Allowed

Indian Bank v. Viivaan Foods

DRT20 Jun 2025OA/73/2022

Case brief

AI extract

What is this about?

The DRT allowed an application filed by Indian Bank against M/s Viivan Foods and Mrs. C.S. Priya for recovery of Rs. 33,68,668/- under a term loan. The Tribunal confirmed interim attachment of properties as absolute and directed sale of hypothecated assets to recover dues with interest.

What did the court decide?

Recovery of Rs.33,68,668/- with interest @11.10% p.a. and penal interest @2% p.a.; confirmation of attachment of properties as absolute; liberty to sell assets for recovery.

Indian Bank versus Viivaan Foods — Banking and Recovery | DRT (2025)

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O.A. No. 73 of 2022

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20.06.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 20^th day of June, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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ORIGINAL APPLICATION No. 73 of 2022

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Indian Bank Maduravoyal Branch, Represented by its Manager, No.4, A1 & A2 MMDA Colony 1^st Main Road Maduravoyal Chennai – 600 095.

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….Applicant

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-Vs-

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M/s Viivan Foods Represented by its proprietrix Mrs. C.S. Priya 53B Trunk road, Porur, Chennai – 600 116.

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Mrs. C.S. Priya, W/o Mr. Sriman Narayan, No.2/26, Kamaraj Street (School Street) Varaha Version, Kanaga Sabai Colony, Koyambedu, Chennai – 600 107. …Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. V. Rajeswari

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Defendants 1 and 2 were set ex-parte on 07.06.2022

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: - FINAL ORDER - :

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This original application is filed on 22.12.2021 by the applicant bank

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under Section 19 of Recovery of Debts and Bankruptcy Act, 1993

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O.A. No. 73 of 2022

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20.06.2025

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(formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants 1 and 2, jointly and severally for recovery of a total sum of Rs.33,68,668/- (Rupees Thirty Three Lakhs Sixty

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Eight Thousand Six Hundred and Sixty Eight Only) due in respect of Term Loan (Account No.6661608140) together with further interest @ 11.10% p.a. with monthly rests besides penal interest @2% p.a. from the date of Application till the date of realization in full, for sale of Hypothecated properties and for costs of this OA.

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Brief Facts of the case:

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The Applicant submits that the application is filed within the period of limitation as prescribed under Section 24 of the Recovery of Debts and Bankruptcy Act, 1993, and the subject recovery claim falls within the jurisdiction of this Tribunal.

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It is the case of the Applicant Bank that 1^st defendant through its Proprietrix, the 2^nd defendant herein approached the applicant bank requesting to grant Term Loan for establishing a Restaurant under franchise “Bistro 1427” and for purchasing equipment and completion of interior words.

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It is submitted that considering the said request of defendant, the applicant bank had sanctioned a Term Loan limit of Rs.30,00,000/- under ‘Standup India Scheme’ to the 1^st defendant concern vide its sanction letter dated 06.08.2018 for the purpose. The loan was under Non-EMI

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scheme payable in 84 monthly instalments starting from the month of October 2018 with 2 months holiday period.

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The Applicant further submits that the Term loan facility is secured by hypothecation of assets created out of loan. Since the loan is under Government of India Scheme (Credit Guarantee Scheme for Standup India Loan), no collateral security was obtained from the borrower. The 1^st defendant counter signed the sanction letter in token of its acceptance of the terms and conditions of sanction, besides executing the following loan documents:

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i. Demand promissory note dated 06.08.2018 wherein the 1^st defendant agreed to repay the loan on demand together with interest @ 2.40% over and above one year MCLR p.a with monthly rests; Then ‘One Year MCLR’ was 8.60% and hence the applicable ROI was 11%.

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ii. Agreement of Hypothecation of movables dated 06.08.2018 wherein the 1^st defendant concern caused hypothecation of Goods, Produce, Merchandise, Stock stored in the restaurant from time to time, Kitchen set-up and the interiors including air conditioners, electrical items, furniture and other fixtures, securing due repayment of its loan

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iii. Declaration dated 06.08.2018 by the sole proprietor, the 2^nd defendant herein, and the limits from 06.08.2018 to 31.08.2018

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The applicant submits that after availing the above facilities, the defendants did not repay the amounts to the applicant bank in spite of repeated demands and incessant requests. The defendants did not keep up their payment schedule and the loan was not regular in repayments of the instalments. The applicant vide notice dated 07.03.2019 and 10.06.2019 called upon the 1^st defendant represented by the 2^nd defendant to remit overdue amounts and to regularize the accounts.

