Allowed

Bank of India v. Ms Raj Associate

DRT9 Jun 2025TA/883/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's original application for recovery of dues. The court found the claims unchallenged and ordered the defendants to pay Rs.68,62,713.07 comprising Cash Credit and Term Loan amounts along with future interest.

What did the court decide?

Recovery of Rs.68,62,713.07 comprising Cash Credit and Term Loan dues along with future interest; liberty to sell assets of the 2nd defendant.

Bank of India versus Ms Raj Associate — Banking and Recovery | DRT (2025)

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T.A. No. 883 of 2023

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09.06.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 09^th day of June, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 883 of 2023

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(Originally filed before DRT- II, Chennai as OA 174/2020 and thereafter transferred to this Tribunal and renumbered as TA No 883 of 2023)

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Bank of India Kodambakkam Branch, No.25, Second Cross Street, Trustpuram, Kodambakkam,

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Chennai – 600 024.

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Rep. by its Constituted Attorney ….Applicant

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-Vs-

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M/s Raj Associate Rep. by its Proprietor

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Mr. C.A. Rajmathivanan

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No.G-2, Kandasamy Homes,

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No.1, 4^th Cross Street, Trustpuram, Kodambakkam

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Chennai – 600 024

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Mr. C.A. Rajmathivanan Aged about 61 years

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S/o Mr. Annu Chetty K.C

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No.1-G, Arcot Apartment,

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3 Sivan Koil Street, Kodambakkam

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Chennai – 600 024 …Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. S.R. Sudhanraj

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Defendants 1 and 2 were set ex-parte on 05.04.2022

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: - FINAL ORDER - :

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This original application is filed on 14.02.2020 by the applicant bank

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T.A. No. 883 of 2023

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09.06.2025

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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 and 2, jointly and severally for recovery of a total sum of Rs.68,62,713.07P (Rupees Sixty Eight Lakhs Sixty Two Thousand Seven Hundred and Thirteen and Seven Paisa only) as follows:

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(i) A sum of Rs.53,00,024.31p due in respect of Cash Credit Facility (Account No.801430110000091) repayable together with further interest @ 10.10% p.a. compounded with monthly rests from the date of application till the date of realisation in full;

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(ii) A sum of Rs.15,62,688.76p due in respect of Term Loan (Account No.801473510000005) repayable together with further interest @ 10.90% p.a. compounded with monthly rests from the date of Application till the date of realization in full and for costs of this OA.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.174 of 2020, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.174 of 2020 stood transferred to this Tribunal and renumbered as TA No.883 of 2023.

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T.A. No. 883 of 2023

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09.06.2025

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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 represented by the 2^nd defendant approached the applicant bank for Cash Credit facility of a sum of Rs.30,00,000/- for their business purpose.

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It is submitted that applicant bank, after carefully considering the request of the defendant and upon verification the applicant sanctioned Cash Credit facility of Rs.30,00,000/- to the defendants. To secure the due repayments of cash credit facility defendants have executed the following loan security documents at the Kodambakkam Branch of the applicant bank for Cash credit facility of Rs.30,00,000/- on 05.12.2015 and availed the credit facility:

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a) Demand promissory note dated 05.12.2015

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b) Bearer letter dated 05.12.2015 for Rs.30,00,000/-

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c) Deed of Continuing Security cum Declaration dated 15.12.2015

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d) Stamped Undertaking letter dated 05.12.2015

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e) Hypothecation cum loan agreement dated 05.12.2015

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f) Charge and hypothecation of book debts dated 05.12.2015 .

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T.A. No. 883 of 2023

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09.06.2025

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It is further submitted that the defendants submitted loan application form for credit facility to the applicant on 03.11.2016. After carefully considering the request of the defendants and the representation made by them, the applicant bank upon request of the defendants have revised and sanctioned enhanced credit facility from existing Rs.30,00,000/- to Rs.50,00,000/- on 05.11.2016 and to secure the repayment of credit facility defendants have executed the following security documents

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a) Demand promissory note dated 05.11.2016 for Rs.20,00,000/-

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b) Bearer letter dated 05.11.2016 for Rs.20,00,000/-

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c) Deed of continuing security cum Declaration dated 05.11.2016

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d) MCLR agreement dated 05.11.2016

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e) Supplemental Deed of Hypothecation dated 05.11.2016

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f) Hypothecation cum loan agreement dated 05.11.2016

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g) The defendants executed letter acknowledging their debts and securities in favour of the applicant on 11.12.2017 for cash credit facilities availed by them.

