Allowed

Union Bank of India v. M/S. Al Engineering Works

DRT17 Jun 2025OA/94/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an original application filed by Union Bank of India for recovery of a loan amount of Rs. 23,69,779 along with interest. The Tribunal rejected the defendant's plea regarding blank signatures and high interest rates due to lack of substantiation and accepted the bank's evidence as prima facie valid, granting orders for debt realization and property sale.

What did the court decide?

Order allowing OA; directing defendant to pay Rs.23,69,779 with interest; permitting realization from hypothecated movables and other properties; issuing recovery certificate.

Union Bank of India versus M/S. Al Engineering Works — Contract and Commercial Disputes | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-I AT HYDERABAD

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DATED THrS THE 17rH DAY OF JUNE, 2025

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PRESENT: SRI GUMMADI GoPICHAND, PRESIDING oFFICER

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OA.No.94 OF 2024

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Between:

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Union Bank of India, Collectorate bra nch, Khammam, Telangana state. Represented by its Branch Manager

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Applicant

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VERSUS

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M/s. AL Engineering Works, Prop: Mr. TanneruNarahari, s/o Srinivas, aged 32 years, # lO- 16, Rebbavaram village, Wyramandal, Khammam dist-507165

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Also at

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2O-7 - 65, Sriramnagar, Road no.9, Kothuru, Gandhichowk, Khammam - 507 003.

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Defendant

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Counsel for the Parties:

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For the Applicant

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Defendant

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Sri Srinivasa Rao Chakrala

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Sri A. Parshuram

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The Applicant OA against Defendant for recovery of ,779/-^(Rupees Twenty

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(OA.No.9412024)

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Three Lakhs Sixty Nine thousand Seven Hundred and Seventy

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Nine only) with interest @ 11.90%p.a from 06.02.2024 till the date of realization and in default for sale of hypothecated property as described in the schedule to OA.

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As per the averments in the application, the Applicant Bank states that the defendant is a proprietary concern represented by its proprietor who availed MSME loan for a sum of Rs.23.75 lakhs and executed term loan agreement, letter of continuity, undertaking, interest agreement etc. The defendant agreed to repay the loan in 60 EMIs with interest @ 11.90olo P.a with hypothecation of machinery worth of Rs.22.00 lakhs more fully mentioned in^the schedule to OA. It is submitted by the Applicant bank that the Defendant has availed the said loan facilities and failed to^{keep up} the repayment schedule, as such the account was classified as^NPA. lnspite of demands made by Applicant the defendant no.1 has not regularized the account, and the Applicant bank issued notices but the defendants did not come forward to repay the same.^{The total} claim of Applicant against defendants is oF Rs.23t69t779/' (Rupees Twenty Three Lakhs Sixty Nine thousand Seven Hundred Nine only) with interest @ 11.90%p.a from 06.0 ealization, Hence the OA. /,F:

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tu,

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(oA.No.9al2o2al

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The Defendant fired written statement and denied the averments made in oA. It is contended that the Appricant bank obtained signatures on blank formats. It is further contended that the Applicant bank charged high rate of interest which is against the guidelines of RBI . It is further contended that the defendant paid substantial payments which was not reflected in the statement of account. Hence prayed for dismissal of oA. Defendant examined themselves as DW.1 and not filed any documents.

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I have perused the documents placed on record.

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Heard the arguments.

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Now, the points that arise for consideration are:

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i) Whether the Applicant Bank has proved its claim as made in OA against the defendant ?

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ii) To what relief ?

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Point No.i):

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Sri R. VeeraVasanthaRao, Senior Manager/ AW.1 who was examined on behalf of the Applicant clearly deposed about the liability of the defen .1 to A.17 exhibited by the Applicant bank of the defenda nts.

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! t I ,rulr¹¹¹⁶ : t,"? rn} ^oa;*Yl

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% 'gNlr.hr"-o4l1V' \ --^t.. "rt),;: rrrr,^'\F-,{/

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(oA.No.9al2024)

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AW.1 was not cross examined by the defendants. Even though defendant examinedhimself as DW.1, his evidence is in noway helpful to him. The defendant having taken the plea that the applicant bank did not follow the RBI guidelines and that the present oA was barred by Iimitation, faired to place any substantiar proof to that effect. Moreover, a perusar of the documents exhibited by the Applicant bank makes clear that all the relevant documents are executed by the defendant in the normal course of transaction. The defendant very vaguely contended that particulars made in the OA are not correct. But as per the statement of accounts, the defendant is liable to pay the OA claim. Considering all the circumstances, I am of opinion that the defense taken by the defendant is not tenable. Hence the applicant bank is entitled to claim the OA amount from defendant. Therefore, the OA claim deserves to be allowed against the defendant.

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Point No.ii)

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B. In the result, the present original application is allowed with costs as under:

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The Defendantis liable to pay to Applicant Bank a total sum of Rs,23,69,779/Twenty Three Lakhs Sixty Nine ,/ thousand SevgA Nine only) with interest .t' l' @ 1 1.9Oolop.afrom date of rea lizatio n ; I ' *W

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(oA.No.94/2024)

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The Applicant bank is entitled to proceed against the hypothecated movables as described in the schedule to oA towards the realization of the debt due.

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The Applicant bank is also entitled to proceed against the person and properties of defendant towards realization of the debt due.

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The Applicant Bank is entiUed to the costs of the OA.

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The Applicant shall file a cost memo within two weeks from the date of receipt of order.

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Issue Recovery certificate accordingly.

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L4. Communicate a copy of the order to the parties concerned.

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(Dictated to the P,A., transcribed by her, corrected, signed and pronounced by me in the open court on this the 17th day of June' 2025)

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sd/_

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(G. GOPTCHAND) PRESIDING OFFICER

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J 1 I ,tun,:n25
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ii"ii1ffi

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DRf.'. '1'I2ERABAO.

Union Bank of India v. M/S. Al Engineering Works

Case brief

What is this about?

What did the court decide?

Union Bank of India v. M/S. Al Engineering Works

Case brief

What is this about?

What did the court decide?

What the court decided

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