Allowed

Karnataka Gramin Bank v. Prabhuswamy

DRT29 Aug 2025OA/58/2023

Case brief

AI extract

What is this about?

The Tribunal upheld an Original Application filed by Karnataka Grameena Bank for a Recovery Certificate against five defendants who failed to appear. Finding the evidence uncontroverted, the Tribunal allowed the claim for Rs. 21,22,864.00 plus interest, reduced to 8% simple interest.

What did the court decide?

Issuance of Recovery Certificate for Rs. 21,22,864.00 @ 8% simple interest to be executed against defendants' joint and several liability and mortgage properties.

Karnataka Gramin Bank versus Prabhuswamy — Contract and Commercial Disputes | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 29^th Day of August, 2025

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Present: Sri. T. RAJESH Presiding Officer OA.No.58/2023

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BETWEEN:

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Karnataka Grameena Bank, Bommalapura Branch, Bommalapura Village, Gundalupet Taluk, Chamarajanagar District, Karnataka State- 571111. Represented by its Branch Manager.

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…APPLICANT

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AND:

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Sri. Prabhuswamy, Aged 61 years, S/o Sri Puttabasappa, Residing at Kundakere Village, Therakanambi Hobli, Gundlupet Taluk, Chamarajanagar District- 571123.

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Sri Pratap, Aged about 35 years, S/o Sri Prabhuswamy K P, Residing at Kundakere Village, Therakanambi Hobli, Gundlupet Taluk, Chamarajanagar District- 571123.

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Sri Shivaswamy, Aged about 39 years, S/o Sri Prabhuswamy K P, Residing at Kundakere Village, Therakanambi Hobli, Gundlupete Taluk, Chamarajanagar District- 571123.

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OA 58/2023

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Sri Chamaraju, Aged about 37 years, S/o Sri Prabhuswamy K P, Residing at Kundakere Village, Therakanambi Hobli, Gundlupet Taluk, Chamarajanagar District- 571123.

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Sri K V Basavanna, Major, S/o Sri Veerappa, Residing at Kundakere Village, Therakanambi Hobli, Gundlupet Taluk, Chamarajnagar District- 571123. ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : N.G. Ravikumar Defendants : Exparte

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FINAL ORDER

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The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 seeking issuance of Recovery Certificate against the defendants for Rs. 21,22,864.00 (Rupees Twenty One Lakh Twenty Two Thousand Eight Hundred and Sixty Four Only) with further interest thereon from the date of filing the Application till realization.

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It is the case of the applicant that, the defendants availed the following loans from the applicant:

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KCC Loan of Rs. 2,79,000/- (Rupees Two Lakh Seventy Nine Thousand Only) availed by defendants No.1 to 4.

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Personal loan of Rs. 50,000/- (Rupees Fifty Thousand Only)

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OA 58/2023

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availed by defendant No.1 & 2 and defendant No.5 stood as guarantor.

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Land development loan of Rs. 3,00,000/- (Rupees Three lakh Only) availed by defendants Nos. 1 to 4.

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It is also the case of the applicant that, in view of the above availed loans, the defendants executed the necessary loan documents along with hypothecation agreement, registered simple mortgage deed and letter of commitment.

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It is further contended that, despite availing the credit facilities, agreeing to service the loan amount promptly and regularly, the defendants failed in complying the same, resulting in default in repayment and consequentially turning the loan accounts as NPA.

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In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the account.

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Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set exparte on 07.10.2025.

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The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A-3 to A-33 and got the same marked in evidence.

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Heard the Ld. Counsel for the Applicant and considered the

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OA 58/2023

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contentions as taken in the OA in the light of documentary evidence and proof affidavit.

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The following issues arise for consideration in this matter:

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i) Whether the applicant had succeeded in proving the OA claim as against the defendants?

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ii) What order are to be passed?

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Both these issues are gone into and decided together.

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The case put forth by the applicant in the Application remains unrebutted as defendants remained exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facilities as stated in the OA, creation of the security interest and the defaults committed in the

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accounts. The liability of the defendants and the claim of the amount due is also proved by the above documents. The claim of the applicant is well within the limitation.

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Hence in view of the finding arrived herein above, the Tribunal

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find both these issues in favour of applicant and hence, this Tribunal

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is of the view that OA is to be allowed.

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OA 58/2023

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Taking into consideration the facts that the credit facilities are

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availed for Agricultural purpose and personal use and also that the

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OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of

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8.00% (simple).

