Allowed

Canara Bank v. Radhakrishnan O

DRT18 Sept 2025OA/336/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an original application filed by Canara Bank to recover outstanding term and working capital loans from two defendants. The bank proved its claim through affiances and documents filed, while the defendants appeared ex-parte. The Tribunal directed payment of the principal along with reduced simple interest.

What did the court decide?

Recovery of total sum of Rs. 74,25,581.95 p along with simple interest at 6% p.a. and realization by sale of properties; preparation of recovery certificate.

Canara Bank versus Radhakrishnan O — Contract and Commercial Disputes | DRT (2025)

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OA No. 336/2023

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL AT MADURAI DATED THIS 18^TH DAY OF SEPTEMBER, 2025 PRESENT: SEEMA SINHA,

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[PR. DISTRICT & SESSIONS JUDGE – Retd] PRESIDING OFFICER

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OA No.336/2023

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Between

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Canara Bank, Rajapalayam Branch-II, 1544, Tenkasi Road, Rajapalayam, Virudhunagar District. Rep. By its Branch Manager.

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---Applicant Bank

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And

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Mr. O. Radhakrishnan,

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S/o G.K.Olimuthu, 18/57, Krishnan Kovil Street,

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Renganathapuram, Srivilliputhur,

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Virudhunagar District.

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Also at:

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Mr. O. Radhakrishnan, S/o G.K.Olimuthu, 1/18, Muthusamy Street, Shenkottai, Tenkasi District.

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Ms. Jayasai Prabha, D/o O. Radhakrishnan, 18/57, Krishnan Kovil Street, Renganathapuram, Srivilliputhur, Virudhunagar District.

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OA No. 336/2023

Also at:

Ms. Jayasai Prabha, D/o O. Radhakrishnan, 1/18, Muthusamy Street, Shenkottai, Tenkasi District. ---Defendants

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Counsel for the Applicant Bank : M/s V. Sukumar, Mark J Jackson, P. Balamurugan, R. Anbarasu.

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This Original Application was heard and fixed for passing final order before me in the presence of the above said Advocate for Applicant Bank and the Defendants having been set ex-parte and upon hearing the arguments of Counsel for Applicant Bank and upon perusing the material available on the records and having stood over for consideration till this day, this Tribunal delivered the following:

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JUDGEMENT

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1 . This Application has been filed under Sec.19 (1) of the "The Recovery of Debts due to Banks and Financial Institutions Act, 1993" now amended as The Recovery of Debts and Bankruptcy Act, 1993 by the Applicant Bank on 24.04.2023 to recover from the Defendants a total sum of Rs.74,25,581.95p i.e., (i) Rs.9,01,079.84p together with interest at the rate of 9% p.a. in respect of Term Loan (ii) Rs.33,21,093.06 together with interest at the rate of 10.80% p.a. in respect of Term Loan (iii) Rs.11,84,319.49p together with interest at the rate of 9.20% p.a. in respect of Working capital Loan AL OCC and (iv) Rs.20,19,089.56 together with interest at the rate of 9.20% p.a. in respect of Working capital Loan AL OCC from the date of filing of Application till the date of realization with cost and by sale of mortgaged/hypothecated properties, more fully described in Schedules of the application.

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2 . The brief averments of the application filed by the Applicant Bank are as follows:-

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The 1st defendant is doing the business and obtained four loan facilities. The 2nd defendant is the daughter of the 1st defendant. She had given personal guarantee for the loan facilities availed by the 1st defendant. The 1st defendant obtained following loan facilities to the applicant bank:

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I. TERM LOAN -General/Agriculture Advances (1st Loan)

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The 1st defendant submitted an application dated 02.09.2016 for setting up dairy farm project to the Applicant bank. The 1st defendant

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OA No. 336/2023

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offered to execute the necessary loan papers and agreed to abide by the bank's terms and conditions including repaying the loan amount and its interest. The 1 defendant borrowed a sum of Rs. 10,00,000/- (Rupees Ten Lakhs only) from the Applicant bank. The 1 defendant also executed an' Agreement for Agriculture advance' on 25.09.2016 in favour of the Applicant Bank by creating security interest for the property detailed in Schedule B hereunder. The 1st defendant agreed to pay the borrowed amount at the rate of 1.25% interest to be calculated daily balances in the loan account with monthly/quarterly/half yearly/yearly or other rests according to the practice of the bank and as per the guidelines of the RBI from time to time as may be applicable. It is necessary to state that the current rate of interest of the applicant bank is 9%. The 1st defendant has undertaken to repay the said loan facility in 60 Equal monthly installments of Rs.25,875/- each with interest and costs which detailed in the Seventh schedule of the said agreement.

