Allowed

Pragathi Krishna Gramin Bank v. Bhanubi

DRT13 Jan 2026OA/1500/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the Original Application. The bank failed to recover a crop loan from the deceased borrower's legal heirs. The court held the heirs liable for the debt and properties mortgaged by their father, issuing a recovery certificate for the principal, interest at 6%, and costs.

What did the court decide?

Recovery Certificate issued for Rs. 20,54,401.97 with future interest at 6% p.a. (simple) from defendants, enforceable against inherited estate and mortgaged properties.

Pragathi Krishna Gramin Bank versus Bhanubi — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL II, BENGALURU

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Dated this 13^th Day of January, 2026

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Present: Sri. T. RAJESH Presiding Officer

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OA.No.1500/2023

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BETWEEN:

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Karnataka Grameena Bank, (Earlier Karnataka Gramin Bank), Tiptur Branch, B. H. Road, Tiptur Taluk, Tumkur District -572202, Rep. by its Branch Manager,

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…APPLICANT

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AND:

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Smt. Bhanubi, W/o. Late Mohiddin Sab @ Mydin Sab,

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Smt. Negina Mamtaz, D/o. Late Mohiddinn Sab @ Mydin Sab,

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Sri. Imran, S/o. Late Mohiddin Sab @ Mydin Sab,

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Sri. Nayaz, S/o. Late Mohiddin Sab @ Mydin Sab,

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All are R/at: Kalkere Village, Kalkere Post, Honnavalli Hobli, Tiptur Taluk, Tumkur District -572202.

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...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : T S Mahabaleswara Defendants : Ex parte

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FINAL ORDER

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The present Original Application in short “OA” has been filed

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under section 19 of Recovery of Debts and Bankruptcy Act 1993 seeking

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OA 1500/2023

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issuance of Recovery Certificate for Rs. 20,54,401.97 (Rupees twenty lakh fifty-four thousand four hundred one and paisa ninety-seven only) with further interest thereon and cost from the Defendants.

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It is the case of the Applicant (erstwhile Karnataka Gramin Bank, which was later amalgamated with the Applicant) that Mohiddinn Sab @ Mydin Sab, as borrower, availed a crop loan of Rs. 7,30,000/- (Rupees Seven Lakh Thirty Thousand Only) for the purpose of cultivating crops such as coconut, arecanut, banana, etc. Subsequently, the said borrower expired, and Defendant Nos. 1 to 4 became the legal heirs of the deceased borrower. The deceased borrower, along with Defendant No. 2, had mortgaged the ‘B’ Schedule property as security for the said loan.

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It is also the case of the Applicant that, in view of the above loan, the Defendants executed necessary loan documents in favour of the Applicant bank to secure the loan and also had created hypothecation and mortgage over the schedule properties.

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It is the case of the Applicant that the Defendants, despite availing the credit facility, after agreeing with the Terms and Conditions for the loan, failed in complying with the same, resulting in defaults and consequentially turning the loan accounts as Non-Performing Asset (NPA).

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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.

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OA 1500/2023

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Despite, taking out the summons, there were no appearance of Defendants. Hence, they were called absent and set ex parte on 04.03.2025.

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The Applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A-1 to A16, got the same marked in evidence.

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

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The following issues arise for consideration in this matter:

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

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ii) If so, to what extent?

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Both these issues are gone into and decided together.

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The case put forth by the Applicant in the Application remains unrebutted. The evidence tendered by the Applicant remains uncontroverted and undisputed. Defendant No. 2 is a legal heir as well as the mortgagor of the Schedule ‘B’ property. However, at the time of execution of the simple mortgage deed, Defendant No. 2 was a minor; therefore, the deceased borrower, being the natural guardian, executed

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and signed the mortgage deed on behalf of Defendant No. 2. Defendant No. 2, being a minor at the time of execution of the mortgage deed, is

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OA 1500/2023

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not personally liable for the loan transaction. However, the liability is enforceable against the mortgaged Schedule ‘B’ property and against the estate of the deceased borrower inherited by Defendant No. 2, to the extent permissible under law.

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The evidence put forth by the Applicant is found admissible and are sufficient to prove the averments made in the OA, and the defaults committed by the Defendants in repaying the loan amount due. The liability of the Defendants and the loan amount due are also proved by

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the above documents. The claim of the Applicant is well within the limitation.

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Hence in view of the above findings this Tribunal comes to the conclusion that the OA is liable to be allowed.

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Taking into consideration the fact that the loan is availed for

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agricultural purposes and also the fact that OA claim is arrived at by calculating interest at the agreed rate, pendente lite and future interest is awarded at 6.00% (simple). The prayer for interest with yearly rests

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and for penal interest for the future period is hereby declined.

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In the result, OA.No.1500/2023, is allowed,

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i) The Applicant is allowed to recover an aggregate sum of Rs.

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20,54,401.97 (Rupees twenty lakh fifty-four thousand four hundred one

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and ninety seven only) with pendente lite and future interest of 6.00%

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OA 1500/2023

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p.a. (simple) from the date of filing of the OA till the realization, from

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the Defendants jointly and severally after giving credit to all the amounts recovered and received during the pendency of the OA if any, and allow the same to be recovered by proceedings against schedule properties. Properties schedule to the OA be the schedule to the Recovery Certificate.

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ii) Defendants are only liable to the extent of the property that is inherited from the deceased borrower Mohiddinn Sab @ Mydin Sab.

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iii) The applicant bank is allowed cost of the proceedings for

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which Applicant to file cost memo within seven days from the date of receipt of the order.

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

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and transferred to Recovery for execution.

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v) Interim application pending, if any, stands disposed of in terms of this final order.

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Communicate a copy of the order to the parties concerned in

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

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(Procedure) Rules, 1993.

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(Dictated to PY directly on the Computer, after its transcription, corrected and pronounced by me in the open Court on this the 13^th day of January, 2026)

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Sd/(T. RAJESH) PRESIDING OFFICER

OA 1500/2023

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Sri. Ranganath R, Branch Manager of Applicant Bank.

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Exhibits on the part of the Applicant:

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Exhibit Nos.	Date	Particulars of Documents
A1	27.08.2013	Sanction letter
A2	27.08.2013	Hypothecation agreement
A3	27.08.2013	Simple mortgage deed
A4	20.07.2016	Letter of commitment
A5	15.06.2019	Letter of commitment
A6	07.11.2020	Death certificate of Mohiddin Sab @ Mydin Sab
A7	18.01.2023	Letter of Revival – legal heirs
A8	09.09.2022	Legal notice
A9 & A10	--	One postal receipt & one returned RPAD Cover
A11	24.06.2023	Legal notice
A12	26.06.2023	Three postal receipts
A13 to A15	--	2 Postal acknowledgements and 1 returned RPAD Cover
A16	--	Statement of account extract

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Witness Examined for the Defendants: List of Documents Exhibited for the Defendants:

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-Nil -

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-Nil -

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Sd/(T. RAJESH) PRESIDING OFFICER

Pragathi Krishna Gramin Bank v. Bhanubi

Case brief

What is this about?

What did the court decide?

Pragathi Krishna Gramin Bank v. Bhanubi

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

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