Allowed

M/s. Indian Overseas Bank v. Mr. S. Rajasekaran

DRT25 Aug 2025OA/181/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an application filed by a bank for a recovery certificate. The court found that the bank successfully proved the loan liability and issued a certificate for sum and interest, permitting sale of mortgaged property if proceeds are insufficient. Criminal and corporate aspects were not the primary focus here. Banking and enforcement of security interests were central

What did the court decide?

Recovery certificate issued for Rs.44,14,173/- plus 8% p.a. interest; lending bank entitled to sell schedule properties

M/s. Indian Overseas Bank versus Mr. S. Rajasekaran — Banking and Recovery | DRT (2025)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI Dated this 25^th day of August, 2025

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PRESENT: SHRI SHARANG DHAR UPADHYAY PRESIDING OFFICER

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OA.No.181 of 2023

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M/s. Indian Overseas Bank MMDA Nagar Branch B-5, Water Tank Road MMDA Nagar, Arumbakkam Chennai – 600 106 Represented by its Chief Manager …Applicant

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Versus

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Mr. S. Rajasekaran S/o.Mr. Sundaramahalingam Plot No.6, Door No.295/1, V.S.Nagar Thangam Avenue, Sikkarayapuram Chennai – 600 069

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Flat No:G-1, Ground Floor Plot No.60, Ramachandra Nagar Gerugambakkam Village Sriperumbudur Taluk Kancheepuram District Chennai – 600 122

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Mrs.R.Rukmani, W/o Mr. S. Rajasekaran Plot No.6, Door No.295/1, V.S.Nagar Thangam Avenue, Sikkarayapuram Chennai – 600 069 …Defendants

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Counsels on Record / Appeared

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Counsel for Applicant : M/s.P.V.Sanjeev. Defendants ex-parte on 20.02.2024

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ORDER

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The Application is filed under Section 19 (1) of the Recovery of Debts

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And Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for a

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sum of Rs.44,14,173/- together with further interest @ 9.30% p.a. with monthly rests from the date of OA till the date of its realization and for sale of schedule mentioned property.

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It is the case of the Applicant that the defendants approached the applicant bank for housing loan for a sum of Rs.40,00,000/- under Subhagruha Housing Loan and considering the said request the applicant bank sanctioned Housing Loan of Rs.40,00,000/- by its sanction dated 29.01.2020. It is also the case of the applicant that the defendants executed various loan and security documents on 29.01.2020. It is the further case of the applicant that the defendants deposited the title deeds of the properties more fully described in the schedule to the OA with the applicant by executing Memorandum relating to deposit of title deeds dated 04.02.2020 registered as Doc. No.854 of 2020, SRO, Pammal, with an intention to create equitable mortgage over the same and confirmed the same by executing confirmation a letter dated 05.02.2020.

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It is also the case of the applicant that the defendants having availed the loan facility was highly irregular in repayment and committed default. It is stated that the defendants did not come forward to regularize the loan account despite repeated requests by the applicant and hence the loan account was classified at NPA on 02.05.2022. It is also stated that the applicant issued the demand notice under Section 13(2) of the SARFAESI Act on 05.05.2022 followed by a Possession Notice under Section 13(4) of the SARFAESI Act on 13.07.2022 and the same was served on the defendants.

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It is the case of the applicant that despite the said notices, the defendants did not come forward to clear the outstanding dues and hence the present OA is filed for recovery of its dues.

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Summons was taken out to the defendants and the same was served. As there was no representation on behalf of the defendants continuously and on 20.02.2024 the defendants were called absent and placed ex-parte on that day. Applicant Bank filed Proof Affidavit along with 19 documents, which were marked as Ex. A-1 to A-19 on 22.05.2024. The Ld. Counsel for Applicant Bank made his submissions on 07.08.2025 and thereafter the matter stood till this date for passing

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final orders.

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The following issues arise for consideration in the matter: -

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(a) Whether the applicant had succeeded in proving the liability of the defendants?

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(b) What order as to cost of the proceedings need be passed?

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These issues are considered together.

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Heard the Ld. Counsel for the applicant, perused the OA averments and the record placed before the Tribunal.

