Allowed

Bank of Maharashtra v. M/S Rajaram Dall Mill

DRT3 Jun 2025TA/885/2023

Case brief

AI extract

What is this about?

DRT allowed an original application filed by Bank of Maharashtra for recovery of approximately Rs.4.05 crores along with interest. Defendants were set ex-parte; Tribunal granted final order for recovery from movables and immovable properties.

What did the court decide?

Recovery of Rs. 4,05,72,902/- plus interest @ 12.45% p.a. from Defendants 1, 2, 4, and 5, with liberty to recover by sale of Schedule A and B assets.

Bank of Maharashtra versus M/S Rajaram Dall Mill — Banking and Recovery | DRT (2025)

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T.A. No. 885 of 2023

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03.06.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 03^rd day of June, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 885 of 2023

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(Originally filed before DRT- II, Chennai as OA 871/2019 and thereafter transferred to this Tribunal and renumbered as TA No 885 of 2023)

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BANK OF MAHARASHTRA,

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Having its Asset Recovery Branch at Sivagnanam road, T Nagar Chennai – 17 Rep. by its Authorised Signatory ….Applicant

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-Vs-

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M/s Rajaram Dall Mill, Rep. by its Prop. D. Kannan, Having business at 165, 166/1

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Great Cotton Road,

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Thoothukudi – 628003

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D. Kannan, S/o N. Dhanasekaran

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Residing at,

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27C Muniasamypuram, 2nd Street, Thoothukudi – 628003.

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N. Dhanasekaran

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S/o Natarajan Residing at 27C Muniasamypuram 2nd Street, Thoothukudi – 628003

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M. Vairamani W/o Mathimaran Residing at Old No.277 New No.6 Natesan Nagar, 7th Cross Street, 2nd Main Road, Virugambakkam, Chennai 92

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T.A. No. 885 of 2023

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03.06.2025

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D. Ravikrishnan S/o N. Dhanasekaran Residing at 27C Muniasamypuram, 2nd Street, Thoothukudi – 628003 …Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. Shree Law Services Defendants 1 to 5 were set ex-parte on 06.07.2022

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: - FINAL ORDER - :

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This original application is filed on 03.09.2019 by the applicant bank 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 to 5, jointly and severally for recovery of a total sum of Rs.4,05,72,902/- (Rupees Four Crores Five Lakhs Seventy Two Thousand Nine Hundred and Two only) due in respect of Cash Credit facility (Account No. 60022450662) together with further interest @ 12.45% p.a., with monthly rests from the date of Application till the date of realization in full, for sale of scheduled mentioned hypothecated assets and immovable property more fully detailed in the schedule to OA and for costs of this OA.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.871 of 2019, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.871 of 2019 stood transferred to this Tribunal and renumbered as TA No.885 of 2023.

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T.A. No. 885 of 2023

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03.06.2025

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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 1^st and 2^nd defendants approached the applicant bank seeking various credit facilities including Cash Credit facility and Term Loan.

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It is submitted that on 31.12.2015 the request of defendants for enhancement of credit facilities was sanctioned and a copy of the sanction letter is produced. This letter was amended on 05.03.2016 in terms of which the Cash Credit limit was enhanced from Rs.1.5 crores to Rs.2 crores and Foreign Import Letter of Credit was reduced from Rs.1.50 crores to Rs.1 crore.

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The Applicant submits that pursuant to such sanction, the 2^nd defendant on behalf of 1^st defendant executed Demand Promissory Note on 07.03.2016 agreeing to pay back on demand the applicant or its order the sum of Rs.1 crore with interest on such sum at the rate of 2.75 p.a., over and above the base rate which was 12.45% at the rate relevant point of time. The 1^st and 2^nd defendants also executed Deed of Hypothecation for all facilities in favour of the applicant hypothecating all the movables more

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T.A. No. 885 of 2023

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03.06.2025

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fully described in the schedule A belonging to the 1^st defendant in favour of the applicant. The 2^nd defendant also executed letter of proprietor ship dated 07.03.2016 confirming that he is solely responsible for liabilities of Rajaram Dall Mill as its Sole Proprietor.

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The applicant submits that 1^st and 2^nd defendants executed an Agreement relating to opening of an irrevocable without recourse Import Letter of credit under LC limits dated 07.03.2016. Defendants 3 to 5 guaranteed the repayment of facilities extended to defendants 1 and 2 and executed a Guarantee Deed on 07.03.2016.

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It is submitted that the defendants 2 to 5, as security for the due repayment of the loan availed by 1^st defendant, had deposited the title deeds relating to the immovable property mentioned in schedule B with the applicant’s branch at Tuticorin, Tamilnadu with an intention to create an equitable mortgage in respect of the same. Defendants 2 to 5 executed a mortgagor’s declaration for the proposed mortgage, a memorandum of record of equitable mortgage and mortgagor’s letter of confirm are submitted.

