Allowed

State Bank of India v. John Kennedy

DRT4 Jul 2025TA/1136/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application for recovery of dues amounting to Rs. 17,15,602 along with interest. The court found the defendants jointly and severally liable for the housing loan debt. The Tribunal directed the applicant to recover the balance from the sale of assets if immovable property proceeds are insufficient.

What did the court decide?

Recovery of Rs. 17,15,602 plus interest @ 9.75% p.a. from respondents jointly and severally; issuance of Recovery Certificate.

State Bank of India versus John Kennedy — Banking and Recovery | DRT (2025)

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T.A. No. 1136 of 2023

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04.07.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 04^th day of July, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 1136 of 2023

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(Originally filed before DRT- II, Chennai as OA 327/2019 and thereafter transferred to this Tribunal and renumbered as TA No 1136 of 2023)

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State Bank of India Rep. by its Chief Manager, Assets Recovery Management Branch, No.44, Eldams Road, 1^st Floor, Teynampet, Chennai - 600 018. …Applicant

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-Vs-

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Mr. D. John kennedy,

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S/o Dencil Durai,

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No.23/65, Annadurai Street Anakaputhur, Chennai – 600 070.

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Also at Flat No.F1, 1^st Floor, S B Homes Maruthi, Plot No.133, M G Nagar Part-VI, Adhanur, Kancheepuram – 603 202.

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Smt. J. Shalini,

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W/o Sri John Kennedy, No.23/65, Annadurai Street, Anakaputhur,

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Chennai – 600 070.

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Counsels on record / appeared:

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Counsel for Applicant : M/s. S. Prasadh Defendants 1 and 2 were set ex-parte on 03.09.2019

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T.A. No. 1136 of 2023

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04.07.2025

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: - FINAL ORDER - :

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This original application is filed on 14.02.2019 by the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants 1 and 2, jointly and severally for recovery of a total sum of Rs.17,15,602/- (Rupees Seventeen Lakhs Fifteen Thousand Six Hundred and Two only) due in respect of Housing Term Loan (Account No.65247414906 and 65247414009) together with further interest @ 9.75% p.a., with monthly rests from the date of Application till the date of realization in full, for sale of schedule mentioned immovable property and for costs of this OA.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.327 of 2019, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.327 of 2019 stood transferred to this Tribunal and renumbered as TA No.1136/2023.

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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 Tribunal.

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It is the case of the applicant bank that the 1^st defendant

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T.A. No. 1136 of 2023

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04.07.2025

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approached the State Bank of Patiala, Ambal Nagar Branch, Chennai for sanction of Home Loan facility and originally sanctioned credit facilities to the 1^st defendant on 23.12.2015 at its State bank of Patiala, Ambal Nagar Branch, Chennai, vide his loan application for grant of Home Loan facility and vide Arrangement Letter dated 23.12.2015, State Bank of Patiala, Ambal Nagar Branch, Chennai, sanctioned a Home Loan of sum of Rs.13,00,000/- for purchase of Flat No.F1, 1^st Floor, “S B Homes Maruthi” Plot No.133, (Northern Part), M G Nagar Part-VI, Adhanur, Kancheepura District.

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It is submitted by the applicant bank that applicant bank on 23.12.2015 vide arrangement letter communicated the sanction of the aforesaid sum of Rs.13,00,000/- and additional loan of Rs.28,385.00/towards funding the insurance cover to the 1^st defendant for purchase of the property. The 1^st defendant made an endorsement in the copy of Arrangement Letter accepting the terms and conditions for the grant of the aforesaid home loan which provides, inter alia, that the aforesaid loan of Rs.13,28,385/- shall be repayable with interest thereon at 0.5% above the base rate which was then 9.75% p.a.

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The applicant submits that the interest was calculated on the daily balance of the loan amount at monthly rests equated monthly instalments of Rs.12331/- each month. The 1^st defendant executed the following security documents in favour of the applicant for the aforesaid credit

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facilities availed by him:-

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a) Arrangement letter dated 23.12.2015

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b) Memorandum of loan agreement for Housing Loan dated 23.12.2015

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c) Long Term Home insurance policy dated 20.07.2016

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d) Agreement of Mortgage dated 23.12.2015

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It is submitted that to secure repayment of the said loan, the 1^st defendant deposited title deeds of the scheduled property by creating equitable mortgage by deposit of title deeds and executed memorandum of depositing title deeds and registering Doc.No.15308/2015.

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The applicant further submits 1^st defendant agreed to repay the aforesaid loan together with interest at the rate of 0.5% p.a., above the base rate, which was currently 9.75% p.a., with monthly rests. The rate of interest is subject to revision from time to time. The present rate of interest is 9.75% p.a., with monthly rests.

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The Applicant submits that 1^st defendant confirmed the creation of the equitable mortgage of the schedule mentioned property by executing a registered memorandum of deposit of title deeds on 28.12.2015 and registered the same vide Doc.No.15308 of 2015 in the office of the SubRegistrar, Guduvanchery.