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The 2nd defendant executed Deed of Guarantee for Agricultural Advances' dated 26.09.2016 agreeing to pay the borrowed amount together with interest on demand of the applicant bank. In view of the said guarantee agreement the 2nd defendant agreed to enforce liability of the 1 defendant. The amount was disbursed to the defendants by the applicant bank. On 26.09.2019, a sum of Rs. 5,49,900/- (Rupees Five Lakhs Forty-Nine Thousand and Nine Hundred only) was disbursed, on 11.01.2017 a sum of Rs.2,25,050/- (Rupees Two Lakhs Twenty-Five Thousand and Fifty only) was disbursed, on 07.07.2017 a sum of Rs. 2,25,050/- (Rupees Two Lakhs Twenty five Thousand and Fifty only) was disbursed. The defendants paid installments few months. Thereafter the defendants failed to repay the loan amount and interest.

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II. TERM LOAN (General/Agriculture Advance Loan) (2nd Loan)

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The 1st defendant submitted an application dated 02.09.2016 to the Applicant bank for setting up Horticulture Unit. The 1st defendant offered to execute the necessary loan papers and agreed to abide by the bank's terms and conditions including repaying the loan amount and its interest for the said loan facility. Under this loan facility, the 1st defendant borrowed a sum of Rs. 20,00,000/- (Rupees Twenty Lakhs only) from the Applicant bank. The 1st defendant also executed an' Agreement for Agriculture advance' on 25.09.2016 in favor of the Applicant Bank by creating security interest for the property detailed in Schedule A hereunder. The 1st defendant agreed to pay the borrowed amount at the rate of 10.80% p.a. Under the Second schedule of the agreement Cucumber grown and to be grown were hypothecated; Under the Fourth schedule of the said agreement Green poly House and Texture and Equipment's were hypothecated; The said equipment and crops is mentioned as Schedule A hereunder. Under the Fifty

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OA No. 336/2023

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Schedule of the said Agreement it is agreed that working capital to be released after completion of the project. Hence the said agreement executed for 27,00,000/- (Rupees Twenty-Seven Lakhs only). Under the said agreement the 1st defendant has undertaken to repay the 2nd loan facility in 14 Half yearly installments of Rs. 1,42,00,000/- each with interest and costs.

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III. WORKING CAPITAL LOAN AL OCC/(Agriculture Advance Loan) (3rd

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Loan)

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The defendants availed 3rd loan facility with the Applicant bank. The 1 defendant submitted an application dated 17.04.2018 to the Applicant bank. The 1st defendant offered to execute the necessary loan papers and agreed to abide by the bank's terms and conditions including repaying the loan amount and its interest. Under the 3rd loan facility, the 1^st defendant borrowed a sum of Rs. 7,00,000/- (Rupees Seven Lakhs only) from the Applicant bank. The 1st defendant also executed an' Agreement for agicultural advance on 07.05.2018 in favour of the Applicant Bank by creating security interest for the property detailed in Schedule B hereunder. The 1st defendant agreed to pay the borrowed amount at the rate of 0.70% interest to be calculated daily balances in the loan account with monthly/quarterly/half yearly/yearly or other rests according to the practice of the bank and as per the guidelines of the RBI from time to time as may be applicable with a minimum of 9.20%p.a.

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The 2nd defendant executed the 'Deed of Guarantee for Agricultural Advances' dated 07.05.2018 agreeing to pay the borrowed amount together with interest on demand of this Applicant.

