Allowed

Bank of India v. M/S Madan Textiles

DRT7 Nov 2025TA/395/2023

Case brief

AI extract

What is this about?

The DRT-III, Chennai allowed the applicant Bank of India's application for recovery of a cash credit dues of Rs. 28,61,832/- and costs against the defendants M/s. Madan Textiles and its proprietor, who were declared ex-parte for defaulting on repayment. The order directs drawing up a recovery certificate.

What did the court decide?

Allowance of application for recovery of Rs. 28,61,832/- plus further interest and costs; direction to issue recovery certificate.

Bank of India versus M/S Madan Textiles — Banking and Recovery | DRT (2025)

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T.A. No. 395 of 2023

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07.11.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 07^th day of November, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 395 of 2023

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(Originally filed before DRT- II, Chennai as OA 303/2021 and thereafter transferred to this Tribunal and renumbered as TA No 395 of 2023)

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Bank of India,

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Chennai Main Branch, Represented by its Constituted Attorney, “Star House”

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No.30, (Old No.17), Errabalu Street, Chennai 600 001.

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….Applicant

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-Vs-

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M/s. Madan Textiles, Represented by its Proprietrix,

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Mrs. Jyoti Nawandhar,

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No.60, Ramaswamy Street,

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Mannady, Chennai 600 001.

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Mrs. Jyoti Nawandhar,

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Proprietrix M/s. Madan Textiles,

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W/o. Mr. Dinesh Kumar Nawandhar,

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Flat No.3502, Girnar Apartments, “C” Block,

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Sydenhama Road,

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Periamet, Park town,

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Chennai 600 001. …..Defendants

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Counsels on record / appeared:

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Counsel for Applicant : Sh. M. P. Venkateswaran Defendants 1 and 2 were set ex-parte on 29.08.2022

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: - FINAL ORDER - :

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This Original Application is filed on 06.07.2021 by the applicant

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bank under Section 19 (1) of Recovery of Debts and Bankruptcy Act,

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1993 (formerly Recovery of Debts Due to Banks and Financial Institutions

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T.A. No. 395 of 2023

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07.11.2025

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Act, 1993) against the defendants jointly and severally for recovery of a total sum of Rs.28,61,832/- (Rupees Twenty Eight Lakhs Sixty One Thousand Eight Hundred and Thirty Two Only) due in respect of Cash Credit Facility (A/c No.800030110000074), repayable together with further interest @ 8.30%, p.a. compounded with monthly rests from the date of filing the OA, till date of realization in full and for costs of this application.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.303 of 2021, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.303 of 2021 stood transferred to this Tribunal and renumbered as TA No.395 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 1^st defendant is M/s Madan Textiles, a proprietorship concern, carrying on business at No.60, Ramaswamy Street, Mannady, Chennai 600 001. The 1^st defendant concern is represented by its Proprietrix Mrs. Jyoti Nawandhar, the 2^nd defendant herein.

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It is submitted by the applicant bank that the defendants had

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T.A. No. 395 of 2023

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07.11.2025

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approached the applicant during the month of July, 2018 and submitted loan application form for MSME for sanction of credit facilities for their textiles business.

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The Applicant Bank submits that after due consideration of the request of the defendants and the representations made by them, the Applicant sanctioned Cash Credit limit of Rs.25,00,000/- and Term Loan limit of Rs.5,00,000/- to the defendants vide their sanction letter dated 07.07.2018. The defendants counter signed the Sanction Letter agreeing to the terms and conditions of sanction.

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It is submitted by the Applicant Bank that to secure the due repayment of the afore said Cash Credit limit of Rs.25,00,000/-, the defendants executed the following security documents in favour of the applicant on 07.07.2018:

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a) Demand promissory dated 07.07.2018 promising to pay to the applicant the sum of Rs.25,00,000/- (Rupees Twenty Five Lakhs) together with interest at the rate of 2% CRP plus 0.30% BSS plus one year MCLR 8.50% then 10.80% per annum compounded with monthly rests for value received.

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b) Bearer letter dated 07.07.2018.

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c) Composite loan document dated 07.07.2018.

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d) Hypothecation cum loan agreement (Priority sector advances excluding vehicle loans) dated 07.07.2018.

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e) MCLR Agreement dated 07.07.2018.

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T.A. No. 395 of 2023

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07.11.2025

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It is submitted by the applicant bank that the defendants did not avail the Term Loan sanctioned by the applicant. However, the defendants fully utilized the Cash Credit facility sanctioned by the applicant. The Cash Credit account of the defendants was always over drawn. The conduct of the cash credit account was not satisfactory. Hence the applicant sent a letter dated 08.05.2020 to the defendants calling upon them to deposit the overdue amount and regularize the Cash Credit account. The defendant, although received the letter but did not regularize the Cash Credit account. The applicant sent another letter dated 16.05.2020 to the defendants calling upon them to deposit the overdue amount and regularize the cash credit account. However, the defendants did not regularize the account.

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It is further submitted that the Applicant had again sent another letter dated 28.12.2020 to the defendants calling upon them to deposit the overdue amount and regularize the Cash Credit account. However, the defendants failed and neglected to regularize the cash credit account. Since the defendants committed default in repayment of the Cash Credit facilities, the applicant classified the Cash Credit account of the defendants as Non-Performing Asset (NPA) with effect from 31.03.2021 in accordance with RBI guidelines. As defendants did not come forward to repay the dues, the present Original Application (OA) has been filed by the applicant bank for recovery of its dues.

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After the filing of the OA, summons were sent to the Defendants 1

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T.A. No. 395 of 2023

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07.11.2025

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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 29.08.2022 even after giving sufficient time, there was

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no appearance or representation from the defendants. Hence, defendants 1 and 2 were placed ex-parte on 29.08.2022.

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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. I. Thaveethuvel, Constituted Attorney representing the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW1 and list of documents came to be marked as Ex A-1 to A-11 . As the defendants 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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The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendants

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a total sum of Rs.28,61,832/- (Rupees Twenty Eight Lakhs

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T.A. No. 395 of 2023

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07.11.2025

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Sixty One Thousand Eight Hundred and Thirty Two Only) due

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in respect of Cash Credit Facility (A/c

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No.800030110000074), repayable together with further interest @ 8.30%, p.a. compounded with monthly rests from the date of filing the OA, till date of realization in full, along with costs.

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(b) 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 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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(d) 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 (Suriya), transcribed by him, corrected, signed and pronounced by me on this the 07^th day of November, 2025)

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T.A. No. 395 of 2023

07.11.2025

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Sh. I. Thaveethuvel, Constituted Attorney 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.	Loan application from.	A-1
2.	Sanction Letter dated 07.07.2018.	A-2
3.	Demand Promissory note dated 07.07.2018.	A-3
4.	Bearer letter dated 07.07.2018.	A-4
5.	Composite loan document dated 07.07.2018.	A-5
6.	Hypothecation cum loan agreement dated 07.07.2018.	A-6
7.	MCLR Agreement dated 07.07.2018.	A-7
8.	Letter sent by the applicant dated 08.05.2020.	A-8
9.	Letter sent by the applicant dated 16.05.2020.	A-9
10.	Letter sent by the applicant dated 28.12.2020.	A-10
11.	Statement of account	A-11

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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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-: SCHEDULE :-

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NIL

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

Bank of India v. M/S Madan Textiles

Case brief

What is this about?

What did the court decide?

Bank of India v. M/S Madan Textiles

Case brief

What is this about?

What did the court decide?

What the court decided

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Parties & counsel

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