Allowed

Canara Bank v. St Marys

DRT19 Sept 2025OA/1223/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the Recovery Certificate application filed by Canara Bank against an overdrawn account. With defendants in ex parte, undisputed evidence established the default. The Tribunal decreed recovery of the principal sum plus interest but declined prayers for monthly rest interest.

What did the court decide?

Recovery Certificate to be drawn for Rs.34,76,253.81 with further interest @9.95% p.a. simple; monthly rest and future penal interest prayed for are declined.

Canara Bank versus St Marys — Banking and Recovery | DRT (2025)

¶1

IN THE DEBTS RECOVERY TRIBUNAL II, BENGALURU

¶2

Dated this 19^th Day of September, 2025

¶3

Present: Sri. T. RAJESH

¶4

Presiding Officer OA.No.1223/2023

¶5

BETWEEN:

¶6

Canara Bank Muniyal Branch 3 by 92, Dinesh Sadan Mangalore Agumbe Road, Muniyal, Karkala Taluk, Udupi District, Karnataka

¶7

…APPLICANT

¶8

AND:

¶9

M/s St. Marys A Proprietary Concern 3-95 Kursukatte Road, Ajekaru Post, Karkala Taluk-574104

¶10

Mr. Sandeep KT Bolla Mane, Ajekar Marne Village Karkala Taluk, Udupi District-574104

¶11

Mr. KC Thomas Bolla Mane, Ajekar Marne Village Karkala Taluk, Udupi District-574104

...DEFENDANTS

OA 1223-2023

Counsel on record/appeared for:

¶16

Applicant : Skanda Legal Defendants : Exparte

¶17

FINAL ORDER

¶18

The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act

¶19

1993 seeking issuance of Recovery Certificate for Rs.34,76,253.81 (Rupees thirty four lakh seventy six thousand two hundred fifty three and paisa eighty one only) with further interest thereon from the date of filing the Application till realization from the Defendants.

¶20

It is the case of the applicant that the defendant No.1 a Proprietary Concern with defendant No.2 as its representator had availed the OD loan credit facilities of Rs.15,00,000/- (Rupees fifteen lakh only) from the erstwhile Syndicate Bank which later got amalgamated with Canara Bank.

¶21

It is also the case of the applicant that, in view of the above amount financed, the defendants executed necessary loan documents along with simple mortgage deed and guarantee agreement in favor of the applicant bank.

¶22

It is further contended that, the defendants despite

¶23

¶24

OA 1223-2023

¶25

availing the credit facility, agreeing to service the loan account promptly and regularly, failed in complying the same, resulting in defaults in repayment and consequentially turning the loan accounts as NPA.

¶26

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.

¶27

Despite, service of summons on the defendants, they failed to appear, resulting the defendant being set exparte on 27.01.2025.

¶28

The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A-1 to A-15 and got the same marked in evidence.

¶29

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

¶30

The following issues arise for consideration in this matter:

¶31

i) Whether the applicant had succeeded in proving the

¶32

OA 1223-2023

¶33

¶34

OA claim as against the defendant?

¶35

ii) What order are to be passed?

¶36

Both these issues are gone into and decided together.

¶37

The case put forth by the applicant in the Application

¶38

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 facilities as stated in the OA, creation of hypothecation and mortgage as claimed by the applicant bank and the defaults committed in the accounts. The liability of the defendants and the claim as the amount due is also proved by the above documents. The claim of the applicant is well within the limitation.

¶39

Hence in view of the finding arrived herein above, this Tribunal find both these issues in favour of applicant and hence this Tribunal is of the view that OA is to be allowed.

¶40

Taking into consideration the facts that the credit facilities

¶41

are availed by defendants for Business Purchase, this Tribunal in

¶42

OA 1223-2023

¶43

¶44

view of the rate of interest as claimed need not be reduced.

¶45

However, as the OA Claim is arrived at by calculating interest at

¶46

the agreed rate and also by applying default interest, the prayer

¶47

for monthly rest and future penal interest are declined.

¶48

In the result, OA.No.1223/2023, stands allowed,

¶49

i) The applicant is allowed to recovery an aggregate

¶50

sum of Rs.34,76,253.81/- (Rupees thirty four lakh seventy six thousand two hundred fifty three and paisa eighty one only) with further interest @9.95% p.a. (simple),

¶51

from the date of filing OA till the realization, from the defendants

¶52

No.1 to 3 jointly severally and personally after giving credit to all the amount recovered and received during the pendency of the OA and allowed the same to be recovered by proceedings

¶53

against the schedule property. Properties schedule to the OA be the schedule to the recovery certificate.

¶54

(ii) If the sale proceeds are not sufficient, the defendants

¶55

personally and their other assets are liable to be proceeded against for the balance amount.

¶56

iii) The applicant bank is allowed cost of the proceedings

¶57

OA 1223-2023

¶58

¶59

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

¶60

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

¶61

order and transferred to Recovery for execution.

¶62

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

¶63

in terms of this final order.

¶64

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

¶65

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

¶66

of DRT (Procedure) Rules, 1993.

¶67

[Dictated to the Stenographer (JV), transcribed by him, corrected and signed and pronounced by

¶68

me in the Open Court, this the 19^th day of September, 2025].

¶69

Sd/ (T. RAJESH)

¶70

PRESIDING OFFICER

¶71

ANNEXURES

¶72

WITNESSES EXAMINED FOR THE APPLICANT BANK:

¶73

AW-1: Ashok T G, Senior Manager, of Applicant Bank.

¶74

Exhibits on the part of the Applicant:

¶75

Exhibit	Date	Particulars of Documents
Nos.
A1	23.08.2016	Loan Application form
A2	07.09.2016	Sanction letter
A3	07.09.2016	Composite Hypothecation Agreement
A4	07.09.2016	Guarantee Agreement
A5	18.08.2016	Supplemental Simple Mortgage Deed

¶76

OA 1223-2023

¶77

¶78

A6	01.02.2018	Application for Credit Facilities
A7	06.04.2018	Sanction Letter
A8	05.04.2018	Composite Hypothecation Agreement
A9	20.03.2018	Simple Mortgage deed
A10	05.04.2018	Guarantee Agreement
A11	07.04.2021	Demand Notice under Sec 13(2) under SARFAESI Act, 2002 by applicant bank
A12	19.08.2021 12.05.2022	Possession Notice under Sec 13 (4) under SARFAESI Act,2002 by Applicant Bank
A13	21.11.2017	Encumbrance Certificate
A14	31.03.2022	Valuation Report
A15	01.01.2016 30.11.2022	Statement of Account Loan Acc No. 01701400000898

¶79

Witness Examined for the Defendant: -Nil - List of Documents Exhibited for the Defendant: -Nil -

¶80

Sd/ (T. RAJESH) PRESIDING OFFICER

Canara Bank v. St Marys

Case brief

What is this about?

What did the court decide?

Canara Bank v. St Marys

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

Case details

Similar cases

Abbas Ca versus Urban Co. operative Bnak Ltd.

State Bank of India versus Sachin Kumar Kaushal

Canara Bank versus M/S Avtar Bag Factory

Karnataka Bank Limited versus Hardik

Ms Habib Agro Industries Rep by Its Partners and Legal Heir of Late Sri Habib Khan and Others versus the Authorised Officer Indiabulls Housing Finance Ltd.

Ms Habib Agro Industries Rep by Its Industries Rep by Its Partner and Legal Heirs of Late Sri Habib Khan and Others versus the Authorised Officer Indiabulls Housing Finance Ltd.