Allowed

State Bank of India v. Lekkala Venkata Subba Reddy

DRT30 Oct 2025OA/249/2023

Case brief

AI extract

What is this about?

Appeal by State Bank of India for recovery certificate against a defaulting borrower. Tribunal allowed the OA, permitting realization of principal, interest at reduced pendente lite rate, and proceeds from sale of mortgaged property, with personal liability for any shortfall.

What did the court decide?

Recovery Certificate issued for Rs.52,56,560.96p plus 8% simple interest pending realization; sale of scheduled property permitted to cover dues.

State Bank of India versus Lekkala Venkata Subba… — Contract and Commercial Disputes | DRT (2025)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 30^th day of October, 2025

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PRESENT: SHRI SHARANG DHAR UPADHYAY PRESIDING OFFICER

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OA No.249 of 2023

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State Bank of India Represented by its Authorised Officer RACPC Chennai No.16, Annai E.V.R. Mariammaiyar Salai Egmore, Chennai – 600 008 …Applicant

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Versus

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Lekkala Venkata Subba Reddy No.3-87, T. Soudarivari Palle T. Soudaravari Palle Kadapa, Andhra Pradesh – 516 503 ... Defendant

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Counsels on Record / Appeared

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Counsel for Applicant Bank : M/s Suresh Law Associates Defendant ex-parte on 19.12.2023

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FINAL ORDER

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This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendant seeking issuance of a Recovery Certificate for recovery of an aggregate sum of Rs.52,56,560.96p comprising a sum of Rs.50,80,270.21p together with interest at the rate of 9.5% per annum with monthly rests being the amount due under housing loan account and a sum of Rs.1,76,290.75p

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together with interest at the rate of 9.5% per annum with monthly interest being the amount due under SBI Suraksa Loan Account from the date of the application till the date of realisation along with costs of the application and for schedule mentioned property.

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The subject matter of the case is the Housing Loan and SBI Suraksha Loan availed by the defendant from the Applicant Bank.

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It is the case of the applicant that the defendant approached the applicant for grant of housing loan for purchase of the flat more fully described in the schedule to the OA on 02.09.2020. The applicant considering the said request sanctioned a housing loan of Rs.48,00,000/- and SBI Suraksha Loan of Rs.1,26,214/- on 16.09.2020. It is stated that the defendant executed Memorandum of Loan Agreement for home loan on 16.9.2020. The defendant executed Memorandum of Deposit of Title deeds dated 06.10.2020 registered as Doc. No.4986 of 2022, SRO, Padappai.

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It is the case of the applicant that having availed the loan the defendant defaulted in repayment and failed to regularize the loan account despite repeated request and hence the loan account was classified as NPA on 13.12.2021. As no payment was forthcoming the applicant issued a demand notice dated 29.12.2021 under Section 13(2) of the SARFAESI Act followed by Possession Notice dated 27.05.2022 under Section 13(4)

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of the SARFAESI Act. Despite the said notice the defendants did not come forward to clear the dues. Hence the applicant is filing this OA for recovery of its dues.

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Summons was taken out to the defendant was served. As there was no representation on behalf of the defendant continuously and on 19.12.2023, the defendant was called absent and placed ex-parte on that day. Applicant Bank filed Proof Affidavit along with 9 documents, which were marked as Ex. A-1 to A-9 on 31.05.2024. The Ld. Counsel for Applicant Bank made his submissions on 18.09.2025 and thereafter the matter stood till this date for passing 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 defendant?

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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-9 along with the proof affidavit. The documents produced

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in evidence are all found admissible. The proof affidavit of the applicant bank remained unchallenged and unrebutted. 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 defendant. 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 defendant. 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 defendant 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

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disbursement of the loan, which the applicant is entitled to realize. Hence,

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OA is disposed off in the following manner: -

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(a) OA No.249 of 2023 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.52,56,560.96p together with interest at the date of 8% (Simple) from the date of filing of the application till the date of realization in full, from the defendant after deducting all the amounts received / realized by them during the pendency of OA and also by selling the schedule mentioned properties 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 defendant is 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

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Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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Sd/-

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(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 30^th day of October, 2025)

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EXHIBITS MARKED BY APPLICANT BANK

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S. No.	Date	Description of Documents	Exhibit Nos.
1.		Loan application by defendant	A-1
2.	16.09.2020	Arrangement letter by applicant	A-2
3.	16.09.2020	Memorandum of Loan Agreement for home loan by defendant	A-3
4.	06.10.2020	Construction Agreement – Doc. No.4984/2020, SRO, Padappai	A-4
5.	06.10.2020	Sale deed – Doc. No.4985/2020, SRO, Padappai in favour of defendant	A-5
6.	06.10.2020	Memorandum of Deposit of Title deeds – Doc. No.4986/2020, SRO, Padappai by defendant	A-6
7.	29.12.2021	Notice issued under Section 13(2) of the SARFAESI Act	A-7
8.	27.05.2022	Notice issued under Section 13(4) of the SARFAESI Act.	A-8
9.		Statement of accounts	A-9

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Sd/-

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

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DESCRIPTION OF PROPERTY

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All that piece and parcel of vacant land with building bearing Plot No.87, undivided share to an extent of 398 sq. ft. out of 2400 sq. ft. builtup area 1295 sq. ft. Flat No. FF-B, First Floor, EB connection etc., “Krishna Nagar Part II” comprised in Survey Nos.105/3A and 105/3B, situated at Varadharajapuram village, Chengalpattu Taluk, Kancheepuram District, lying within the Registration Sub District Padappai and Registration District of South Chennai bounded on the

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North by : Plot No.77 South by : 20 feet road East by : Plot No.86 West by : Plot No.88

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Undivided share to an extent of 398 sq. ft. out of 2400 sq. ft. builtup area 1295 sq. ft. Flat No. FF-B, First Floor, EB Connection etc.

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Sd/-

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

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State Bank of India v. Lekkala Venkata Subba Reddy

Case brief

What is this about?

What did the court decide?

State Bank of India v. Lekkala Venkata Subba Reddy

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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