Allowed

Tamilnad Mercantile Bank Limited v. Raghunath

DRT20 Aug 2026OA/1464/2023

Case brief

AI extract

What is this about?

DRT allowed an application for a recovery certificate against defendants who defaulted on a housing loan. The court reduced the agreed interest from 8.85% to 8% p.a. pending recovery.

What did the court decide?

Recovery Certificate issued for Rs.22,34,249.45 plus interest at 8% p.a. to be recovered against respondents jointly, severally and personally or from the schedule property.

Tamilnad Mercantile Bank Limited versus Raghunath — Specific Performance | DRT (2026)

¶1

IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

¶2

Dated this 20^th Day of August 2026

¶3

Present: Sri. T. RAJESH Presiding Officer

¶4

OA. No.1464/2023

¶5

BETWEEN:

¶6

Tamilnad Mercantile Bank Ltd Bangalore City Branch, 19 F, B.V.K.Iyenger Road, Abhinay Theatre, Bengaluru-560009.

¶7

… APPLICANT

¶8

AND:

¶9

Mr.R.K.Raghunath

¶10

S/o.Rajagopala Setty Krishnaiah Setty,

¶11

No.346, 4^th Cross, 3^rd Phase,

¶12

5^th Block, Banashankari 3^rd Stage,

¶13

Bengaluru-560085.

¶14

Mrs.A.R. Chandana W/o. Mr.R.K.Raghunath No.346, 4^th Cross, 3^rd Phase, 5^th Block, Banashankari 3^rd Stage, Bengaluru-560085. ...DEFENDANTS

¶15

Counsel on record/appeared for:

¶16

Applicant : Skanda Legal Defendants : Exparte

¶17

2 OA No.1464/2023

¶18

: FINAL ORDER:

¶19

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.22,34,249.45/- (Rupees Twenty-Two Lakhs Thirty-Four Thousand Two Hundred Forty-Nine and Paisa Forty-Five Only) with further interest thereon from the date of filing the Application till realization from the Defendants.

¶20

The Defendants No.1 and 2 availed a sum of Rs.19,10,000/- (Rupees Nineteen Lakhs Ten Thousand Only) for purpose of Housing Loan.

¶21

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

¶22

It is further contended that, despite availing the credit facility, 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.

¶23

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.

¶24

3 OA No.1464/2023

¶25

Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set exparte on 07.04.2026.

¶26

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 A24 and got the same marked in evidence.

¶27

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.

¶28

The following issues arise for consideration in this matter:

¶29

i) Whether the applicant had succeeded in proving the OA claim as against the defendants?

¶30

ii) What order are to be passed?

¶31

Both these issues are gone into and decided together.

¶32

The case put forth by the applicant in the Application remains unrebutted as defendants remained exparte. The 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 facility 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

¶33

4 OA No.1464/2023

¶34

are also proved by the above documents. The claim of the applicant is well within the limitation.

¶35

Hence in view of the above findings which cover both the issues raised in this manner, this Tribunal is of the view that OA is liable to be allowed.

¶36

Taking into consideration the facts that the credit facility was availed for Housing Loan and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of 8.00% p.a.(simple)

¶37

In the result, OA.No.1464/2023 stands allowed,

¶38

i) The applicant is allowed to recover an aggregate sum of Rs.22,34,249.45/- (Rupees Twenty-Two Lakhs Thirty-Four Thousand Two Hundred Forty-Nine and Paisa Forty-Five Only) along with current and future interest 8% from the date of the OA till the date of realization, from the defendants jointly, severally and personally, after giving credit to all the amounts recovered and received during the pendency of the OA if any, and allowed the same to be recovered by proceeding against the schedule property. The schedule property to the OA be the schedule property to the Recovery Certificate.

¶39

ii) If the sale proceeds are not found sufficient to cover the

¶40

amount due and payable to the applicant bank, the defendants and their

¶41

other assets are liable for all such amounts due in loan accounts.

¶42

iii) The applicant bank is allowed cost of the proceeding which

¶43

applicant to file cost memo within 7 days from the date of receipt of the order.

¶44

iv) The Recovery Certificate to be drawn in terms of this order and

¶45

transferred to Recovery for execution.

¶46

v) Interim Application pending, if any, stands disposed of with

¶47

this Final Order.

¶48

14. Communicate a copy of the order to the parties concerned in terms

¶49

of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure)

¶50

Rules, 1993.

¶51

[Dictated to the Stenographer (GS), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 20^th Day of August 2026].

¶52

6 OA No.1464/2023

¶53

ANNEXURES

¶54

WITNESSES EXAMINED FOR THE APPLICANT BANK:

¶55

AW-1: Sri. N.Rajesh, Asst.Vice President of the Applicant Bank.