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The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-19 along with the proof affidavit. The

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documents produced in evidence are all found admissible. The proof affidavit of the applicant bank remained unchallenged and rebutted. Therefore, on careful consideration of proof affidavit along with exhibits filed on behalf of the applicant bank, besides the material placed before the Tribunal, the Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendants. Further, the statement of accounts in respect of the loan account produced and certified under the Banker’s Book Evidence Act, clearly indicates that the amount claimed by the applicant is due from the defendants. It is clear from the statement of accounts that penal interest is not capitalized.

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In view of the foregoing, it is clearly evident that the application filed by the applicant bank is well within the period of limitation and this Tribunal possesses the territorial and pecuniary jurisdiction to entertain this OA.

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In view of the fact that the loan facility availed by the defendants is a housing loan and the applicant has claimed interest at contractual rate till the date of filing of the OA, this Tribunal is of the view that the pendente lite interest can be awarded at reduced rates.

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In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, OA is disposed off in the following manner: -

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(a) OA No.181 of 2023 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.44,14,173/- with further interest @8% per annum (simple) from the date of filing of the application till the date of realization in full, from the defendants after deducting all the amounts received / realized by them during the pendency of OA and also by selling the schedule property and other assets of the defendants.

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(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendants are personally liable for all such amounts due as ordered above.

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(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 15 days from the date of receipt of the copy of the order.

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(e) The Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of this final 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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Sd/- (SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 25^th day of August, 2025)

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EXHIBITS MARKED BY APPLICANT BANK

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S. No.	Date	Description of documents	Exhibit No.
1.	28.01.2012	Power of Attorney	A-1
2.	21.10.2019	Application for Credit Facility	A-2
3.	29.01.2020	Credit Sanction Advice by applicant	A-3
4.	29.01.2020	Demand Promissory Note executed by the defendants	A-4
5.	29.01.2020	Demand Promissory Note Letter	A-5
6.	29.01.2020	Letter of Undertaking for repayment of Installments	A-6
7.	29.01.2020	Undertaking letter from the new borrower after introduction of interest linked with RLLR	A-7
8.	29.01.2020	Term Loan agreement for Direct Finance Scheme	A-8
9.	04.02.2020	Equitable mortgage executed by defendants	A-9
10.	05.02.2020	Confirmation letter for creation of equitable mortgage	A-10
11.	05.05.2022	Demand notice u/s.13(2) by applicant	A-11
12.		Ack. Card in respect of Mr. S. Rajasekaran	A-12
13.		Ack. Card in respect of Mrs. R. Rukmani	A-13
14.	13.07.2022	Possession notice issued by the applicant	A-14
15.		Return Cover in respect of Mr. Rajasekaran	A-15
16.		Return Cover in respect of Mrs. Rukmani	A-16
17.	17.07.2022	Possession Notice (Paper Publication - English)	A-17
18.	17.07.2022	Possession Notice (Paper Publication-Tamil)	A-18
19.		Statement of Accounts issued by the Applicant along with Bankers Certificate.	A-19

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Sd/- (SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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DESCRIPTION OF PROPERTY

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SCHEDULE – A

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All that piece and parcel of vacant house site bearing Plot No.60 measuring an extent of 2578 Sq. ft. in the approved layout viz., “Ramachandra Nagar” by

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CMDA in P.P.D/L.O. No.63/2000 vide letter No. L1/30295 dated 6.9.2000 comprised in Old Survey No.315/2, New Sub-Division Survey No.315/4, as per New Patta No.1674 in No.57, Gerugambakkam Village, Sriperumbudur Taluk, Kancheepuram District.

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And bounded on the:

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North by : Plot No:65, South by : Plot No.59 and 16 feet Road, East by : Plot No.61 and West by : Vacant land now 30 feet Road

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Measuring Northern Side – 41 feet, Southern Side – 41 feet plus 8 feet Splay Eastern Side – 50 feet plus 8 feet Splay and Western side – 58 feet and situated within the Sub-Registration District of Pammal and Registration District of Chennai South

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SCHEDULE – B

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470 Sq. ft. undivided share of land more fully described in the ScheduleA herein above along with Flat bearing G-1 in the Ground Floor having built up area of 856 Sq. ft. together with the usage of right of reserved Earmarked Covered Car Parking.

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Sd/- (SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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M/s. Indian Overseas Bank v. Mr. S. Rajasekaran

Case brief

What is this about?

What did the court decide?

M/s. Indian Overseas Bank v. Mr. S. Rajasekaran

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

Coram

Case details

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