Allowed

Indian Overseas Bank v. Mr. v Lakshmanan

DRT22 Apr 2026OA/260/2023

Case brief

AI extract

What is this about?

The DRT allowed the bank's application for a recovery certificate regarding an unpaid home loan. The defendant failed to appear, and the bank proved the loan documents and due amount. Relief granted includes recovery of principal, reduced interest, and sale of mortgaged property.

What did the court decide?

Recovery Certificate issued for Rs.54,16,166/- with 9% interest; sale of schedule property permitted; costs awarded. Defendant remains personally liable.

Indian Overseas Bank versus Mr. v. Lakshmanan — Banking and Recovery | DRT (2026)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 22^nd day of April, 2026

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PRESENT: SHRI SHARANG DHAR UPADHYAY PRESIDING OFFICER

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OA No.260 of 2023

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Indian Overseas Bank Arumbakkam Branch No.1063, E.V.R. Periyar High Road Arumbakkam, Chennai – 600 106 Rep. by Branch Manager

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…Applicant

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Versus

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V. Lakshmanan S/o Venkatesan No.4, Mangalapuram 9^th Street Chetpet, Chennai – 600 031

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…Defendant

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Counsels on Record / Appeared

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Counsel for Applicant Bank :Mr. N.K.S. Rukmangathan Defendant ex-parte on 10.11.2023

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FINAL ORDER

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This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendantseeking issuance of a Recovery Certificate for recovery of a sum of Rs.54,16,166/- - together with interest at the rate of 10.15% per annum with monthly rests plus 2% penal interest from the date of the application till the date of realisation along with costs of the application and for sale of schedule mentioned property.

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The subject matter of the case is the Home Loan availed by the defendant from the Applicant Bank.

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It is the case of the applicant that the defendant approached the applicant bank for financial assistance for purchase of flat under Subha Gruha Scheme and submitted loan application dated 14.12.2015 and considering the said request the applicant bank sanctioned a loan of Rs.32,00,000/- on 29.12.2015. It is also the case of the applicant that the defendant executed various loan documents on 29.12.2015 viz., Demand Promissory Note for Rs.32,00,000/-, undertaking letter to repay the said loan in 240 equal monthly installments commencing from 30.01.2016 and Term Loan Agreement (Housing Loan).

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It is also the case of the applicant that the defendant deposited the title deeds of the schedule mentioned property with the applicant on 27.1.2016 with an intention to create equitable mortgage over the same in favour of the applicant and confirmed the same by executing Memorandum of Deposit of Title deeds dated 27.01.2016 registered as Doc. No.678/2016, SRO, Guduvanchery.

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It is also the case of the applicant that the defendant was highly irregular in repayment and failed to regularize the loan account despite repeated demands and hence the loan account was classified as NPA on 27.10.2016. it is also stated that the defendant executed revival letter on

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29.03.2017 and 28.03.2020. It is further stated that the applicant thereafter issued a demand notice dated 09.11.2018 under Section 13(2) of the SARFAESI Act calling upon the defendant to clear the outstanding dues but the defendant did not come forward to clear the dues. Hence the present OA is filed for recovery of its dues.

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Summons was taken out to the defendant and was served by way of substituted service. As the defendant was absent continuously and as there was no representation for the defendants on 10.11.2023,the defendant was set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 16 documents, which were marked as Ex. A-1 to A-16 on 22.04.2024, however, Exhibits A-6 to A-10 and A-13 to A-15 were marked subject to proof and relevancy. The Ld. Counsel for Applicant Bank made his submissions on 13.03.2026and thereafter the matter stood till this date for passing final orders.

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The following issues arise for consideration in the matter: -

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(a) Whether the applicant had succeeded in proving the liability of the defendant?

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(b) What order as to cost of the proceedings need be passed?

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These issues are considered together.

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Heard the Ld. Counsel for the applicant, perused the OA averments and the record placed before the Tribunal.

