Allowed

Punjab National Bank v. Sree Lakshmi Papers

DRT13 Nov 2025OA/527/2023

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed the bank's application for recovery of a loan sum of approx. 65 lakhs along with interest. The court found the bank's documents proved the claim in the absence of the defendants. It directed repayment and authorized sale of mortgaged properties in case of default.

What did the court decide?

Directed defendants to pay Rs.65,40,838.15p with interest at 11.65% p.a.; liberty to sale movable/immovable properties for satisfaction of dues.

Punjab National Bank versus Sree Lakshmi Papers — Execution and Attachment | DRT (2025)

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OA No. 527/2023

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL AT MADURAI DATED THIS 13^TH DAY OF NOVEMBER, 2025 PRESENT: SEEMA SINHA,

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

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OA No.527/2023

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Between

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Punjab National Bank (Erstwhile Oriental Bank of Commerce) Circle SASTRA Trichy, Circle Office, Kailasapuram, Trichy-620 014. Rep. By its Chief Manager.

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---Applicant Bank

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And

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Sree Lakshmi Papers Prop. Mrs.M.Sindhuja 217 G, Jawaharlal Nehru Road, 1st Floor, Opp to Safira Scanning, Sivakasi-626 123.

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And also at

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Sree Lakshmi Papers Prop. Mrs.M.Sindhuja 133, PSR Road, Sivakasi.

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Mrs.M.Sindhuja D/o. Manivasakam No.48, Thaikkapatti Street, Srivilliputtur Post- 626125.

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Page 1 of 8

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OA No. 527/2023

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Mrs. Vijayalakshmi W/o.Manivasakam Plot No.3,4 No.1/523-1, Chellappa Nagar, NGO Colony, Sivakasi-626123.

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Mr.Manivasakam S/o.K.R.Manickam Plot No.3,4 No.1/523-1, Chellappa Nagar, NGO Colony, Sivakasi-626123. ---Defendants

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Counsel for the Applicant Bank : M/s S. Balasubramanian, T.M. Subramanian

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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 12.07.2023 to recover from the Defendants a sum of Rs.65,40,838.15p together with interest at the rate of 11.65% p.a. with monthly rests plus penal interest at the rate of 2%p.a. in respect of Cash Credit facility 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 defendants availed Cash Credit for a sum of Rs.60,00,000/- and availed Term Loan for a sum of Rs.8,60,000/- totalling Rs.68,60,000/-. The defendants executed necessary loan documents in favour of the Applicant Bank. In addition to that, the defendants also deposited the original title deeds of immovable property with the applicant bank as security for the due repayment of loan availed by them. Further, the 3^rd defendant had executed Memorandum of deposit of title deed on 06.09.2011 in Doc.No.6042/2011,

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Page 2 of 8

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OA No. 527/2023

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SRO Thiruthangal and Supplementary Memorandum of deposit of title deed on 27.12.2012 in Doc.No.6146/2012, SRO Thiruthangal and Supplementary Memorandum of deposit of titled deed on 14.12.2015 in Doc.No.5851/2015, SRO Thiruthangal. And additional Supplementary Memorandum of deposit of titled deed on 01.07.2020 in Doc. No.2530/2020, SRO Thiruthangal. Further, the defendants agreed to repay the loan with interest at the rate of 11.65%p.a. and also agreed to pay penal interest at the rate of 2%p.a in case of default.

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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. Thus, the loan account had become non performing asset. The Applicant Bank already initiated SARFAESI proceedings against the defendants which are pending for its execution.

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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 has issued demand notice dated on 08.08.2022 to the defendants to call upon to pay the outstanding amount. The SARFAESI Notices were duly served to the defendants. Even after the said notice the defendants did not come forward to repay the outstanding loan amount.

