Allowed

Canara Bank v. Ms D N Enterprises

DRT22 May 2026OA/2621/2024

Case brief

AI extract

What is this about?

Debt Recovery Tribunal allowed an Original Application filed under Section 19 of the RDB Act. The court found the bank's evidence uncontradicted by the absent defendant, proving the loan default and quantum. The court allowed the claim but ordered a reduced interest rate of 11% p.a. and permitted recovery from both the security schedule and the defendant's personal assets.

What did the court decide?

Recovery Certificate issued for Rs. 38,89,118.67 plus interest at 11% p.a. (simple); recovery allowed from security schedule and defendant's personal assets; costs awarded.

Canara Bank versus Ms D N Enterprises — 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 22^nd Day of May, 2026

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Present: Sri. T. RAJESH Presiding Officer

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OA. No.2621/2024

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BETWEEN:

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Canara Bank Branch office at Shimoga Gopala Branch, Ashok Arcade, KHB Colony, Gopala Main Road, Shimoga-577205 Rep. by its Agent and Senior Manager Sri. Kusuru Dinesh

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… APPLICANT

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AND:

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M/s. D.N. Enterprises Main Road, Near I G Circle, Devu Complex, Ground Floor, Kashipura, Shimoga-577204 Rep. by its Proprietor Smt. Nirmala Devi Aged about 64 years House No.C-13, Sugar Factory Colony, Harige, Vidyanagar, Shimogga City-577201 ...DEFENDANT

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Counsel on record/appeared for:

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Applicant : Sri. K Shashidhar Parlathaya Defendant : Exparte

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:FINAL ORDER:

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The present Original Application in short (OA) has been filed

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under section 19 of Recovery of Debts and Bankruptcy Act 1993 for

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OA. No.2621/2024

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seeking issuance of Recovery Certificate against the defendant for Rs.38,89,118.67 (Rupees Thirty Eight Lakh Eighty Nine Thousand One Hundred Eighteen and Sixty Seven Paisa 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 credit facility of Rs.30,00,000/- which was renewed later.

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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. Apart from the creation of security interest by way of hypothecation over the Schedule.

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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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Despite, service of summons on the defendant, he failed to appear, resulting the defendant being set exparte on 31.10.2025.

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OA. No.2621/2024

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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 A17 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

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

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OA. No.2621/2024

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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

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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 the OA can be allowed with a reduced interest of 11.00% p.a.(simple).

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In the result, OA.No.2621/2024 stands allowed,

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i) The applicant is allowed to recovery an aggregate sum

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of Rs.38,89,118.67 (Rupees Thirty Eight Lakh Eighty Nine Thousand One Hundred Eighteen and Sixty Seven Paisa only) with further interest of 11.00% 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 proceeding against the schedule. The schedule to the OA be the schedule to the Recovery Certificate.

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OA. No.2621/2024

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

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the amount due and payable to the applicant bank, the defendant

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personally and his 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 with this Final Order.

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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 22^nd Day of May 2026].

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Sd/(T. RAJESH) PRESIDING OFFICER

OA. No.2621/2024

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Mr. Noushad, Senior 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	Loan application dated 29.06.2020		A1
2	Sanction memorandum dated 29.06.202	0	A2
3	Cash credit agreement dated 29.06.202	0	A3
4	Request for overdraft facilities 29.06.2020	dated	A4
5	Registered simple mortgage deed 29.06.2020	dated	A5
6	Loan application dated 29.06.2021		A6
7	Sanction memorandum dated 29.06.202	1	A7
8	Letter of renewal dated 29.07.2022		A8
9	Loan application dated 29.07.2022		A9
10	Sanction memorandum dated 29.07.202	2	A10
11	Letter of renewal dated 29.07.2022		A11
12	Request for overdraft facilities 29.07.2022	dated	A12
13	Letter of undertakings dated 29.07.2022		A13
14	Statutory notice under Section 13(2) 18.07.2023	dated	A14
15	Postal acknowledgment card		A15
16	Postal acknowledgment card		A16
17	Statement of loan account No.59462610	00032	A17

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

Canara Bank v. Ms D N Enterprises

Case brief

What is this about?

What did the court decide?

Canara Bank v. Ms D N Enterprises

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

Parties & counsel

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Case details

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