Allowed

Canara Bank v. Puttaraje Gowda

DRT20 Jan 2024OA/911/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the bank's Original Application for recovery of dues totaling Rs. 28,60,369/- along with interest. The debtor relatives and bank were adjudicated on bank's affidavit evidence as respondents remained absent in ex-parte proceedings.

What did the court decide?

Recovery of Rs. 28,60,369/- plus interest from respondents be realized by sale of mortgaged schedule property or personal assets. Recovery Certificate to be issued.

Canara Bank versus Puttaraje Gowda — Banking and Recovery | DRT (2024)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 20^th Day of January, 2024

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

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OA. No.911/2022

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BETWEEN:

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CANARA BANK, Ramanathpura Branch, No. 100, Roopesh Nilaya, Ramanathapura, Hassan – 573 133 Represented by its Senior Manager and PA Holder

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Sri M. Suresh, …APPLICANT

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AND:

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SRI. PUTTARAJE GOWDA S/o. Javaregowda, Aged about 51 years

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SRI RAME GOWDA S/o. Javaregowda, Aged about 37 years

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3. SRI KODI GOWDA

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S/o. Javaregowda, Aged about 35 years

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All are residing at: Hampapura Village, Ramnathpura Hobli, Arkalgud Taluk, Hassan District – 573 142. ... DEFENDANTS

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Counsel on record/appeared for:

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Applicant : M/s. HSR Associates Defendants No.1 & 2 : Exparte

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2 OA. 911/2022

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:FINAL ORDER:

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The Original Application (OA) is filed on 18.03.2022 by Applicant Bank under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993, against the defendant to recover a sum of Rs. 28,60,369/- (Rupees Twenty Eight Lakhs Sixty Thousand Three Hundred and Sixty Nine Only) with further interest thereon from the date of filing the Application till realization from the defendants.

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BRIEF FACTS OF THE CASE :

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The Applicant submits that the application is filed within the

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period of limitation as prescribed under Section 24 of the Recovery of Debt Due to Banks and Bankruptcy Act 1993, and the subject recovery claim falls within the jurisdiction of this Hon’ble Tribunal.

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The case of the Applicant Bank is that the Defendant Nos 1 to 3 are brothers. The Defendant No.1 has approached the Applicant Bank seeking General Credit Card Loan of Rs 25,000/- (Rupees Twenty Five Thousand Only) for agricultural operations. The Defendant No. 1 has submitted Loan Application dated 25.07.2007. The Applicant Bank has considered the proposal of the Defendant No. 1 and sanctioned GCC Loan of Rs.25,000/- (Rupees Twenty Five Thousand Only) for the purpose of agricultural operations vide Sanction Memorandum dated 25.07.2007. the GCC Loan was tenable for 3 years subject to annual review. The Defendant No.1 agreed to pay interest @13.25% p.a. compounded half

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3 OA. 911/2022

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yearly and penal interest of 2% p.a. on the overdue amount.

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The Defendant No.1 executed Letters of Revival dated 02.04.2010, 01.04.2013, 18.09.2015, 19.12.2017, 05.12.2020 and 20.12.2021 in respect of GCCS in favor of the Applicant Bank for the purpose of Section 18 of the India Limitation Act, 1963.

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The Defendants have Again approached the Applicant Bank seeking KCCS Loan of Rs. 94,000/- (Rupees Ninety Four Thousand Only) for the purpose of Crop Cultivation and submitted Loan Application dated 31.08.2007. The Applicant Bank has considered the proposal of the Defendants and sanctioned KCCS Loan of Rs. 94,000/- (Rupees Ninety Four Thousand Only) for Crop Cultivation vide Sanction Memorandum dated 31.08.2007 and the same is acknowledged by the Defendant No. 1 agreeing to the terms and conditions enumerated there under. The KCCS limit is tenable for 3 years subject to annual review. The Defendants have agreed to repay the loan within 12 months from the date of disbursement or eighteen months in case of annual yielding crops or marketing of the produce; whichever is earlier. The Defendants have agreed to pay interest at 9% p.a. Compounded half yearly and penal interest of 2% p.a. on the overdue amount. The Defendants have hypothecated the crops like ginger, tobacco etc., grown in the Schedule Property in favour of the Applicant Bank.