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It is submitted that the 1^st defendant vide letter dated 28.06.2019 requested to consider the restructure of loan and the request was considered favourably by the applicant bank under RBI’s Restructuring Policy for MSME accounts stressed due to COVID. The Term Loan was restructured with dues of Rs.28,78,017/- by reducing the EMI to Rs.26,898/- plus interest payable in 107 months as per sanction letter dated 28.06.2019.

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The applicant further submits that the 1^st defendant represented by 2^nd defendant executed the following documents pursuant to restructuring of the Term Loan as stated above:

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i. Agreement of Hypothecation of movables dated 28.06.2019 hypothecating all the Goods, Produce, Merchandise, Stock stored in the restaurant from time to time, Kitchen set-up and the interiors including air conditioners, electrical items, furniture and other fixtures (which is more fully described hereunder in the schedule)

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securing due repayment of its loan.

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The Applicant submits that defendants also executed acknowledgement of Term Loan liability and securities vide Document dated 28.06.2019 for a sum of Rs.28,78,017/-. However, the Defendants, much contrary to the sanction terms and their assurances of repayment, committed default in repayment of instalments of the Term Loan Account even after restructure and hence the Term Loan account came to be classified as NPA on 31.03.2021 in accordance with the prudential norms and guidelines of the RBI.

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The Applicant further states that the applicant once again on 20.09.2020 issued a recall notice calling upon the 1^st defendant to remit the overdue amount. But in spite of the above defendants did not repay the same, hence the applicant bank issued a legal notice dated 14.12.2020 to remit the entire dues. Despite the applicant’s repeated, persistent demands, the defendant had not chosen to liquidate the outstanding amounts due and payable by them towards the Term Loan Account. Hence the present Original Application (OA) has been filed for recovery of amounts due from defendant.

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After the filing of the OA, summons were sent to the Defendants 1 and 2 through Registered Post with Acknowledgment Due, which returned unserved with postal endorsement as ‘left’ in respect of D-1, and as ‘Door

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Locked’ in respect of D-2. Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 07.06.2022 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 and 2 were placed ex-parte on 07.06.2022.

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Heard the submissions of Applicant Bank and perused the

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records .

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To prove the case of the Applicant Bank, Sh. I. Robins Kumar Roshan, Branch Manager of the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW-1 and list of documents came to be marked as Ex A-1 to A-11 . As the Defendants remained ex-parte, the OA claim remains unchallenged. There is no contra evidence available on record to repudiate the claim of the Applicant Bank.

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During the pendency of OA, applicant bank had filed IA No.822/22 and 823/22 praying to direct the respondents / defendants to furnish security, failing which to grant an order of interim attachment of the schedule mentioned properties. Notice was ordered to respondents in IA, who entered appearance, but despite availing substantial adjournments did not choose to file counter to the IAs. Hence the IAs were allowed vide proceedings dated 17.07.2023, wherein it is observed as follows:

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“In the circumstances, as respondents failed to furnish any security in terms of the order of this Tribunal dated 27.02.2023,

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attachment before judgment of the schedule mentioned properties in IA No.823/22 is hereby granted to the extent of Rs.33,68,668/- to be met to the satisfaction of OA claim. Registry is directed to communicate a copy of this order to the concerned SRO on payment of appropriate fee by the petitioner bank.”

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With regard to the amount advanced, the interest applied, the conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled for a final order on the following terms:

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: O R D E R :

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The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendants a total sum of Rs.33,68,668/- (Rupees Thirty Three Lakhs Sixty Eight Thousand Six Hundred and Sixty Eight Only) due in respect of Term Loan (Account No.6661608140) together with further interest @ 11.10% p.a. with monthly rests and penal interest @2% p.a. from the date of Application till the date of realization in full along with costs of this application.

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(b) The attachment in respect of properties ordered in IA No.823/22 is made absolute.

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(c) In the event of failure of the Defendants to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the

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Hypothecated properties more fully detailed in the OA schedule and also by way of sale of immovable properties morefully detailed in the IA No.823/22.

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(d) Hypothecated property mentioned in the OA and immovable property mentioned in IA No.823/22 shall be appended to this final order.

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(e) If the sale proceeds of the hypothecated assets and immovable properties are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the and 2^nd Defendant (both movable and immovable) to recover the balance dues as required under law for which the 2^nd Defendant to disclose to the Tribunal particulars of other properties or assets owned by the 2^nd Defendant.

