Allowed

Canara Bank v. Basappa Basavaneppa Magadum

DRT29 Aug 2025OA/1662/2023

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed the bank's application for a recovery certificate against two defaulting borrowers. The defendants appeared ex parte. The Tribunal found the claim valid, reduced the interest rate to 6% simple for agricultural purposes, and authorized recovery from the borrowers' joint and several assets.

What did the court decide?

Issuance of Recovery Certificate for Rs. 25,79,387 with 6% p.a. simple interest from the date of filing; proceeds recoverable from schedule property and defendant assets.

Canara Bank versus Basappa Basavaneppa Magadum — Contract and Commercial Disputes | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 29^th Day of August, 2025

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Present: Sri. T. RAJESH Presiding Officer OA.No.1662/2023

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BETWEEN:

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Canara Bank, Konnur Branch, Gokak Taluk, Dist Belgavi, Through its Branch Manager, Mr. Nilesh Maruti Jadhav.

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…APPLICANT

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AND:

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Mr. Basappa Basavaneppa Magadum, S/o Basaveppa Magadum, Aged about: 38 years, Residing at: Ghodageri Post, Hukkeri Taluk, Belgaum- 591 107.

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Mr. Vaibhav Basavenappa Magadum, S/o Basaveppa Magadum, Aged about: 34 years, Residing at: Ghodageri Post, Hukkeri Taluk, Belgaum- 591 107.

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...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri. Venu K .V Defendants : Exparte

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FINAL ORDER

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The present Original Application in short (OA) has been filed

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under section 19 of Recovery of Debts and Bankruptcy Act 1993

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OA 1662/2023

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seeking issuance of Recovery Certificate against the defendants for Rs. 25,79,387.00 (Rupees Twenty Five lakh Seventy Nine Thousand Three Hundred and Eighty Seven 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, the defendants availed the following credits for agricultural purpose of Rs. 1,30,000/- (Rupees One Lakh Thirty Thousand Only) of Rs. 2,50,000/- (Rupees Two Lakh Fifty Thousand Only). Rs. 50,000/- (Rupees Fifty Thousand Only) and Rs. 1,50,000/- (Rupees One Lakh Fifty Thousand Only).

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It is also the case of the applicant that, in view of the above availed loans, the defendants executed the necessary loan documents along with agreement of hypothecation, letters of revival and simple mortgage deed in favour of the applicant bank.

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It is further contended that, despite availing the credit facilities, agreeing to service the loan amount promptly and regularly, the defendants failed in complying the same, resulting in default 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

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OA 1662/2023

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appear, resulting the defendants being set exparte on 26.09.2024.

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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 A-3 to A-32 and got the same marked in evidence.

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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

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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 facilities as stated in the OA, creation of the security interest and the defaults committed in the accounts. The liability of the defendants and the claim of the amount

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due are also proved by the above documents. The claim of the

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OA 1662/2023

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applicant is well within the limitation.

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Hence in view of the findings arrived herein above, the Tribunal

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

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Taking into consideration the facts that the credit facilities are

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availed for Agricultural purpose and also that the OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of 6.00% (simple).

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In the result, OA.No.1662/2023, stands allowed,

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i) The applicant is allowed to recovery an aggregate sum of

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Rs. 25,79,387.00 (Rupees Twenty Five lakh Seventy Nine Thousand

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Three Hundred and Eighty Seven Only) with further interest @6.00 % p.a.(simple) from the date of filing OA till the realization, from the defendants jointly, severally & 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 proceeding against schedule property. Properties schedule to the OA be the schedule to the recovery certificate.

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ii) If the sale proceeds are not found sufficient to cover the

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amount due and payable to the applicant bank, the defendants

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OA 1662/2023

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jointly, severally & personally and their assets are liable for respective

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amounts due under the respective loan accounts.

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iii) The applicant bank is allowed cost of the proceedings

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

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

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and transferred to Recovery for execution.

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

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terms of this final order.

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Communicate a copy of the order to the parties concerned in

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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 the Stenographer (AJ), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 29^th Day of August, 2025].

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Sd/- (T. RAJESH)

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PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Nilesh Maruthi Jadhav S/o. Maruthi Jadhav, Branch Manager, of Applicant Bank.

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OA 1662/2023

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Exhibits on the part of the Applicant:

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Exhibit	Particulars of Documents
Nos.
A1	Affidavit of evidence
A2	List of documents
A3	Loan application dated 17.06.2019
A4	Agreement of hypothecation for agricultural loans dated 18.06.2009
A5	Simple mortgage deed dated 15.06.2009
A6	Letters of revival dated 18.05.2012
A7	Letters of revival dated 22.01.2014
A8	Letters of revival dated 01.06.2016
A9	Letters of revival dated 10.07.2020
A10	Application dated 14.05.2011
A11	Sanction letter dated 14.05.2011
A12	Agreement and deed for kisan OD dared 14.05.2011
A13	Simple mortgage deed dated 09.05.2011
A14	Loan application dated 22.09.2011
A15	Sanction letter dated 22.09.2011
A16	Agreement of hypothecation for agricultural loans dated 22.09.2011
A17	Letters of revival dated 10.01.2014
A18	Letters of revival dated 01.06.2016
A19	Letters of revival dated 05.10.2018
A20	Letters of revival dated 05.09.2021
A21	Simple mortgage deed dated 04.12.2013
A22	Loan application dated 11.07.2014
A23	Sanction letter dated 11.07.2014
A24	Hypothecation for agricultural loans dated 11.07.2014
A25	Memorandum of agreement for agricultural loans dated 11.07.2014
A26	Simple mortgage deed dated 20.05.2014
A27	Legal notice 19.08.2023
A28	True extract of statement of accounts pertaining to the defendants aforesaid loan accounts No. 0446841007867
A29	True extract of statement of accounts pertaining to the defendants aforesaid loan accounts No. 0446897000038
A30	True extract of statement of accounts pertaining to the defendants aforesaid loan accounts No. 0446858009427

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OA 1662/2023

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A31 & True extract of statement of accounts pertaining to the 32 defendants aforesaid loan accounts No. 0446881009292 & Combines statement

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Witness Examined for the Defendants: List of Documents Exhibited for the Defendants:

-Nil -

-Nil -

Sd/- (T. RAJESH)

PRESIDING OFFICER

Canara Bank v. Basappa Basavaneppa Magadum

Case brief

What is this about?

What did the court decide?

Canara Bank v. Basappa Basavaneppa Magadum

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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