Allowed

State Bank of India v. Jagannath

DRT25 Jul 2025OA/701/2022

Case brief

AI extract

What is this about?

The Tribunal allowed a recovery certificate application filed by State Bank of India against three defendants for a housing loan default totaling Rs. 3.49 Crores. The defendants were ex-parte. The Tribunal allowed the claim but capped interest at 8% simple interest per annum.

What did the court decide?

Recovery certificate issued for Rs. 3,49,36,802 plus 8% simple interest per annum from filing date; sale proceeds insufficient to cover dues to be recovered from other assets.

State Bank of India versus Jagannath — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 25^th Day of July, 2025

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Present: Sri. T. RAJESH Presiding Officer OA.No.701/2022

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BETWEEN:

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State Bank of India, Stressed Assets Recovery Branch, No. 11/90, 3^rd Floor, Near Old Shivaji Theathre, J C Road, Bengaluru- 560002, Represented by Daya S Naik.

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…APPLICANT

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AND:

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Mr. Jagannath. P, S/o A. Padmanabhan, Aged about 60 years.

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Mrs. Uma Jagannath, W/o. Jagannath P, Aged about 58 years.

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Mr. Aditya P, S/o Jagannath P.

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All three Residing and available at:

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a) No. 71,19^th Main, 14^th Cross, 2^nd Phase, J.P. Nagar, Bengaluru – 560078.

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b) Flat No. 701A, A Block, L & T South City Apartments, Arekere MICO Layout, 2^nd Stage, Bengaluru- 560076.

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c) Unit No. 180/23D or D5,

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OA 701/2022

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“Vaishnavi Ananthya” Sy.No. 119/2, Panchayath Khatha No. 92/180, S. Medahalli Village, SarjapurahobliAnekal Taluk, Bengaluru Urban, District- 560099. (Mortgaged property, On date of filing OA Under the physical possession Of the Applicant Bank). ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : M/s. Skanda Legal 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. 3,49,36,802/- (Rupees Three Crore Forty Nine Lakh Thirty Six Thousand Eight Hundred and Two 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 a housing term loan of Rs. 3.00 Crore for the purchase of construction/ purchase of one house/ Villa.

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It is also the case of the applicant that, in view of the above availed loans, the defendants executed necessary loan documents along with Deed of undertaking, agreement to mortgage,

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OA 701/2022

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memorandum of deposit of title deeds and sale deed.

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It is further contended that, despite availing the credit facilities, agreeing to service the loan account promptly and regularly, the defendants failed in compliance of 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 defendant, they failed to appear, resulting the defendants being set exparte on 23.08.2024

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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-23 and got the same marked in evidence.

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Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and the 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

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OA 701/2022

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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 the credit facilities as stated in the OA, creation of security interest as claimed by the applicant bank and the defaults committed in the accounts. The liability of the defendants and the claim of the amount due are 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 is of the view that OA is liable to be allowed.

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Taking into consideration the facts that the credit facilities are

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availed for Housing purpose and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal is of the view that

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the OA can be allowed with a reduced interest of 8.00% (simple).

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OA 701/2022

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In the result, OA.No.701/2022, stands allowed,

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

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Rs. 3,49,36,802/- (Rupees Three Crore Forty Nine Lakh Thirty Six Thousand Eight Hundred and Two Only) with further interest @ 8.00 % p.a.(simple), from the date of filing OA till the realization, from the defendants jointly, severally & personally after giving credit to all the amounts recovered and received during the pendency of the OA and allowed to recover the same by proceeding against the schedule property. 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 other assets are liable for all such amounts due under the 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

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and transferred to Recovery for execution.

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v) Interim application pending, if any, are disposed of with this

OA 701/2022

Final Order.

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 (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 25^th Day of July, 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: Govind L Ballal S/o Laxman Ballal, Chief 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	--	Evidence Affidavit
A2	--	List of Documents
A3	05.10.2019	Loan application
A4	02.01.2020	Sanction letter
A5	09.01.2020	Letter of arrangement
A6	09.01.2020	Memorandum of loan agreement
A7	09.01.2020	Deed of undertaking
A8	09.01.2020	Agreement to mortgage
A9	27.01.2020	Memorandum of deposit of title deed
A10	27.01.2020	Form-A issued by the defendants confirming deposit of title deeds

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OA 701/2022

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A11	09.01.2020	Affidavit
A12	27.01.2020	Housing insurance policy
A13	22.09.2020	Recall Notice
A14	29.10.2020	Recall Notice
A15	17.11.2020	Demand notice issued u/s. 13(2) of the SARFAESI Act, 2002.-Shri Jagannath
A16	17.11.2020	Demand notice issued u/s. 13(2) of the SARFEASI Act, 2002.- Smt. Uma Jagannath
A17	17.11.2020	Demand notice issued u/s. 13(2) of the SARFEASI Act, 2002-Shri Adithya
A18	18.01.2021	Possession notice issued under Sec. 13(4) of the SARFEASI Act
A19	18.01.2021	e-mail by the defendants seeking for further time for payment
A20	18.01.2021	Letter surrending the keys of the mortgaged house by the borrowers
A21	19.04.2022	Statement of accounts- 39062452594
A22	19.04.2022	Statement of accounts- 39107939713

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

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-Nil -

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-Nil -

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Sd/- (T. RAJESH) PRESIDING OFFICER

State Bank of India v. Jagannath

Case brief

What is this about?

What did the court decide?

State Bank of India v. Jagannath

Case brief

What is this about?

What did the court decide?

What the court decided

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