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Hence, the Applicant Bank has filed the OA for recovery of a sum of Rs.65,40,838.15p together with interest at the rate of 11.65% p.a. with monthly rests plus penal interest at the rate of 2%p.a. in respect of Cash Credit facility 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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S. No.	Date	Description of docume	nt		Exhibits
1	18.10.2010	Sanction of Cash Credit Rs.8,00,000/-	limit	for	Ex.No.A-01
2	18.10.2010	Agreement of Hypothecation of As	sets		Ex.No.A-02
3	18.10.2010	Common Agreement			Ex.No.A-03
4	18.10.2010	Sole ProprietorshipLetter			Ex.No.A-04
5	18.10.2010	Agreement of Guarantee - D3			Ex.No.A-05
6	18.10.2010	Agreement of Guarantee - D4			Ex.No.A-06
7	10.09.2011	Sanction of Cash Credit Rs.30,00,000/-	limit	for	Ex.No.A-07
8	10.09.2011	Supplemental Agreement t	o Se	cure	Ex.No.A-08

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Page 3 of 8

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OA No. 527/2023

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		Credit/Loan Facilities
9	10.09.2011	Sole ProprietorshipLetter			Ex.No.A-09
10	10.09.2011	Common Agreement			Ex.No.A-10
11	10.09.2011	Agreement of Guarantee - D3			Ex.No.A-11
12	10.09.2011	Agreement of Guarantee - D4			Ex.No.A-12
13	28.12.2012	Sanction of Cash Credit Rs.50,00,000/-	limit	for	Ex.No.A-13
14	28.12.2012	Supplemental Agreement to Credit/Loan Facilities	Sec	ure	Ex.No.A-14
15	28.12.2012	Sole ProprietorshipLetter			Ex.No.A-15
16	28.12.2012	Agreement of Guarantee - D3			Ex.No.A-16
17	28.12.2012	Agreement of Guarantee - D4			Ex.No.A-17
18	02.12.2015	Sanction of Cash Credit Rs.60,00,000/-	limit	for	Ex.No.A-18
19	09.12.2015	Supplemental Agreement to Credit/Loan Facilities	Sec	ure	Ex.No.A-19
20	09.12.2015	Sole ProprietorshipLetter			Ex.No.A-20
21	09.12.2015	Common Agreement			Ex.No.A-21
22	09.12.2015	Agreement of Guarantee - D3			Ex.No.A-22
23	06.09.2011	SupplementaryMOD Doc. No.604	2/2011		Ex.No.A-23
24	27.12.2012	SupplementaryMOD Doc. No.614	6/2012		Ex.No.A-24
25	14.12.2015	SupplementaryMOD Doc. No.585	1/2015		Ex.No.A-25
26	01.07.2020	SupplementaryMOD Doc. No.253	0/2020		Ex.No.A-26
27	---	Statement of Accounts			Ex.No.A-27

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SCHEDULE OF PROPERTY

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Mortgaged Property

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Survey No.	Extent Areas	Location	Boundaries
1) 849/1A	The house site plot Nos.3 & 4 extending to East West 70 feet on the north, 70 feet on the south, south north 35 feet on the west, 35 feet on the east totally 2450sq.ft=272sq.yard	"Natesan Nagar" in Thiruthangal Village, S.N.Puram Panchayat, Sivakasi Panchayat Union, Thiruthangal Sub Registration District and Virudhunagar Registration	North: V.T.Manoharan's Plot South: 16 feet width east west Rajiv Gandhi Road, West: 28 feet width south north chellappan-road, East: Plot No.2

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Page 4 of 8

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OA No. 527/2023

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		District
ii) 849/1A	The House site extending to east west 61.5 feet on the north, 64.5 feet on the south, south north 38.5 feet on the west 32.5 feet on the east totally 2236.5sq.feet. Total extent 4686.5sq.feet	"Natesan Nagar in Thiruthangal Village, S.N.Puram Panchayat Union, Sivakasi Panchayat Union, Thiruthangal Sub Registration District and Virudhunagar Registration District	South: Plot Nos. 3 & 4 i.e., 1^st item, North: Land sold by Karthikeyan, East: 12 feet width south north common pathway, West: 28 feet width south north common pathway

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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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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 Mr. Manjunath Venkatagiri, who is the Chief Manager of the Applicant Bank.