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The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-16along with the proof affidavit. The documents produced in evidence are all found admissible. The proof affidavit of the applicant bank remained unchallenged and unrebutted. Therefore, on careful consideration of proof affidavit along with exhibits filed on behalf of the applicant bank, besides the material placed before the Tribunal, the Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendant. Further, the statement of accounts in respect of the loan account produced and certified under the Banker’s Book Evidence Act, clearly indicates that the amount claimed by the applicant is due from the defendants. It is clear from the statement of accounts that penal interest is not capitalized.

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In view of the foregoing, it is clearly evident that the application filed by the applicant bank is well within the period of limitation and this Tribunal possesses the territorial and pecuniary jurisdiction to entertain this OA.

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In view of the fact that the loan facility availed by the defendant is a homeloan and the applicant has claimed interest at contractual rate till the date of filing of the OA, this Tribunal is of the view that the pendente lite interest can be awarded at reduced rates.

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In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, OA is disposed off in the following manner: -

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(a) OA No.260 of 2023 stands allowed.

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(b) Applicant is permitted to realize a sum of Rs.54,16,166/-with further interest @9% per annum (simple) from the date of filing of the application till the date of realization in full, from the defendant after deducting all the amounts received / realized by them during the pendency of OA and also by selling the schedule property and other assets of the defendant.

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(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendant is personally liable for all such amounts due as ordered above.

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(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 15 days from the date of receipt of the copy of the order.

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(e) The Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of this final order.

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13. Communicate a copy of the order to the parties concerned in terms of

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Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

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Sd/(SHARANG DHAR UPADHYAY ) PRESIDING OFFICER DRT-II, CHENNAI

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(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 22^nd day of April, 2026)

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EXHIBITS MARKED BY APPLICANT BANK

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S. No.	Date	Description of Documents	Exhibit Nos.
1.	14.12.2015	Loan Application	A-1
2.	29.12.2015	Sanction Letter	A-2
3.	29.12.2015	Demand Promissory Note	A-3
4.	29.12.2015	Undertaking Letter	A-4
5.	29.12.2015	Housing Loan [Team Loan Agreement]	A-5
6.	27.01.2016	Letter regarding Deposit of Title Deeds	A-6
7.	28.09.2015	Sale Agreement	A-7
8.	30.09.2015	Agreement for construction	A-8
9.	27.01.2016	Sale Deed Doc.No.677/2016 of SRO Guduvanchery	A-9
10.	27.01.2016	Memorandum Relating to Deposit of Title Deeds Doc. No.678/2016	A-10
11.	29.03.2017	Revival Letter	A-11
12.	28.03.2020	Revival Letter	A-12
13.	09.11.2018	Demand Notice under Sec.13[2] of SARFAESI Act, 2002	A-13
14.	12.11.2018	Returned cover	A-14

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S.	Date	Description of Documents	Exhibit
No.			Nos.
15.	28.01.2016	Encumbrance Certificate No.968	A-15
16.		Statement of Account	A-16

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Sd/-

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(SHARANG DHAR UPADHYAY ) PRESIDING OFFICER DRT-II, CHENNAI

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DESCRIPTION OF PROPERTY

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SCHEDULE – A

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All that part and parcel of the property bearing Flat No. G-1, Ground Floor,

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measuring area of 915 sq.ft., at Plot No.17, MG Nagar VI, Aathanur Village, Kundrathur Panchayat Union, Sriperumbudur Taluk, Kancheepuram District, comprised in S.No.376/6C1, 376/6C2, 376/6C3 & 376/6B1, of Aathanur Village, Sriperumbudur Taluk, Kancheepuram District, along with 319 sq.ft., of UDS in 1593 sq.ft., of land, and bounded on the North by : 23 Feet Road, South by : Land in Survey No.375/6B5, East by : 23 Feet Road, West by : Vacant land, and lying within the Registration District of South Chennai and Sub-Registration District of Guduvanchery.

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Sd/(SHARANG DHAR UPADHYAY ) PRESIDING OFFICER DRT-II, CHENNAI

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Indian Overseas Bank v. Mr. v Lakshmanan

Case brief

What is this about?

What did the court decide?

Indian Overseas Bank v. Mr. v Lakshmanan

Case brief

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What did the court decide?

What the court decided

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