¶56

Exhibits on the part of the Applicant:

¶57

Sl.No	Date	Particulars of Documents	EXHIBITS
1.	14.01.2020	TMB HOME Loan Application for Rs.19,10,000/- executed by R.K. Raghunath & A.R.Chandana	A1
2.	23.01.2020	Sanction Intimation for Term Loan of Rs. 19,10,000/- interest at the rate of 8.85% p.a.with Acceptance of Sanctioned Home Loan of Rs.19,10,000/- by R.K. Raghunath & A.R.Chandana	A2
3.	23.01.2020	Articles of Agreement for Rs.19,10,000 – Form No. 169 executed by R.K. Raghunath & Arachnidan and Tamilnad Mercantile Bank Ltd.	A3
4.	23.01.2020	Promissory Notes for Rs. 19,10,000/- executed by R.K. Raghunath & A.R.Chandana	A4
5.	23.01.2020	Take Delivery Letter executed by R.K.Raghunath & A.R.Chandana for Rs. 19,10,000/-	A5
6.	23.01.2020	Letter of undertaking cum consent executed by R.K. Raghunath & A.R.Chandana for Loan A/c No.044700950100194 for Loan Rs.19,10,000/-	A6

¶58

7 OA No.1464/2023

¶59

7.	23.01.2020	Authority to release the loan amount in case of joint borrowers executed by R.K. Raghunath &	A7
		A.R.Chandana for Loan Rs. 19,10,000/-
8.	23.01.2020	Letter of Undertaking for payment of installment executed by R.K. Raghunath & A.R.Chandana for Rs. Loan 19,10,000/-	A8
9.	23.01.2020	Letter of standing Instruction executed by R.K. Raghunath & A.R.Chandana for transfer every month of Rs. 17,001/- from Saving A/c to Loan A/c	A9
10.	23.01.2020	Consent letter executed by R.K. Raghunath & A.R.Chandana regarding the Immovable security offered for Loan Rs. 19,10,000/-.	A10
11.	23.01.2020	Undertaking Letter to keep the security intact in case of mortgage of immovable property executed by R.K. Raghunath & A.R.Chandana for Loan Rs. 19,10,000/-.	A11
12.	23.01.2020	Consent clause in the loan documents	A12
13.	31.01.2020	Memorandum of deposit of title deeds- from No. 26 executed by R.K.Raghunath & A.R.Chandana for Home Loan of Rs. 19,10,000/	A13

¶60

8 OA No.1464/2023

¶61

14.	31.01.2020	Memorandum of Deposit of Title Deeds executed by Defendants for Rs.19,10,000/- Registered as Doc.No.BSG-1-07075-2019-20 and recorded in CDNo.BSGD623	A14
15.	14.11.2022	Revival Letter for Loan A/c No. 044700950100194	A15
16.	29.09.2020	Encumbrance Certificate	A16
17.		CERSAI Report	A17
18.	20.12.2022	Demand Notice Under Section 13(2) Under SARFAESI Act 2002 to repay a sum of Rs. 21,32,547.45 as on 30.11.2022. Receipt of copy acknowledged by Mr. R.K Ragunath and Mrs.A.R. Chandana separately.	A18
19.	08.03.2023	Possession Notice issued under Sec.13(4) of the SARFAESI Act along with Paper publication and proof of affixation	A19
20.	15.06.2023	Memorandum of Calculation	A20
21.	15.06.2023	Statement of Interest Calculation	A21
22.	15.06.2023	Certificate under Banker’s Books of Evidence Act	A22
23.	27.03.2023	Bank Statement for Account No.044700950100194 for the	A23
		period from 23.01.2020 to 27.03.2023

¶62

9 OA No.1464/2023

¶63

Bank	Statement	for	Acc	ount
No.044	70095010019	4	for	the
period	from 27	.03.	2023	to
12.06.	2023

¶64

Sd/-

¶65

(T. RAJESH) PRESIDING OFFICER

Tamilnad Mercantile Bank Limited v. Raghunath

Case brief

What is this about?

What did the court decide?

Tamilnad Mercantile Bank Limited v. Raghunath

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

Similar cases

Karnataka Vikas Grameena Bank versus Sri.Heeru Somalu Lamani

Canara Bank versus Sri.Vijayakumar

Canara Bank versus Sri.Veerendra. D.M

Ms Anjani Kumar Srivastava and Others versus Mansarovar Urban Co. Operative Bank Ltd.

Mr Amit Kumar Nag and Anr. versus Axis Bank Limited

Sri Tuhin Kumar Das and Another versus Bank of India