Allowed

Union Bank of India v. Lala Asaram Chavan

DRT22 Sept 2025OA/129/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the application filed by Union Bank of India for recovery of a term loan against two defendants who failed to appear. The court adjusted the claimed future interest from 12.50% to 9% per annum and granted a direction to sell mortgaged property.

What did the court decide?

Defendants to pay Rs. 26,51,424/- plus future interest at 9% p.a. from filing; direction to sell mortgaged properties; issuance of Recovery Certificate.

Union Bank of India versus Lala Asaram Chavan — Contract and Commercial Disputes | DRT (2025)

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Presented on: 25.02.2022 Registered on: 18.05.2022 Decided on: 22.09.2025 Duration: Y M D 03 06 27

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IN THE DEBTS RECOVERY TRIBUNAL AT AURANGABAD (Before Dr. J. R. Chauhan Presiding Officer) ORIGINAL APPLICATION No. 129/2022

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TOTAL CLAIM AMOUNT – Rs. 26,51,424/-

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Union Bank of India,

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A Body Corporate and constituted under the Banking companies (Acquisition of Undertaking) Act 1970, Having its Central office at Union Bank Bhavan, 239, Vidhan Bhavan Marg, Nariman Point, Mumbai400021. And amongst other branches, one of its branch office at PITTI Complex, Neharu Road, Sarafa Bazar, Jalna Tq. And Dist. Jalna. Through its Authorized Person, Shri. Yogesh Sitaram Girhe, Age:

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41 yrs., Occ.: Service, Working as Manager, Union Bank of India, Jalna

… Applicant

Versus

(OA No.129/2022)

Page 1 of 9

[AMBADAS]

Lala Asaram Chavan Age: Major, Occu.: Agriculture At Post Navha, Nandapur, Tq. And District Jalna 431203.

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Shri. Vitthal Mhatarba Chavan Age: Major, Occu.: Agriculture At Post Navha, Nandapur, Tq. And District Jalna 431203

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…Defendants

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APPEARANCES

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For the Applicant For Defendants

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Mr. Atul A. Mishra -Advocate Ex-parte

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JUDGMENT

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Delivered on 22.09.2025

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The Applicant Bank has filed the present application for the recovery of a sum of Rs. 26,51,424/- (Rupees Twenty Six Lacs, Fifty One Thousand, Four Hundred and Twenty Four only), along with future interest from the date of filing of the Original Application, i.e., 25.02.2022, until the date of realization of the entire outstanding dues from the Defendants.

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Brief facts of the application are as under:

(OA No.129/2022)

Page 2 of 9

[AMBADAS]

The Applicant Bank states that the Defendant No. 1 approached and requested the Applicant Bank seeking financial assistance for the purpose of Grapes Gardening, Purchase of Tractor & Drip Irrigation work. Upon considering the request and financial needs of the Defendant, the Applicant Bank sanctioned a Term loan facility of Rs. 19,00,000/- vide sanction letter dated 14.03.2015 on certain terms and conditions. The agreed rate of interest for the aforesaid loan was @12.50% p.a. with half yearly rests. The Defendant also agreed to pay additional interest @2% by way of liquidated damages in the event of any default in repayment.

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In order to secure the aforesaid loan facility, the Defendant executed various loan documents in favour of the Applicant Bank. These included sanction letter, registered mortgage deed bearing daybook no. 1020/2014 dated 16.03.2015, letter of undertaking, demand promissory note, letter of continuity & hypothecation agreement. Additionally defendant No. 2 stood as guarantor for

(OA No.129/2022)

Page 3 of 9

[AMBADAS]

defendant No. 1 and executed deed of guarantee on 17.03.2015 in

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favour of the Applicant Bank.

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The Applicant Bank further contends that, in order to secure the

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aforesaid loan facility, the Defendant No. 1 created first charge

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over his immovable property under daybook no. 1020/2014 dated 16.03.2015 in favour of the Applicant Bank. The mortgage

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was created in respect of the following properties-

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i) All that piece and parcel of property bearing Gut No. 100, admeasuring 1 Hector 25 R, situated at village Nandapur, Tq. And Dist. Jalna, which is bounded as under:

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East: By Nala West: Land of Limbaji Chavan South: Land of Ambadas Chavan North: Land of Kamalbai Chavan.

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ii) All that piece and parcel of property bearing Gut No. 55, admeasuring 96 R, situated at village Thar, Tq. And Dist. Jalna, which is bounded as under:

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East: Land of Bhagwan Wankhede West: By River South: Land of Bhagubai Chavan North: Land of Sunil Chavan.

