Allowed

Union Bank of India v. M/s. Mahalakshmi Industries

DRT17 Dec 2025OA/149/2024

Case brief

AI extract

What is this about?

tribunal allowed an original application under Section 19 of RDB Act, 1993 filed by Union Bank of India for recovery of Rs.52,48,631.80 plus interest and costs against the defendants, finding their contentions regarding evidence and interest rates unsubstantiated. The bank was permitted to proceed for recovery.

What did the court decide?

Defendants liable to pay Rs.52,48,631.80 plus interest @7.5% simple and costs; Bank entitled to proceed for realization; Recovery Certificate issued.

Union Bank of India versus M/s. Mahalakshmi Industries — Insolvency and Bankruptcy | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-]I AT HYDERABAD DATED THIS THE 17TH DAY OF DECEMBER, 2025

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PRESENT: SH. RAMESHWAR KOTHE, B.COM, L.LB.^{(HONS.),IVI.A.} PRESIDING OFFICER

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ORIGINAL APPLICATION NO. T49 OF²⁰²⁴

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Union Bank of India Sl,'lE Nachara m Bra nch H lvlT Nagar, Nacharam Hyderabad. Rep by lts Authorised Sig natory.

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Versus

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Mla. Ma halaksh mi Industries Plot No. 1128, 5th Floor lu bilee Square, Road No.36 Jubilee Hills, Hyderabad-33.

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Also at:

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M/s Mahalakshmi Industries Factory - Plot No.3/B IDA Bhonglri, Yadadri Dist. Telangana - 508 116.

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AkkinepalliSindhura D/o Akkinepalli Rama Rao H. No. 4-12-1000 & 1001/303

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S.S.R. Residency, HUDA Sai Nagar Va nasth a lipu ra m, Hayathnagar R.R. District, Telangana-500070.^{..... Defendants.}

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Counsel for the Applicant :^{Ms.Eshwari Muvva.}

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Counsel for the Defendants :^{Mr. B. NarasingaRao.}

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::^qLLE-B ::

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The Applicant Bank filed^{the present OA u/s 19 of The Recovery} of Debts & Eankruptcy Act,¹⁹⁹³ for^{recoveryof a total sumof} Rs.52,48,631.80Ps^{(Rs.50,01,965/-towards loan account} trfu'o'*

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()A.1{9/2021

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No.087330100139008 and Rs.2,50,154.80ps towards accounr No.087313100005118) from the defendants joinUy and severally with future interest @11olo and g.5olo per annum respectively compounded monthly from the date of Application till the date of realisation along with costs.

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The averments of the OA, in brief, are;

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Defendant No.1, a Small Enterprise engaged in manufacture of Mattresses, represented by its proprietrix_2nd defendant, availed open cash credit of Rs.50 lakh under sanction letter dated 30.10.2019 by securing its stocks available at factory premises. The rate of interest w?S 11olo per annum subject to variation from time to time. During Covid.19 defendants availed a further credit facility of Rs.7.45 lakh under the Union Guaranteed Emergency Credit Line scheme. Defendant executed necessary loan documents/letter of access. Due to improper operation, the loan accounts became irregular within a span of short period, leading to classification as NpA by 27.7O.2023. Applicant issued tegat notice dated 18.01.2024 to the defendants. As per the postal track report, the legal notice was served upon the defendant. As the repeated requests and demands did not yield any result, the present OA is filed.

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Defendant filed written statement. The averments of the written statement, in brief, are;

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Defendants raised preliminary objections on the accuracy and veracity of OA claim, statement of account, certification under Bankers' Books Evidence Act, 1991, unsigned statements of accounts on plain sheets in place of letter head, exorbitant rate fi*rw. .- (t/^{./n{\1 ,}

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oA,119t2021

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of interest, violation of Section 658 of the Indian^{Evidence Act} etc.

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While admitting avvailment of enhanced limits due to^liquidity issues and subsequent default in repayment/^{defendantsseek} reconsideratlon of NPA classiflcation as the irregularityⁱⁿ repayment was on account of covid.19^{pandemic. Applicant} bank^granted meTe seven days time to^{respondto legalnotice.} In view of the above mentioned facts, it is^clear that^{the OA} filed by the Applicant is an abuse of^process of^{law and devoid} of any merits and therefore, defendants^{prayedfor dismissal of} OA with exemplary costs.

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In order to^prove its claim, Applicant Bank^{examined Rohit} Pandey, Chief Manager, as AW-1 and marked 18^documents through him as Ex. A.1to Ex. A.18.

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Defendants right to adduce evidence forfeited on^29.07.2025 for non-representation.

