Allowed

Karur Vysya Bank v. v Amuthan

DRT1 Apr 2026OA/229/2024

Case brief

AI extract

What is this about?

The Tribunal allowed the Original Application filed by Karur Vysya Bank to recover a principal sum of Rs.20,09,805.16 and interest. Penal interest capitalization was disallowed in line with Supreme Court precedent. The order directed recovery from respondents jointly/severally with liberty to sell mortgaged properties.

What did the court decide?

Directing respondents to jointly/severally pay Rs.20,09,805.16 with interest at 9.55% p.a. within one month and permitting sale of mortgaged properties if payment defaults.

Karur Vysya Bank versus v Amuthan — Contract and Commercial Disputes | DRT (2026)

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OA No. 229/2024

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL AT MADURAI DATED THIS 01^ST DAY OF APRIL, 2026 PRESENT: SEEMA SINHA,

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[PR. DISTRICT & SESSIONS JUDGE – Retd] PRESIDING OFFICER

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OA No.229/2024

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Between

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The Karur Vysya Bank Limited, Asset Recovery Branch, Mattuthavani, Madurai – 625 107. Rep. By its Branch Manager. ---Applicant Bank

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And

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Mr. V. Amuthan,

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S/o Vairakannu,

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No.572/33C1, Adambai Road, Ambalakkara Street,

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Nambivayal Village and post, Pattukottai Taluk,

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Thanjavur District -614 615.

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Mr. V. Anbarasan, S/o Vairakannu, No.617, Sepplan Street, Adambai Road, Ambalakkara Street, Nambivayal Village Post, Pattukottai Taluk, Thanjavur District -614 615 ---Defendants

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Counsel for the Applicant Bank : M/s M. Muthukumaran, S. vanitha M. Sivapriyadharshiny, E. saravanaraj S. Abitha.

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Page 1 of 9

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OA No. 229/2024

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This Original Application was heard and fixed for passing final order before me in the presence of the above said Advocate for Applicant Bank and the Defendants having been set ex-parte and upon hearing the arguments of Counsel for Applicant Bank and upon perusing the material available on the records and having stood over for consideration till this day, this Tribunal delivered the following:

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JUDGEMENT

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1 . This Application has been filed under Sec.19 (1) of the "The Recovery of Debts due to Banks and Financial Institutions Act, 1993" now amended as The Recovery of Debts and Bankruptcy Act, 1993 by the Applicant Bank on 15.03.2024 to recover from the Defendants a sum of Rs.20,09,805.16p together with interest at the rate of 12.55% p.a. (with Penal Interest) with monthly rests in respect of KVB HSL from the date of filing of Application till the date of realization with cost and by sale of mortgaged/hypothecated properties, more fully described in Schedules of the application.

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2 . The brief averments of the application filed by the Applicant Bank are as follows:-

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The 1^st Defendant availed Rs.14,95,000/-Under HSL-New housing loan and the same was sanctioned by the applicant bank to the Defendant. The 2nd defendant stood as guarantor for the loan availed by the 1^st defendant. The defendants KVB Housing Loan account number is 1623753000001016. The details of the credit facilities are as follows:

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SI. No	Type of Loan	Date of Loan	Loan Amount (Rs.)	Date of Execution of Documents
1	KVB Housing Loan (HSL)	10.04.2017	14,95,000/-	10.04.2017

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The Defendants executed necessary loan documents in favour of the Applicant Bank and the 1^st defendant had mortgaged his property and to abide by the terms of the Bank that may be stipulated by the Applicant Bank in the matter of repaying the amounts availed under the said accounts and the interest accrued there under. The details of the interest, repayment and present outstanding as follows:

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Page 2 of 9

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OA No. 229/2024

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S. No.	Name of Loan	Rate of Interest	Repayment Schedule	Outstanding Loan Amount (Rs.)
1	KVB Loan (HSL) Housing	9.70% + 3% PI	180 Equated Monthly Instalments with initial Holiday Period of 3 months commencing from 10.08.2017	20,09,805.16
	Total			20,09,805.16

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The 1^st Defendant have created mortgage over their properties described in schedule "A" hereunder by deposit of original title deeds in favour of applicant bank.

