Allowed

State Bank of India v. Chethana Industries

DRT11 Sept 2026OA/1955/2025

Case brief

AI extract

What is this about?

This DRT judgment deals with an Original Application filed by State Bank of India for a recovery certificate against M/s. Chethana Industries. The court held the evidence of loan default and credit facility availment uncontroverted as the defendant appeared ex parte. Allowing the application, the court issued a recovery certificate for the principal amount, reduced the interest rate to 12% p.a. (simple), and confirmed the respondent's personal liability.

What did the court decide?

Recovery Certificate issued for Rs. 22,92,129/- plus further interest at 12% p.a. (simple) from the date of filing till realization. Defendant personally liable for shortfall if schedule proceeds are insufficient. Cost of proceedings awarded.

State Bank of India versus Chethana Industries — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 11^th Day of September, 2026

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Present: Sri. T. RAJESH

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Presiding Officer

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OA. No.1955/2025

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BETWEEN:

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State Bank of India SME Centre, Opp. Deaf & Dumb School, New Sayyajirao Road, Bamboo Bazar, Mysuru-570021 Rep.by its Chief Manager, Smt. Maheswari … APPLICANT

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AND:

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M/s. Chethana Industries Rep. by its Proprietor Smt. Chethana R W/o. Sri. Jayanth B No.1374, Kasaba Hobli, Smt. Devamma Sri Malli Siddegowda Commercial Building, Koorgalli, Mysuru – 570016 Also at: No.SM-153, KSSIDC Industrial Estate, Hebbal, Mysore – 570016 And also at: Smt. Chethana R W/o. Jayanth B No.4/18, 2^nd main road, Near BSNL Telephone Exchange, Shakthinagar, Mysore-570029 Also at: No.4, 1^st cross, 5^th main road, Jayanagar, Mysuru-570014 ...DEFENDANT

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Counsel on record/appeared for:

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OA. No.1955/2025

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Applicant : Smt. M. Anitha Defendant : Exparte

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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 defendant for Rs.22,92,129/- (Rupees Twenty Two Lakh Ninety Two Thousand One Hundred and Twenty Nine only) with further interest thereon from the date of filing the Application till realization from the Defendant.

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It is the case of the applicant that, the defendant availed Cash Credit facility of Rs.5,00,000/- and Term loan of Rs.23,50,000/- on 27.063.2023 for the purpose of running business.

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It is also the case of the applicant that, in view of the above financed credit facilities, the defendant executed necessary loan documents.

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

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OA. No.1955/2025

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Despite entering appearance/filing vakalath, no written statement filed by the defendant No.1, hence the chance is closed on 05.05.2026.

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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 A1 to A9 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 defendant?

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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 remains unrebutted as defendant 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

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OA. No.1955/2025

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defaults committed in the account. The liability of the defendant and

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

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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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Taking into consideration the facts that the credit facilities were availed for business purpose and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of

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the OA can be allowed with a reduced interest of 12.00% p.a.(simple).

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In the result, OA.No.1955/2025 stands allowed,

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i) The applicant is allowed to recovery an aggregate sum of Rs.22,92,129/- (Rupees Twenty Two Lakh Ninety Two Thousand One Hundred and Twenty Nine only) with further interest of 12.00% p.a.(simple) from the date of filing OA till the realization from the defendant, after giving credit to all the amounts recovered and received during the pendency of the OA and allowed the same to be recovered by proceeding against defendant personally and also by

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proceeding against the schedule. The schedule to the OA be the

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OA. No.1955/2025

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schedule to the Recovery Certificate.

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

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amount due and payable to the applicant bank, the defendant personally and her other assets are liable for all such amounts due

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under the loan accounts.

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iii) The applicant bank is allowed cost of the proceeding

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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

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order and transferred to Recovery for execution.

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

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with 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 the Stenographer (PR), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 11^th Day of September 2026].

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

OA. No.1955/2025

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Mr. Narasimha Murthy B, Chief 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	Application form for stand-up India Scheme dated 28.02.2023	A1
2	Sanction resolution dated 16.03.2023	A2
3	Letter of arrangement and addendum to arrangement/sanction letter dated 27.03.2023	A3 & A4
4	Agreement of loan-cum-hypothecation dated 27.03.2023	A5
5	Legal notice dated 22.01.2025	A6
6	Postal receipt	A7
7	Request letter from borrower	A8
8	Foreclosure/statement of accounts in account No.41789651904	A9

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

State Bank of India v. Chethana Industries

Case brief

What is this about?

What did the court decide?

State Bank of India v. Chethana Industries

Case brief

What is this about?

What did the court decide?

What the court decided

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