Allowed

Canara Bank v. M/S.Micro Cables

DRT24 Dec 2025OA/501/2024

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's original application for recovery of loan dues of Rs.82.55 lakh against a private limited company and its proprietor-proceeds. The court held the defendants liable to pay the principal sum along with interest and costs.

What did the court decide?

Defendants liable to pay Rs.82,55,557.78 with interest at 9.25% simple; OA schedule assets and properties subject to realization; costs awarded.

Canara Bank versus M/S.Micro Cables — Contract and Commercial Disputes | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-II AT HYDERABAD

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DATED THIS FHE 24TH DAY OF DECEIV1BER, 2025

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PRESENT: SH. RAIYESHWAR KOTHE, B.Com, L.LB. (Hons.), M.A. PRESlDlNG OFFICER

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ORIGINAL APPLICATION NO. 507 OF 2024

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Between:

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Canara Bank SMI Kukatpa lly Hydera bad-500072 Rep by its Authorised Representative. .......Applicant.

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And

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M/s. Micro Cables Plot No.21lP Cooperative Industrial Estate Gandhi Nagar, Hyderabad-37. Rep by its Proprietor Mr. Begari Shankar 2. Sri Begar Shankar S/o Davulayya Begari Aged about 47 yearc H. No. 385/A, Alwyn Colony Kukatpally-II Phase ..... Defendants. Hyderabad-500072. Counsel for the Applicant : Ms. A. Sravanthi. Counsel for the Defendants : Mr. G. Prem Kumar Reddy.

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:: ORDER::

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The Applicant Bank filed the present OA u/s 19 of The Recovery of Debts & Bankruptcy Act, 1993 for recovery of a total sum of Rs.82,55,557.78Ps (Rs.62,25,240.31Ps towards loan account N'.2727267OO5339, Rs.4t75,040.47Ps towards account No.2427766000029, Rs.2,79,183.24Ps -towards account e

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ff'r*t,

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oA.50l/202.1

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No.2427755000009, Rs.72,7 6,093.7 6ps towards account No.170001762340 with interest at the rates of 15.95olr,, 72.90o/o, 9.25o/o per annum respectively) from the defendants jointly and severally from 30.08.2024 along with costs and sale of OA schedule assets.

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The averments of the OA, in brief, are;

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Defendant No.1, represented by its proprietor-2nd defendant, availed a cash credit of Rs.15 lakh, term loan of Rs.37 lakh, working capital requirements to the tune of Rs.20 lakh and GECL of Rs.11,80,000/- from time to time. In between defendants got their credit limits enhanced on various occasions. Defendants executed necessary loan documents/ supplemental/hypothecation agreements, etc., as required from time to time. However, defendants failed to repay the monies and committed default in repayment. Accordingly, the accounts were classified as NPA on 04.09.2022 followed by legal notice dated 20.08.2024. Since no payment was forthcoming, the present OA is filed for recovery of outstanding dues against the loans availed by 1st defendant.

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Defendant filed written statement. The averments of the written statement, in brief, a re;

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While admitting the availment of loans for business purposes and execution of loan documents from time to time, defendants submit that the default in repayment is not deliberate and the liability is also not disputed. However, due to financial crisis during Covid.19, defendants suffered huge losses leading to delay in repayment. Though made specific request not to classify the loan account as NpA, aopllcant bank fu{"Droceeded with

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oA.50l/2024

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the same and filed the^present OA. Even in the^{post NPA} classification, defendants^paid Rs.18,25,000/- and^requested for regularisation. In the pre- NPA, defendants the^total payments towards principal and interest put together work out to Rs.1,08,00,000/-. They are not wilFul defaulters.^{As on date} the outstanding dues work out to only Rs.77,26,000/-. In^view of the above facts and circumstances, defendants^{prayed for} granting three years time to clear the balance dues. Accordingly, defendants^prayed for dismissal of the OA.

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In order to prove its claim, Applicant Bank examlned^B. Narasimha, Manager, as AW-1 and marked 63 documents through him as Ex. A.1 to Ex. 4.63.

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Defendants right to adduce evldence forfeited on 27.17.2025 for non-representation.

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Heard both sides. Perused the material^placed on^record.

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Learned counsel for the applicant bank submits that since the defendants dld not^pay the instalments^{as per} the^{terms of the} loan agreements, the bank was constrained to initiate^steps recovery of outstanding dues. Defendants have^not approached for reschedulement or restructure of loans at any^{pointof time.} Since the defendants failed to clear the dues despite^notice, applicant bank filed the^present OA for recovery of^dues. Hence, OA claim as^prayed for may be allowed in the^{interest of} justice.

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Per contra, learned counsel appearing for the defendants prayed that sonable time to K*s

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oA.50l/202,1

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discharge the liability as they are committed to clear the debt subject to granting reasonable time as prayed for.

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The point that arises for consideration is:_

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Whether the Applicant Bank is entiiled for the OA claim against the Defendants and the OA schedule assefs?

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There is no dispute over the avairment of roan and defaurt in repayment thereafter. The grievance of the defendants is they were not afforded sufficient time to repay the dues despite specific request to this effect. Therefore, in view of the foregoing facts and circumstances, the evidence aFfidavit of AW.1 of the applicant bank and the recitals in Exhibits A. 1 to A.63 stand proved. Accordingly, I hold that defendants are liable to pay the OA claim to the applicant bank along with interest and costs.

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In the result, the present Original Application No.501/2024 is allowed as under: -

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i) defendants are liable to pay to the Applicant Bank a total sum of Rs.82,55,557.7gps under different loan accounts stated supra along with interest @9.25% per annum simple from the date of application till the date of realization;

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ii) the OA claim is secured by way of hypothecation of assets described in the schedules annexed to the fu*OA and the

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oA.50t/2024

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applicant bank is entitled to^{proceed against} the same for recoverY of its dues;

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iii) the applicant bank is^{entitled to proceed} against the^person and^{propertiesof the} defendants for realization^{of its dues;and}

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iv) the applicant bank^{is entitledfor the costs'}

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L2. The Applicant^{Bank is directed to file Cost Memo within2 weeks} from the date of^{receipt of this Order.}

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Issue Recovery^{Certificate accordingly.}

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L4.Communicateacopyofthisordertothepartiesconcernedand upload in official^{Web Portal.}

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(Dictated to the steno, signed^{and pronouncedby mein the open court on this the 24th} day of December,²⁰²⁵ ) tol

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(RAMESHWAR KOTHE) PRESIDING OFFICER

Canara Bank v. M/S.Micro Cables

Case brief

What is this about?

What did the court decide?

Canara Bank v. M/S.Micro Cables

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

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Case details

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