Allowed

Karnataka Gramin Bank v. Mathanna

DRT17 Jul 2026OA/1039/2025

Case brief

AI extract

What is this about?

Drug rehabilitation tribunal allowed OA filed by Canara Bank for recovery certificate against defaulting co-borrowers. Court reduced interest from 14.5% to 7% p.a. and directed recovery from joint and several liabilities and schedule property.

What did the court decide?

Recovery Certificate issued for Rs.69,96,024.01 + 7% p.a. interest from date of filing against respondents; costs awarded to applicant.

Karnataka Gramin Bank versus Mathanna — Contract and Commercial Disputes | DRT (2026)

¶1

IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

¶2

Dated this 17^th Day of July, 2026

¶3

Present: Sri. T. RAJESH

¶4

Presiding Officer

OA. No.1039/2023

BETWEEN:

Canara Bank

Athani Branch

No.4355, Main Road, Near Sriram Lodging, Athani, Belgaum, Karnataka-591317

¶10

Rep. by its Chief Manager Arun Kumar … APPLICANT

¶11

AND:

¶12

Sri. Ningayya S Mathapathi S/o. Sri. Shailmathapathi Aged about 43 years R/at. Adahalli, Athini,

¶13

Belgam District-591248

¶14

Sri. Surendra L Atha

¶15

S/o. Lakappa Aged about 53 years R/at. Adhalli, Athini, Belgam District – 591248

¶16

Shivanand B Malaganvi S/o. Baragouda Malaganvi Aged about 38 years R/at. Adahalli, Athini, Belgaum Distrct-591248

¶17

Kallappa Bhimappa Tavate S/o. Bhimappa Tavate Aged about 43 years

¶18

OA. No.1039/2023

¶19

¶20

R/at. Hulagabali Village, Athini, Belgaum District-597304

¶21

Sri. Shivagouda B Nemagouda S/o. B Nemagouda Aged major, R/at. Kokatnur, Athini, Belagam District-591230

¶22

...DEFENDANTS

¶23

Counsel on record/appeared for:

¶24

Applicant : Sri. Prakash Hegde Defendants : Exparte

¶25

:FINAL ORDER:

¶26

The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 for seeking issuance of Recovery Certificate against the defendants for Rs.69,96,024.01 (Rupees Sixty Nine Lakh Ninety Six Thousand Twenty Four and One Paisa only) with further interest thereon from the date of filing the Application till realization from the Defendants.

¶27

It is the case of the applicant that, the defendants availed the following credit facilities:

¶28

i) housing loan (new construction) of Rs.8,00,000/- on 25.07.2011;

¶29

ii) MSME loan of Rs.20,00,000/- on 11.12.2014; iii) Agricultural Term loan (Sugar Cane Crop) of Rs.2,60,000/- on 22.07.2015;

¶30

OA. No.1039/2023

¶31

¶32

iv) Agricultural Term loan (Storage Tank/pond) of Rs.12,00,000/- on 23.07.2015;

¶33

v) Agricultural Term loan (Solar pump set) of Rs.3,65,000/- on 01.12.2015;

¶34

vi) MSME loan of Rs.22,50,000/- on 16.06.2016 and

¶35

vii) Housing loan (Renovation) of Rs.5,00,000/- on 28.09.2017.

¶36

It is also the case of the applicant that, in view of the above financed credit facilities, the defendants executed necessary loan documents. Apart from the creation of security interest by way of mortgage over the Schedule property.

¶37

It is further contended that, despite availing the credit facilities, agreeing to service the loan amount promptly and regularly, the defendants failed in complying the same, resulting in default in repayment and consequentially turning the loan account as NPA.

¶38

In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the account.

¶39

Despite, entering appearance/filing Vakalath, the written statement is filed with delay and no petition is filed to condone the same. Hence, the written statement rejected on 10.09.2025.

¶40

OA. No.1039/2023

¶41

¶42

The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A1 to A38 and got the same marked in evidence.

¶43

Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

¶44

The following issues arise for consideration in this matter:

¶45

i) Whether the applicant had succeeded in proving the OA

¶46

claim as against the defendants?

¶47

ii) What order are to be passed?

¶48

Both these issues are gone into and decided together.

¶49

The case put forth by the applicant in the Application

¶50

remains unrebutted as defendants remained exparte. The

¶51

evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facilities

¶52

as stated in the OA, creation of security interest as claimed by the applicant bank and the defaults committed in the account. The liability of the defendants and the claim of the amount due are also proved by the above documents. The claim of the applicant is well

¶53

OA. No.1039/2023

¶54

¶55

within the limitation.

¶56

Hence in view of the above findings which cover both the

¶57

issues raised in this manner, this Tribunal is of the view that OA is

¶58

liable to be allowed.

¶59

Taking into consideration the facts that the credit facilities

¶60

were availed for various purpose and also that OA claim is arrived

¶61

at by calculating interest at the agreed rate, this Tribunal in view

¶62

of the OA can be allowed with a reduced interest of 7.00%

¶63

p.a.(simple).

¶64

In the result, OA.No.1039/2023 stands allowed, i) The applicant is allowed to recovery an aggregate sum

¶65

of Rs.69,96,024.01 (Rupees Sixty Nine Lakh Ninety Six Thousand Twenty Four and One Paisa only) consisting of:

¶66

a) Rs.9,38,452.28/- with further interest of 7.00% p.a.(simple)

¶67

from the date of filing OA till the realization from the defendants No.1 and 2;

¶68

b) Rs.23,78,917.84/- with further interest of 7.00% p.a.(simple)

¶69

from the date of filing OA till the realization from the defendants No.1 and 2;

¶70

OA. No.1039/2023

¶71

¶72

c) Rs.4,03,667.24/- with further interest of 7.00% p.a.(simple)

¶73