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(f) The applicant bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by Defendants to the applicant bank.

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(g) The applicant bank shall file memo of costs within ten days from the date of receipt of this final order.

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(h) Recovery Certificate shall be drawn up and issued to the

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Recovery Officer in terms of the final order.

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A copy of this order be communicated to the parties concerned.

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to Steno (Mogesh), transcribed by him, corrected, signed and pronounced by me on this the 20^th day of June, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Sh. I. Robin Kumar Roshan, Branch Manager of the Applicant Bank

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Exhibits on the part of the Applicant:

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Sl. No.	Descr	iption of Documents		Exhibit No.
1.	Sanction ticket 06	.08.2018		A-1
2.	Demand Promisso	ry Note 06.08.2018		A-2
3.	Agreement of 06.08.2018	Hypothecation of	Movables	A-3
4.	Declaration by So	le Proprietor 06.08.201	8	A-4
5.	Notice from the 07.03.2019	Applicant to the 1^st	defendant	A-5
6.	Notice from the 10.06.2019	applicant to the 1^st	defendant	A-6
7.	Request letter of defendant for 28.06.2019	1^stdefendant represen restructure of Te	ted by 2^nd rm Loan	A-7
8.	Agreement of 28.06.2019	Hypothecation of	Movables	A-8
9.	Acknowledgemen	t of Term Loan	Liability	A-9

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	28.06.2019
10.	Legal Notice issued by the applicant to the	A-10
	defendants 14.12.2020
11.	Statement of Accounts	A-11

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Witness Examined for the Defendants: -Nil-

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List of Documents Exhibited for the Defendants: -Nil –

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:- OA - SCHEDULE -:

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Goods, Produce, Merchandise, Stocks stored or to be stored from time to time at Viivaan Foods, 53B, Trust Road, Porur Chennai Entire Kitchen set up created out of loan

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All Consumer durables consisting of Air Conditioners, Duct, interiors, exteriors, electrical items, Lights, Wall papers, Tables, Chairs, Name Boards, Bed, Cot, Flooring, CCTV etc.

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SCHEDULE - IA No.823/22

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1. Property 1 – owned by the 2^nd respondent as per sale deed dated 02.04.2007 Registered as Doc.No.9153/2007 In SRO Sriperumbudur

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All that piece and parcel of vacant House site, bearing Plot No.756, extent 1907 sq.ft comprised in Survey No.305/1 (as per Patta No.830 New Sub-Division Survey No.305/41) in Thathanur Village, Sriperumbudur Taluk, Kancheepuram District, Registration District of Chengalpet and Registration Sub-district of Sriperumbudur and forming part of the Layout of House sites named “Kaivalyam Nagar” approved by DTCP authorities vide approval No.C.R.DT & C.P. M83 – 75/L.P.41 bounded on the

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North by: Plot No.757

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South by: 30 Feet Road

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East by: Plot No.735

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West by: 50 Feet Road

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2. Property 2 – owned by the 2^nd respondent as per Sale deed dated 25.09.2006 Registered as Doc.No.5498/2006 in SRO Ponneri

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Vacant land in Plot No.41, Sakthimurugan Nagar situated at S.No.355/3 Part, No.76 Andarkuppam Village, Thachur Group, Ponneri Taluk, North Chennai Registration District, Thiruvallur District, Ponneri SRO admeasuring 1500 sq.ft. bounded in the

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North by: 20 feet wide road

South by: Plot No.44

East by: Plot No.40

West by: Plot No.42

3. Property 3 jointly owned by 2^nd respondent and her husband as per Sale deed dated 07.11.2003 Registered as Doc.No.3954/2003 in SRO Anna Nagar

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UDS of 271/2400 sq.ft. of vacant land comprised in S.No.121, T.S. No.113, Block No.42 in Koyambedu Village (total extent 2400 sq.ft) bearing Old No.26, New No.2, Kanagasabai Colony, Kamaraj Street, Koyambedu, Chennai – 600 107 bounded on the

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North by: Plot No.17

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South by: Kamaraj Street

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East by: School Street (Panchayat Road)

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West by: Plot No.25

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

Indian Bank v. Viivaan Foods

Case brief

What is this about?

What did the court decide?

Indian Bank v. Viivaan Foods

Case brief

What is this about?

What did the court decide?

What the court decided

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