Allowed

Rbl Bank Limited v. M/s Sri Kodandarama Aquafeeds & Needs

DRT15 May 2026OA/216/2024

Case brief

AI extract

What is this about?

Stricto jure, the Debts Recovery Tribunal allowed the bank's original application for recovery. Citing uncontradicted documentary evidence, the court held borrowers and guarantor jointly liable for the debt, allowing recovery from attached properties subject to existing encumbrances. Costs were awarded to the bank.

What did the court decide?

The respondents were held jointly liable to pay the sum of Rs. 88,50,279/- with interest and costs. The bank was directed to proceed against attached properties subject to prior encumbrances.

Rbl Bank Limited versus M/s Sri Kodandarama… — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-II AT HYDERABAD DATED THIS THE 15TH DAY OF MAY, 2026

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PRESENT: SH. RAMESHWAR KOTHE, B.Com, L.LB.^{(Hons.), M.A.} PRESIDING OFFICER

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Original Application No: 216 OF 2024

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RBL BANK LIMITED, Madhapur, Hyderabad. Represented by its Senior Vice President cum Authorised Officer

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.....Applicant

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Versus

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M/s Sri Kodandarama Aquafeeds & Needs Rep. by its Proprietor Sri Lokam Bala Subrahmanyam, Situated at^premises No. 9-25, Beside Devi Janaki Theatre Main Road, lYogaltur, West Godava ri-534281 Andhra Pradesh

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Sri Lokam Bala Subrahmanyam, S/o Sri Gopala Rao Lokam, Aged 48 years, Occ: Business R/o 19-25, Beside Devi -lanaki Theatre Main Road, Mogaltur, West Godavari-534281

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Smt Kasturi Syamala, W/o Sri Lokam Bala Subrahmanyam, Aged 42^years, Occ: Business, R/o l-95/2, Sri Kodandarama Nilayamm, High School Road, Mogaltur Mandalam, West Godavari - 534281

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...Defendants

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Counsel for the Applicant : Mr.^M. Srinivas/Mr.N'^ManoharReddy Counsel for Defendant : Mr.M.K.^{Sridhar Goud} hil\ ''$'}\ t^1'. r6"

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OA. No. 216/2024

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:: ORDER::

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The Applicant Bank filed the present OA for the recovery of a sum of Rs. 88,50,279l- from the Defendant Nos. 1 to 3 jointly and severally with future interest @ 15.10olo p.a. with monthly rests from the date of application till the date of realisation along with costs.

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The averments of the applicant bank, as stated in the OA, in brief, are that Defendant No.I is a proprietary concern represented by its proprietor who is Defendant No.2, approached the applicant Bank for financial assistance. Pursuant to such request, the Bank initially sanctioned a loan of Rs.50,00,000 on 22.71,.2021,, for which the Defendants executed the requisite loan documents such as Demand Promissory Note, declarations, and undertakings. Defendant No.3 stood as guarantor by executing a Deed of Guarantee, thereby undertaking joint and several liability for repayment of the facility and expressly waiving the statutory rights and protections available to a surety. Subsequently, on the request of the borrower, the Bank enhanced the credit facility to Rs.1,00,00,000/- vide sanction dated t2.tZ.ZO22, and fresh loan documents, including fresh promissory notes and declarations, were executed with the consent of all Defendants. Defendants executed letter of Acknowledgement of Debt dated 15.72.2022. However, despite availing the enhanced facilities and executing the requisite documentation, the Defendants failed to adhere to the repayment schedule, committed persistent defaults, and their loan account was classified as a NpA on 28.07.2023. Thereafter, the applicant Bank issued a loan recall cum invocation of guarantee notice dated 18.11.2023, demanding repayment of Rs.g6,O6,506 as on 15.11.2023; yet the Defendants failed to comply with the notice or regularise the account. Despite repeated demands and reminders, they neither discharged the liability nor exhibited any financial discipline, and

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Vov$

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OA. No.2L6/2o24

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the Bank further^{apprehendedthat Defendants No'2 and No'3 were} attempting to create^{third party interests in their immovable properties} so as to defeat recovery^{proceedings,which prompted the Bank to} moveanapplicationforattachmentbeforejudgment.HencethisoAfor recovery of dues.