(OA No.129/2022)

Page 4 of 9

[AMBADAS]

The applicant bank further states that in order to secure the aforesaid loan facility, the defendant No. 1 also executed hypothecation agreement thereby hypothecating Tractor Mitsubhi Shakti VT 224 ID, Chassis No. T14K053165, Engine No. D14K008161 bearing vehicle No. MH21AN1084 registered on 20.11.2015.

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The applicant bank contended that the defendants have failed to keep their promise and commitments agreed by them with regard to due repayment of the loan amount. The defendants failed to operate the loan account properly and failed to pay the agreed rate of interest as per terms and conditions of the sanction letter. Thereafter, the applicant bank repeatedly made demand of loan amount and called upon the defendants to pay with the agreed rate of interest thereon, but the defendants failed and neglected to pay the same. The loan account of the defendants became irregular and classified as NPA on 31.03.2021. Therefore, on 20.01.2021 the applicant bank issued legal notice to the defendants through their advocate. Despite service of Notices, the

(OA No.129/2022)

Page 5 of 9

[AMBADAS]

defendants failed and neglected to repay the outstanding dues of the applicant Bank. Hence, this application is filed.

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The defendants failed to appear in matter though they were served through summons. Hence, the defendants were proceeded ex-parte as per Order dated 21.03.2024.

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The applicant Bank has filed Claim Affidavit of evidence at Exhibit-4 of Yogesh Sitaram Girhe, Branch Manager of the applicant Bank, and has produced on record the original loan transaction documents as Annexure A-1 to A-17 along with list of documents Exh.5 which corroborates the case of the applicant Bank.

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I have heard arguments of the learned Advocate for the applicant Bank.

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Since the defendants failed to appear and contest the application, I find no reason to disbelieve the unrebutted evidence of the applicant Bank. Therefore, the applicant Bank is entitled for the reliefs as claimed.

(OA No.129/2022)

Page 6 of 9

[AMBADAS]

The applicant Bank has claimed charge over immovable property of the borrower which is mortgaged in favour of the applicant bank.

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The applicant Bank has claimed future interest @12.50 p. a. on term loan from the date of filing i.e. 25.02.2022 of this application till realization of the claim amount. However, considering the facts of the case, I am of the opinion that if future interest is granted @ 9% per annum (simple), it would be just and reasonable rate of interest.

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ORDER

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(A) Original Application No. 129/2022 is allowed with costs.

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(B) The defendants shall pay jointly and severally to the applicant Bank a sum of Rs. 26,51,424/- (Rupees Twenty Six Lacs, Fifty One Thousand, Four Hundred and Twenty Four only), along with future interest @ 9% per annum (simple) from the date of filing of the Original

(OA No.129/2022)

Page 7 of 9

[AMBADAS]

Application i.e. 25.02.2022 till full payment/realization of the amount mentioned in this operative order.

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(C) The aforesaid adjudicated amount is secured by the mortgage of the following immovable property bearing daybook no. 1020/2014 vide registered mortgage deed dated 16.03.2015 at Annexure A-3 in list of documents Exh. 5.

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i) All that piece and parcel of property bearing Gut No. 100, admeasuring 1 Hector 25 R, situated at village Nandapur, Tq. And Dist. Jalna.

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East: By Nala West: Land of Limbaji Chavan South: Land of Ambadas Chavan North: Land of Kamalbai Chavan.

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ii) All that piece and parcel of property bearing Gut No. 55, admeasuring 96 R, situated at village Thar, Tq. And Dist. Jalna.

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East: Land of Bhagwan Wankhede West: By River South: Land of Bhagubai Chavan North: Land of Sunil Chavan.

(OA No.129/2022)

Page 8 of 9

[AMBADAS]

(D) The applicant Bank is entitled to sell the mortgaged immovable properties and hypothecated articles/goods

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vehicles etc., to recover its dues.

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(E) Issue Recovery Certificate accordingly.

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(F) The Registrar is directed to send the copy of the Judgment and Recovery Certificate to the applicant and defendants.

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(G) File be consigned to the record room.

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Sd/-

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Pronounced in open court. (Dr. J. R. Chauhan) Place: Aurangabad Presiding Officer Date:.22.09.2025 Debts Recovery Tribunal, Aurangabad

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(OA No.129/2022)

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Page 9 of 9

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[AMBADAS]

Union Bank of India v. Lala Asaram Chavan

Case brief

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Union Bank of India v. Lala Asaram Chavan

Case brief

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