Allowed

Canara Bank v. Deogiri Organics Pvt. Ltd.

DRT9 Dec 2025OA/81/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an application filed by Canara Bank for recovery of an outstanding loan amount against a company and its guarantors. The court awarded the principal amount along with future interest at a reduced rate of 9% per annum.

What did the court decide?

Order: Allow application. Respondents to pay Rs. 25,19,526.43/- with future interest at 9% p.a., and applicant bank to recover dues from hypothecated assets via recovery certificate.

Canara Bank versus Deogiri Organics Pvt. Ltd. — Insolvency and Bankruptcy | DRT (2025)

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Presented on: 11.11.2021 Registered on: 05.04.2022 Decided on: 09.12.2025 Duration: Y M D 04 00 28

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IN THE DEBTS RECOVERY TRIBUNAL AT AURANGABAD (Before Dr. J. R. Chauhan Presiding Officer) ORIGINAL APPLICATION No. 81/2022

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TOTAL CLAIM AMOUNT – Rs. 25,19,526.43/-

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CANARA BANK,

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A Body Corporate constituted under the Banking companies (Acquisition & Transfer of Undertakings)

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Act, 1970, having its Head Office at 112 JC Road, Bangalore in the State of Karnataka and one of its branch offices amongst other places at Shendra Aurangabad. Through its Power of Attorney Holder,

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Shri. Upendra Vishwakarma.

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… Applicant

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Versus

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1. Deogiri Organics Pvt. Ltd., A Company incorporated under The Companies Act, 1956 and havng At: R.H. No.: 13, B-1 Sara Sapnagan, Shendra Gangapur, Aurangabad – 431 007.

(OA No.81/2022)

Page 1 of 7

[AMBADAS]

2. Shri. Sanjay Sanduji Chaudhari, R/o.: Gut No: 729, Chaudhari Colony, Near Hanuman Mandir, Chikalthana, Aurangabad-431 001.

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3. Shri. Pramod Bhagwanrao Deshmukh, R/o.: H. No.: 11, Ghargaon, Aurangabad-431 001.

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4. Shri. Bhanudas Dattu Mhaskee, R/o.: Plot No: 1, Chaitanya HSG. Society, Bajrang Chowk, N-6, Aurangabad 431 003.

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…Defendants

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APPEARANCES

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For the Applicant For Defendants

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Mr. G. A. Rajput -Advocate Ex-parte

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JUDGMENT Delivered on 09.12.2025

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The Applicant Bank has filed the present application for the recovery of a sum of Rs. 25,19,526.43/- (Rupees Twenty Five Lacs, Nineteen Thousand, Five Hundred Twenty Six and Forty Three Paisa only), along with future interest from the date of filing of the Original Application, i.e., 11.11.2021, until the date of realization of the entire outstanding dues from the Defendants.

(OA No.81/2022)

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[AMBADAS]

Brief facts of the application are as under:

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The Applicant Bank states that the Defendant No. 1 approached and requested the Applicant Bank for Cash Credit facility & Term loan Facility. Upon considering the request and financial needs of the Defendant, the Applicant Bank sanctioned Credit facility of Rs. 10,00,000/- & Term loan Facility of Rs. 15,00,000/- vide sanction letter dated 18.03.2019 on certain terms and conditions. The agreed rate of interest for the aforesaid loan was @10.60% & @ 11.15% p.a. respectively with half yearly rests. The Defendant also agreed to pay additional interest @2% by way of liquidated damages in the event of any default in repayment.

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In order to secure the aforesaid loan facilities, the Defendants executed various loan documents in favour of the Applicant Bank. These included sanction letters, deed of hypothecation, request letter, etc. Additionally, Defendant No. 2 to 4 stood as guarantors

(OA No.81/2022)

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[AMBADAS]

for defendant No. 1 and executed deed of guarantee in favour of the Applicant Bank.

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The Applicant Bank further contends that, in order to secure the aforesaid loan facility, the Defendants executed deed of hypothecation thereby hypothecating stocks, receivables, bookdebts and other movables assets etc., in favor of the applicant bank.

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The applicant bank contended that the defendants have failed to keep their promise and commitments agreed by them with regard to due repayment of the loan amount. The defendants failed to operate the loan account properly and failed to pay the agreed rate of interest as per terms and conditions of the sanction letter. Thereafter, the applicant bank repeatedly made demand of loan amount and called upon the defendants to pay with the agreed rate of interest thereon, but the defendants failed and neglected to pay the same. The loan account of the defendants became irregular and classified as NPA on 30.06.2021. Therefore, on

(OA No.81/2022)

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[AMBADAS]

22.09.2021 the applicant bank issued legal notice to the defendants through their advocate. Despite service of Notices, the defendants failed and neglected to repay the outstanding dues of the applicant Bank. Hence, this application is filed.

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The defendants failed to appear in matter though they were served through summons. Hence, the defendants were proceeded ex-parte as per Order dated 06.09.2023.

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The applicant Bank has filed Claim Affidavit of evidence at Exhibit-4 of Upendra Vishwakarma, Power of Attorney Holder of the applicant Bank, and has produced on record the original loan transaction documents as Exh. A-1 to A-18 along with list of documents Exh.5 which corroborates the case of the applicant Bank.

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I have heard arguments of the learned Advocate for the applicant Bank.

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Since the defendants failed to appear and contest the application, I find no reason to disbelieve the unrebutted evidence of the

(OA No.81/2022)

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[AMBADAS]

applicant Bank. Therefore, the applicant Bank is entitled for the reliefs as claimed.

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The applicant Bank has claimed future interest @10.60% & @11.15% p. a. respectively on both the loans from the date of filing i.e. 11.11.2021 of this application till realization of the claim amount. However, considering the facts of the case, I am of the opinion that if future interest is granted @ 9% per annum (simple) on outstanding amount, it would be just and reasonable rate of interest.

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ORDER

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(A) Original Application No. 81/2022 is allowed with costs.

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(B) The defendants shall pay jointly and severally to the applicant Bank a sum of Rs. 25,19,526.43/- (Rupees Twenty Five Lacs, Nineteen Thousand, Five Hundred Twenty Six and Forty Three Paisa only), along with future interest @ 9% per annum (simple) from the date of filing of the O.A. i.e. 11.11.2021 till full

(OA No.81/2022)

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[AMBADAS]

payment/realization of the amount mentioned in this operative order.

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hypothecation of stocks, receivables, book-debts and other movables assets vide deed of hypothecation dated

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30.03.2019 at Exh. A-5 in list of documents Exh. 5.

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(D) The applicant Bank is entitled to sell the hypothecated stocks / articles/ goods etc., to recover its dues.

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(E) Issue Recovery Certificate accordingly.

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(F) The Registrar is directed to send the copy of the Judgment and Recovery Certificate to the applicant and defendants.

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(G) File be consigned to the record room.

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Sd/-

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Pronounced in open court. Place: Aurangabad Date:.09.12.2025

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(Dr. J. R. Chauhan) Presiding Officer Debts Recovery Tribunal, Aurangabad

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(OA No.81/2022)

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Page 7 of 7

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[AMBADAS]

Canara Bank v. Deogiri Organics Pvt. Ltd.

Case brief

What is this about?

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Canara Bank v. Deogiri Organics Pvt. Ltd.

Case brief

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