Allowed

Canara Bank v. Danayya Rudrayya Ganachari

DRT27 Apr 2026OA/1907/2023

Case brief

AI extract

What is this about?

This is an Original Application under the RDB Act for issuance of a Recovery Certificate against borrowers and heirs for a farm loan default. The Debt Recovery Tribunal allowed the application ex-parte, reducing interest to 6% p.a. and directed recovery proceedings against guarantors and mortgaged properties.

What did the court decide?

Granted Recovery Certificate directing recovery of Rs.76.95 Lakhs plus 6% p.a. interest against heirs and mortgaged property.

Canara Bank versus Danayya Rudrayya Ganachari — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 27^th Day of April, 2026

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Present: Sri. T. RAJESH Presiding Officer

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OA. No.1907/2023

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BETWEEN:

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Canara Bank Branch office at 1^st Floor, Sri Sai Ganesh Plaza, Opp: Huns Talkies, Khade Bazar, Belgaum – 590001, Karnataka State, Rep. by its Manager and Principal Officer Smt. Shilpa S Boragaon … APPLICANT

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AND:

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Sri. Danayya Rudrayya Ganachar (since deceased, Rep. by: Defendant Nos.2,3 and 1(a) Smt. Gangavva W/o. Danayya Ganachari, Major, Bailur Village-591115, Kittur Taluk, Belgaum District.

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1(b) Smt. Sudha Madivalayya Hiremath Bialur Village – 591115, Kittur Taluk, Belgaum District.

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1(c) Sri. Basayya Danayya Ganachari Major, Bailur village-591115, Kittur Taluk, Belgaum District.

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OA. No.1907/2023

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1(d) Sri. Mahantayya Danayya Ganachari, Malor, Bailur village-591115, Kittur Taluk, Belgaum District.

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Sri. Shankarayya S/o. Danayya Ganachari Major, Bailur Village-591115, Kittur Taluk, Belgaum District.

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Sri. Irayya S/o. Danayya Ganachari Bailure Village-591115 Kittur Taluk, Belgaum District ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri. T.P. Muthanna Defendants : Sri. M.R. Patil (WS closed)

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FINAL ORDER:

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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.76,95,671/- (Rupees Seventy Six Lakh Ninety Five Thousand Six Hundred and Seventy One only) with further interest thereon from the date of filing the Application till realization from the Defendants.

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It is the case of the applicant that, the defendant No.1 Danayya Rudrayya Ganachari deceased on 08.05.2013 leaving behind defendant Nos.1(a), 1(b), 1(c), 1(d), 2 & 3 as his legal

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OA. No.1907/2023

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heirs/successors to the assets. The deceased defendant No.1 along with defendant Nos.2 and 3 availed Term loan of Rs.7,00,000/- for purchasing of Tractor, Trailer and accessories on 28.03.2007 and Kisan Credit Card Scheme (KCCS) loan of Rs.1,25,000/- on 28.03.2007.

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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 and hypothecation over the Schedule A & B property.

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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 accounts as 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 accounts.

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Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set exparte on 06.04.2026.

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The applicant had let in evidence through AW-1, who filed

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OA. No.1907/2023

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Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A1 to A26 and 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 proof affidavit.

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The following issues arise for consideration in this matter:

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

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ii) What order are to be passed?

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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

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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 facilities 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

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

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OA. No.1907/2023

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11. Hence in view of the above findings which cover both the

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issues raised in this manner, this Tribunal is of the view that OA is liable to be allowed.

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12. Taking into consideration the facts that the credit facilities

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were availed for agricultural purpose 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 6.00%

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p.a.(simple).

