Allowed

State Bank of India v. M/S Abhiraj Constructions

DRT16 Jun 2025TA/925/2023

Case brief

AI extract

What is this about?

The DRT-III, Chennai allowed State Bank of India's application under Section 19 RDB Act for recovery of outstanding dues from borrowers who defaulted on a Term Loan, ordering joint and several recoveries and liberty to sell personal assets.

What did the court decide?

Allowed recovery of Rs.91,79,265.89 including interest at 14.45% p.a., costs, and directed parties to give credit to proceeds from prior SARFAESI sale; granted liberty to sell second defendant's perso

State Bank of India versus M/S Abhiraj Constructions — Specific Performance | DRT (2025)

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T.A. No. 925 of 2023

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16.06.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 16^th day of June, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 925 of 2023

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(Originally filed before DRT- II, Chennai as OA 352/2021 and thereafter transferred to this Tribunal and renumbered as TA No 925 of 2023)

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State Bank of India

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Asset Recovery Management Branch, No.44, Eldams Road, 1^st Floor, Teynampet, Chennai 600 018. Rep. by its Chief Manager

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….Applicant

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-Vs-

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M/s. Abhiraj Constructions,

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Prop. Mr. S. Sankarasubramanian,

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S/o. S. Santhanam, No.3, State Bank Colony, 1^st Street, Rajakilpakkam, Sembakkam,

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Chennai -600 073.

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S. Sankarasubramanian, S/o. S. Santhanam, Prop. Abhiraj Constructions, Annappanpet Village, Papanasam Taluk, Thanjavur District.

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Also at: No.3, State Bank Colony, 1^st Street, Rajakilpakkam, Sembakkam, Chennai 600 073.

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Both the defendants 1 & 2 also at:

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(i) No.3, Opposite to Mosque, Kandan Street, Kancheepuram 603 201.

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T.A. No. 925 of 2023

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16.06.2025

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(ii) C4, Saradha Apartment,

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Sringeri Mutt Road,

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Mandaveli, Cehnnai 600 028.

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(iii) Flat No.A3 & C3, ‘Thumburu’ Plot No.91 & 76, Yamunai Nagar, No.8, Iyyanchery Village, Urapakkam, Chennai 603 201. …Defendants

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Counsels on record / appeared:

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Counsel for Applicant : Mr. N. Elumalai

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Defendants 1 and 2 were set ex-parte on 10.03.2022

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: - FINAL ORDER - :

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This original application is filed on 24.08.2021 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 and 2, jointly and severally for recovery of a total sum of Rs.91,79,265.89p (Rupees Ninety One Lakhs Seventy Nine Thousand Two Hundred and Sixty Five and Eighty Nine Paise Only) due in respect of Term Loan (Project Finance) (Account No.64165076317) repayable together with an interest @ 14.45% p.a. with monthly rests from the date of filing the OA, till the date of realization in full, for sale of schedule mentioned immovable properties and for costs of this Application.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.352 of 2021, and thereafter in pursuance to the notification from

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T.A. No. 925 of 2023

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16.06.2025

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Ministry of Finance, DFS dated 04.10.2022, OA No.352 of 2021 stood transferred to this Tribunal and renumbered as TA No.925 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 State of Mysore has been taken over by the State Bank of India, with effect from 01.04.2017 as per Gazette Notification No.128 dated 22.02.2017 of the Government of India, under Section 35 of State Bank of India Act, 1955. As per internal policy of the bank, for expeditious recovery of the outstanding loan amount and interest, the subject mentioned loan was transferred to the Applicant Bank.

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It is submitted by applicant bank that originally the 1^st Defendant herein approached the State Bank of Mysore, Urapakkam Branch for the purpose of availing Term Loan – Project Finance on 19.07.2014 and submitted a loan application for a loan amount of Rs.75,00,000/- and also executed the loan documents on 12.01.2015 and 19.01.2015.

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It is further submitted by applicant bank that considering the said request of defendants, loan was sanctioned on 19.01.2015. The said loan was sanctioned after obtaining necessary legal opinion from the Counsel for the Applicant Bank. It is pertinent to mention that the 1^st defendant is the

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T.A. No. 925 of 2023

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16.06.2025

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primary borrower and the 2^nd defendant is the sole proprietor of the 1^st defendant firm. All the loan documents were executed by the 2^nd defendant on behalf of the 1^st defendant as its sole proprietor. Loan is secured by hypothecation of goods and assets and also collaterally secured by mortgage by deposit of title deeds of the immovable property belonging to 2^nd defendant.

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The Applicant Bank states that in connection with the sanction of the Term Loan-Project Finance, the defendants herein executed and produced the following documents.

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i. Sale deed dated 15.04.2013 vide document No.5027/2013

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ii. Sale deed dated 15.04.2013 vide document No.5037/2013

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iii. Loan Application dated 19.07.2014

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iv. Memorandum relating to Deposit of Title Deeds dated 12.01.2015

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v. Agreement of Loan for overall limit dated 19.01.2015

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vi. Agreement of hypothecation of goods and assets dated 19.01.2015

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vii. Agreement of Pledge of goods and assets dated 19.01.2015.

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viii. Letter regarding grant of individual limits within the overall limit dated 19.01.2015

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ix. Deed of guarantee for overall limit dated 19.01.2015

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T.A. No. 925 of 2023

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16.06.2025

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The applicant Bank, considering the execution of necessary documents as stated above, sanctioned a sum of Rs.75,00,000/- to the 1^st defendant herein by a sanction communication letter dated 19.01.2015.

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The Applicant further states that thereafter the 1^st defendant submitted a request letter seeking to disburse the loan amount. Considering the request made by the 1^st defendant herein the applicant bank disbursed the loan.