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The applicant submits that the defendants approached the applicant during 2018 seeking for Term Loan of Rs.20,00,000/-. After carefully considering the request of the defendants and the representation made by them, the applicant bank sanctioned Term Loan of Rs.20,00,000/- and to secure the repayment of term loan defendants have executed security documents on 12.07.2018:

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T.A. No. 883 of 2023

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a) Demand promissory note dated 12.07.2018 for Rs.20,00,000/-

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b) Bearer letter dated 12.07.2018 for Rs.20,00,000/-

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c) Instalment letter dated 12.07.2018

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d) Hypothecation cum loan agreement dated 12.07.2018

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e) Deed of Continuing Security cum Declaration dated 12.07.2018

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f) MCLR Agreement dated 12.07.2018

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It is submitted that the defendants availed loan for their business activities and generated income from its business. However, the defendants did not repay the loan as undertaken and committed default. Despite several demands made by the applicant the defendants failed and neglected to repay the loan. Therefore, the loan account was classified as NPA on 30.09.2019 as per the guidelines issued by the RBI. Inspite of repeated demands, as defendants did not come forward to repay the dues, the present Original Application (OA) has been filed for recovery of amount due from defendants.

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

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2 through Registered Post with Acknowledgment Due, which was duly served. Although D-2 party in person appeared, did not choose to file Written Statement. When OA was taken up on 05.04.2022 even after giving

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sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 and 2 were placed ex-parte on

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T.A. No. 883 of 2023

09.06.2025

05.04.2022.

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, Mrs. Gowri Ramachandran, Constituted Attorney of the Applicant Bank, has filed her 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-24 . 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 1 and 2 jointly and severally, a total sum of Rs.68,62,713.07P (Rupees Sixty Eight Lakhs Sixty Two Thousand Seven Hundred and Thirteen and Seven Paisa only) as follows:

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(i) A sum of Rs.53,00,024.31p due in respect of Cash

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Credit Facility (Account No.801430110000091) repayable

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together with further interest @ 10.10% p.a. compounded with

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T.A. No. 883 of 2023

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monthly rests from the date of application till the date of realisation in full;

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(ii) A sum of Rs.15,62,688.76p due in respect of Term Loan (Account No.801473510000005) repayable together with further interest @ 10.90% p.a. compounded 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) The applicant bank is at liberty to sell the personal assets of the 2^nd Defendant (both movable and immovable) to recover the balance dues as required under law for which the 2^nd Defendant to disclose to the Tribunal particulars of other properties or assets owned by the 2^nd 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 Defendants 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 receipt of this final order.

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(e) Recovery Certificate shall be drawn up and issued to the

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T.A. No. 883 of 2023

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09.06.2025

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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 (Mogesh), transcribed by him, corrected, signed and pronounced by me on this the 09^th day of June, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: M/s Gowri Ramachandran, Constituted Attorney of 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.
	Cash Credit Facility of Rs.30,00,000/-
1.	Sanction letter 01.12.2015	A-1
2.	Demand Promissory Note 05.12.2015	A-2
3.	Bearer Letter 05.12.2015	A-3
4.	Deed of Continuing Security cum Declaration 05.12.2015	A-4
5.	Stamped Undertaking letter 05.12.2015	A-5
6.	Hypothecation cum loan agreement 05.12.2015	A-6
7.	Charge and Hypothecation of Book Debts 05.12.2015	A-7
	Credit Facility of Rs.20,00,000/-
8.	Loan application form for credit facility 03.11.2016	A-8
9.	Sanction letter 05.11.2016	A-9
10.	Demand Promissory Note 05.11.2016	A-10
11.	Bearer Letter 05.11.2016	A-11
12.	Deed of continuing Security cum Declaration 05.11.2016	A-12
13.	MCLR Agreement 05.11.2016	A-13
14.	Supplemental Deed of Hypothecation 05.11.2016	A-14
15.	Hypothecation cum loan Agreement 05.11.2016	A-15
16.	Letter of Acknowledgement of Debts and Securities 11.12.2017	A-16

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	Term Loan Rs.20,000/-
17.	Demand Promissory 12.07.2018	A-17
18.	Bearer Letter 12.07.2018	A-18
19.	Instalment Letter 12.07.2018	A-19
20.	Hypothecation cum loan agreement 12.07.2018	A-20
21.	Deed of continuing Security cum Declaration 12.07.2018	A-21
22.	MCLR Agreement 12.07.2018	A-22
23.	Statement of Account for credit facility 30.01.2020	A-23
24.	Statement of Account for Term Loan facility 30.01.2020	A-24

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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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SCHEUDLE

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NIL

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

Bank of India v. Ms Raj Associate

Case brief

What is this about?

What did the court decide?

Bank of India v. Ms Raj Associate

Case brief

What is this about?

What did the court decide?

What the court decided

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