Allowed

Indian Overseas Bank v. Shanthiram Engineering

DRT27 Mar 2025MA/268/2024

Case brief

AI extract

What is this about?

The Tribunal condoned a 1735-day delay and restored an Original Application submitted by Indian Overseas Bank. Relying on precedents regarding banks as custodians of public funds, the court granted a conditional restoration, directing payment of costs to the Bar Association and requiring the bank to refund accrued interest to the defendants upon success.

What did the court decide?

Restoration of the Original Application allowed subject to payment of costs and a directive to disclaim interest for the 1735-day delay period upon success.

Indian Overseas Bank versus Shanthiram Engineering — Banking and Recovery | DRT (2025)

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MAs 268/24 & 150/25 in OA No.594/2017

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27.03.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 27^th day of March, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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Misc. Application Nos. 268/24 & 150/25 in

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OA No.594 of 2017

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Indian Overseas Bank Rep. by its Manager Kattupakkam Branch 2/49, First Floor Poonamallee Main Road Chennai – 600 056 …Applicant -Vs-

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Shanthiram Engineering Proprietor Mr. R. Senthinathan No.4/5, Perumal Koil Street Chettipedu Village, Thandalam Post Sriperumbudur – 602 105 .….Defendant

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Counsels on record / appeared:

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Counsel for Applicant : Mr. P.H. Vinodh Pandian

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: -ORDER ON MAs 268/24 & 150/25-:

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MA 268/24 is filed by applicant bank praying to condone delay of 1735 days in filing restoration petition and MA 150/25 is filed to restore TA, which was dismissed for default on 28.03.2018.

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The Original Application is filed by the Petitioner/Applicant Bank against the Defendants, seeking main relief to order the Defendants pay a sum of Rs.77,84,275/- (Rupees Seventy Seven Lakhs Eight Four Thousand Two Hundred and Seventy Five only) together with future interest @ 12.55% p.a. with monthly rests and costs.

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MAs 268/24 & 150/25 in OA No.594/2017

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27.03.2025

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The Applicant Bank has filed the present petitions i.e., MA No. 268/24 & 150/25 along with affidavit of Ms. L. Linu T Joy, Manager of applicant bank seeking to condone delay of 1735 days in filing restoration petition and to restore OA which was dismissed for default on 28.03.2018.

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It is submitted by applicant bank that the OA was posted for rectification of Proof Affidavit on 20.08.2018 as last chance. As applicant bank had neither rectified the proof affidavit nor the counsel had appeared before the Tribunal, OA came to be dismissed for default on 20.08.2018. It is submitted that the applicant bank was unable to comply and re-present the rectified PA and OD on time due to recent change in bank’s Management, which caused communication issues between the bank’s officials and counsel. Hence the instructions could not be obtained for compliance of PA and OD and file necessary restoration petition before this Tribunal. Hence the delay of 1735 days occurred, which is neither willful nor wanton but only due to the aforesaid reason. Thus submitting, counsel prayed for condonation of delay and restoration of TA.

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Heard counsel for applicant bank and perused the records of the case .

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The applicant, being a financial institution has filed the present restoration petition for recovery of a sum of Rs.77,84,275/- along with interest and for sale of mortgaged properties. It is seen that the applicant has not re-present the PA and OD despite availing substantial

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MAs 268/24 & 150/25 in OA No.594/2017

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27.03.2025

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adjournments. Accordingly, OA came to be dismissed for default and non-prosecution on 20.08.2018.

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In view of the fact that the bank being a financial institution is the custodian of the public money held under trust, the Tribunal relying on the judgment of Hon’ble High Court of Madras (At Madurai) in the judgment of V.P. Rajula -Vs.- K.J. Sakadeva Raja reported in LAWS (MAD)-2020-8-441 feels it apt to condone the delay and restore the OA and give last opportunity to applicant to adduce their evidence along with documents.

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Accordingly, MA Nos. 268/24 and 150/25 stands allowed subject to payment of costs of Rs.5,000/- to DRT and DRAT Bar Association, Chennai on or before 15.04.2025 by the applicant bank and to file the payment of compliance report before the Registrar Court on 17.04.2025.

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Further, the Tribunal, placing reliance on the judgment supra , directs that in case if applicant bank succeeds in the OA, applicant bank shall not claim interest for the said period of 1735 days from the defendants and file a memo of calculation at the time of adjudication of OA claim. The copy of this order be placed in the OA enabling to claim the exemption of interest at the time of final adjudication of OA.

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In case of the applicant complying with the order, OA stands restored to file for processing of proof affidavit and documents before the

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MAs 268/24 & 150/25 in OA No.594/2017

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27.03.2025

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Registrar’s Court on 17.04.2025. It is clarified that in case if the applicant bank fails to comply with the conditional order above, MAs stand dismissed automatically without there being any need to pass separate order.

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to PS, transcribed by her, corrected, signed and pronounced by me on this the 27^th day of March, 2025)

Indian Overseas Bank v. Shanthiram Engineering

Case brief

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Indian Overseas Bank v. Shanthiram Engineering

Case brief

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