Allowed

Canara Bank v. Mahantesh Arjun

DRT12 Nov 2025OA/1314/2024

Case brief

AI extract

What is this about?

DRT-II Bangalore allowed the bank's Recovery Certificate application regarding a defaulted agricultural term loan. The court held the claim was un-rebutted and within limitation, awarding the principal sum plus simple interest at 6% p.a.

What did the court decide?

Issuance of Recovery Certificate for Rs.20,40,553.32 plus interest at 6% p.a. simple; recovery from defendants collectively and personally after lien on schedule properties.

Canara Bank versus Mahantesh Arjun — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-II, BANGALORE

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Dated this 12^th Day of November, 2025

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PRESENT: SHRI T. RAJESH Hon’ble Presiding Officer

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O.A.No.1314 of 2024

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Canara Bank, Yergatti Branch, Mahabaleshwar Complex, Gogak Road, Yergatti, Saundatti Taluk, Dist. Belagavi. Through its Senior Manager, Mr.Rahul Shukla.

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… Applicant.

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Vs.

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Mr.Mahantesh Arjun Chilakandi, S/o. Arjun Chilakandi, At & Post: Soppadla, Savadatti Taluk, Belgaum – 591 129.

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Smt.Basalingawwa Arjun Chilakandi, W/o.Arjun Chilakandi, At & Post: Soppadla Village, Savadatti Taluk, Belgaum – 591 129.

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Smt.Pushpa Ravi Sullanavar, W/o.Ravi Sullanavar, At & Post: Soppadla Village, Savadatti Taluk, Belgaum – 591 129.

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Mr.Vinod Kumar Veerappa Bannur, S/o.Veerappa Bannur, At & Post: Soppadla Village, Savadatti Taluk, Belgaum – 591 129. … Defendants. Counsel for Applicant : M/s.Venu K.V. Defendants : Exparte. ……

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ORDER

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The Application is filed under Section 19 (1) of the Recovery of Debts And Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for a sum of Rs.20,40,553.32 together with further interest @11.55% compounded Half Yearly from 01.04.2024 till the date of realisation together with costs from the defendants jointly and severally and by way of sale of schedule mentioned properties.

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The Applicant contends that the defendants 1 to 3 approached the erstwhile Syndicate Bank for financial assistance of Rs.10,00,000/towards crop cultivation and availed the same on 30.11.2017 by execution of necessary loan documents including Agreement for Agricultural Advances coupled with Simple Mortgage Deed dt.21.11.2017 in respect of schedule mentioned properties in favour of applicant which was registered on 21.11.2017 vide Doc.No.MUR-102392-2017-18. The 4^th defendant guaranteed the due repayment of facility advanced to defendants 1 to 3 by executing Deed of Guarantee

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dt.30.11.2017. As a result of natural calamities, the applicant given a proposal dt.08.12.2020 to rephase the facility availed by defendants and with the consent of the defendants the Crop Loan was converted in to Term Loan on 20.01.2021.

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It is also stated that the above facility was availed after execution of necessary loan documents by defendants obliging themselves to repay the amount promptly and regularly, without fail.

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The Applicant further contends that after availing the aforesaid facility, the defendants failed to regularize the said loan and hence the loan account of the defendants was declared as Non-Performing Asset. The applicant bank has also issued Legal Notice dt.30.04.2024 to the defendants. Despite availing the credit facility by obliging to pay back the amount, the defendants failed in compliance of the same and all the efforts of the Applicant to make the defendants pay back the amount failed, forcing the Applicant to file this Application.

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Summons was taken out and as the defendants failed to enter appearance, they were set exparte on 19.12.2024.

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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 A1 to A9, got the same marked in evidence.

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Heard. The following issues arise for consideration in this matter:

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i) Whether the applicant succeeded in proving the OA claim as

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against the Defendants?

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ii)If so, to what extent?

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Both these issues are gone into and decided together.

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The Applicant’s evidence remains un-rebutted and hence proved. The documents produced by the Applicant are found to be admissible and are sufficient to prove the OA claim. Hence the Applicant is found to be entitled for the OA claim. The OA claim is made within limitation and there is no capitalization of penal interest.

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Since the OA claim is arrived at by calculating interest with default interest and that the facilities are availed in respect of Crop Loan which was subsequently converted into Term Loan the pendent lite and future interest is awarded at simple rate that too at reduced rate of 6% p.a. (simple).

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In view of the above

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i) OA No.1314 of 2024 stands allowed.

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ii) Applicant is permitted to recover an amount of Rs.20,40,553.32 (Rupees Twenty Lakhs Forty Thousands Five Hundred Fifty Three and Thirty Two Paise only) together with interest @6% p.a. (simple) from the date of filing of OA till the date of realization together with costs from the defendants

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jointly, severally and personally 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 the schedule mentioned properties. The schedule to the OA to be the schedule to the Recovery Certificate.

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iii) If the sale proceeds are not sufficient to clear the liability, then the Defendants are personally and their other assets are liable to be proceeded against for realization of respective dues.

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iv) A Recovery Certificate is to be drawn and issued to the Recovery Officer to enable recovery of the dues as per the above terms.

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v) Interim application pending, if any, stands disposed of in terms of this final order.

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vi) Applicant is allowed to realize cost of the proceeding for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the 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 and pronounced by me in the open Court on this the 12^th day of November, 2025)

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Sd./-

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(T. RAJESH) PRESIDING OFFICER

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Applicant Witness:

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AW1 –Mr.Naga Chetan, Senior Manager, Applicant Bank.

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Exhibits on the part of the Applicant:

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Ext A1 - Loan Application dt.21.11.2017. Ext.A2 - Sanction Memorandum dt.21.11.2017. Ext.A3 - Agreement for Agricultural Advances dt.30.11.2017. Ext.A4 - Simple Mortgage Deed dt.21.11.2017. Ext.A5 - Deed of Guarantee for Agricultural Advances executed by 4^th defendant dt.30.11.2017. Ext.A6 - Proposal Letter dt.08.12.2020. Ext.A7 - Letter dt.20.01.2021 with regard to conversion of the Crops Loan into Term Loan. Ext.A8 - Notice dt.30.04.2024. Ext.A9 - True Extract of Statement of Accounts pertaining to the Defendant’s Loan A/c.No.05178440002830.

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Witness Examined for the Defendants:

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NIL

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List of Documents Exhibited for the Defendants :

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NIL

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Sd./-

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(T. RAJESH) PRESIDING OFFICER

Canara Bank v. Mahantesh Arjun

Case brief

What is this about?

What did the court decide?

Canara Bank v. Mahantesh Arjun

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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Case details

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