma, in favour of the Applicant.	A7
26.08.2016	Guarantee Agreement executed by the Defendant No.2-Smt. Sharadamma alias Shivamma, in favour of the Applicant in respect of Agricultural Term loan of Rs. 160.00 Lakhs.	A8
26.08.2016	Guarantee Covering Letter executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant.	A9
26.08.2016	Guarantee Agreement executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant in respect of Agricultural Term loan of Rs. 160.00 Lakhs.	A10
26.08.2016	Letter of Attestation/Declaration executed by the Defendant No.3 in favour of the Applicant.	A11
11.04.2022	Certified Statement of Account in respect of Poultry/Duck Rearing Loan A/c. No. 2373862000017 of the 1^stdefendant with Interest Calculation Sheet & Certificate.	A12
18.07.2016	Comprehensive Application-Cum-Appraisal Report submitted by the Defendants in favour of the Applicant for the Agriculture Term Loan of Rs. 550.00 Lakhs for Installation of Solar Roof Top.	A13
17.08.2016	Sanction Memorandum issued by the Applicant in favour of the Defendants, sanctioning Agriculture Term Loan of Rs. 550.00 Lakhs for Installation of Solar Roof Top.	A14

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23.08.2016	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the Applicant for Rs. 1,60,00,000/- (rupees One Crore Sixty Lakhs only).	A15
23.08.2016	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the Applicant for Rs. 5,50,00,000/- (Rupees Five Crore Fifty Lakhs only).	A16
23.08.2016	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the Applicant for Rs. 5,50,00,000/- (Rupees Five Crore Fifty Lakhs only).	A17
7.09.2016	Memorandum of Agreement for Agricultural Loans executed by the Defendant Nos.1 & 2 in favour of the Applicant in respect of Agriculture Term Loan of Rs. 550.00 Lakhs.	A18
07.09.2016	Common Hypothecation Agreement executed by the Defendant Nos.1 and 2 in favour of the applicant in respect of Agriculture Term Loan of Rs. 550.00 Lakhs.	A19
11.04.2022	Certified Statement of Account in respect of Agriculture Tem Loan A/c. No.2373891000081 of the 1^stdefendant with Interest Calculation Sheet & Certificate.	A20
07.09.2016	Common Hypothecation Agreement executed by the Defendant Nos.1 and 2 in favour of the applicant in respect of enhancement of Agriculture Term Loan from Rs.160.00 Lakhs to 710.00 Lakhs.	A21

¶132

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OA No.559/2022

¶134

07.09.2016	Supplemental Common Hypothecation agreement executed by the Defendant No.1 in favour of the Applicant in respect of enhancement of Agriculture Term Loan from Rs. 160.00 Lakhs to 710.00 Lakhs	A22
07.09.2016	Guarantee Covering Letter executed by the Defendant No.2-Smt. Sharadamma alias Shivamma, in favour of the Applicant.	A23
07.09.2016	Guarantee Agreement executed by the Defendant No.2-Smt. Sharadamma alias Shivamma, in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 710.00 Lakhs.	A24
07.09.2016	Guarantee Covering Letter executed by the Defendant No.3-Sri. B.R. Vishwanath in favour of the Applicant	A25
07.09.2016	Guarantee Agreement executed by the Defendant No.3- Sri. B.R. Vishwanath in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 710.00 Lakhs.	A26
07.09.2016	Letter of Attestation/Declaration executed by the Defendant No.3 in favour of the Applicant.	A27
11.04.2022	Certified Statement of Account in respect of Agriculture Term Loan A/c. No. 2373891000083 of the 1^stdefendant with Interest Calculation Sheet & Certificate.	A28
05.07.2017	Registered Simple Mortgage Deed for Agricultural Advances executed by the Defendant Nos. 1 to 4 in favour of the Applicant in respect of the Working Capital/Open Cash Credit Loan Limit of	A29

¶135

¶136

OA No.559/2022

¶137

	Rs. 62,42,000/- (Rupees Sixty Two Lakhs Forty Two Thousand only).
07.07.2017	On Demand Promissory Note executed by the Defendant Nos. 1 and 2 in favour of the Applicant in respect of the Working Capital/Open Cash Credit Loan Limit of Rs. 62,42,000/- (Rupees Sixty Two Lakhs Forty Two Thousand only).	A30
07.07.2017	Supplemental Common Hypothecation Agreement executed by the Defendant No.1 in favour of the Applicant in respect of the enhanced Loan Limit from Rs. 710.00 Lakhs to Rs. 7,72,42,000/- i.e. OCC Limit of Rs. 62.42 Lakhs.	A31
07.07.2017	Guarantee Covering Letter executed by the Defendant No.2-Smt. Sharadamma alias Shivamma, in favour of the Applicant	A32
07.07.2017	Guarantee Agreement executed by the Defendant No.2-Smt. Sharadamma alias Shivamma, in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 7,72,42,000/-i.e. OCC Limit of Rs.62.42 Lakhs..	A33
07.07.2017	Guarantee Covering Letter executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant	A34
07.07.2017	Guarantee Agreement executed by the Defendant No.3-Sri B. R. Vishwanatha in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 7,72,42,000/-i.e OCC Limit of Rs. 62.42 Lakhs.	A35