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The Defendants are the owners of the Schedule Property. The Defendants have executed a Simple Mortgage Deed dated 06.09.2007 in

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4 OA. 911/2022

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favour of the Applicant Bank and the same is registered as Document No. ARG-1-03559-2007-08 stored in C.D No. ARGD23 in the Office of the Sub-Registrar, Arakalagud, as security for the loan amount sanctioned to them

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The Defendant No.1 approached the Applicant Bank seeking Renewal with Enhancement of KCCS Limit from Rs.94,000/- to Rs.1,90,000/- for Crop Cultivation and submitted loan application dated 21.02.2012. The Applicant Bank renewed the KCCS Limit with enhancement from Rs.94,000/to Rs.1,90,000/vide Sanction Memorandum dated 21.02.2012 which is integral part of the loan application

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Defendant No.1 availed the Renewed KCCS Limit with Enhancement of Rs.1,90,000/- (Rupees One Lakh Ninety Thousand Only) and utilized the same for Crop Cultivation. While availing the said facility, the Defendant No.1 executed Letter of Renewal and Supplemental Agreement dated 21.02.2012 in favour of the Applicant Bank.

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The KCCS limit is tenable for 3 years subject to annual review. The Defendant No.1 has agreed to repay the loan within 12 months from the date of disbursement or eighteen months in case of Annual yielding crops or marketing of the produce; whichever is earlier. The Defendant No.1 has agreed to pay interest at 8.5% p.a. Compounded half yearly and penal interest of 2% p.a. on the overdue amount.

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The Applicant Bank submits that the Defendant No.1 for self

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5 OA. 911/2022

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and as guardian of minor children has extended subsisting mortgage of the Schedule Property for the liabilities arising out of Enhanced KCCS Limits by executing a Simple Mortgage Deed dated 18.02.2012 in favour of the Applicant Bank registered as Document No. ARG-1-03641-2011-12 stored in C.D No. ARGD57 in the Office of the Sub-Registrar, Arkalgud, as security for the loan amount sanctioned to them.

¶36

Defendant No.1 approached the Applicant Bank seeking Renewal with Enhancement of KCCS Limit from Rs.1,90,000/- to Rs.3,00,000/- for Crop Cultivation and submitted Loan Application dated 15.07.2013. The Applicant Bank renewed the KCCS Limit with enhancement from Rs.1,90,000/to Rs.3,00,000/- vide Sanction Memorandum dated 15.07.2013. The Loan Application and the Sanction Memorandum are herewith produced as ANNEXURES -A19 & A20.

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The Applicant Bank submits that Defendant No.1 availed the

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Renewed KCCS Limit with Enhancement of Rs.3,00,000/- (Rupees Three Lakhs Only) and utilized the same for Crop Cultivation. While availing the said facility, the Defendant No.1 executed Letter of Renewal and Supplemental Agreement dated 16.07.2013 in favour of the Applicant Bank.

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The KCCS limit is tenable for 3 years subject to annual review. The Defendant No.1 has agreed to repay the loan within 12 months from the date of disbursement or eighteen months in case of annual yielding crops or marketing of the produce; whichever is earlier.

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6 OA. 911/2022

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The Defendant No.1 has agreed to pay interest at 10.95% p.a. Compounded half yearly and penal interest of 2% p.a. on the overdue amount.

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The Applicant Bank submits that the Defendant No.1 for self and as guardian of minor children and the Defendant Nos. 2 & 3 have extended subsisting mortgage of the Schedule Property for the liabilities arising out of Enhanced KCCS Limits by executing a Simple Mortgage Deed dated 11.07.2013 in favour of the Applicant Bank registered as Document No. ARG-1-01510-2013-14 stored in C.D No. ARGD78 in the Office of the Sub-Registrar, Arkalgud, as security for the loan amount sanctioned to them.

