Allowed

Federal Bank v. Sreekumar K

DRT27 Aug 2025OA/7/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application for recovery of a defaulted term loan of approximately Rs.49.54 lakhs. The court granted relief for the principal amount, reduced pendente lite interest, and ordered issuance of a recovery certificate for sale of the hypothecated vehicle.

What did the court decide?

Recovery of Rs.49,54,980.57 with adjusted interest; issuance of Recovery Certificate to the Recovery Officer; costs and expenses.

Federal Bank versus Sreekumar K — Banking and Recovery | DRT (2025)

¶1

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

¶2

PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

¶3

Dated this the 27^th day of August, 2025

¶4

ORIGINAL APPLICATION No.7/2022

¶5

Between

¶6

The Federal Bank Ltd., Thrissur East Fort Branch, Ground Floor, City Castle, East Fort, Thrissur – 680 005. …Applicant

¶7

And

¶8

Sreekumar K., S/o.Kesavan P K M, Kesava Nivas, Palakkad Road, Koduvayur Post, Palakkad District – 678 501.

¶9

Sugandhi, W/o.Sreekumar K., Kesava Nivas, Palakkad Road, Koduvayur Post, Palakkad District – 678 501. …Defendants

¶10

This Original Application having been heard on 29.07.2025

¶11

in the presence of Advocate Sri.Santhosh Kumar K. for the applicant bank and the defendants being absent and stood over to this day for consideration, the Tribunal delivered the following:

¶12

OA 7/2022

¶13

¶14

F I N A L O R D E R

¶15

This Original Application has been filed under S.19(1) of the Recovery of Debts and Bankruptcy Act, 1993 for recovery of a sum of Rs.49,54,980.57 due under term loan account together with future interest @9.25% per annum with monthly rests and overdue interest @4% per annum on the sum of Rs.47,88,561.59 from the defendants jointly and severally and by sale of the schedule property.

¶16

Facts of the case:

¶17

The applicant is a banking company registered under the Companies Act, 1956 having its registered office at Aluva and a branch amongst other places at East Fort, Thrissur.

¶18

The defendants approached the applicant bank for a term loan for purchase of a Volvo V40 cross country D3 car under federal agri. mobile loan scheme. Considering the request, applicant bank sanctioned a term loan of Rs.33 lakhs to the defendants as per sanction letter dated 08.03.2017. The defendants availed the facility after executing the security documents on 09.03.2017. The defendant had hypothecated the vehicle described in the schedule to secure the loan. Though the defendants agreed to repay the loan amount as per the terms and

¶19

OA 7/2022

¶20

¶21

conditions of the loan agreement, they failed to do so which resulted in classification of the loan as NPA on 10.05.2019. The applicant bank initiated proceeding under the SARFAESI Act and issued notice under S.13(2) of the SARFAESI Act to the defendants on 16.05.2019 demanding repayment of the outstanding dues but they did not liquidate the liability. Hence the applicant bank was constrained to file the OA claiming the following reliefs:

¶22

(i) To recover the sum of Rs.49,54,980.57 together with pendente lite and post-decree interest on the sum of Rs.47,88,561.59 from the defendants jointly and severally and by sale of the schedule property;

¶23

(ii) To recover the costs, charges and expenses from the defendants;

¶24

(iii) To issue Recovery Certificate to the Recovery Officer with a direction to recover the amount and pay it to the applicant bank.

¶25

The defendants were duly served with summons. But

¶26

they remained absent from the proceeding.

¶27

OA 7/2022

¶28

¶29

Proof Affidavit :

¶30

To establish the claim on behalf of the applicant bank, one Mr.Jibin Mathew, Senior Manager of the bank has filed proof affidavit and produced the loan documents marked as Exhibits A1 to A11. The proof affidavit filed by AW1 and the documents produced in this case are not challenged by the defendants. The availing of the credit facility and creation of hypothecation charge over the schedule property are well established from the documents placed by the applicant bank. A sum of Rs.49,54,980.57 is outstanding in the loan account as on 15.12.2021, which is clearly established from the account statement marked as Ext.A9.

¶31

Considering the amount advanced, interest and penal interest applied and default committed, I am of the view that applicant bank is entitled to get pendente lite and post decree interest @9% per annum on the sum of Rs.47,88,561.59 (i.e., after excluding the penal interest of Rs.1,66,418.98 from the OA claim amount of Rs.49,54,980.57), which is reasonable in the facts and circumstances of the case.