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IV. WORKING CAPITAL LOAN AL OCC/(Agriculture Advance Loan) (4th

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Loan)

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The defendants availed 4th loan facility with the Applicant bank for the purpose of his organic farm namely "Anandam Organics". The 1st defendant submitted an application dated 04.01.2019 to the Applicant bank. The 1st defendant offered to execute the necessary loan papers and agreed to abide by the bank's terms and conditions including repaying the loan amount and its interest. Under the said loan facility, the 1st defendant borrowed a sum of Rs. 13,00,000/- (Rupees Thirteen Lakhs only) from the applicant bank. The 1 defendant also executed an' Agreement for Agriculture advance on 31.01.2019 in favour of the Applicant Bank by creating security interest for the property detailed in Schedule B hereunder. The 1 defendant agreed to pay the borrowed amount at the rate of 0.70% interest to be calculated daily balances in the loan account with monthly/quarterly/half yearly/yearly or other rests according to the practice of the bank and as per the guidelines of the RBI from time to time as may be

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OA No. 336/2023

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applicable. The 2nd defendant executed the 'Deed of Guarantee for Agricultural Advances' dated 31.01.2019 agreeing to pay the borrowed amount together with interest on demand of this Applicant.

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EQUITABLE MORTGAGE:

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In consideration of above said loans availed by the 1st defendant, the 1st defendant offered his property which is fully described in the B Schedule hereunder as security and thereby deposited his title deeds on 20.09.2016 with the Applicant Bank pertaining to the said properties with an intention to create an equitable mortgage over them. To that effect, the 1st defendant executed a letter confirming the deposit of title deeds and creating of equitable mortgage in favour of Applicant Bank on 20.09.2016 in respect of the above said loan facilities. The Applicant Bank submits that in consideration of the said loan facilities the 1 defendant had executed a Memorandum of Deposit of Title Deeds in respect of schedule of property in favour of Applicant Bank. The said Document is registered on 20.09.2016 in Document No. 4858 of 2016 on the file of Sub Registrar, Srivilliputhur.

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In consideration of the loan facilities of Rs.7,00,000/- (Rupees Seven Lakhs only) and Rs.20,00,000/- (Rupees Twenty Lakhs only) respectively availed by the 1 defendant from the Applicant Bank, 1st defendant mortgaged the standing crops and machineries, equipments, green poly house and texture respectively to the applicant bank i.e, Schedule of property- A, the 1 defendant who has already deposited his title deeds and created an equitable mortgage over the B schedule of property had also extended the security and authorized the Applicant Bank to continue and to hold the same and title deeds as continuing security towards the said loans. After availing the loan, defendants were not regular in the matter of repayment. The defendants made several promises, but they failed to keep up their promises.

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Despite repeated demands and reminders, made by the Applicant Bank, the Defendants have failed and neglected to repay and adjust their liability. Hence, the Applicant Bank has filed the OA for recovery of a total sum of Rs.74,25,581.95p i.e., (i) Rs.9,01,079.84p together with interest at the rate of 9% p.a. in respect of Term Loan (ii) Rs.33,21,093.06 together with interest at the rate of 10.80% p.a. in respect of Term Loan (iii) Rs.11,84,319.49p together with interest at the rate of 9.20% p.a. in respect of Working capital Loan AL OCC and (iv) Rs.20,19,089.56 together with interest at the rate of 9.20% p.a. in respect of Working capital Loan AL OCC from the date of filing of Application till the date of realization with cost.

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The Applicant Bank has submitted the following documents in support its claim in the OA, which are as follows:

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OA No. 336/2023

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S. No.	Date	Description of document	Exhibits
1.	02.09.2016	1^stLoan Application	Ex.No.A-01
2.	26.09.2016	General Agreement	Ex.No.A-02
3.	26.09.2016	Guarantee Agreement	Ex.No.A-03
4.	02.09.2016	2^ndloan Application	Ex.No.A-04
5.	28.09.2016	General Agreement	Ex.No.A-05
6.	28.09.2016	Guarantee Agreement	Ex.No.A-06
7.	13.08.2019	1^stLegal notice and acknowledgment card	Ex.No.A-07
8.	25.09.2019	2^ndLegal notice and acknowledgment card	Ex.No.A-08
9.	17.04.2019	3^rdLoan Application	Ex.No.A-09
10.	07.05.2018	General Agreement	Ex.No.A-10
11.	07.05.2018	Guarantee Agreement	Ex.No.A-11
12.	04.01.2019	4^thloan Application	Ex.No.A-12
13.	28.09.2016	General Agreement	Ex.No.A-13
14.	31.01.2019	Guarantee Agreement	Ex.No.A-14
15.	27.11.2014	Partition Deed Document No.6149 of 2014	Ex.No.A-15
16.	20.09.2016	Memorandum of Deposit of Title deed	Ex.No.A-16
17.	15.03.2023	Statement of Loan Account No. 62718240000077	Ex.No.A-17
18.	15.03.2023	Statement of Loan Account No. 62718320000034	Ex.No.A-18
19.	15.03.2023	Statement of Loan Account No. 62711470000045	Ex.No.A-19
20.	15.03.2023	Statement of Loan Account No. 62711470000030	Ex.No.A-20

