Allowed

Canara Bank v. Sri Venkateshwara Industries

DRT18 Sept 2025TA/583/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal, Chennai allowed an application by Canara Bank for an Order for Recovery (Recovery Certificate) against M/s Sri Venkateshwara Industries and Mr. Vimal Kumar. The court affirmed the loan liability based on proved documents and denied penal interest, awarding simple interest instead.

What did the court decide?

Recovery Certificate issued directing realization of Rs.41,47,679/- with 9% per annum simple interest from defendants jointly and severally.

Canara Bank versus Sri Venkateshwara Industries — Execution and Attachment | DRT (2025)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 18^th day of September, 2025

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PRESENT: SHRI SHARANG DHAR UPADHYAY PRESIDING OFFICER

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TA No.583 of 2022

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(Originally filed before DRT-I, Chennai as OA No.72 of 2022 and thereafter transferred

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to this Tribunal and renumbered as TA No.583 of 2022)

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Canara Bank, Ambur Branch Represented by its Senior Branch Manager Old No.19, New No.20 Chairman Rajagopal Street Ambur – 635 802 …Applicant

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Versus

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M/s Sri Venkateshwara Industries

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Represented by its Proprietor Mr. Vimal Kumar 10, Chinna Kamavar Street Kaspa-A, Ambur – 635 802

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Also at M/s Sri Venkateshwara Industries Represented by its Proprietor Mr. Vimal Kumar 41/1B, Gangapuram Road Ambur – 635 802

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Mr. Vimal Kumar S/o Mr. Krishnamoorthy 41/1B, Gangapuram Road Ambur – 635 802 …Defendants

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Counsels on Record / Appeared

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Counsel for Applicant Bank : M/s K.V. Subramanian Associatez Defendants ex-parte on 04.08.2022

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FINAL ORDER

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This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendants seeking issuance of a Recovery Certificate for recovery of a sum of Rs.41,47,679/- with further interest at the rate of 11.15% per annum with half yearly rests plus 2% penal interest from the date of the application till the date of realisation along with costs of the application.

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The subject matter of the case is the Term Loan availed by the defendants from the Applicant Bank.

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It is the case of the applicant that the 1^st defendant, a proprietorship concern, represented by the 2^nd defendant approached the applicant bank for grant of Term Loan by application dated 16.07.2013 and the applicant considering the said request vide its sanction dated 17.08.2013 sanctioned a sum of Rs.70,00,000/-. The defendants executed various loan and security documents on 14.08.2013 and 17.08.2013. The defendants also acknowledged the debt on 12.08.2016 and 06.05.2019.

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It is also the case of the applicant that the defendants defaulted in repayment and hence the loan account was classified as NPA on 04.05.2021.

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As the defendants did not come forward to clear the dues, the applicant sent a recall notice to the defendants on 10.01.2020 followed by a legal notice on 20.09.2021. Despite the said notices the defendants did not come forward to clear the outstanding dues, hence the present OA is filed for recovery of its dues.

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Summons was taken out to the defendant and the same was returned with postal endorsement “Refused” and hence it is deemed service. As there was no representation on behalf of the defendants continuously and on 04.08.2022the defendants were called absent and placed ex-parte on that day. Applicant Bank filed Proof Affidavit along with 11 documents, which were marked as Ex. A-1 to A-11 on 08.01.2024, however, Ex. A-10 was marked subject to proof. The Ld. Counsel for Applicant Bank made his submissions on 26.08.2025 and thereafter the matter stood till this date for passing final orders.

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The following issues arise for consideration in the matter: -

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(a) Whether the applicant had succeeded in proving the liability of the defendants?

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(b) What order as to cost of the proceedings need be passed?

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These issues are considered together.

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Heard the Ld. Counsel for the applicant, perused the OA averments and the record placed before the Tribunal.

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The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-11 along with the proof affidavit. The documents produced in evidence are all found admissible. The proof affidavit of the applicant bank remained unchallenged and rebutted. Therefore, on careful consideration of proof affidavit along with exhibits filed on behalf of the applicant bank, besides the material placed before the Tribunal, the Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendants. Further, the statement of accounts in respect of the loan account produced and certified under the Banker’s Book Evidence Act, clearly indicates that the amount claimed by the applicant is due from the defendant. It is clear from the statement of accounts that penal interest is not capitalized.

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In view of the foregoing, it is clearly evident that the application filed by the applicant bank is well within the period of limitation and this Tribunal possesses the territorial and pecuniary jurisdiction to entertain this OA.

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In view of the fact that the loan facility availed by the defendant is a term loan and the applicant has claimed interest at contractual rate till the date of filing of the OA, this Tribunal is of the view that the pendente lite interest

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can be awarded at reduced rates and prayer for award of penal interest is rejected.

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In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, OA is disposed off in the following manner: -

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(a) TA No.583 of 2022 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.41,47,679/- with further interest @9% per annum (simple) from the date of filing of the application till the date of realization in full, from the defendants jointly and severally after deducting all the amounts received / realized by them during the pendency of OA and also by selling the schedule property and other assets of the defendants.

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(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 15 days from the date of receipt of the copy of the order.

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(e) The Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of this final order.

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Communicate a copy of the order to the parties concerned in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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(SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 18^th day of September, 2025)

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EXHIBITS MARKED BY APPLICANT BANK

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S. No.	Date	Description of Documents	Exhibit Nos.
1.	16.07.2013	Application for Term Loan by defendants	A-1
2.	17.08.2013	Sanction Letter of the applicant bank	A-2
3.	14.08.2013	Common Hypothecation Agreement executed by the 1^stdefendant represented by 2^nddefendant	A-3
4.	17.08.2013	Deed of hypothecation Re: Machinery executed by the 1^stdefendant represented by the 2^nd defendant	A-4
5.	17.08.2013	Pro-note executed by the 1^st defendant represented by the 2^nddefendant	A-5
6.	17.08.2013	Letter of undertaking re: Loans / Advances executed by the 1^stdefendant represented by the 2^nddefendant.	A-6
7.	12.08.2016	Acknowledgement of debt executed by the 1^st defendant represented by the 2^nddefendant.	A-7

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8.	06.05.2019	Acknowledgement of debt executed by the 1^st	A-8
		defendant represented by the 2^nddefendant
9.	10.01.2020	Recall notice issued to the defendants	A-9
10.	20.09.2021	Legal notice sent to the defendants	A-10
11.		Statement of accounts along with certificates	A-11
		under Bankers’ Book Evidence Act.

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Sd/(SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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DESCRIPTION OF PROPERTY

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NIL

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Sd/(SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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Canara Bank v. Sri Venkateshwara Industries

Case brief

What is this about?

What did the court decide?

Canara Bank v. Sri Venkateshwara Industries

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

Coram

Case details

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