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13. In the result, OA.No.58/2023, stands allowed,

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i) The applicant is allowed to recovery an aggregate sum of

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Rs. 21,22,864.00 (Rupees Twenty One Lakh Twenty Two Thousand

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Eight Hundred and Sixty Four Only) @ 8.00% (Simple) which consists

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of:-

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a) Rs. 20,43,087.00 (Rupees Twenty Lakh Forty Three Thousand

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Eighty Seven Only) from the date of filing OA till the realization, from the defendant Nos. 1 to 4 jointly, severally & personally, after giving credit to all the amount recovered and received during the pendency of the OA and allowed the same to be recovered by proceeding against schedule property.

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b) Rs.79,777/- (Rupees Seventy Nine Thousand Seven Hundred and

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OA 58/2023

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Seventy Seven Only) from the date of filing OA till the realization,

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from the defendant Nos. 1 ,2 & 5 jointly, severally & personally,

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after giving credit to all the amount recovered and received during the pendency of the OA and allowed the same to be recovered by proceeding against their other assets.

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Properties schedule to the OA be the schedule to the recovery certificate.

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ii) If the sale proceeds are not found sufficient to cover the

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amount due and payable to the applicant bank, the defendants jointly, severally & personally and their assets are liable for respective amounts due under the respective loan accounts.

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iii) The applicant bank is allowed cost of the proceedings

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which applicant to file cost memo within 7 days from the date of receipt of the order.

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iv) The Recovery Certificate to be drawn in terms of this order and transferred to Recovery for execution.

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v) Interim application pending, if any, stands disposed of in terms of this final order.

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OA 58/2023

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14. Communicate a copy of the order to the parties concerned in

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terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT

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(Procedure) Rules, 1993.

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[Dictated to the Stenographer (AJ), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 29^th Day of August, 2025].

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Sd/- (T. RAJESH)

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PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Nanjunda Naika H.C S/o Chikka Honnaiah, Manager, of Applicant Bank.

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Exhibits on the part of the Applicant:

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Exhibit Nos.	Date	Particulars of Documents
A1	--	Applicant evidence
A2	--	List of documents
		For the KCC loan of Rs. 2,79,000/-
A3	20.09.2011	Loan application with translation
A4	14.10.2011	Loan sanction letter with translation
A5	14.10.2011	Hypothecation agreement executed defendant No. 1 to 4 with translation	by
A6	07.10.2011	Registered declaration in form No. executed by the defendant No. 1 to 4 w translation	3 ith
A7	13.10.2014	Letter of commitment executed defendant No.1	by
A8	14.10.2014	Letter of commitment executed defendant No.2	by
A9	12.10.2017	Letter of commitment executed defendant No.1	by

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OA 58/2023

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A10	27.03.2019	Letter of commitment defendant No.1	executed	by
A11	01.10.2021	Letter of revival executed NO.1	by defen	dant
A12	17.10.2022	Statement of accounts from 30.09.2022 with certificate	02.11.201	9 to
		For personal loan of Rs. 5	0,000/-
A13	20.10.2011	Loan application with transl	ation
A14	31.10.2011	Sanction letter with translat	ion
A15	02.11.2011	Personal loan agreement defendant No.1 & 2	executed	by
A16	02.11.2011	Demand promissory note an letter to DPN executed by d and 2	d take deli efendant	very No.1
A17	02.11.2011	Guarantee agreement exe defendant No.5	cuted by	the
A18	28.10.2014	Letter of commitment defendant No.1	executed	by
A19	25.10.2017	Letter of commitment defendant No.1	executed	by
A20	27.03.2019	Letter of commitment defendant No.1	executed	by
A21	13.01.2022	Letter of revival executed No.1	by defen	dant
A22	17.10.2022	Statement of accounts from 30.09.2022 with certificate	03.11.201	9 to
		For ATL loan Rs. 3,00,00	0/-
A23	28.11.2012	Loan application with transl	ation
A24	04.12.2012	Sanction letter with translat	ion
A25	20.12.2012	Hypothecation agreement defendants No. 1 to 4	executed	by
A26	20.12.2012	Registered simple mor executed by defendants No.	tgage d 1 to 4	eed
A27	15.12.2015	Letter of commitment defendant No.1	executed	by
A28	14.12.2018	Letter of commitment defendant No.1	executed	by
A29	10.12.2018	Letter of revival executed No.2	by defen	dant
A30	10.12.2021	Letter of revival executed No.1	by defen	dant
A31	17.10.2022	Statement of accounts from 30.09.2022 with certificate	03.11.201	9 to

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OA 58/2023

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A32	25.12.2021	Legal Notice
A33	--	Postal acknowledgement

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Witness Examined for the Defendants: -Nil - List of Documents Exhibited for the Defendants: -Nil -

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Sd/- (T. RAJESH)

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PRESIDING OFFICER

Karnataka Gramin Bank v. Prabhuswamy

Case brief

What is this about?

What did the court decide?

Karnataka Gramin Bank v. Prabhuswamy

Case brief

What is this about?

What did the court decide?

What the court decided

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