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DETAILS OF THE MORTGAGED PROPERTIES

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Mortgagor : V.Amuthan Mortgagee : The Karur Vysya Bank Limited, Pattukottai Branch, Thanjavur District. Date of Mortgage : 10.04.2017 Rate of Interest : 9.70% p.a Details of Properties : As per Schedule "A"

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Thus, as per the accounts of the Applicant maintained in the name of the Defendants, kept in their regular course of business and as certified under the Bankers Books of Evidence Act, as on 10.02.2024 for a sum of Rs.20,09,805.16 has become due and to be liable to pay the said amounts with future interest till realization.

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The Defendants though have availed the entire sanctioned loan for the purpose of Construction of Residential House Building and they have not chosen to repay the loan amounts as agreed, despite the repeated demands and reminders by the Applicant Bank. The defendants made several promises, but they failed to keep up their promises.

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Hence, the Applicant Bank has filed the OA for recovery of a sum of Rs.20,09,805.16p together with interest at the rate of 12.55% p.a. (with Penal Interest) with monthly rests in respect of KVB HSL from the date of filing of Application till the date of realization with cost.

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The Applicant Bank has submitted the following documents in support its claim in the OA, which are as follows:

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Page 3 of 9

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OA No. 229/2024

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S. No.	Date	Description of document	Exhibits
1	10.04.2017	Sanction of Credit facilities	Ex.No.A-01
2	10.04.2017	Memorandum of Deposit of Title Deeds for Registration(DOC. No. 388/17)	Ex.No.A-02
3	10.04.2017	Demand PromissoryNote	Ex.No.A-03
4	10.04.2017	Take Delivery Letter (TDL) cum Continuity Letter in relation to DPN	Ex.No.A-04
5	10.04.2017	HousingAgreement Loan	Ex.No.A-05
6	10.04.2017	Agreement of Guarantee	Ex.No.A-06
7	10.04.2017	Undertaking Letter for Payment of Interest Charged Duringthe HolidayPeriod	Ex.No.A-07
8	11.05.2017	SupplementaryAgreement	Ex.No.A-08
9	12.12.2019	Acknowledgment of Debt from the Borrower	Ex.No.A-09
10	12.12.2019	Acknowledgment of Debt from the Guarantor	Ex.No.A-10
11	02.12.2022	Revival Letter	Ex.No.A-11
	10.04.2017		Ex.No.A-12
12	to 14.02.2024	Account Statement
13	25.07.1971	Sale deed executed by Karuppaiyan in favour of AyyasamyAmbalam, Doc No. 1423/1971	Ex.No.A-13
		Sale deed executed by Ayyasamy Ambalam	Ex.No.A-14
14	18.08.1982	for himself and his minor son Ramamoorthi as Guardian Duraikannu in favour of Vairakannu, Doc. No. 798/1982
		Partition deed executed between Vairakannu,	Ex.No.A-15
15	23.02.2017	Anbarasan, Arivarasan, Arangakannan, Amuthan, Doc. No. 184/2017
16	14.03.2017	Online Patta Transfer Order issued by Zonal DeputyTahsildar Pattukottai	Ex.No.A-16
17	17.03.2017	Ownership and Valuation Certificate issued byVAO, 7-Nambivayal, Pattukottai Taluk	Ex.No.A-17
18	17.03.2017	Four Boundaries Certificate issued by VAO, 7-Nambivayal, Pattukottai Taluk	Ex.No.A-18
19	17.03.2017	UDR-A Register issued by VAO, 7- Nambivayal, Pattukottai Taluk	Ex.No.A-19
20	-	Online A-Register Extract	Ex.No.A-20
21	17.03.2021	Chitta and Adangal Extract issued by VAO, 7-Nambivayal, Pattukottai Taluk	Ex.No.A-21
22	14.03.2017	Online Computer Chitta Extract	Ex.No.A-22
23	17.03.2017	F.M.B Sketch issued by VAO, 7-Nambivayal, Pattukottai Taluk	Ex.No.A-23
24	03.03.2017	Blue Print Plan Approval, Building	Ex.No.A-24

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Page 4 of 9

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OA No. 229/2024

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		Construction Permission Order issued by Special Officer, Nambivayal Panchayat Board /Block Development Officer, Pattukottai
25	03.03.2017	Miscellaneous Receipt stands in the name of Amuthan issued by Special Officer, Nambivayal Panchayat Board / Block Development Officer, Pattukottai	Ex.No.A-25
26	15.03.2017	Encumbrance Certificate No. 413/2017 for the period from 01.01.1987 to 14.03.2017 for 31 years issued by Sub Registrar, Keeramangalam Registrar Office	Ex.No.A-26
27	22.03.2017	Legal Opinion	Ex.No.A-27