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Defendants Nos.^{1 to 3 filed written statement' The averments'} briefly, are that^{enhancementof the facility fromRs.50 lakhs to Rs.1} crore was not at the^{requestof the defendantsbut was initiated by the} Bank on the^{basis of business turnover, and that the Bankcompelled} the 2nd defendant^{to depositRs.5 Lakhs as a procedural requirement.} The defendants further^{deny executionof any loan and security} documents after^{enhancementand that blank cheques and promissory} notesWereobtainedbytheApplicantBankunderthepretextof collateral security and^{later misused, includinginitiationof cheque} bounce^{proceedings on supposedly fabricated instruments'The} defendants also dispute^{the existence of any validguaranteeby} Defendant No.3,^{assertingthat her signatures wereobtained merelyas} a formality being^{the spouseof Defendant No'2 and not in the capacity} ofaguarantor,andthereforeshecannotbeheldliab|ejointlyand severally'Withrespecttotheallegedsecuredassets,theystatethat Defendant No.3^{had already sold the concernedproperty prior to the} dispute, and that^{the property of Defendant No'2 was already} mortgaged with ICICI^{Bank, thereby disentitling the applicantBank} from seeking attachment^{or creating a fresh mortgage' They further} denythattheyevercreatedthirdpartyinterestsinthepropertiesto defeat recovery^{proceedingsand attribute any such transfersto} independent commercial^{transactions. From a factual standpoint'the} defendants attribute their^{financial distress to severelossesin the} aquaculture business^{caused by market fluctuations, price crashes'}

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ff6,'t'to

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OA, No,27612024

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disease in prawn culture, and widespread defaults by their own borrowers, which disrupted their repayment capacity despite an otherwise regular repayment track record. They contend that substantial payments were made but were not duly accounted for by the Bank, and chailenge the Bank's computation of the outstanding amount. Hence, OA is liable to be dismissed.

¶23

In order to prove its case, Applicant Bank examined by Mr. Md. Jameel Ullah Shareef, Assistant Manager as AW_1 and marked 17 documents through him as Exhibits A_1 to A_17.

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5' In order to substantiate their defence, defendants examined sri Lokam Bala Subrahmanyam-2'd defendant as DW-1 and marked no documents.

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Heard the rearned counser appearing for the appricant whereas right of defendant to advance arguments was forfeited on 07.04.2026 after affording sufficient opportunity. perused the written arguments filed by the Defendants and arso perused the materiar brought on record.

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During the course of arguments, the rearned counser for the applicant bank whire reiterating the version as in the apprication, 2nd contended that the 1tt defendant represented by defendant/proprietor avaired credit/enhanced crecrit facirities from the applicant bank, to which 3rd respondent arso stood as personar guarantor, by executing roan documents and guarantee agreements. Due to defaurt, the account was decrared as NpA as per RBI guiderines. He relied on Exs.A-1 to Exs.A-17 marked through appricant evidence (AW-1) as proof of craim of the bank and submitted that the appricant

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Ow,ro

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oA. No.2L6/2024

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bank is entiued for recovery of the outstanding amount together with future interest and costs. He further contended that the appricant bank is also enti'ed to proceed against the immovabre properties beronging to defendants 2 and 3 as per order dated 24.L0.2024, for rearization of its debt. Accordingly he prayed to allow the OA.