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the Defendants have approached the Applicant Bank seeking a Vehicle Loan of Rs. 4,00,000/- (Rupees Four Lakhs only) for the purpose purchasing brand new Tata Sumo car and submitted Loan Application dated 01.10.2008. The Applicant Bank has considered the proposal of the Defendants and has sanctioned Vehicle Loan of Rs.4,00,000/(Rupees Four Lakhs Only) for the purpose of purchasing brand new Tata Sumo car vide a Sanction Memorandum dated 16.10.2008.

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The Defendants have availed the Vehicle Loan and purchased

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brand new Tata Sumo car for Agricultural Operations. While availing the loan the Defendant No.1 has executed Memorandum of Agreement for Agricultural Loans dated 16.10.2008 in favor of the Applicant Bank. The Vehicle Loan was repayable in 5 yearly instalments of Rs.80,000/-

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7 OA. 911/2022

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(Rupees Eighty Thousand Only) each and to pay interest and other charges separately along with annual installments. The Defendants have agreed to pay interest at 12.75% p.a. compounded half yearly and penal interest of 2% p.a. on the overdue amount.

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The Defendant No.1 for self and as guardian of minor children and the Defendant Nos. 2 & 3 have extended subsisting mortgage of the Schedule Property for the liabilities arising out of Vehicle Loan by executing a Simple Mortgage Deed dated 01.10.2008 in favour of the Applicant Bank registered as Document No. ARG-1-01590-2008-09 stored in C.D No. ARGD28 in the Office of the Sub-Registrar, Arkalgud, as security for the loan amount sanctioned to them.

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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 loan account was classified as NPA. The default in repayment continued and there was no positive response from the defendants. Hence, the applicant bank has issued Legal notice dated 09.02.2022. 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 and 2 through Registered Post with Acknowledgment Due and duly served on defendants during the month of June 2022. When OA was taken up on 05.01.2023 even after giving sufficient time,

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8 OA. 911/2022

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there was no appearance or representation from the defendants; hence, Defendant Nos.1 to 3 were placed exparte on 05.01.2023.

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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, G. Rajkumar, Senior Manager of the applicant bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW.1 and marked as Ex.A1, the list of Document came to be marked as Ex.A2 and documents came to be marked as Ex.A3 to A46. 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,

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the conduct and operations in the account and the default committed,

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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 Defendants jointly, severally and personally sum of Rs. 28,60,369/- (Rupees Twenty Eight Lakhs Sixty Thousand Three Hundred and Sixty Nine Only) out of the said amount (i) GCC liability of Rs. 47,944/carries interest @ 12.05% p.a. compounded half yearly from the date of OA till realization; (ii) KCCS Loan liability of Rs.

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9 OA. 911/2022

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7,84,128/- carries interest @ 11.75% p.a. compounded half yearly from the date of OA till realization and (iii) Vehicle Loan Liability of Rs. 20,28,297/- carries interest @ 14.90% p.a. compounded half yearly from the date of OA till 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 property in the OA;

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(d) If the sale proceeds of the schedule mentioned

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mortgaged/hypothecated properties are not sufficient to satisfy the dues

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as ordered above, the applicant bank is at liberty to sell the personal assets of the defendants (both movable and immovable) 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

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OA amount together with interest, costs etc., to be paid by the defendants duly considering the amounts, if any, paid by the defendants

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and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare

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10 OA. 911/2022

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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

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from the date of this final order.

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

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Recovery Officer in terms of the final order.

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

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[Dictated to the (PR), transcribed by her, corrected and signed by me on this the 20^th of January, of 2024]

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Sd/-

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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: G. Rajkumar, Senior Manager of the applicant bank

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Exhibits on the part of the Applicant:

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EXHIBITS	PARTICULARS	Dated	Page Nos.
A1	Applicant Evidence
A2	List of Documents
A3	Loan Application submitted by the Defendant No.1	25.07.2007	27 – 32
A4	Sanction Memorandum issued by the Applicant Bank	25.07.2007	33
A5 & A6	Take Delivery Letter to DPN & Pronote and Request for Overdraft Facilities executed the	25.07.2007	34 – 43