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SCHEDULE "A" MORTGAGED PROPERTIES

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Thanjavur District, Pattukottai Taluk, Pattukottai registration district, Pattukottai Joint Sub Registration Office No.2, Pattukottai Union, Nambivayal Panchayat Union, No.2 Nambivayal Village, Comprised in Survey No. 213A-3B1, total extent of 1 acre 4 cents that is 0.42.0 ares out of which in the new survey No.213A-3B1 punjai manaicut land comprises a total extent of 0.075.5 ares that is 0.19 cents that is 57 kuzhis that is 8276.4 square feet out of which punjai manaicut land admeasuring eastwest on the north 29.0 meter,east-west on the south 21.8 meter, southnorth on the east 26.6 meter, south -north on the west 29.2 meter thus in total 7625 square feet that is 52^1/2 kuzhis that is 17^1/2 cents lodged in patta No. 1608.

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Including a thatched house building measuring plinth area 10x16=160 square feet, bearing door No. 554/1, including electricity service connection No. 1047.including a terraced residential ground floor house building super structure, building measuring plinth area 1200 square feet (as per bule print plan approval) being constructed with electricity service connection to be effected bore well to be erected with sub mersible electric motor to be installed, drinking water tap connection to be effected, compound wall, stair case to be constructed in further etc.

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Bounded on the:

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East : Main Road West : Mariappan Punjai South : Property belongs to Arumbu North : Property belongs to Dharmalingam

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Page 5 of 9

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OA No. 229/2024

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3 . On the other hand, Notices were issued to Defendants and since from the beginning of the case, there was no representation on behalf of the Defendants. Hence, Defendants were set ex-parte.

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4. Now the main point for consideration before me is as to whether the Applicant has been able to prove his case on his own leg?

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Having gone through the affidavit of the applicant and the documents filed by them and also considering the submission of the counsel for the Applicant, I find that the Applicant Bank, in order to prove its claim, has filed Proof Affidavit executed by one Mr. S. Dhandapani, who is the Chief Manager of the Applicant Bank.

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He has stated in his affidavit that the defendants has availed KVB HSL from the Applicant Bank, but they failed to pay the outstanding loan amount, hence he has filed the case. The applicant bank has also filed the documents given by the defendants at the time of sanctioning the loan amount, which have been marked as exhibits No.A-01 to A-27 in support of its claim in the OA.

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The Sanction of Credit facilities has been marked as Ex. No A-01, and the Memorandum of Deposit of Title Deeds for Registration (DOC. No. 388/17) has been marked as Ex. No A-02, and the Demand Promissory Note has been marked as Ex. No A-03, and the Take Delivery Letter (TDL) cum Continuity Letter in relation to DPN has been marked as Ex. No A-04, and the Housing Agreement Loan has been marked as Ex. No A-05, and the Agreement of Guarantee has been marked as Ex. No A-06, and the Undertaking Letter for Payment of Interest Charged During the Holiday Period has been marked as Ex. No A-07, and the Supplementary Agreement has been marked as Ex. No A-08, and the Acknowledgment of Debt from the Borrower has been marked as Ex. No A-09, and the Acknowledgment of Debt from the Guarantor has been marked as Ex. No A-10.

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The Revival Letter has been marked as Ex. No A-11, and the Account Statement has been marked as Ex. No A-12, and the Sale deed executed by Karuppaiyan in favour of Ayyasamy Ambalam, Doc No. 1423/1971, has been marked as Ex. No A-13, and the Sale deed executed by Ayyasamy Ambalam for himself and his minor son Ramamoorthi as Guardian Duraikannu in favour of Vairakannu, Doc. No. 798/1982, has been marked as Ex. No A-14, and the Partition deed executed between Vairakannu, Anbarasan, Arivarasan, Arangakannan, Amuthan, Doc. No. 184/2017, has been marked as Ex. No A-15, and the Online Patta Transfer Order issued by Zonal Deputy Tahsildar Pattukottai has been marked as Ex. No A-16, and the Ownership and Valuation Certificate issued by VAO, 7-Nambivayal,

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Page 6 of 9

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OA No. 229/2024

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Pattukottai Taluk has been marked as Ex. No A-17, and the Four Boundaries Certificate issued by VAO, 7-Nambivayal, Pattukottai Taluk has been marked as Ex. No A-18, and the UDR-A Register issued by VAO, 7- Nambivayal, Pattukottai Taluk has been marked as Ex. No A-19, and the Online A-Register Extract has been marked as Ex. No A-20.