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In the result, OA.No.1907/2023 stands allowed,

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i) The applicant is allowed to recovery an aggregate sum

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of Rs.76,95,671/- (Rupees Seventy Six Lakh Ninety Five Thousand Six Hundred and Seventy One only) with further interest of 6.00% p.a.(simple) from the date of filing OA till the realization from the

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defendant Nos.2 and 3 and the defendant No.1(a) to 1(d), 2 & 3 to the extent of his inheritance of any estate from the deceased borrower Late Danayya Rudrayya Ganachari, after giving credit to all the amounts recovered and received during the pendency of

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the OA and allowed the same to be recovered by proceeding against defendant Nos.2 and 3 jointly, severally and personally

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OA. No.1907/2023

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and also by proceeding against the schedule A & B property. The schedule property to the OA be the schedule property to the Recovery Certificate.

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ii) If the sale proceeds are not found sufficient to cover the amount due and payable to the applicant bank, the defendant No.2 and 3 jointly, severally and personally and their other assets and the defendant No.1(a) to 1(d), 2 & 3 to the extent of his inheritance of any estate from the deceased borrower Late Danayya Rudrayya Ganachari are liable for all such amounts due under the loan accounts.

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iii) The applicant bank is allowed cost of the proceeding which applicant to file cost memo within 7 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 and transferred to Recovery for execution.

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v) Interim Application pending, if any, stands disposed of with this Final Order.

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OA. No.1907/2023

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

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

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DRT (Procedure) Rules, 1993.

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[Dictated to the Stenographer (PR), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 27^th Day of April 2026].

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Sri. Sarath Das D, Manager of the applicant bank.

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Exhibits on the part of the Applicant:

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Sl. No.	Description of Documents	Exhibit Number
1	Copy of Application for Agricultural Credit (Tractor Loan)dated 21.03.2007.	A1
2	Copy of Loan Sanction Letter dated 28.03.2007	A2
3	Copy of Memorandum of Agreement for Agricultural Loans dated 28.03.2007	A3
4	Copies of Registration Certificates dated 04.04.2007	A4
5	Copy of the application for Kisan Credit card (KCCS)dated 21.03.2007	A5
6	Copy of the Sanction Letter for KCCS dated 28.03.2007	A6
	Copy of the Agreement and Deed of
7	Hypothecation for Kisan Credit Card dated 28.03.2007	A7
8	Copy of Simple Mortgage Deed dated 22.03.2007 3479/6-7	A8

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OA. No.1907/2023

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9	Copy of Simple Mortgage Deed dated 22.03.2007 348016-7	A9
10	Copy of re-phasement conveying letter dated 31.01.2009 in respect of Tractor Loan.	A10
11	Copy of re-phasement conveying letter dated 31.01.2009 in respect of KCCS Loan.	A11
12	Copy of Letter of Revival dated 04.03.2010	A12
13	Copy of Letter of Revival dated 15.02.2013	A13
14	Copy of Letter of Revival dated 15.02.2013	A14
15	Copy of Letter of Revival dated 08.10.2015	A15
16	Copy of Letter of Revival dated 08.10.2015	A16
17	Copy of Letter of Revival dated 08.10.2015	A17
18	Copy of Letter of Revival dated 08.10.2015	A18
19	Copy of Letter of Revival dated 27.09.2018	A19
20	Copy of Letter of Revival dated 27.09.2018	A20
21	Copy of Letter of Revival dated 27.09.2018	A21
22	Copy of Letter of Revival dated 01.09.2021	A22
23	Copy of Letter of Revival dated 01.09.2021	A23
24	Copy of the Legal Notice dated 05.10.2022	A24
25	Copy of the statement of account & Memo of calculation certified under Bankers' Book of Evidence Act showing the outstanding liabilities under loan a/c,no.0505856005875.	A25
26	Copy of the statement of account & Memo of calculation certified under Bankers' Book of Evidence Act showing the outstanding liabilities under loan a/c. no.0505895005877.	A26

Canara Bank v. Danayya Rudrayya Ganachari

Case brief

What is this about?

What did the court decide?

Canara Bank v. Danayya Rudrayya Ganachari

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

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Case details

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