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"A" SCHEDULE

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HYPOTHICATED GOODS

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All standing crops and its yield grown in Survey No. 126/1, Ponnankanni Village, Srivilliputhur, Virudhunagar District.

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HYPOTHICATED BOOK DEBTS

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All the hypothecated book debts, outstanding, money receivables, claims and bills due and owing to the defendants.

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HYPOTHECATED MACHINERIES

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OA No. 336/2023

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All machineries, tools, accessories, including purchasing equipment and green poly house situated in Survey No. 126/1, Ponnankanni Village, Srivilliputhur, Virudhunagar District

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"B" SCHEDULE MORTGAGE PROPERTIES

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Item No. 1 (Belonging to 1" defendant)

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All that piece and parcel of the land in Survey No. 126/1 with an extent of 0.21.50 Hectare (i.e., Cents 53) situated at Ponnankanni Village, Srivilliputhur Taluk and Sub-Registration District, Virudhungar Registration District.

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Item No.2 (Belonging to 1st defendant)

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All that piece and parcel of the land in Survey No. 127/1 with an extent of 0.44.0 Hectare in its Western side 0.32 Acre situated at Ponnankanni Village, Srivilliputhur Taluk and Sub-Registration District, Virudhungar Registration District

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Bounded on

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North	:	East West Road
East	:	Venkatesh's land
South	:	Land in Survey No. 127/2
West	:	Land in Survey No. 125

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Item No.3 (Belonging to the 1st defendant)

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All that piece and parcel of the land in Survey No. 127/2 with an extent of 0.40.5 Hectare in its Western side 0.21 Acre situated at Ponnankanni Village, Srivilliputhur Taluk and Sub-Registration District, Virudhungar Registration District.

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Bounded on

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North	:	Land in Survey No. 127/1
East	:	Venkatesh's land
West	:	Land in Survey No. 125
South	:	Land in Survey No. 126/1

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3 . On the other hand, Notices were issued to Defendants and since from the beginning of the case, there was no representation on behalf of the Defendants. Hence, Defendants were set ex-parte.

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OA No. 336/2023

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4. Now the main point for consideration before me is as to whether the Applicant has been able to prove his case on his own leg?

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Having gone through the affidavit of the applicant and the documents filed by them and also considering the submission of the counsel for the Applicant, I find that the Applicant Bank, in order to prove its claim, has filed Proof Affidavit executed by one Ms. Suganya Panneerselvam, who is the Manager of the Applicant Bank.

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She has stated in her affidavit that the defendants has availed Term Loans and working Capital Loans AL OCC from the Applicant Bank, but they failed to pay the outstanding loan amount, hence she has filed the case. The applicant bank has also filed the documents given by the defendants at the time of sanctioning the loan amount, which have been marked as exhibits No.A-01 to A-20 in support of its claim in the OA.

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The 1st Loan Application has been marked as Ex.No.A-01, General Agreement has been marked as Ex.No.A-02, Guarantee Agreement has been marked as Ex.No.A-03, 2nd loan Application has been marked as Ex.No.A04, General Agreement has been marked as Ex.No.A-05, Guarantee Agreement has been marked as Ex.No.A-06, 1st Legal notice and acknowledgment card has been marked as Ex.No.A-07, 2nd Legal notice and acknowledgment card has been marked as Ex.No.A-08, 3rd Loan Application has been marked as Ex.No.A-09, General Agreement has been marked as Ex.No.A-10.

