Allowed

Canara Bank v. Huchappa

DRT29 Aug 2025OA/988/2023

Case brief

AI extract

What is this about?

DRT allowed the Debt Recovery Tribunal applicant bank's Original Application for issuance of a Recovery Certificate. The Tribunal accepted uncontroverted evidence of loan defaults, found the claim within limitation, and sanctioned a reduced interest rate of 6% p.a. while permitting recovery from joint liability and mortgaged properties.

What did the court decide?

Issuance of Recovery Certificate for Rs.40,67,732/- with 6% simple interest p.a. from the date of filing, recoverable jointly/severally/Personally and against schedule properties.

Canara Bank versus Huchappa — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 29^th Day of August, 2025

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Present: Sri. T. RAJESH Presiding Officer

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OA. No.988/2023

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BETWEEN:

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Canara Bank Shimoga Neharu Road Branch, Nelli Soudha, Kuvempu Mark, Shimoga – 577201, Rep. by its Chief Manager, Sri. K Pundaleeka … APPLICANT

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AND:

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Sri. Huchappa S/o. Ningappa

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Sri. Manjunath S/o. Huchappa

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Sri. Thejakumar S/o. Huchappa

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All are residing at Katikere Village, Shimoga Taluk, Shimoga District-577202 ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : M/s. Swamy & Swamy Advocates Defendants : Exparte

OA. No. 988/2023

FINAL ORDER

The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 for seeking issuance of Recovery Certificate against the defendants for Rs.40,67,732/- (Rupees Forty Lakhs Sixty Seven Thousand Seven Hundred and Thirty Two only) with further interest thereon from the date of filing the Application till realization from the Defendants.

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It is the case of the applicant that, the defendants availed the following credit facilities:

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i. KCCS limit of Rs.85,000/- on 15.10.2010, enchanced to Rs.1,69,000/- on 28.11.2013.

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ii. Farm Development loan of Rs.4,00,000/- on 19.12.2011

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iii. Canara Kisan OD loan of Rs.2,25,000/- on 04.01.2014

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iv. OD limit of Rs.6,00,000/- on 29.07.2017

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v. Term loan of Rs.15,00,000/- on 06.08.2018

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vi. KCCS limit of Rs.2,40,000/- on 07.09.2018

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It is also the case of the applicant that, in view of the above financed credit facilities, the defendants executed necessary loan documents apart from the creation of security interest by way of mortgage over the Schedule properties.

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OA. No. 988/2023

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It is further contended that, despite availing the credit

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facilities, agreeing to service the loan amount promptly and regularly, the defendants failed in complying the same, resulting in default in repayment and consequentially turning the loan accounts as NPA.

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In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the accounts.

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Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set exparte on 27.06.2024.

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The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A3 to A59 and got the same marked in evidence.

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Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

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The following issues arise for consideration in this matter:

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i) Whether the applicant had succeeded in proving the OA

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OA. No. 988/2023

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claim as against the defendants?

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ii) What order are to be passed?

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Both these issues are gone into and decided together.

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The case put forth by the applicant in the Application remains unrebutted as defendants remained exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facilities as stated in the OA, creation of security interest as claimed by the applicant bank and the defaults committed in the account. The liability of the defendants and the claim of the amount due is also proved by the above documents. The claim of the applicant is well within the limitation.

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Taking into consideration the facts that the credit facilities was availed for agriculture purpose and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of 6.00% (simple).

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OA. No. 988/2023

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Hence in view of the above finding which cover both the

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issues raised in this manner, this Tribunal is of the view that OA is liable to be allowed.

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In the result, OA.No.988/2023 stands allowed,

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i) The applicant is allowed to recovery an aggregate sum of Rs.40,67,732/- (Rupees Forty Lakh Sixty Seven Thousand Seven Hundred and Thirty Two only) with further interest of 6.00% p.a.(simple) from the date of filing OA till the realization

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from the defendants, after giving credit to all the amounts recovered and received during the pendency of the OA allowed the same to be recovered by proceeding against defendants jointly, severally, personally and also by proceeding against the schedule properties. The schedule properties to the OA be the schedule properties to the Recovery Certificate.