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It is submitted by the Applicant bank that subsequent to availing of credit facility, the defendant failed to make payment as per the agreed terms of the loan. Consequently, there was gross default in payment of principal and interest by the 1^st defendant. Therefore, the 1^st defendant’s loan account was classified as NPA on 28.05.2017 in accordance with RBI guidelines. Since the defendant failed to repay the loan liability, the loan records were transfer from Home Branch State bank of India, Urapakkam Branch, to the ARMB Branch, Eldoms Road, Teynempet, Chennai as per internal policy of the bank, for effective and expeditious recovery of liability. 11. The Applicant further states that having accepted the terms and conditions for grant of home loan, the 1^st defendant neglected to pay the installments and thus the defendant defaulted in performance of his obligations towards the loan despite several remainders sent to the 1^st defendant herein. Lastly, the defendant herein has paid a sum of Rs.1,74,514/- to the Applicant bank on 23.11.2020 and thereafter no

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16.06.2025

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further payments were made. Inspite of repeated demands and requests and notices sent to the defendants, the defendants did not care and come forward to repay the loan. Therefore, the Applicant Bank finally caused a Legal Notice on 21.07.2021 calling upon the defendants to re-pay the outstanding dues and the said notices were returned unserved with an postal endorsements of “Door Lock”, “No Such Person”, “No Such Addressee”, “Insufficient address”. Thereafter the Applicant Bank through its Authorised Officer had issued notice under section 13(2) of the SARFAESI Act to the defendants on 05.08.2021 individually at the addresses furnished by them at the time of availing the loan, the notices however returned unserved, except the address at C4, Saradha Apartment, Sringeri mutt road, mandaveli, Chennai, which was duly served to the defendant. Despite receipt of the same the defendants have not come forward to settle the outstanding dues. Hence the present Original Application (OA) has been filed for recovery of dues from the defendants.

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After the filing of the OA, summons were sent to the Defendants 1 and 2 through Registered Post with Acknowledgment Due, which returned with the remarks “Door Locked and No such person”. Applicant bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 10.03.2022 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, defendants 1 and 2 were placed ex-parte on 10.03.2022.

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T.A. No. 925 of 2023

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16.06.2025

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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. B. Selvamurugesh, Assistant Manager, ARMB 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-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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During the pendency of OA, Applicant Bank had reported part satisfaction of OA claim in a sum of Rs.30,10,000/- by way of sale of Schedule B mentioned (unsold plots A3 and C3) immovable property under SARFAESI Act on 25.11.2022. Accordingly, part satisfaction of sum of Rs.30,10,000/- was duly recorded vide order dated 14.11.2023 and documents marked as Ex A-1, A-2 and A-5 were returned to applicant bank on 05.01.2024 under proper acknowledgement .

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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 :

The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendants jointly and severally, a sum of Rs.91,79,265.89p (Rupees Ninety

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One Lakhs Seventy Nine Thousand Two Hundred and Sixty Five

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and Eighty Nine Paise Only) due in respect of Term Loan (Project Finance) (Account No.64165076317) repayable together with an interest @ 14.45% 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) A sum of Rs.30,10,000/- realized by way of SARFAESI sale is directed to be given credit to the borrower’s loan account as on the date of realization.

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(c) If the sale proceeds of the immovable properties are not sufficient to satisfy the dues as ordered above, 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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(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

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T.A. No. 925 of 2023

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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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(e) 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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(g) 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 PS, transcribed by her, corrected, signed and pronounced by me on this the 16^th day of June, 2025)

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T.A. No. 925 of 2023

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ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Mr. B. Selvamurugesh, Assistant Manager, ARMB 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.	Sale deed vide Document No.5027/2013 dated 15.04.2013.	A-1
2.	Sale deed vide Document No.5037/2013 dated 15.04.2013.	A-2
3.	Loan Application.	A-3
4.	Proposal and sanction dated 26.12.2014.	A-4
5.	Memorandum relating to Deposit of Title Deeds dated 12.01.2015.	A-5
6.	Sanction communication letter dated 19.01.2015.	A-6
7.	Confirmation letter dated 19.01.2015.	A-7
8.	Agreement of loan for overall limits dated 19.01.2015.	A-8
9.	Agreement of hypothecation of goods and assets dated 19.01.2015.	A-9
10.	Agreement of Pledge of Goods and Assets dated 19.01.2015.	A-10
11.	Deed of guarantee for overall limit dated 19.01.2015.	A-11
12.	Letter regarding grant of individual limit within the overall limit dated 19.01.2015.	A-12
13.	Request letter from the borrower dated 03.03.2015.	A-13
14.	Revival letter dated 17.12.2017.	A-14
15.	Revival letter dated 27.01.2020.	A-15
16.	Letter from the borrower disclosing the unsold flats details (mail communication) dated 27.01.2020.	A-16
17.	Statement of account with interest calculation sheet (A/c No.64165076317) and along with certificated dated 19.01.2015 to 31.07.2021.	A-17
18.	Legal Notice dated 21.07.2021.	A-18
19.	Returned envelopes from the 1^stdefendant (4 No’s).	A-19

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20.	Returned envelopes from the 2^nddefendant (5 No’s).	A-20
21.	Notice u/s 13(2) of SARFAESI Act date 05.08.2021.	A-21
22.	Acknowledgement (1).	A-22
23.	Returned envelopes from the defendant’s (8 No’s).	A-23
24.	Merger notification dated 20.03.2017	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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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

State Bank of India v. M/S Abhiraj Constructions

Case brief

What is this about?

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State Bank of India v. M/S Abhiraj Constructions

Case brief

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