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B' Learned counser for the defendants, vide his written arguments, would repeat the contents of the written statement and contended that the bank has proceeded on the basis of farse, fabricated and forged documents, incruding brank cheques and Dp notes said to have been taken as collaterar, and that the cheque-bounce case for Rs.g6,06,560/filed at New Delhi (cc No. 860/2024) is also founded on such misuse. They contend that the bank acted with mara fi?e intent to harass them and to recover infrated amounts without properry expraining the dues, interest, penar interest, and other charges, whire ignoring substantiar repayments already made and the account,s prior enhancement on the basis of their repayment record. The 3'd defendant is not having any immovable property in her name since she sord the same on 24.03.2022 vide Doc.No. L34g/2022 and the property of 2nd defendant is already under mortgage with ICICI Bank, Narasapuram Branch by depositing original documents. Therefore the applicant bank is not entitled to proceed against the same. With these submissions, defendants sought for dismissal of OA.

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The point that arises for consideration is:-

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Whether the Applicant Bank is entiiled for the OA ctaim against the Defendants and attached properties?

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As stated supra, defendants except for making bald statement in the written statement pertaining to non-availment of enhanced loan

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@nv,o

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oA. No.^216/2024

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facility, documents^{being fabricated' un-accounted for substantial} paymentsmadetowardsthedebt'wrongfulclassificationofNPAetc'' they failed^{to substantiatetheir plea by marking any relevant evidence} as to taking^{up the matter with the higher-upsof the bank or with the} RBI; or by^{confrontingthe witness of the applicantbank by way of} cross-examination^{as to disprove the veracityof the Exhibits A-1 to A-} lT.ItissettledlawthatmerestatementsWithoutsufficientevidenceis ofnoavail.ontheotherhand,theapplicantbankproduceddocuments and marked^{them as Exs'A'to A'17 through AW-1 as proofof its claim'} Under such^{circumstances,the evidence affidavitof AW-1 coupled with} recitalsinExhibitsA-1toA-lTremainSunchallengedandun-rebutted' Accordingly,^{Ihold that the DefendantNos'1 to 3 are jointly and} severally^{liable to pay to the applicant bank the claimmade in the OA} with future^{interest and costs'}

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As far as^{the contentionof defendants pertaining to immovable} properties attached^{vide order dated 24'10'2024is concerned'though} the defendants^{have not filed documentary evidence, their contention} that the attachecl^{properties are alreadysold/chargedcannotbe} brushed aside.^{Hence, in order to prevent any wrongful or illegal} attachment,itismadeclearthattheattachmentoflANo.lB14/2024 schedule immovable^{properties,shall be subjectto charge/saleexisting} if any,^prior to^{the date of attachment.}

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In the result, the^{present Original Application No'216/2024is} allowed as under:^-

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(i) The Defendant Nos. 1 to 3 are liable to^pay to^the Applicant Bank a sum of Rs. 88,50,279l-^with future interest rate of 7.600/o simple^{from-Lhe date} of application till the date of^realization rfr$r*,

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OA. No.216/2024

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(ii) The applicant bank is entitled to proceed against the immovable properties belonging to defendants 2 and 3 attached vide order dated 24.10.2024 in lA No.L81412024, subject to sale/charge subsisting if any, prior to the date of attachment;

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(iii) the applicant is also entitled to proceed against the person and properties of the Defendant Nos. 1 to 3 for realization of dues; and

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(iv) the applicant bank is entitled for the costs.

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The Applicant Bank is directed to file Cost Memo within 2 weeks from the date of receipt of this Order.

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Issue Recovery Certificate accordingly.

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Communicate a copy of this order to the parties concerned.

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(Dictated to the steno, corrected, signed and pronounced by me in the open court on this the 15th day of M ay,2026l

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$-r.to$

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(RAMESHWAR KOTHE) PRESIDING OFFICER

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Rbl Bank Limited v. M/s Sri Kodandarama Aquafeeds & Needs

Case brief

What is this about?

What did the court decide?

Rbl Bank Limited v. M/s Sri Kodandarama Aquafeeds & Needs

Case brief

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What the court decided

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