¶32

The applicant bank, therefore, is entitled to get a final order on the following lines:

¶33

OA 7/2022

¶34

¶35

In the result, the applicant bank is given a final order allowing it to recover:

¶36

(i) the sum of Rs.49,54,980.57 (Rupees forty nine lakhs fifty four thousand nine hundred and eighty and Paise fifty seven only) due under the term loan account from the defendants jointly and severally and by sale of the schedule property;

¶37

(ii) pendente lite and post-decree interest @9% per annum on the sum of Rs.47,88,561.59 (Rupees forty seven lakhs eighty eight thousand five hundred and sixty one and Paise fifty nine only) from 16.12.2021 till realization from the defendants jointly and severally and by sale of the schedule property; and

¶38

(iii) costs and expenses bone by it for realization of the loan from the defendants.

¶39

The schedule to the OA shall be appended to this final

¶40

order.

¶41

The applicant bank shall file memo of costs within ten

¶42

days from the date of this final order.

¶43

Recovery Certificate shall be drawn up and issued to

¶44

the Recovery Officer in terms of the final order.

¶45

OA 7/2022

¶46

¶47

Communicate copy of this order to both parties as provided in R.16 r/w R.2(c) of the Debts Recovery Tribunal (Procedure) Rules, 1993.

¶48

(Dictated to my PA, corrected and pronounced by me in the open Tribunal on this the 27^th day of August, 2025)

¶49

[SOVAN KUMAR DASH] PRESIDING OFFICER

OA 7/2022

A P P E N D I X

Witness for Applicant: AW1: Mr.Jibiin Mathew, Senior Manager of the applicant bank.

¶54

Witness for Defendant(s): Nil

¶55

Applicant’s Exhibits

¶56

Ext.No Date Particulars of documents

¶57

A1	09.03.2017	Demand promissory note for Rs.33 lakhs executed by the defendants.
A2	09.03.2017	Security delivery letter executed by the defendants in favour of the applicant bank.
A3	09.03.2017	Term loan agreement executed by the defendants in favour of the applicant bank.
A4	12.04.2017	Copy of certificate of registration of vehicle No.KL-70-C-749.
A5	08.05.2019	Letter executed by the defendants confirming the balance outstanding under the loan account.
A6	16.05.2019	Copy of demand notice under S.13(2) of the SARFAESI Act issued to the defendants.
A7	24.03.2021	Copy of lawyer notice issued to the defendants calling upon them to repay the outstanding dues.
A8	29.03.2021	Reply to Ext.A7 lawyer notice issued by the defendants.
A9	…	Certified copy of the statement of account relating to the term loan.
A10	16.12.2021	Statement showing the penal interest charged in Ext.A9 account.
A11	16.12.2021	Certificate showing the rate of interest applied in Ext.A10 account.

¶58

Defendants’ Exhibits – Nil

¶59

PRESIDING OFFICER

OA 7/2022

SCHEDULE

Motor car – Volvo V40 Cross Country D3 with Registration No.KL-70-C749, Engine No.1496568 and

¶64

Chassis No.YVIMV79H0G2328083.

¶65

PRESIDING OFFICER

¶66

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

¶67

PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

¶68

Dated the 27^th August, 2025

¶69

OA NO.7/2022

¶70

Between

¶71

The Federal Bank Ltd., Thrissur East Fort Branch, Ground Floor, City Castle, East Fort, Thrissur. …Applicant

¶72

And

¶73

Sreekumar K., S/o.Kesavan P K M, Kesava Nivas, Palakkad Road, Koduvayur Post, Palakkad District – 678 501 & another. …Defendants

¶74

F I N A L O R D E R

Federal Bank v. Sreekumar K

Case brief

What is this about?

What did the court decide?

Federal Bank v. Sreekumar K

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

Similar cases

State Bank of India versus Sh Resham Singh @ Sher Singh

Punjab National Bank versus Sh. Swaran Singh

Indian Overseas Bank versus Sh. Baldev Singh Arora (Now Deceased)

State Bank of India versus M/S Raghav Oil Mills and Ors.

Manoj Cm versus Kerala State Co-Operative Bank Ltd.

Punjab National Bank versus Smt. Maninderjeet Kaur