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ii) If the sale proceeds are not found sufficient to cover

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the amount due and payable to the applicant bank, the defendants jointly, severally, personally and their other assets are liable for all such amounts due under the loan accounts.

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OA. No. 988/2023

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iii) The applicant bank is allowed cost of the proceeding

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which applicant to file cost memo within 7 days from the date of receipt of the order.

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iv) The Recovery Certificate to be drawn in terms of this

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order and transferred to Recovery for execution.

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v) Interim Application pending, if any, stands disposed of

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with this Final Order.

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

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in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of

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DRT (Procedure) Rules, 1993.

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[Dictated to the Stenographer (PR), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 29^th Day of August 2025].

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: R Prabhakaran, Chief Manager of the applicant bank.

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OA. No. 988/2023

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Exhibits on the part of the Applicant:

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Annexure	Date	Particulars
A1	--	Applicant Evidence
A2	--	List of documents
A3	14.10.2010	Application cum appraisal form
A4	15.10.2010	Sanction memorandum
A5	15.10.2010	Agreement and deed of hypothecation
A6	12.06.2013	Letter of revival
A7	27.11.2013	Application cum sanction
A8	28.11.2013	Registered simple mortgage deed
A9	03.12.2013	Supplemental agreement
A10	03.12.2013	Letter of renewal
A11	07.05.2016	Letter of revival
A12	24.04.2017	Application cum sanction for renewal
A13	24.04.2017	Supplemental agreement
A14	24.04.2017	Letter of renewal
A15	11.12.2018	Letter of revival
A16	10.12.2021	Letter of revival
A17	12.12.2011	Application cum appraisal form
A18	16.12.2011	Simple mortgage deed
A19	19.12.2011	Memorandum of agreement for agricultural
A20	01.12.2014	Letter of revival
A21	28.12.2016	Letter of revival
A22	18.12.2019	Letter of revival
A23	08.12.2022	letter of revival
A24	04.01.2014	Application cum appraisal form
A25	28.11.2013	Simple mortgage deed
A26	04.01.2014	Sanction memorandum
A27	04.01.2014	Agreement and deed for kissan OD
A28	28.12.2016	Letter of revival
A29	18.12.2019	Letter of Revival
A30	09.12.2022	Letter of Revival
A31	29.07.2017	Application cum appraisal form
A32	29.07.2017	Sanction memorandum
A33	26.07.2017	Simple mortgage deed

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OA. No. 988/2023

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A34	29.07.2017	Memorandum of agreement agricultural loan	for
A35	29.07.2017	Request for overdraft facilities
A36	29.07.2017	pronote
A37	29.07.2017	Particulars of hypothecation
A38	20.12.2019	Letter of revival
A39	01.09.2020	Sanction for restructure
A40	04.12.2022	Letter of revival
A41	06.08.2018	Application cum appraisal form
A42	06.08.2018	Sanction memorandum
A43	04.08.2018	Memorandum of agreement agricultural loan	for
A44	12.04.2021	Simple mortgage deed
A45	07.09.2018	Letter of revival
A46	06.09.2018	Application cum appraisal
A47	06.09.2018	Simple mortgage deed
A48	07.09.2018	Sanction memorandum
A49	07.08.2018	Agreement and deed
A50	04.08.2021	Letter of revival
A51	23.08.2021	Letter of revival
A52	28.02.2023	Legal notice
A53	--	Postal receipts/acknowledgments
A54 to A59	--	Statement of account

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

Canara Bank v. Huchappa

Case brief

What is this about?

What did the court decide?

Canara Bank v. Huchappa

Case brief

What is this about?

What did the court decide?

What the court decided

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