¶138

¶139

OA No.559/2022

¶140

07.07.207	Guarantee Covering Letter executed by the Defendant No.4-Sri B. R. Bhaskar in favour of the Applicant	A36
07.07.2017	Guarantee Agreement executed by the Defendant No.4-Sri B. R. Bhaskar in favour of the Applicant in respect of the enhanced Agricultural Term loan of Rs. 7,72,42,000/-i.e OCC Limit of Rs. 62.42 Lakhs.	A37
07.09.2016	Letter of Attestation/declaration executed by the defendant No.3 in favour of the Applicant.	A38
11.04.2022	Certified Statement of Account in respect of Open Cash Credit Loan A/c. No. 2373261005133 of the defendants with Interest Calculation Sheet & Certificate.	A39
	Consolidated Statement	A39 A
22.03.2019	Letter of Revival executed by the Defendant Nos. 1 to 3 in favour of the Applicant.	A40
23.12.2019	Legal Notice issued to the Defendants	A41
26.12.2019	Postal Registration Receipts.	A42 to A45
01.0.1.2020	RPAD Returned Envelops of the Defendants.	A46 to 49
28.01.2019	Request Letter submitted by the Defendant No.1 in favour of the Applicant for restructure of the loan accounts.	A50
28.08.2020	Supplemental Simple Mortgage Deed executed by the Defendants in favour of the applicant up to the loan limits of Rs.260 Lakhs for the purpose of construction of Poultry Farm.	A51

¶141

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OA No.559/2022

¶143

30.12.2020	Sanction Memorandum issued by the Applicant with respect to restructuring of Term Loans.	A52
30.12.2020	Letter of Undertaking from the borrowers /defendants /guarantors for restructuring of loan in favour of the applicant.	A53
30.12.2020	Debt Restructuring Agreement executed by the defendants in favour of the applicant.	A54
30.12.2020	Debtor - Creditor Agreement executed by the defendants in favour of the applicant.	A55

¶144

Witness Examined for the Defendants:

¶145

-Nil –

¶146

List of Documents Exhibited for the Defendants:

¶147

-Nil –

¶148

SCHEDULE ‘A’

¶149

(The Properties mortgaged by the Owners/Defendants in favour

¶150

of the Applicant Bank)

¶151

I. Properties belonging to Sri B. M. Ramachandraiah-1^st

¶152

Defendant-Owner:

¶153

(1) All that piece and parcel Land Survey No. 13/2, measuring 6 acres, K. G. Lingarajapura Village, Kasaba Hobli, Srinivasapura Taluk, Kolar District and bounded as follows:

¶154

East by : Property of B. C. Sonnegowda, West by : Property of T. B. Babu, North by : Government Forest, South by : Mulbagal Road.

¶155

(2) All that piece and parcel Land Survey No. 251, measuring 4 acres, Hebbata Village, Kasaba Hobli, Srinivasapura Taluk, Kolar District and bounded as Follows:

¶156

¶157

OA No.559/2022

¶158

East by : Property of Abdul Khalik, West by : Chinthukunte Road, North by : Property of Sharamamma alias Shivamma, South by : Mulbagal Road.

¶159

(3) All that piece and parcel property bearing V. P. Khatha No. 464/368/1, 465/368/2, 466/368/3, Shop and House Property, measuring East to West 45 feet and North to South 33.5 feet, situated at Kollur New Extension, J. Thimmasandra Grama Panchayath, Kasaba Hobli, Srinivasapura Taluk, Kolar District, and bounded as follows:

¶160

East by Site & House Property of V. Muddu Kumar,

¶161

West by	:	Kadapa Road,
North by	:	5 ½ X 45 feet passage of Muddukumar,
South by	:	Property of Narayanaswamy and others.

¶162

(4) All that piece and parcel of Property/Site bearing A. R. No. 216, measuring East to West 27 feet and north to South 30 feet, situated at M. G. Road, Srinivasapura, Kolar District, and bounded as follows:

¶163

East by	:	M. G. road,
West by Property of	:	B. M. Narayanaswamy,
North by	:	Maruthinagar Road,
South by Property of	:	B. M. Narayanaswamy.

