Allowed

Canara Bank v. M/s. Gears and Force

DRT19 Jun 2025OA/978/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the application filed by Canara Bank for a Recovery Certificate against its partners and associates. Finding the applicant's evidence un-rebutted, the Tribunal validated the claim for Rs. 72,36,400 and authorized recovery proceedings.

What did the court decide?

Permission to recover Rs. 72,36,400 plus future and pending interest @ 9.75% p.a. from the respondents jointly, severally, and personally. Issuance of Recovery Certificate authorized.

Canara Bank versus M/s. Gears and Force — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-II, BANGALORE

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Dated this 19^th Day of June, 2025

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PRESENT: SHRI T. RAJESH Hon’ble Presiding Officer

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O.A. No. 978 of 2022

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Canara Bank, Having its Head Office at, 112 J C Road, Town Hall Junction, Bengaluru Having its Branch at Banashankari 2^nd Stage Branch, 121, 27^th Cross, Banashanakari II Stage, Bengaluru 560070. Represented by its Chief Manager, K V Sreedevi.

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. . . Applicant

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Versus

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M/s. Gears and Force, Represented by its Partners, Mr. K Y Srinivas Murthy, Mrs. K P Shwetha, Ground and Basement 1577, 11^th Main Road, 4^th T Block, Jayanagar, Bangalore 560041.

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Mr. K Y Srinivas Murthy, S/o Yalakkaiah, Aged about 43 Years, T4, C Block, Himagiri Green Forest Apartment, Silver Oak Street, 1^st Main Vinayak Nagar, J P Nagar, 7^th Phase, Bangalore- 560078.

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OA 978/2022

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Mrs. K P Shwetha, W/o K Y Srinivas Murthy, Aged about 35 years, T4, C Block, Himagiri Green Forest Apartment, Silver Oak Street, 1^st Main Vinayak Nagar, JP Nagar, 7^th Phase, Bangalore- 560078.

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---Defendants

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Ld. Counsels on record / appeared :- Counsel for Applicants :- B. Rajashree Counsel for Defendants :- EXPARTE

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The Application is filed Under Section 19 (1) of the Recovery of Debt And Bankruptcy Act, 1993 seeking for issuance of a Recovery Certificate for Rs. 72,36,400/- (Rupees Seventy Two Lakh Thirty Six Thousand Four Hundred Only) due in the Working capital credit facilities of Rs. 70.00 lakhs availed by the defendants and defaulted subsequently in gross violation of the terms and conditions stipulated in the loan agreement.

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It is stated that the defendant No.1 is a partnership concern represented

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by its partners defendant No.2 & 3. The credit facilities were secured by common hypothecation agreement, guarantor agreements and debtor creditor agreement.

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The Applicant further contents that despite availing the credit facility by

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obliging to pay back the amount, the defendants failed in compliance of

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OA 978/2022

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the same and all the efforts of the Applicant to make the defendants pay

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back the amount failed forcing the Applicant to file this Application.

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Summons was taken out and as the defendants failed to appear they were set exparte on 21.11.2024 and evidence was adduced by the applicant through AW1, who filed proof affidavit, produced documents and got marked Ext.A1 to A14 list of which are annexed to this order.

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The Applicant evidence remain un-rebutted and hence proved. The documents produced by the Applicant are found to be admissible and are sufficient to prove the OA claim. Hence the Applicant is to be found entitled for the OA claim as the only issue as to the proof of OA claim is answered in favour of the applicant. The OA claim is made within limitation and there is no capitalization of penal interest.

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Since the OA Claim is arrived at by calculating interest at agreed rate,

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penal interest/ default interest; which this Tribunal considers as on the

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higher side, pendentalite and future interest is awarded at fixed rate.

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In view of the above

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i. OA 978 OF 2022 stands allowed

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ii. Applicant is permitted to recover an amount of Rs. 72,36,400/(Rupees Seventy Two Lakh Thirty Six Thousand Four Hundred Only)

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with future and pendentalite interest @ 9.75% p.a.(Simple) from

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OA 978/2022

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the date of filing of the OA till realization from the defendants jointly, severally and personally after giving credit to all the amount recovered and received during the pendency of the OA.

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iii. The defendants jointly, severally and personally and other assets of the defendants are also liable to be proceeded against.

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iv. A Recovery Certificate is to be drawn and issued to the recovery

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Officer to enable recovery of the as per the above terms.

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v. Applicant is allowed to realize cost of the proceeding for which cost

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memo is to be filed in 7 days’ time from the date of receipt of the

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copy of the order.

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vi. Interim application pending, if any, stands disposed of in terms of this final order.

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Communicate a copy of the order to the parties concerned in terms of

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Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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(Dictated to AJ, transcribed by her, corrected, signed and pronounced by me in Virtual Court on this day of 19^th Day of June, 2025)

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Sd/- (T. RAJESH) Hon’ble Presiding Officer DRT-II- BANGALORE

OA 978/2022

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Deepak Kumar , Chief Manager, of Applicant Bank.

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Exhibits on the part of the Applicant:

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Exhibit	Particulars of Documents
Nos.
A1	Applicant Evidence
A2	List of documents
A3	Copyof sanction letter dated 29.09.2020
A4	Copyof sanction letter dated 25.11.2021
A5	Common Hypothecation agreement on 5.10.2020
A6	Guarantor agreements dated 5.10.2020 by2^nddefendant
A7	Guarantor agreements dated 5.10.2020 by3^rddefendant
A8	Debt restructuringagreement dated 26.11.2021 bydefendants
A9	Debtor creditor agreement dated 26.11.2021 bydefendants
A10	Annexure 7 letter of undertakingdated 26.11.2021
A11	Legal notice dated 9.52022postal receipt and returned envelope
A12	Certificate by banker under 2A(b) and 2A(c) of the bankers book of evidence Act
A13	Loan account statement for 1147261006615
A14	Loan account statement for 1147768000196

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Witness Examined for the Defendants: -Nil -

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List of Documents Exhibited for the Defendants:

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-Nil -

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Sd/-

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(T. RAJESH) Hon’ble Presiding Officer DRT-II- BANGALORE

Canara Bank v. M/s. Gears and Force

Case brief

What is this about?

What did the court decide?

Canara Bank v. M/s. Gears and Force

Case brief

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What did the court decide?

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