Allowed

Union Bank of India (Andhra Bank) v. M/S Mass Super Market

DRT8 Aug 2025TA/268/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's claim for recovery of dues totaling over one crore rupees from the defendant, who was condemned ex-parte, with an order to recover via sale of hypothecated assets if payment fails.

What did the court decide?

Allowed OA for recovery of Rs. 1,02,91,466.72 plus future interest; liberty to sell hypothecated assets for recovery if unpaid.

Union Bank of India (Andhra Bank) versus M/S Mass… — Contract and Commercial Disputes | DRT (2025)

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T.A. No. 268 of 2023

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08.08.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 08^th day of August, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 268 of 2023

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(Originally filed before DRT- II, Chennai as OA 494/2020 and thereafter transferred to this Tribunal and renumbered as TA No 268 of 2023)

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Union Bank of India (Erstwhile Andhra Bank) Saidapet Branch, 391 & 393 Anna Salai, Saidapet, Chennai – 600 015. ….Applicant

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-Vs-

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V. Prabhu Proprietor M/s. Mass Super Market No. 5/3, Ramamurthy Colony Main Road, TVK Nagar, Perambur (Peravallur), Chennai 600 082. …..Defendant

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Counsels on record / appeared:

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Counsel for Applicant : M/s. R. Gowthamanarayanan

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Defendant was set ex-parte on 22.03.2022

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: - FINAL ORDER - :

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This Original Application is filed on 25.09.2020 by the applicant

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bank under Section 19 (1) of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendant for recovery of a total sum of Rs.1,02,91,466.72p (Rupees One Crore Two Lakhs Ninety

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One Thousand Four Hundred and Sixty Six and Seventy Two

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Paisa Only) as follows:

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T.A. No. 268 of 2023

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(i) A sum of Rs.87,21,173.72/- due in respect of OCC Facility (A/c No.054413100000210) repayable together with further interest @ 11.50%, p.a. with monthly rests from the date of filing the OA till date of realization in full;

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(ii) A sum of Rs.15,70,293/- due in respect of Term Loan Facility (A/c No.054430100020931) repayable together with further interest @ 11.75%, p.a. with monthly rests from the date of filing the OA till date of realization in full;

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for sale of schedule mentioned hypothecated assets and for costs of this application.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.494 of 2020, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.494 of 2020 stood transferred to this Tribunal and renumbered as TA No.268 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 the defendant was running a Super Market. On 26.10.2017, the defendant approached the Applicant Bank for credit facilities for the purpose of working capital

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T.A. No. 268 of 2023

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08.08.2025

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requirements for purchase of stocks and for day to day business.

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It is submitted that considering the said request, applicant bank sanctioned the following credit facilities on 01.11.2017:

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a) Open Cash Credit facility for a limit of Rs. 70,00,000/-. The said credit facility was sanctioned against hypothecation of stocks and book-debts.

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b) Term Loan of Rs. 15 Lakhs. This loan was sanctioned against hypothecation of Furniture, equipments, signage, interior works and electric works.

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It is submitted by the applicant bank that the Defendant availed the said credit facilities. In respect of the said OCC facility, the Defendant executed a Demand Promissory Note on 01.11.2017 promising to pay the sum of Rs. 70,00,000/- along with interest at the rate of 3.05% per annum above Bank’s Base Rate with a minimum of 11.45% per annum calculated at monthly rests.

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On the same date, the defendant has executed a Loan Agreement, wherein the defendant had agreed to the terms of the loan and created security for the same. In respect of the Term Loan, the defendant had agreed to repay the Term Loan of Rs. 15,00,000/- in 60 monthly installments commencing from 31.12.2017. He had also agreed to pay interest on the said amount at the rate of 3.55% above Bank’s Base Rate with a minimum of 11.95% per annum calculated at monthly rests.

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It is submitted that for the due repayment of the amounts

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T.A. No. 268 of 2023

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payable under the said loan, the Defendant, as per letter of sanction and the Loan Agreement had hypothecated in favour of the Applicant Bank the following assets:

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a) Stocks and Book Debts; and

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b) Furniture, equipments, signage, interior works and electric works more fully described in the Schedule to the OA.

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Applicant Bank submits that the defendant availed the credit facilities, however subsequently committed default in repayment of the amounts due under the account. Hence the accounts were classified as Non-Performing Asset (NPA) on 30.04.2019 in accordance with RBI guidelines. The Applicant bank issued notice dated 05.03.2020 demanding payment of the amounts due. The Notice was returned with endorsement ‘Left’. The Defendant avoided to receive the notice. In spite of the notice the defendant did not discharge the liability. Hence the present Original Application (OA) has been filed for recovery of its dues from the defendants.

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After the filing of the OA, summons were sent to sole defendant through Registered Post with Acknowledgment Due, which returned with endorsement ‘left’. Applicant bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 22.03.2022 even after giving sufficient time, there was no appearance or representation from the defendant. Hence, defendant were placed ex-parte on 22.03.2022.

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T.A. No. 268 of 2023

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08.08.2025

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Heard the submissions of Applicant Bank and perused the

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records.

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To prove the case of the Applicant Bank, Mr. Vetriselvan J, Chief Manager representing 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-8 . As the defendant remained ex-parte, 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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13. The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendant a total sum of Rs.1,02,91,466.72p (Rupees One Crore Two Lakhs Ninety One Thousand Four Hundred and Sixty Six and Seventy Two Paisa Only) as follows:

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(i) A sum of Rs.87,21,173.72/- due in respect of OCC Facility (A/c No.054413100000210) repayable together with further interest @ 11.50%, p.a. with monthly rests from the date of filing the OA till date of realization in full;

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T.A. No. 268 of 2023

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08.08.2025

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(ii) A sum of Rs.15,70,293/- due in respect of Term Loan Facility (A/c No.054430100020931) repayable together with further interest @ 11.75%, p.a. with monthly rests from the date of filing the OA till date of realization in full along with costs.

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(b) In the event of failure of the Defendant to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the hypothecated asset.

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(d) 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 defendants and/or amount realized by sale of assets etc., during

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the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by defendant 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

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Recovery Officer in terms of the final order.

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T.A. No. 268 of 2023

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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 (Deepika), transcribed by her, corrected, signed and pronounced by me on this the 08^th day of August, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Sh. Vetriselvan J, 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.	Application for Loan Submitted by the Defendant dated 26.10.2017.	A-1
2.	Letter of sanction issued by the Applicant dated 30.10.2018.	A-2
3.	Promissory Note Executed by the Defendant dated 01.11.2017.	A-3
4.	Composite Agreement executed by the Defendant dated 15.11.2017.	A-4
5.	Legal Notice issued by the Applicant dated 05.03.2020.	A-5
6.	Return cover	A-6
7.	Statement of Account (OCC)	A-7
8.	Statement of Account (TL)	A-8

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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. 268 of 2023

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:- SCHEDULE -:

a. Stocks and Book Debts and

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b. Furniture, Equipment, Signage, Interior Works and Electric Works

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

Union Bank of India (Andhra Bank) v. M/S Mass Super Market

Case brief

What is this about?

What did the court decide?

Union Bank of India (Andhra Bank) v. M/S Mass Super Market

Case brief

What is this about?

What did the court decide?

What the court decided

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