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OA. 911/2022

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A7 to A12	Defendant No.1 Letters of Revival executed by the Defendant No.1	02.04.2010, 01.04.2013, 18.09.2015, 19.12.2017, 05.12.2020, 20.12.2021	44 – 49
A13	Loan Application submitted by the Defendant No.1 for KCCS Loan	31.08.2007	50 – 57
A14	Sanction Memorandum issued by the Applicant Bank for KCCS loan.	31.08.2007	58
A15	Agreement and Deed of Hypothecation for Kisan Credit Card executed by the Defendant No.1	06.09.2007	59 – 68
A16	Simple Mortgage Deed executed by the Defendants in favour of Applicant Bank.	06.09.2007	69 – 77
A17	Loan Application for Renewal with Enhancement of KCCS Limit submitted by the Defendant No.1	21.02.2012	78 – 81
A18 & A19	Letter of Renewal and Supplemental Agreement executed by the Defendant No.1	21.02.2012	82 – 87
A20	Simple Mortgage Deed executed by the Defendants in favour of Applicant Bank.	18.02.2012	88 – 100
A21	Loan Application submitted by the Defendant No.1.	15.07.2013	101 – 104
A22	Sanction Memorandum issued by the Applicant Bank.	15.07.2013	105
A23 & A24	Letter of Renewal and Supplemental Agreement executed by the Defendant No.1	16.07.2013	106 – 112
A25	Simple Mortgage Deed executed by the Defendants in favour of Applicant Bank.	11.07.2013	113 – 120
A26 to	6 Nos. of Letters of Revival	24.02.2010,	121–

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A31	executed by Defendant No.1	20.11.2012, 11.09.2015, 07.12.2017, 04.05.2019, 20.11.2021	126
A32	Loan Application for Vehicle Loan submitted by the Defendants	01.10.2008	127 – 134
	Sanction Memorandum for
A33	Vehicle Loan issued by the Applicant Bank.	16.10.2008	135
A34	Memorandum of Agreement for Agricultural Loans executed by the Defendants.	16.10.2008	136 – 145
A35	Simple Mortgage Deed executed by the Defendants in favour of Applicant Bank.	01.10.2008	146 – 152
A36	Particulars of Vehicle Hypothecated executed by the Defendant No.1.	02.12.2008	153
A37 to A42	6 Nos. of Letters of Revival executed by the Defendant No.1 in favor of the Applicant Bank	04.04.2011, 21.02.2012, 06.02.2015, 10.11.2017, 25.05.2019, 20.11.2021	154 – 159
A43	Legal Notice issued by the Applicant Bank	09.02.2022	160
	3 Nos. of Certified Account
A44 to A46	Extracts of the Defendant No.1 maintained by the Applicant Bank.	-	161 – 170

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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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13 OA. 911/2022

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FIRST SCHEDULE ‘A’ PROPERTY

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The Defendant No.1 is the owner of the following agricultural lands situated at Hampapura Village, Ramnathpura Hobli, Arkalgud Taluk, Hassan District – 573 142.

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Sl. No.	Sy. Nos.	Extent A – G	Boundaries
1.	54/4	0-22	East by: Land of Nanje Gowda West by: Land of Thimmanna Gowda North by: Govt. Manti South by: Nale
2.	79/1B	0-05	East by: Kere West by: Land of Shiva Gowda North by: Land of Gowde Gowda South by: Road
3.	82/3	0-25	East by: Land of Sure Gowda West by: Land of Swami Gowda North by: Land of Rame Gowda South by: Forest
4.	85	2-34	East by: Land of Dyave Gowda West by: Land of Kodi Gowda North by: Kere South by: Land of Swami Gowda
5.	85/2	0-25 1/4	East by: Land of Putte Gowda West by: Road North by: Land of Hucche Gowda South by: Forest

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Sd/-

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(S.V. GOWRAMMA)

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PRESIDING OFFICER DRT-II, BENGALURU

Canara Bank v. Puttaraje Gowda

Case brief

What is this about?

What did the court decide?

Canara Bank v. Puttaraje Gowda

Case brief

What is this about?

What did the court decide?

What the court decided

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