Allowed

Union Bank of India v. Mohammed Musthafa Khan

DRT25 Nov 2025OA/110/2023

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed Original Application for issuance of Recovery Certificate against defendants who failed to repay an agricultural loan of Rs.35,00,000/- resulting in default. Tribunal sanctioned recovery of Rs.51,20,500/- with reduced interest at 6.00% p.a. simple against joint and several liability and mortgage properties.

What did the court decide?

Recovery Certificate for Rs.51,20,500/- with interest at 6.00% p.a. (simple) against defendants jointly, severally and personally and schedule properties.

Union Bank of India versus Mohammed Musthafa Khan — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 25^th Day of November, 2025

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Present: Sri. T. RAJESH Presiding Officer

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OA. No.110/2023

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BETWEEN:

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Union Bank of India (Erstwhile Corporation Bank) Aruna Complex, No.66/1 & 66/2, 1st Floor, JC Road, Bengaluru-560002 Represented by its Senior Manager … APPLICANT

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AND:

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Sri. Mohammed Musthafa Khan, S/o. Abdulla Khan, Aged about 61 years R/at 1129, Khajipete, B Block, 7^th Ward, Gudibande, Chikkabalapular-561209.

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And Also At Sy No. 59/1 Gudibande, Kasaba Hobli, Gudebande Taluk, Chikkaballapura District-561209.

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And Also At

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Sy No. 27/1A, Brahmanarahalli village, Kasaba Hobli, Gudebande Taluk, Chikkaballapura District-561209.

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And Also At

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No.200/144+45, Khajipete, Gudebande Taluk, Chikkaballapura District-561209.

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OA. No.110/2023

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Sri Abdul khader, S/o. Nyamath Sabi, Aged about 38 years No.121/4, pulumakanahalli, Gudibandi Taluk, Chikkaballapur-561209.

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And Also At. Alagedharana halli Village, Ullodu Post, Gudibande Taluk, Chikkaballapura District-561209. ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri. Prabhu Rao CB Defendants : Exparte

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:FINAL ORDER:

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The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 for seeking issuance of Recovery Certificate against the defendants for Rs.51,20,500/- (Rupees Fifty One Lakh Twenty Thousand and Five Hundred Only) with further interest thereon from the date of filing the Application till realization from the Defendants.

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It is the case of the applicant that, the defendants availed the Agricultural Term loan of Rs.35,00,000/- for production of vegetables under green house.

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It is also the case of the applicant that, in view of the above financed credit facility, the defendants executed necessary loan documents. Apart from the creation of security interest by way of

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OA. No.110/2023

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mortgage over the Schedule properties.

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It is further contended that, despite availing the credit facility, agreeing to service the loan amount promptly and regularly, the defendants failed in complying the same, resulting in default in repayment and consequentially turning the loan account as NPA.

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In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the account.

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Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set exparte on 22.09.2023.

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The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A3 to A15 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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OA. No.110/2023

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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 defendants?

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ii) What order 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

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remains unrebutted as defendants remained exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facility as stated in the OA, creation of security interest as claimed by the applicant bank and the defaults committed in the account. The liability of the defendants and the claim of the amount due are also proved by the above documents. The claim of the applicant is well within the limitation.

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Hence in view of the above findings which cover both the issues raised in this manner, this Tribunal is of the view that OA is liable to be allowed.

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OA. No.110/2023

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Taking into consideration the facts that the credit facility

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were availed for agricultural purpose and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of 6.00%

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p.a.(simple).

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In the result, OA.No.110/2023 stands allowed,

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i) The applicant is allowed to recovery an aggregate sum of Rs.51,20,500/- (Rupees Fifty One Lakh Twenty Thousand and Five Hundred Only) with further interest of 6.00% p.a.(simple) from the date of filing OA till the realization from the defendants, after giving credit to all the amounts recovered and received during the pendency of the OA and allowed the same to be recovered by proceeding against defendants jointly, severally and personally and also by proceeding against the schedule properties. The schedule properties to the OA be the schedule properties to the Recovery Certificate.

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ii) If the sale proceeds are not found sufficient to cover

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the amount due and payable to the applicant bank, the defendants jointly, severally and personally and their other assets are liable

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OA. No.110/2023

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for all such amounts due under the loan accounts.

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iii) The applicant bank is allowed cost of the proceeding

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which applicant to file cost memo within 7 days from the date of receipt of the order.

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iv) The Recovery Certificate to be drawn in terms of this

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order and transferred to Recovery for execution.

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v) Interim Application pending, if any, stands disposed of

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with this Final Order.

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14. Communicate a copy of the order to the parties concerned

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in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of

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DRT (Procedure) Rules, 1993.

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[Dictated to the Stenographer (PR), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 25^th Day of November 2025].

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(T. RAJESH) PRESIDING OFFICER

OA. No.110/2023

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Sri. Avhigyan Mukharjee, Senior Manager of the applicant bank.

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Exhibits on the part of the Applicant:

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Annexure	Particulars
A3	Copy of loan application dated 14.02.2014
A4	Copy of letter of sanction dated 26.02.2014
A5	Copy of Agreement for term loan dated 26.02.2014
A6	Copy of Letter of undertaking dated 26.02.2014
A7	Copy of Guarantee Agreement dated 26.02.2014
A8	Copy of Common deed of hypothecation of crops and socks dated 26.02.2014
A9	Copy of Common deed of hypothecation of movables/ Assets/Debts
A10	Copy of memorandum of deposit of title deed dated 26.02.2014
A11	Copy of deed of simple mortgage dated 24.02.2014
A12	Copy of the Legal notice dated 29.01.2022
A13	Copy of the postal receipts
A14	Copy of the served acknowledgments
A15	Copy of the statement of account A/W Certificate as per Banker's Banker's Book Evidence Act

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(T. RAJESH) PRESIDING OFFICER

Union Bank of India v. Mohammed Musthafa Khan

Case brief

What is this about?

What did the court decide?

Union Bank of India v. Mohammed Musthafa Khan

Case brief

What is this about?

What did the court decide?

What the court decided

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