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Learned counsel for applicant filed Memo stating^{that its'} version of arguments was filed in writing.^{Therefore,there} would be no oral arguments from its end.^{Perused the written} arguments filed by both sides and the^{materialplaced on} record.

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The point that arises for consideration is:-

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Whether the Applicant Bank^is entitled for the OA claim against^the Defendants?

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B. There is no dispute over the availment of loan and default^ln repayment thereafter. However, defendaots' contention^{is on} fur-''*9

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oA.t19/2021

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the reliability and the veracity of certificate u/s 2(a) of Bankers Book of Evidence Act, higher rate of interest charged to the loan accounts and non-compliance of provisions of Section 658 of the Indian Evidence Act. The specific contention of the defendants is that the certificate filed u/s 2(a) of the Bankers Book of Evidence Act, is not varid as the same was not on the letter head of the appricant and did not discrose the name of signatory. I have gone through the certificates filed u/s 2(a) i.e., annexures to Exhibits A.15 and A.16. They are duly signed and stamped. The OA and the subject documents were filed by the same person. The name of the signatory has been mentioned in the verification affidavit filed with the OA. On the contrary, defendants have not pointed out any specific discrepancy that is at variance with the provisions of section 2(a) of the Bankers Books of Evidence Act. Instead, defendants made bald allegations without there being any valid evidentiary material in the form of evidence affidavit. Same is the case with respect to the contention over non_compliance of 658 of Indian Evidence Act. Defendants failed to bring any specific discrepancy or overrapping as to the vioration of provisions of Section 658 by the applicant bank as also the prejudice if any caused to them on these counts. Any unsupported allegations or contentions are of no use.

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Defendants filed IA.1757 of 2O2S on 19.05.2025 along with statements of account of both loan accounts duly stamped and signed by the applicant bank as on 06.01.2025 with a prayer to permit the Special power of Attorney holder to represent the defendants, In spite of doing so, defendants did not choose to mark those bank statements through an affidavit. Instead defendants rather allowed their right to adduce evidence oot

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,4,Y^# (/

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ot^.119/2021

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forfeited by remaining absent in the^{proceedings.However,} defendants followed it up this aspect by making a^referencein the written arguments and sought direction to the applicant bank to suitably alter/modify the clalm amount in OA^after adjusting the credit entries appearing in the statements^of account filed along with 1A.175612025. A^perusal of^the statement of account filed in the IA^pertains to the loan account bearing No. 087313100005118. The statement^shows a^credlt entry of RS.3O,OO,OOO/- which inter alia^pertains to the^1't instalment of CGTMSE. Defendants have not brought any material on record as to how the^payment under CGTI.4SE^{is to} be appropriated against OA claim.^Therefore, this^issueneeds no consideration.

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As regards rate of interest, defendants have not brought^on record any reconciliation statement^quantifying the excess^rate of interest allegedly debited to the^loan accounts.^Therefore,in the absence of identification of excess rate of interest, if^any, charged contrary to the agreed terms, the^{plea is} devoid of^any merit.

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Above all, as stated supra, except maklng bald assertions^{in the} written statement, defendants did not choose to^produceany material evidence in support of their contentions nor did^they choose to cross examine AW.1 to disprove the veracity^of documents exhibited vide A.1 to A.18.

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In view of the foregoing facts and circumstances, the^evidence aFfidavit of AW.1 filed on behalf of the applicant^{bank and the} recitals in Exhibits A.1 to A.18 remain unchallenged^and unrebutted. Accordingly, I hold that defendants are^{liable to} 2fw"vang

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a^'.""-

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oA.t49t2021

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pay the OA claim to the applicant bank along with interest and costs.

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In the result, the present Original Application No.t49/2024 is allowed as under: -

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i) defendants are liable to pay to the Applicant Bank a total sum of Rs.52,48,631.80ps along with interest @7.SOo/o per annum simple from the date of application till the date of realization;

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ii) the applicant bank is entiued to proceed against the person and properties of the defendants for realization of its dues; and

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iii) the applicant bank is entiiled for the costs.

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14' The Appricant Bank is directed to fire cost Memo within 2 weeks from the date of receipt of this Order.

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Issue Recovery Certificate accordingly.

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Communicate a copy of this order to the parties concerned and upload in official Web portal.

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(Dictated to the steno, signed and pronounced by me in the open court on this the 17rh ' .1,U,;;. day of December, 2025.)

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,-. a' - ) ,\I^r-'.' ' -

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(RAMESHWAR KOTHE) PRESIDING OFFICER

Union Bank of India v. M/s. Mahalakshmi Industries

Case brief

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Union Bank of India v. M/s. Mahalakshmi Industries

Case brief

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