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The Chitta and Adangal Extract issued by VAO, 7-Nambivayal, Pattukottai Taluk has been marked as Ex. No A-21, and the Online Computer Chitta Extract has been marked as Ex. No A-22, and the F.M.B Sketch issued by VAO, 7-Nambivayal, Pattukottai Taluk has been marked as Ex. No A-23, and the Blue Print Plan Approval, Building Construction Permission Order issued by Special Officer, Nambivayal Panchayat Board / Block Development Officer, Pattukottai has been marked as Ex. No A-24, and the Miscellaneous Receipt in the name of Amuthan issued by Special Officer, Nambivayal Panchayat Board / Block Development Officer, Pattukottai has been marked as Ex. No A-25, and the Encumbrance Certificate No. 413/2017 for the period from 01.01.1987 to 14.03.2017 issued by Sub Registrar, Keeramangalam Registrar Office has been marked as Ex. No A-26, and the Legal Opinion has been marked as Ex. No A-27. So the averments of the applicant as well as the statement of the pleading have been corroborated by the above mentioned documents.

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As the Defendants remained ex-parte, the claim of the Applicant Bank is neither disproved nor dislodged and goes on record as proved. Accordingly a cumulative analysis of both the Proof Affidavit and documents marked by the Applicant Bank would prove the claim of the Applicant Bank in the OA.

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So far the claim of interest is concerned, it is a well settled Law that the Tribunal has got powers to award pendente lite interest in view of the Judgment of the Hon’ble Supreme Court in N.M. Veerapa Vs Canara Bank (reported in AIR 98(1), 1101 & in Central bank of India Vs Ravindra and OS (AIR, 2001(1), 3095).

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So far the penal interest is concerned Hon'ble supreme court stated in the said judgement as followed " Though interest can be capitalised on the anology that the interest falling due on the accrued date and remaining unpaid, partakes the character of amount advanced on that date, yet penal interest, which is charged by way of penalty for non payment, cannot be capitalized. Further interest, i.e interest on interest, whether simple, compound or penal, cannot be claimed on the amount of penal interest. Penal interest cannot be capitalized. It will be opposed to public policy ".

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Therefore, this Original Application is allowed . The Applicant Bank is entitled for a final order on the following lines:-

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Page 7 of 9

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OA No. 229/2024

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The Applicant Bank is entitled to recover from the Defendants, a sum of Rs.20,09,805.16p together with interest at the rate of 9.55% p.a. with half yearly rests in respect of KVB HSL from the date of filing of Application till the date of realization with cost. Accordingly, it is hereby

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ORDERED

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(a) That the Defendants are directed to pay jointly/severally a sum of Rs.20,09,805.16p together with interest at the rate of 9.55% p.a. with half yearly rests in respect of KVB HSL from the date of filing of Application till the date of realization with cost within one month from the date of receipt of this order.

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(b) In case of default of payment by the above mentioned Defendants, the Applicant Bank is at liberty to sell the movable / immovable properties more fully described in Schedule of the original application for appropriation of sale proceeds towards the satisfaction of amount due to the Applicant Bank.

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(c) If the sale proceeds are not sufficient, after defraying the expenses of such sale, for the payment of all such amounts, the defendants are jointly/severally liable to pay the amount of such deficiency with interest mentioned above until realization.

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Page 8 of 9

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OA No. 229/2024

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(d) Any amount remitted during the course of this proceedings shall

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be given due credit, to the loan account of the defendants.

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(e) Recovery Certificate be prepared, as per the directions given above, and issue accordingly. A copy of the order is to be communicated to the parties concerned, immediately.

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(f) It is further ordered that the Applicant Bank shall file cost memo within a period of one month from the date of receipt of this order, so as to prepare the recovery certificate with cost for the KVB HSL and the Recovery Officer is also directed to proceed with the matter in accordance with law. In case, cost memo is not filed before said period of one month, Recovery Certificate will be prepared with available records.

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Dictated to T.P, taken down, transcribed, typed by her, corrected and pronounced by me in the Open Court in this the 01^st April, 2026.

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Sd/-

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(SEEMA SINHA) PRESIDING OFFICER

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Uploaded on 10.04.26

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Karur Vysya Bank v. v Amuthan

Case brief

What is this about?

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Karur Vysya Bank v. v Amuthan

Case brief

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