Allowed

Canara Bank v. M/S Maarvel Homes

DRT7 Jul 2025TA/1395/2023

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an original application filed by Canara Bank for recovery of dues including interest against three defendants. The court upheld the bank's claim based on filed documents and affidavits, allowing recovery via sale of mortgaged immovable property. Original Application allowed with costs.

What did the court decide?

Recovery of Rs.53,64,157/- with interest @14.75% p.a., costs, and power to sell mortgaged immovable property for realization.

Canara Bank versus M/S Maarvel Homes — Banking and Recovery | DRT (2025)

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T.A. No. 1395 of 2023

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07.07.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 07^th day of July, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 1395 of 2023

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(Originally filed before DRT- II, Chennai as OA 282/2020 and thereafter transferred to this Tribunal and renumbered as TA No 1395 of 2023)

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Canara Bank Velachery Branch, 2A, Dhandeeswaram Main Road, Velachery, Chennai – 600 042 Rep. by its Branch Manager ….Applicant

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-Vs-

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Mrs. Geetha Velayutham, W/o K. Velayutham, Proprietor of M/s Maarvel Homes 36, Santhoshnagarm, 2^nd cross Street, Porur, Chennai – 600 116

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S. Balu S/o Selliah

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36, Santhoshnagarm, 2^nd cross Street, Porur, Chennai – 600 116

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B. Sankaranarayanan, S/o S.Balu

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36, Santhoshnagarm, 2^nd cross Street,

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Porur, Chennai – 600 116 …Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. V. Jayanandakumar

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Defendants 1 to 3 were set ex-parte on 12.05.2022

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: - FINAL ORDER - :

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This original application is filed on 08.06.2020 by the applicant bank

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T.A. No. 1395 of 2023

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07.07.2025

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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 to 3, jointly and severally for recovery of a total sum of Rs.53,64,157/- (Rupees Fifty Three Lakhs Sixty Four Thousand One Hundred and Fifty Seven only) due in respect of Working Capital Loan (Account No.60331530000417) repayable together with further interest @ 14.75% 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.282 of 2020, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.282 of 2020 stood transferred to this Tribunal and renumbered as TA No.1395 of 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 defendant availed loan from applicant bank to improve the business from the syndicate bank,

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T.A. No. 1395 of 2023

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Velachery branch. The first defendant hypothecated the stock with the syndicate bank and executed a deed of composite hypothecation agreement on 19.11.2008. The second and third defendants executed a Deed of guarantee on 19.11.2008. The 2^nd defendant also mortgaged the property as security for the amounts availed.

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It is submitted by the Applicant that they agreed to repay the loan with interest at the rate of 14.75% p.a. The applicant submits that for the loans availed by the 1^st defendant, the 2^nd defendant mortgaged the schedule herein properties by deposit of title deed of the properties as security for due repayment of the loan and had executed a registered memorandum evidencing the deposit of the title deeds.

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It is further submitted by applicant bank that Government of India by notification GSR No.155(E) Department of Financial Services, Ministry of Finance Dated 04.03.2020 amalgamated the Syndicate Bank with the Applicant Bank with effect from 01.04.2020. Accordingly the Applicant Bank has taken over the erstwhile syndicate bank with entire assets and liabilities.

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It is submitted that the first defendant by his application dated 12.10.2008 approached the Applicant Bank for financial assistance for the working capital requirements for sum of Rs.7.00 lakhs. The Applicant Bank sanctioned a loan of Rs.7.00 lakh to the first defendant on 19.11.2008.

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T.A. No. 1395 of 2023

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The 2^nd defendant and 3^rd defendant agreed to repay the loan along with 1^st defendant. The defendants executed the following documents on 19.11.2008 in favour of applicant bank:

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a) Composite Hypothecation Agreement for Rs.7.00 lakh agreeing to repay the loan together with interest thereon at 14.25% p.a., with monthly rest or such other rate or rates as may be revised by RBI from time to time

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b) Guarantee Deed

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c) Equitable mortgage

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The applicant submits that statement of account showing amount due and payable by the defendants duly certified under the Bankers Book Evidence Act 1891 is filed along with this application, as per the documents executed by the defendant is liable to pay the claim in this application and as per the direction of the bank, the present rate of interest on the outstanding is 14.75% p.a., with monthly rests.