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The Guarantee Agreement has been marked as Ex.No.A-11, 4th loan Application has been marked as Ex.No.A-12, General Agreement has been marked as Ex.No.A-13, Guarantee Agreement has been marked as Ex.No.A14, Partition Deed Document No.6149 of 2014 has been marked as Ex.No.A15, Memorandum of Deposit of Title deed has been marked as Ex.No.A-16, Statement of Loan Account No. 62718240000077 has been marked as Ex.No.A-17, Statement of Loan Account No. 62718320000034 has been marked as Ex.No.A-18, Statement of Loan Account No. 62711470000045 has been marked as Ex.No.A-19, Statement of Loan Account No. 62711470000030 has been marked as Ex.No.A-20. So the averments of the applicant as well as the statement of the pleading have been corroborated by the above mentioned documents.

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As the Defendants remained ex-parte, the claim of the Applicant Bank is neither disproved nor dislodged and goes on record as proved. Accordingly a cumulative analysis of both the Proof Affidavit and documents marked by the Applicant Bank would prove the claim of the Applicant Bank in the OA.

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OA No. 336/2023

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Therefore, this Original Application is allowed. Since this is an Agricultural Advance the Applicant Bank is entitled for a final order on the following lines:-

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The Applicant Bank is entitled to recover from the Defendants, a total sum of Rs.74,25,581.95p i.e., (i) Rs.9,01,079.84p together with simple interest at the rate of 6% p.a. in respect of Term Loan (ii) Rs.33,21,093.06p together with simple interest at the rate of 6% p.a.in respect of Term Loan (iii) Rs.11,84,319.49p together with simple interest at the rate of 6% p.a. in respect of Working capital Loan AL OCC and (iv) Rs.20,19,089.56 together with simple interest at the rate of 6% p.a. in respect of Working capital Loan AL OCC from the date of filing of Application till the date of realization with cost. Accordingly, it is hereby

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ORDERED

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(a) That the Defendants are directed to pay jointly/severally a total sum of Rs.74,25,581.95p i.e., (i) Rs.9,01,079.84p together with simple interest at the rate of 6% p.a. in respect of Term Loan (ii) Rs.33,21,093.06p together with simple interest at the rate of 6% p.a.in respect of Term Loan (iii) Rs.11,84,319.49p together with simple interest at the rate of 6% p.a. in respect of Working capital Loan AL OCC and (iv) Rs.20,19,089.56 together with simple interest at the rate of 6% p.a. in respect of Working capital Loan AL OCC from the date of filing of Application till the date of realization with cost within one month from the date of receipt of this order.

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(b) In case of default of payment by the above mentioned Defendants, the Applicant Bank is at liberty to sell the movable / immovable properties more fully described in Schedule of the original application for appropriation of sale proceeds towards the satisfaction of amount due to the Applicant Bank.

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(c) If the sale proceeds are not sufficient, after defraying the expenses of such sale, for the payment of all such amounts, the defendants are jointly/severally liable to pay the amount of such deficiency with interest mentioned above until realization.

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OA No. 336/2023

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(d) Any amount remitted during the course of this proceedings shall be given due credit, to the loan account of the defendants.

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(e) Recovery Certificate be prepared, as per the directions given above, and issue accordingly. A copy of the order is to be communicated to the parties concerned, immediately.

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(f) It is further ordered that the Applicant Bank shall file cost memo within a period of one month from the date of receipt of this order, so as to prepare the recovery certificate with cost for the Term Loan-I, Term Loan-II and working Capital Loan AL OCC-I, working Capital Loan AL OCC-II and the Recovery Officer is also directed to proceed with the matter in accordance with law. In case, cost memo is not filed before said period of one month, Recovery Certificate will be prepared with available records.

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Dictated to T.P, taken down, transcribed, typed by her, corrected and pronounced by me in the Open Court in this the 18^th September, 2025.

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Sd/- (SEEMA SINHA) PRESIDING OFFICER

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Uploaded on 19.11.2025

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Canara Bank v. Radhakrishnan O

Case brief

What is this about?

What did the court decide?

Canara Bank v. Radhakrishnan O

Case brief

What is this about?

What did the court decide?

What the court decided

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