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The Applicant further states that in pursuance of the statutory directives of the RBI in vogue, is entitled to charge interest for the

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T.A. No. 1136 of 2023

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04.07.2025

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aforesaid credit facilities at such rate and rests as may be fixed from time to time by its Corporate Centre and the defendant are liable to pay the same as per Sections 21 and 35-A of the Banking Regulation Act. 1^st defendant is the principal debtor and as mortgagor is personally liable to repay the amount of debt owed by him to the applicant bank under the aforesaid credit facility availed from the Applicant Bank. The 2^nd defendant as guarantor is also liable to above said Home loan amount.

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The applicant submits that by SARFAESI notice dated 13.11.2018 addressed to the Defendants, applicant bank advised that the loan account has been migrated to the Asset Recovery Management Branch, Teynampet, Chennai for recovery of its dues. The loan account was made operative at ARMB Branch of the applicant. The 1^st defendant availed the entire loan amount but the operation and conduct of the loan account by the 1^st defendant is unsatisfactory and defaulted to pay the monthly instalment. Therefore, the loan account was classified as Non-performing Asset (NPA) on 22.08.2016 in accordance with RBI guidelines. The Applicant Bank through its Authorised Officer issued Demand Notice dated 13.11.2018 under Section 13(2) of SARFAESI Act. In spite of repeated demands, the defendants failed to repay the liability owed by them to the Applicant Bank under the aforesaid credit facility. Hence the present Original Application (OA) has been filed by applicant bank for recovery of its dues from defendants.

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T.A. No. 1136 of 2023

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04.07.2025

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After the filing of the OA, summons were sent to the Defendants 1 and 2 through Registered Post with Acknowledgment Due, which was returned unserved with postal endorsement as “Left”. Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 03.09.2019 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 and 2 were placed ex-parte on 03.09.2019.

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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, Sh. S.K. Subash, 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-14 . As the Defendants remained exparte, 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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During the pendency of OA, Applicant Bank had reported part satisfaction of OA claim in a sum of Rs.13,50,000/- by way of sale of Schedule immovable property A & B under SARFAESI Act on 06.09.2019. Accordingly, part satisfaction of sum of Rs.13,50,000/- was duly recorded vide order dated 12.09.2022.

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With regard to the amount advanced, the interest applied, the conduct and operations in the account and the default committed, this

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T.A. No. 1136 of 2023

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04.07.2025

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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 the Defendants jointly and severally, a total sum of Rs.17,15,602/- (Rupees

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Seventeen Lakhs Fifteen Thousand Six Hundred and Two only) due in respect of Housing Term Loan (Account No.65247414906 and 65247414009) together with further interest @ 9.75% p.a., with monthly rests from the date of Application till the date of realization in full along with costs of this application.

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(b) The sum of Rs.13,50,000/- realized by way of SARFAESI sale is directed to be given credit to the borrower’s loan account as on the date of realization.

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(c) If the sale proceeds of the mortgaged immovable property 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 for which the Defendants to disclose to the Tribunal particulars of other properties or assets owned by the Defendants.

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(d) The applicant bank shall file the latest memo of calculation of

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T.A. No. 1136 of 2023

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OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant 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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(e) The applicant bank shall file memo of costs within ten days

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from the date of receipt of this final order.

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(f) Recovery Certificate shall be drawn up and issued to the Recovery 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/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to Steno (Mogesh), transcribed by him, corrected, signed and pronounced by me on this the 04^th day of July, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Sh. S.K. Subash, Chief Manager representing the Applicant Bank

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Exhibits on the part of the Applicant:

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Sl.	Description of Documents		Exhibit
No.			No.
1.	Application form for Housing Loan	dated	A-1
	23.12.2015

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2.	Request for Loan for payment of Life Insurance dated 23.12.2015	A-2
3.	Specimen of Agreement for Additional Housing Loan dated 23.12.2015	A-3
4.	Agreement to Mortgage dated 23.12.2015	A-4
5.	Consent for Disclosure of Information dated 23.12.2015	A-5
6.	Arrangement Letter dated 23.12.2015	A-6
7.	Specimen of Memorandum of Agreement for Home Loan Granted to Public dated 23.12.2015	A-7
8.	Guarantee Agreement dated 23.12.2015	A-8
9.	Agreement for Sale dated 23.09.2015	A-9
10.	Agreement for Construction dated 23.09.2015	A-10
11.	Sale Deed dated 28.12.2015	A-11
12.	Memorandum of Deposit of Title Deeds dated 28.12.2015	A-12
13.	Statement of Account No.65247414009	A-13
14.	Statement of Account No.65247414906	A-14

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Witness Examined for the Defendants: -Nil-

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List of Documents Exhibited for the Defendants: -Nil –

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

State Bank of India v. John Kennedy

Case brief

What is this about?

What did the court decide?

State Bank of India v. John Kennedy

Case brief

What is this about?

What did the court decide?

What the court decided

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