Allowed

The Karur Vysya Bank Ltd., v. Mr. Sivakumar. E

DRT20 Nov 2025OA/393/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the bank's application for a Recovery Certificate under the RDB Act. The bank proved the loan disbursement via unchallenged affidavits. While agreeing the claim was valid, the Tribunal modified the interest rate from contractual rate to 8% simple interest pendente lite and approved recovery from assets and personal liability.

What did the court decide?

Recovery Certificate issued to realize Rs.59,01,494.02p with 8% simple interest from filing date; defendant personally liable if assets insufficient.

The Karur Vysya Bank Ltd., versus Mr. Sivakumar. E — Contract and Commercial Disputes | DRT (2025)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 20^th day of November, 2025

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PRESENT: SHRI SHARANG DHAR UPADHYAY PRESIDING OFFICER

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OA No.393 of 2022

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The Karur Vysya Bank Ltd., Rep. by its Branch Manager Nadukuppam Branch Plot No.2, Arni Padavedu Road Nadukuppam Village, Arni Taluk Tiruvannamalai District - 606903 …Applicant

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Versus

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Mr. Sivakumar. E S/o Egambaram No.34, Pillaiyar Koil Street Periyanallur, Thirumani Nesal (Nallur) – 604 504 ... Defendant

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Counsels on Record / Appeared

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Counsel for Applicant Bank : M/s Shyam Kumar Defendant ex-parte on 11.10.2023

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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 a sum of Rs.59,01,494.02p together with interest at the rate of 9.95% per annum

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with monthly rests plus penal interest of 1% per annum from the date of

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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 Warehouse 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 vide loan application dated 30.01.2017 for grant of Warehouse Loan of Rs.50,00,000/- by pledging the stocks as mentioned in the storage receipt as a primary security for the said loan. The applicant considering the said request sanctioned a loan of Rs.50,00,000/- vide its sanction letter dated 30.01.2017 for the purpose of purchase of Paddy.

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It is also the case of the applicant that the defendant signed in the sanction letter dated 30.01.2017 accepting the terms and conditions of sanction and extended the commodity stored in the Warehouse as a primary security vide Storage Receipt SR No.SR-1576432 dated 24.01.2017 issued by Star Agriwarehousing and Collateral Management Limited and executed necessary loan documents on 30.01.2017. It is stated that the loan was repayable in 8 installments.

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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 lastly made a payment of Rs.7,100/- on 31.12.2021,

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hence the loan account was classified as NPA on 26.04.2018. The defendant confirmed the debts and liability by executing letter dated 31.12.2021. As no payment was forthcoming the applicant 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 11.10.2023, the defendant was called absent and placed ex-parte on that day. Applicant Bank filed Proof Affidavit along with 10 documents, which were marked as Ex. A-1 to A-10 on 02.04.2024. The Ld. Counsel for Applicant Bank made his submissions on 16.09.2025 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-10 along with the proof affidavit. The documents produced 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 Loan for purchase of paddy 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 and the prayer for award of penal interest is rejected.

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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.393 of 2022 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.59,01,494.02p 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 Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993. 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 20^th day of November, 2025)

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EXHIBITS MARKED BY APPLICANT BANK

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S. No.	Date	Description of Documents	Exhibit Nos.
1.	30.01.2017	Application for Warehouse Loan against Warehouse Receipt Loan Farmers	A-1
2.	30.01.2017	Sanction Communication by applicant	A-2
3.	30.01.2017	Agreement for Warehouse Loan	A-3
4.	30.01.2017	Demand Promissory Note executed by defendant	A-4
5.	30.01.2017	Take delivery letter – cum – continuity letter in relation to DPN	A-5
6.	30.01.2017	Security delivery letter	A-6
7.	24.01.2017	Storage Receipt (SR) SR No.1576432	A-7
8.	31.12.2021	Letter confirming the liability of the debt by defendant	A-8
9.	31.12.2021	Payment Challan	A-9
10.		Statement of Accounts alongwith certificates under Bankers Book Evidence Act.	A-10

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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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NIL

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

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The Karur Vysya Bank Ltd., v. Mr. Sivakumar. E

Case brief

What is this about?

What did the court decide?

The Karur Vysya Bank Ltd., v. Mr. Sivakumar. E

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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