Allowed

Indian Overseas Bank v. Rama Thamilarasan

DRT13 Feb 2024TA/664/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the applicant bank's appeal for recovery of debt. The defendant defaulted on an agricultural term loan. The Tribunal reduced the interest rate to 9% simple interest and permitted selling of secured properties for recovery.

What did the court decide?

Allowed appeal; directed sale of schedule properties and recovery of Rs. 11,92,714 including future interest at 9% p.a. simple.

Indian Overseas Bank versus Rama Thamilarasan — Contract and Commercial Disputes | DRT (2024)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 13^th day of February, 2024

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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TA No.664 of 2023

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(Originally filed before DRT-I Chennai as OA No.823 of 2019 and thereafter transferred to this Tribunal and renumbered as TA No.664 of 2023)

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Indian Overseas Bank Keeramangalam Branch Rep. by its Chief Manager No.4, Gandhiji Road, Keeramangalam Alangudi Taluk, Pudukkotai District …Applicant

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Versus

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Mr. Rama Thamilarasan S/o Mr. Ramanathan Senthangudi, Nagaram Post Alangudi Post, Pudukottai District Pincode : 614 624 …Defendant

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Counsel for the Applicant Bank : M/s Ananda Gomathy Defendant : Ex- parte

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FINAL ORDER

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This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendant for recovery of a sum of Rs.11,92,714/- together with interest at the rate of 13.00% per annum with monthly rests plus 2% penal interest from the date of filing of the application till the date of realization in full along with costs of this application and for sale of schedule of properties.

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The above Original Application is filed before DRT-I Chennai and stood transferred to this Tribunal and renumbered as above.

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The case of the applicant can be encapsulated as follows: -

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The defendant approached the applicant for grant of agricultural term loan and considering the said request the applicant vide sanction dated 30.05.2007 sanctioned Agricultural Term Loan of Rs.2,60,000/-. Having availed the said facility the defendant executed necessary loan and security documents on 30.05.2007. The defendant hypothecated the items more fully described in Schedule ‘A’ to the OA. The defendant deposited the title deeds of the property more fully described in Schedule ‘B’ to the OA on 22.05.2007 with an intention to create equitable mortgage over the same and confirmed the same by executing Memorandum of Deposit of Title deeds dated 22.05.2007 registered as Doc. No.620 of 2007, SRO, Keeramangalam. The defendant also executed a revival letter on 25.05.2010.

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It is further stated that even though the defendant had obliged to repay the amount promptly and regularly, but failed to do so resulting in default in repayment and hence the account was classified as NPA on 02.01.2011.

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It is contended by the applicant that the applicant’s officials had on many occasions approached the defendant requesting them to regularize the account and despite the same no effort was made by the defendant to get the account regularized or to pay back the amount. The applicant issued legal notice dated 6.3.2019 requesting the defendant to clear the outstanding dues.

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It is also the case of the applicant that despite repeated reminders and requests the defendant failed to make the repayment forcing the applicant to file this OA

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seeking recovery of the amount due in the account with further interest and costs.

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It is the further case of the applicant that the defendant remained absent and hence was called absent and set ex-parte on 05.03.2020.

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The applicant had let in evidence through AW-1, who had sworn to a Proof Affidavit in terms of the pleading in the OA and also produced Exhibits A-1 to A-9 and got the same marked in evidence.

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Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

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The following issues arise for consideration in this matter: -

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(i) Whether the applicant had succeeded in proving the OA claim as against the defendant?

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(ii) What orders are to be passed?

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Both these issues are gone into and decided together.

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The case put forth by the applicant in the Application remains unrebutted as defendant remained ex-parte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible. From the statement of accounts as produced by the applicant, it is evident that the amount as claimed in the OA is outstanding in the account, which the applicant is entitled to get recovered from the defendant and his

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assets. The claim of the applicant is well within the period of limitation and there is no capitalization of penal interest.

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In view of the fact that the subject loan is an Agricultural Term loan and the applicant has charged interest at contractual rates till the date of filing and further as the interest rates have come down the Tribunal is inclined to reject the interest with monthly rests and award simple interest at reduced rates. The prayer of the applicant for grant of 2% penal interest is also rejected.

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In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, TA is disposed off in the following manner: -

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(a) TA No.664 of 2023 stands allowed.

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(b) Applicant is permitted to realize an aggregate amount of Rs.11,92,714/with future and pendentelite interest @9% p.a., simple from the defendant, from the date of filing of the OA till realization, after deducting all the amounts received by them during the pendency of OA, and also by selling the schedule mentioned properties and other assets of the defendant.

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(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendant is personally liable for all such amounts due under the Loan Accounts.

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(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 7 days from the date of receipt of the order.

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

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Communicate a copy of the order to the parties concerned in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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(Dictated to PS, transcribed by him, corrected, signed and pronounced by me in Open Court, on this the 13^th day of February, 2024)

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Sd/(T. RAJESH ) PRESIDING OFFICER DRT-II, CHENNAI

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Indian Overseas Bank v. Rama Thamilarasan

Case brief

What is this about?

What did the court decide?

Indian Overseas Bank v. Rama Thamilarasan

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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Case details

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