¶164

(5) All that piece and parcel of Property/Site bearing A. R. No. 218, measuring East to West 27 feet and north to South 30 feet, situated at M. G. Road, Srinivasapura, Kolar District and bounded as follows:

¶165

East by : M. G. Road,
West by Property of : B. M. Narayanaswamy,
North by : Maruthinagar Road,
South by : Property of B. M. Narayanaswamy.

¶166

¶167

OA No.559/2022

¶168

II: Properties belonging to Smt. Sharadamma alias Shivamma wife of Sri B. M. Ramachandraiah-2^nd Defendant:

¶169

(1) All that piece and parcel of land bearing Survey No. 252, measuring 4 acres, situated at Hebbata Village, Kasaba Hobli, Srinivasapura Taluk, Kolar District and bounded as follows:

¶170

East by	:	Property of Abdul Khalik,
West by	:	Chinthukunte Road,
North by	:	Government Forest,
South by	:	Property of B. M. Ramachandraiah.

¶171

All that piece and parcel of Site/Property bearing M. L. No. 1334, Assessment No. 1323, measuring East to West 117 feet and North to South 22 feet situated at Vallabai Road, Srinivasapura, Kolar District and bounded as follows:

¶172

East by	:	Vallabai Road,
West by	:	Govt Girls High School,
North by	:	House Property of V. Kashinath,
South by	:	Property of S. Suryanarayana Rao.

¶173

III: Properties belonging to Sri B. R. Vishwanath son of Sri B. M. Ramachandriah-Defendant No.3:

¶174

(1) All that piece and parcel of Site Property bearing V. P. Khatha No. 87 and property No. 77 paiki, measuring East to west 50 feet and north to south 90 feet, situated at Boyinachinapalli Village, J. Thimmasandra Grama Panchayath, Kasaba Hobli, Srinivasapura Taluk, Kolar District and bounded as follows:

¶175

East by	:	Vacant Site of Rukminiyamma,
West by	:	Vacant Site of Venkatalakshmamma,

¶176

¶177

OA No.559/2022

¶178

North by : Railway Road, South by : Srinivasapur-Chinthamani PWD Road.

¶179

(2) All that piece and parcel of Property/Site bearing V. P. Khatha No. 543/1 and property No.10, measuring East to west 32 feet on the southern side, northern side 52 feet, and north to south 25 feet, i.e 32+52/2 X 25 feet, situated at Kollur Village, J. Thimmasandra Grama Panchayath, Kasaba Hobli, Srinivasapura Taluk, Kolar District and bounded as follows:

¶180

East by	:	Road,
West by	:	Property of Srirama Reddy,
North by	:	Site No.11,
South by	:	Site No. 09.

¶181

(3) All that piece and parcel of Land bearing Sy No.235/P8, New No.234, measuring 2 Acres, situated at Muthakapalli Village, Yeldur Hobli, Srinivasapur Taluk, Kolar District and bounded as follows:

¶182

East by : Daari/Road West by : Sarkari Kaluve, North by : Muthakapalli Yeldur road, South by : Own Land

¶183

(4) All that piece and parcel of Land bearing Sy No.234/P10, New No.234, measuring 3 Acres 35 Guntas, situated at Muthakapalli Village, Yeldur Hobli, Srinivasapur Taluk, Kolar District and bounded as follows:

¶184

East by : Daari/Road West by : Sarkari Kaluve, North by : Own Land, South by : Own Land

¶185

¶186

OA No.559/2022

¶187

(5) All that piece and parcel of Land bearing Sy No.234/P14, New No.234, measuring 1 Acre 20 Guntas, situated at Muthakapalli Village, Yeldur Hobli, Srinivasapur Taluk, Kolar District and bounded as follows:

¶188

East by : Daari/Road West by : Sarkari Kaluve, North by : Own Land, South by : Hyder Sab’s Land.

¶189

SCHEDULE-“B”

¶190

(The following Items are Hypothecated by the defendants in favour of the Applicant Bank)

¶191

Hypothecated Livestock (Poultry birds), inventories, (feeds, medicines etc) and other consumable stores and spares (Poultry project) and Civil constructions(Poultry Project), Plant and Machineries’ (Poultry project), Solar project Plant and Machineries equipments, solar roof top, plant and machinery located at Sy. No. 251, 252, Hebbata Village, Kasava Hobli, Srinivasapura Taluk, Kolar District.

¶192

(S.V.GOWRAMMA) PRESIDING OFFICER DRT-II, BENGALURU

Canara Bank v. Ramachandraiah

Case brief

What is this about?

What did the court decide?

Canara Bank v. Ramachandraiah

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

Coram

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