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The Applicant further submits that the loan is a business loan and the default omitted by the defendant was wilful. The interest charged was fair, reasonable and less than market rate as per RBI guidelines under Section 21 of B.R.Act 1949, the applicant as a bank is entitled for protection and interest is not liable to be re-opened. The defendants are not covered by any debt relief laws.

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T.A. No. 1395 of 2023

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07.07.2025

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It is submitted by the applicant bank that subsequent to availing of loan, the operation of the accounts by the defendant subsequently was not satisfactory since the defendants committed default in repayment of the loans and did not keep up their promise. The applicant bank sent Notice of Demands on 18.02.2020, which were of no avail. Consequently, the loan account was classified as Non-Performing Asset (NPA) on 24.05.2010 in accordance with RBI guidelines. Inspite of repeated reminders, defendants did not come forward to repay the dues. Hence the present Original Application (OA) has been filed for recovery of amounts due from defendants.

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After the filing of the OA, summons were sent to the Defendants 1 to 3 through Registered Post with Acknowledgment Due, which were returned unserved with postal endorsement as ‘Insufficient Address’ in respect of D-1, D-2, and D-3. Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 12.05.2022 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 to 3 were placed ex-parte on 12.05.2022.

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Heard the submissions of Applicant Bank and perused the record s.

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To prove the case of the Applicant Bank, Sh. John Eben, Chief

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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-10 . 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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With regard to the amount advanced, 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 the Defendants jointly and severally, a total sum of Rs.53,64,157/- (Rupees Fifty Three Lakhs Sixty Four Thousand One Hundred and

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Fifty Seven only) due in respect of Working Capital Loan (Account No.60331530000417) repayable together with further interest @ 14.75% 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) 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 schedule mentioned immovable property more fully detailed

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T.A. No. 1395 of 2023

07.07.2025

in the OA schedule.

(d) If the sale proceeds of the Secured assets are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the 1^st and 2^nd Defendants (both movable and immovable) to recover the balance dues as required under law for which the 1^st and 2^nd Defendants to disclose to the Tribunal particulars of other properties or assets owned by the 1^st and 2^nd Defendants.

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

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(g) 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/-

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(S.V. GOWRAMMA)

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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 07^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. John Eben, Chief Manager representing 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.	Loan Application 12.10.2008	A-1
2.	Composite Hypothecation Agreement 19.11.2008	A-2
3.	Guarantee Deed of second and third defendant 19.11.2008	A-3
4.	Memo of deposit of title deeds D.No.2806/08 30.09.2008	A-4
5.	Encumbrance certificate from 01.01.2007 to 13.02.2020 dated 18.02.2020	A-5
6.	Notice to first defendant 18.02.2020	A-6
7.	Returned postal cover 25.02.2020	A-7
8.	Notice to second defendant 18.02.2020	A-8
9.	Returned postal covers 21.02.2020	A-9
10.	Statement of account 30.04.2020	A-10

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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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T.A. No. 1395 of 2023

07.07.2025

SCHEDULE

Item I

All that piece and parcel of land bearing plot No.1, measuring to an extent of 3260 sq.ft at Door No.1, 1^st street, Officer’s Colony, Adambakkam, Chennai – 88, Comprised in Pymash No.1032/ part of Survey No:150/11, as per patta S.No.5, Ward ‘G’, Block 4, Adambakkam Village No.138, bounded on the

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North by : Railway Track, South by : 20 Feet Road, East by : Plot No.2 and West by : Open Land and Railway Track

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Situated within the Registration District of South Chennai and in the Registration Sub District of Alandur.

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Item 2

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Undivided share of land measuring 300 sq.ft out of 3260 sq.ft of Schedule ‘A’ property

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Item 3

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Flat No.C measuring 600 sq.ft with common area and passages in the ground floor.

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

Canara Bank v. M/S Maarvel Homes

Case brief

What is this about?

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Canara Bank v. M/S Maarvel Homes

Case brief

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