Allowed

Canara Bank v. Smt.Shakila P Shetty

DRT27 Jun 2025OA/1389/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an Original Application filed by Canara Bank against the legal heirs of a deceased borrower for issuance of a Recovery Certificate. Since defendants appeared ex parte, the Tribunal found the bank's evidence sufficient to prove loan defaults and directed recovery of the dues with interest.

What did the court decide?

Recovery Certificate allowed for Rs.67,59,938/- with further interest at 7.65% p.a. from filing till realization against the defendants and schedule property.

Canara Bank versus Smt.Shakila P Shetty — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 27^th Day of June, 2025

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Present: Sri. T. RAJESH Presiding Officer

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OA.No.1389/2022

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BETWEEN:

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Canara Bank Erstwhile Syndicate Bank Kollur Branch, Kollur Udupi District-576220 By its Branch Manager Sri. Nidhin K Anand … APPLICANT

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AND:

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Mrs. Shakila P Shetty D/o. Late JK Surendra Shetty Aged about 38 years Ambika Guest House, Sagar Road, Kolluru, Kundapura Taluk, Udupi District- 576220

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Sri. Prakash Shetty S/o. Late K Surendra Shetty Aged by Major Mayur Guest House, kollur, Kundapura Taluk, Udupi District – 576220

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Mrs. Shyamala Daughter of Late K Surendra Shetty Aged by Major Ambika Guest House Sagar Road, Kollur, Kundapura Taluk, Udupi District – 576220 ...DEFENDANTS

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2 OA/1389/2022

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Counsel on record/appeared for:

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Applicant : Sri. M.S. Vinayaka 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.67,59,938/- (Rupees Sixty Seven Lakh Fifty Nine Thousand Nine Hundred and Thirty Eight only) with further interest thereon from the date of filing the Application till realization.

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It is the case of the applicant that, Late Surendra Shetty the father of the 1^st to 3^rd defendants on the co-obligancy of the 1^st defendant had availed Vehicle loan of Rs.90,00,000/- on 11.11.2016 for the purpose of purchase of Audi Q7 car from applicant bank after executing necessary loan documents in favour of applicant such as Composite Hypothecation Agreement. It is submitted that, Late Surendra Shetty the father of 1^st to 3^rd defendants herein expired on 30.04.2018 and his wife Smt. Sushila K and the mother of 1^st to 3^rd defendant herein also expired on 13.03.2019 leaving behind them the defendants Nos. 1to 3 are their surviving legal heirs.

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3 OA/1389/2022

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The deceased borrower had executed necessary loan documents in favour of the applicant bank as security for the due repayment of the loans, interest, cost and charges. The deceased borrower had also Composite Hypothecation Agreement dated 11.11.2016.

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It is further contended that, despite availing the credit facility, agreeing to service the loan account promptly and regularly, the defendants failed in complying the same, resulting in defaults in repayment and consequentially turning the loan accounts 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 05.06.2025.

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The applicant let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A3 to A14 and got the same marked in evidence.

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4 OA/1389/2022

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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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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 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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5 OA/1389/2022

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Hence in view of the above finding which cover both the

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issues raised in this manner, this Tribunal is of the view that OA is liable to be allowed.

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Since the OA claim is arrived at by calculating agreed rate

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of interest, penal interest/default interest, which this Tribunal considers as on the higher side, pendentalite and future interest is awarded at fixed rate.

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In the result, OA.No.1389/2022 stands allowed,

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i) The applicant is allowed to recover an aggregate sum

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of Rs.67,59,938/- (Rupees Sixty Seven Lakh Fifty Nine Thousand Nine Hundred and Thirty Eight only) with further interest of 7.65%

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p.a.(simple) from the date of filing OA till the realization, from the defendants to the extent of their inheritance of any estate from the deceased borrower Late K Surendra Shetty, after giving credit to all the amounts recovered and received during the pendency of the OA allowed the same to be recovered by proceeding against defendants jointly, severally and personally and also by proceeding against the schedule property. The schedule property to the OA be the schedule property to the Recovery Certificate.

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6 OA/1389/2022

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ii) 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

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receipt of the order.

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iii) 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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iv) Interim Application pending, if any, stands disposed of

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with this Final Order.

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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 27^th Day of June 2025].

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(T. RAJESH) PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Sri. Nikhil M, Senior Manager of the applicant bank.

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Exhibits on the part of the Applicant:

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Annexure	Particulars
A1	Affidavit Evidence
A2	List of documents
A3	Loan application form

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7 OA/1389/2022

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A4	Loan sanction letter dated 11.11.2016
A5	Composite hypothecation agreement dated 11.11.2016
A6	Death certificate dated 30.04.2018 of Sri. Surendra Shetty
A7	Death certificated dated 13.03.2019 of Sushila K Shetty
A8	Familytree of Surendra Shetty
A9	Acknowledgement of debt dated 30.07.2019
A10	Legal notice dated 07.02.2022
A11, A12 & A13	Postal acknowledgement of defendant Nos.1, 2 and 3
A14	Statement of loan account

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(T. RAJESH)

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PRESIDING OFFICER

Canara Bank v. Smt.Shakila P Shetty

Case brief

What is this about?

What did the court decide?

Canara Bank v. Smt.Shakila P Shetty

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

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Case details

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