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The applicant further submits that the Memorandum of deposit of title deeds was registered on 06.01.2016. The defendants acknowledged their liability on 17.06.2017.

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It is submitted by the applicant bank that subsequent to availing of

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T.A. No. 885 of 2023

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03.06.2025

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credit facility, the defendants defaulted in repayment of the dues. Therefore, the account was declared as NPA on 01.07.2018 in accordance with the RBI norms. Despite repeated requests and demands, defendants did not come forward to repay the outstanding dues. Hence the present Original Application (OA) is filed for recovery of amounts due from defendants.

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After the filing of the OA, summons were sent to the Defendants 1 to 5 through Registered Post with Acknowledgment Due, which returned with postal endorsement as ‘Unclaimed’ in respect of D-1 and D-4, and returned with postal endorsement as ‘Left’ in respect of D-2 and D-5 and returned with postal endorsement as ‘Expired’ in respect of D-3. Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 06.07.2022 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1, 2, 4 and 5 were placed ex-parte on 06.07.2022.

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As summons to 3^rd defendant returned with postal endorsement as ‘expired’, applicant bank was directed to take steps to implead the LRs of deceased 3^rd defendant. However, despite availing several adjournments, as applicant bank did not take any steps to prosecute the IA filed for impleading the LRs of deceased 3^rd defendant, OA against D-3 was dismissed vide proceedings dated 05.09.2023.

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T.A. No. 885 of 2023

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03.06.2025

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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. Tulsi Ram Sahoo, Authorised Signatory of 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-14 . 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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1, 2, 4 to 5 jointly and severally, a total sum of Rs.4,05,72,902/(Rupees Four Crores Five Lakhs Seventy Two Thousand Nine

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Hundred and Two only) due in respect of Cash Credit facility (Account No. 60022450662) together with further interest @ 12.45% p.a., 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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T.A. No. 885 of 2023

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03.06.2025

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(b) In the event of failure of the Defendants to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the schedule A and B mentioned hypothecated asset and immovable properties more fully detailed in the OA schedule.

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(d) The applicant bank shall file the latest memo of calculation of

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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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(e) The applicant bank shall file memo of costs within ten days from the date of this final order.

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(f) 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 (Mogesh), transcribed by him, corrected, signed and pronounced by me on this the 03^rd day of June, 2025)

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T.A. No. 885 of 2023

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ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Mr. Tulsi Ram Sahoo, Authorised Signatory of 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.	Sanction Letter 31.12.2015	A-1
2.	Sanction Letter 05.03.2016	A-2
3.	Demand Promissory Note 07.03.2016	A-3
4.	Letter of Proprietorship 07.03.2016	A-4
5.	Deed of Hypothecation 07.03.2016	A-5
6.	Agreement relating to opening an LC 07.03.2016	A-6
7.	Guarantee Deed 07.03.2016	A-7
8.	Mortgagors Declaration 02.01.2016	A-8
9.	Memorandum of record of Equitable Mortgage 08.03.2016	A-9
10.	Mortgagors Letter of Confirmation 09.03.2016	A-10
11.	Memorandum of deposit of title 06.01.2016	A-11
12.	Acknowledgement of Debt 17.06.2017	A-12
13.	Acknowledgement of Debt 17.06.2017	A-13
14.	Statement of Accounts	A-14

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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 A-:

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First and exclusive charge and security by way of hypothecation charge in favour of the bank over the borrowers present and future movables, plants, machineries, goods, stocks of raw materials, items, inventories, stocks in process, semi-finished and finished goods, stores and spares (consumable stores and spares), stock in trade, goods in process movables in transit and present and future tangible and intangible assets, vehicles, goodwill, trademark, copyright, patent and all the right title

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T.A. No. 885 of 2023

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interest and benefit of the borrower in upon or over all contracts and agreements and amounts and right to collect receive and recover the same together with all movables, situated or located at No.165, 166/1 Great Cotton Road, Tuticorin – 628001 and any place and now lying, being affixed or installed at any placed at any time and all outstanding monies, claims, bills, receivables, book debts due or to become due to the Borrowers at any time or from time to time and all of the borrowers right titles or interest thereon.

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:- SCHEDULE B-:

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All those pieces and parcels of land along with two houses situated being and lying at Muniasamypuram, Tuticorin admeasuring 4173.75 sq.ft., i.e.387.75 sq.mtr i.e,9.58 Cents of land bearing ward No.3767, Door No.27C and 27D part bounded as follows

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North of: 30 feet broad East West Road South of: Plot No.8 plot West of: Plot No.26 plot East of: 30 feet broad North South Colony road

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Together with the buildings and structures/residential block constructed to be constructed there on and all the fixture annexed thereto.

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

Bank of Maharashtra v. M/S Rajaram Dall Mill

Case brief

What is this about?

What did the court decide?

Bank of Maharashtra v. M/S Rajaram Dall Mill

Case brief

What is this about?

What did the court decide?

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