Allowed

Union Bank of India (Andhra Bank) v. M/S Mount

DRT26 May 2025TA/555/2023

Case brief

AI extract

What is this about?

Union Bank of India recovered Rs. 74,96,369.68 plus interest from V. Sathish via an ex-parte application under the Debt Recovery Act. The Tribunal allowed the claim due to the defendant's failure to appear and lack of contra evidence.

What did the court decide?

Allowed recovery of principal sum of Rs. 74,96,369.68 along with interest at 11.75% p.a. with monthly rests and costs. Granted liberty to the applicant to sell defendant's assets for recovery of balan

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

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T.A. No. 555 of 2023

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26.05.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 26^th day of May, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 555 of 2023

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(Originally filed before DRT- II, Chennai as OA 493/2020 and thereafter transferred to this Tribunal and renumbered as TA No 555 of 2023)

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

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-Vs-

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V. Sathish Proprietor, M/s. Mount Bazaar, No.9/5, Taluk Office Road, Little Mount, Saidapet, Chennai 600 015 …Defendant

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Counsels on record / appeared:

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Counsel for Applicant : Mr. 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 bank

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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)

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against the defendant for recovery of a total sum of Rs.74,96,369.68p

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(Rupees Seventy Four Lakhs Ninety Six Thousand Three Hundred

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T.A. No. 555 of 2023

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26.05.2025

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Sixty Nine and Sixty Eight Paise Only) due in respect of Open Cash Credit Facility (Account No.054413100000201) together with an interest @ 11.75%p.a. with monthly rests from the date of filing the OA, till the 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.493 of 2020, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.493 of 2020 stood transferred to this Tribunal and renumbered as TA No.555 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 Hon’ble Tribunal.

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It is the case of the Applicant Bank that the Defendant availed credit facilities from Andhra bank, Saidapet Branch. The said Andhra Bank was merged with Applicant Union Bank of India as per gazette notification dated 04 March 2020 with effect from 01 April 2020. Hence this Application is being filed by the Applicant Bank.

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It is submitted by the Applicant that the defendant was running a Super Market Store. On 30.07.2017, the defendant approached the Applicant Bank for credit facilities for the purpose of working capital

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T.A. No. 555 of 2023

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26.05.2025

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

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The Applicant Bank considered the request of the defendant and on 05.08.2017, sanctioned Open Cash Credit facility for a limit of Rs.60,00,000/-, which was availed by the defendant. The said credit facility was sanctioned against hypothecation of stocks, book-debts and fixed assets of the business.

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It is submitted by applicant bank that in respect of the said OCC facility, the Defendant executed a Demand Promissory Note on 05.08.2017 promising to pay the sum of Rs.60,00,000/- along with interest at the rate of 3.05% per annum above Bank’s Base Rate with a minimum of 11.70% per annum calculated at monthly rests.

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Applicant bank submitted that on the same date, the defendant had executed a Loan Agreement, wherein the defendant had agreed to the terms of the loan and created security for the same. For the due repayment of the amounts payable under the said loan, the Defendant, under the said Loan Agreement had hypothecated in favour of the Applicant Bank, all stocks, Book Debts and fixed assets of the business.

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It is submitted by applicant bank that subsequent to availing of credit facility, the defendant committed default in repayment of the amounts due under the account and hence the accounts become Non-Performing Account on 31.03.2019, which was classified in accordance with RBI guidelines. The Applicant issued a notice dated 05.03.2020 demanding

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T.A. No. 555 of 2023

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26.05.2025

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payment of the amount due, which was returned with endorsement ‘Left’. The Defendant avoided receiving the notice. In spite of the notice the defendant did not discharge the liability.

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After the filing of the OA, summons were sent to the defendant through Registered Post with acknowledgement due, which were returned unserved with postal endorsement as ‘Left’. Applicant bank had caused paper publication 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 was placed ex-parte on 22.03.2022.

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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. J. Vetriselvan, Chief Manager, Asset Recovery Branch 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-7 . 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

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T.A. No. 555 of 2023

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26.05.2025

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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 Defendant a sum of Rs.74,96,369.68p (Rupees Seventy Four Lakhs Ninety Six Thousand Three Hundred Sixty Nine and Sixty Eight Paise Only) due in respect of Open Cash Credit Facility (Account No.054413100000201) together with interest @ 11.75%p.a. with monthly rests from the date of filing the OA till the date of realization in full along with costs.

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(b) The applicant bank is at liberty to sell the personal assets of the Defendant (both movable and immovable) to recover the balance dues as required under law for which the Defendant to disclose to the Tribunal particulars of other properties or assets owned by the Defendant.

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(c) 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 Defendant to the applicant bank.

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(d) The applicant bank shall file memo of costs within ten days from

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the date of this final order.

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(e) 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) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to Steno (Surya), transcribed by him, corrected, signed and pronounced by me on this the 26^th day of May, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Sh. J. Vetriselvan, Chief Manager, Asset Recovery Branch 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 30.07.2017.	A-1
2.	Letter of Sanction issued by the Applicant dated 05.08.2017.	A-2
3.	Promissory Note executed by the Defendant dated 05.08.2017.	A-3
4.	Composite Agreement executed by the Defendant dated 05.08.2017.	A-4
5.	Legal Notice issued by the Applicant dated 05.03.2020.	A-5
6.	Returned Cover.	A-6
7.	Statement of Account.	A-7

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T.A. No. 555 of 2023

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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/PRESIDING OFFICER, DRT-III, CHENNAI

Union Bank of India (Andhra Bank) v. M/S Mount

Case brief

What is this about?

What did the court decide?

Union Bank of India (Andhra Bank) v. M/S Mount

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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Case details

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