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He has stated in his affidavit that the defendants has availed Medium Term Loan from the Applicant Bank, but they failed to pay the outstanding loan amount, hence he 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-27 in support of its claim in the OA.

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The Sanction of Cash Credit limit for Rs.8,00,000/- has been marked as Ex.No.A-01, Agreement of Hypothecation of Assets has been marked as Ex.No.A-02, Common Agreement has been marked as Ex.No.A-03, Sole Proprietorship Letter has been marked as Ex.No.A-04, Agreement of Guarantee - D3 has been marked as Ex.No.A-05, Agreement of Guarantee - D4 has been marked as Ex.No.A-06, Sanction of Cash Credit limit for Rs.30,00,000/- has been marked as Ex.No.A-07, Supplemental Agreement to Secure Credit/Loan Facilities has been marked as Ex.No.A-08, Sole

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Page 5 of 8

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OA No. 527/2023

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Proprietorship Letter has been marked as Ex.No.A-09, Common Agreement has been marked as Ex.No.A-10.

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The Agreement of Guarantee - D3 has been marked as Ex.No.A-11, Agreement of Guarantee - D4 has been marked as Ex.No.A-12, Sanction of Cash Credit limit for Rs.50,00,000/- has been marked as Ex.No.A-13, Supplemental Agreement to Secure Credit/Loan Facilities has been marked as Ex.No.A-14, Sole Proprietorship Letter has been marked as Ex.No.A-15, Agreement of Guarantee - D3 has been marked as Ex.No.A-16, Agreement of Guarantee - D4 has been marked as Ex.No.A-17, Sanction of Cash Credit limit for Rs.60,00,000/- has been marked as Ex.No.A-18, Supplemental Agreement to Secure Credit/Loan Facilities has been marked as Ex.No.A-19, Sole Proprietorship Letter has been marked as Ex.No.A-20.

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The Common Agreement has been marked as Ex.No.A-21, Agreement of Guarantee - D3 has been marked as Ex.No.A-22, Supplementary MOD Doc. No.6042/2011 has been marked as Ex.No.A-23, Supplementary MOD Doc. No.6146/2012 has been marked as Ex.No.A-24, Supplementary MOD Doc. No.5851/2015 has been marked as Ex.No.A-25, Supplementary MOD Doc. No.2530/2020 has been marked as Ex.No.A-26, Statement of Accounts has been marked as Ex.No.A-27. 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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So far the claim of interest is concerned, it is a well settled Law that the Tribunal has got powers to award pendente lite interest in view of the Judgment of the Hon’ble Supreme Court in N.M. Veerapa Vs Canara Bank (reported in AIR 98(1), 1101 & in Central bank of India Vs Ravindra and OS (AIR, 2001(1), 3095).

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So far the penal interest is concerned Hon'ble supreme court stated in the said judgement as followed " Though interest can be capitalised on the anology that the interest falling due on the accrued date and remaining unpaid, partakes the character of amount advanced on that date, yet penal interest, which is charged by way of penalty for non payment, cannot be capitalized. Further interest, i.e interest on interest, whether simple, compound or penal, cannot be claimed on the amount of penal interest. Penal interest cannot be capitalized. It will be opposed to public policy ".

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Page 6 of 8

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OA No. 527/2023

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Therefore, this Original Application is allowed. 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 sum of Rs.65,40,838.15p together with interest at the rate of 11.65% p.a. with half yearly rests in respect of Cash Credit facility 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 sum of Rs.65,40,838.15p together with interest at the rate of 11.65% p.a. with half yearly rests in respect of Cash Credit facility 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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(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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Page 7 of 8

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OA No. 527/2023

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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 Cash Credit facility 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 13^th November, 2025.

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Sd/- (SEEMA SINHA) PRESIDING OFFICER

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Uploaded on 25.11.2025

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Punjab National Bank v. Sree Lakshmi Papers

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. Sree Lakshmi Papers

Case brief

What is this about?

What did the court decide?

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