Allowed

Canara Bank v. Mohana

DRT3 Feb 2025OA/84/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an Original Application filed by Canara Bank for recovery of Rs. 22,76,572 along with interest against two defendants who defaulted on a Term Loan. As defendants were ex-parte, the bank was granted liberty to recover dues by sale of hypothecated equipment and personal assets.

What did the court decide?

The applicants were allowed to recover Rs. 22,76,572 plus interest @ 14.35% p.a. from defendants jointly and severally. Liberty granted to recover balance dues by sale of hypothecated property or pers

Canara Bank versus Mohana — Contract and Commercial Disputes | DRT (2025)

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OA No.84/2022 (E)

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03.02.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 03^rd day of February, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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ORIGINAL APPLICATION No. 84 of 2022

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M/s. Canara Bank, Chengalpattu Branch, First Floor, No. 9, Alagesan Street, Vedhachalam Nagar, Chegalpattu – 603 001. Rep by its Branch Manager.

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….Applicant

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-Vs-

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Mrs. S. Mohana, W/o. R. Sudhakar, No. 16, Devadoss Street, Vedhachalam Nagar, Chengalpattu – 603 001.

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Also at:

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Mrs. S. Mohana W/o. R. Sudhakar, No. 263, N.G.G.O. Nagar, Chengalpattu – 603 001.

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Mr. R. Sudhakar, S/o. Rajendran No.16, Devadoss Street, Vedhachalam Nagar, Chengalpattu – 603 001.

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Also at:

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Mr. R. Sudhakar, S/o. Rajendran, No. 263, N.G.G.O. Nagar, Chengalpattu – 603 001. ….Defendants

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Counsels on record / appeared:

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Counsel for Applicant : S. Parathasarathy Defendants 1 & 2 were set ex-parte on 07.06.2022.

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OA No.84/2022 (E)

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03.02.2025

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: - FINAL ORDER - :

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This original application is filed on 22.02.2022 by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants for recovery of a total sum of Rs.22,76,572/- (Twenty-Two Lakhs Seventy-Six Thousand Five Hundred and Seventy-Two only) due in respect of Term Loan under MSME (Loan Account No. 26967680000089) together with further interest @ 14.35% per annum with half yearly rests from the date of application till the date of realization in full and for costs of this application.

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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 Hon’ble Tribunal.

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The applicant bank's case is that the 1^st defendant approached the applicant bank for the sanction of a business loan under MSME for ₹25,00,000/- for purchase of photography and video coverage equipment.

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It is submitted that upon considering the application made by the 1^st defendant, the applicant bank sanctioned Term Loan of ₹23,75,000/- vide Sanction Letter dated 30.01.2015, under Loan Account No. 26967680000089, which is repayable along with interest at the rate of 13.95% per annum with monthly rests in 60 monthly installments of Rs.23,75,000/- with moratorium period of three months

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OA No.84/2022 (E)

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03.02.2025

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commencing from May 2015. The defendants also agreed to pay an overdue interest at the rate of 2% p.a. over and above the interest rate agreed to between the parties.

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The applicant bank submits that upon availing of the MSME- Loan credit facility, the defendants executed the following loan documents on 30.01.2015 in favour of applicant bank:

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a) Composite Loan Agreement.

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b) Particulars of Equipment’s Hypothecated.

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c)Guarantee Covering Letter.

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d)Guarantee Agreement.

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e) Deed of Hypothecation.

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f) Letter of Undertaking.

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Further, the applicant bank submits that the 1^st defendant had acknowledged her liability through an Acknowledgment of Debt and Security dated 09.11.2017 and 28.01.2018 in favour of applicant bank.

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It is submitted by applicant bank that the Defendant, after availing the sanctioned credit facilities, violated the terms of the sanction, including the repayment schedule, and defaulted in the repayment of the loan despite repeated reminders. The applicant bank had caused Legal Notice dated 01.02.2022 to the defendant calling them to repay the outstanding dues as on 25.11.2021. As there was no response from defendants, the loan account was classified as a Non-Performing Asset (NPA) on 24.10.2021 for Loan Account No. 2696768000089. However, the Defendants failed to settle the dues. Therefore, the Applicant Bank has filed this

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OA No.84/2022 (E)

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03.02.2025

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Original Application (OA) seeking recovery of the outstanding dues from the Defendants.

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After the filing of the OA, summons were sent to Defendant Nos. 1 and 2, which were returned as ‘Intimation delivered, unclaimed’. 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 exparte on 07.06.2022.

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Heard the submissions of Applicant Bank and perused the records.

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To prove the case of the Applicant Bank, Mr. Amrutavelli Satish Kumar, Chief 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-12 . 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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With regard to the amount due to the applicant bank, 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 Defendants No.1 and 2

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OA No.84/2022 (E)

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03.02.2025

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jointly, severally a sum of Rs.22,76,572/- (Twenty-Two Lakhs Seventy-Six Thousand Five Hundred and Seventy-Two only) due in respect of Term Loan (Loan Account No. 26967680000089) together with further interest @ 14.35% per annum with monthly rests from the date of filing this application till the date of realization.

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(b) 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 hypotheca.

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(d) If the sale proceeds of the schedule mentioned hypothecated properties are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the defendants (both movable and immovable) to recover the balance dues as required under law;

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

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

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OA No.84/2022 (E)

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03.02.2025

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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/-

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

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(Dictated to Prasobh Sankar, transcribed by him, corrected, signed and pronounced by me on this the 03^rd day of February, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Mr. Amrutavelli Satish Kumar, Chief Manager of the applicant bank.

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Exhibits on the part of the Applicant:

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Sl. No.	Description of Documents	Exhibit No.
1.	Application form for loans toMSMEdated 30.01.2015	A-1
2.	Sanction Memorandum for Rs. 23.75 Lakhs dated 30.01.2015	A-2
3.	CompositeLoan Agreement dated 30.01.2015	A-3
4.	Particulars of Equipment’s hypothecated	A-4
5.	Guarantee CoveringLetterdated 30.01.2015 (D2)	A-5
6.	Guarantee Agreement dated 30.01.2015 (D1)	A-6
7.	Affidavit duly signed by the1^stDefendant	A-7
8.	Deed of Hypothecationdated 30.01.2015	A-8
9.	LetterofUndertaking dated 30.01.2015	A-9
10	Acknowledgement of Debt and Security dated 09.11.2017	A-10
11	Acknowledgement of Debt and Security dated 28.01.2018	A-11
12	Statement for loan A/c No. 2696768000089 along with Bankers Certificated under Evidence Act dated 06.01.2022	A-12

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OA No.84/2022 (E)

03.02.2025

:- SCHEDULE -:

Choice HD without system

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Choice HD system configuration

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AOC 24” LCD Monitor HDMI Cable (2 Nos.)

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Panasonic AG Advocate Commissioner 400A – AVC HD Comcorder 5. Batteries (2nos.) power cable

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Nikon D810

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Lens VR & IT

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Standby Computer with software

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Hasg Kits Pro Lamp

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Sd/(S.V. GOWRAMMA)

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PRESIDING OFFICER, DRT-III, CHENNAI

Canara Bank v. Mohana

Case brief

What is this about?

What did the court decide?

Canara Bank v. Mohana

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

Parties & counsel

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Case details

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