Allowed

Bank of Baroda v. Akshaya Foods

DRT3 Jul 2026OA/292/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application for recovery of Rs. 78,00,288 along with interest and costs against the borrower and proprietor after they failed to appear. The court authorized the sale of hypothecated and mortgaged assets for recovery.

What did the court decide?

Recovery of Rs. 78,00,288 with interest and costs through sale of Schedule A (hypothecated assets) and Schedule B (mortgaged immovable properties).

Bank of Baroda versus Akshaya Foods — Banking and Recovery | DRT (2026)

¶1

O.A. No.292 of 2023

¶2

03.07.2026

¶3

¶4

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

¶5

Dated this the 03^rd day of July, 2026

¶6

Present: SMT. S.V. GOWRAMMA Presiding Officer

¶7

ORIGINAL APPLICATION No.292 of 2023

¶8

Bank of Baroda,

¶9

Purasawalkam Branch,

¶10

80, Ritherdon Road, Purasawalkam.

¶11

Chennai- 600 007 Represented by its Chief Manager/Authorized Officer ….Applicant

¶12

-Vs-

¶13

M/s Akshaya foods.

¶14

A Proprietorship concern,

¶15

Represented by its Proprietor, Mr.L.Selvam, Both office and shop at No.3, Ground and First Floor, 31^st Street, TNHB, Korattur, Chennai- 600 080

¶16

Mr. L. Selvam, S/o Mr. Lakshmanan, Residing at No.5/75, Ambethkar Street, Avanipurm, Viluppuram District- 604 101 …..Defendants

¶17

Counsels on record / appeared:

¶18

Counsel for Applicant: M/s. E. Vijayaraghavan

¶19

Defendants 1 and 2 were set ex-parte on 08.04.2024

¶20

: - FINAL ORDER -:

¶21

This Original Application is filed on 12.06.2023 by the applicant

¶22

bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993

¶23

(formerly Recovery of Debts Due to Banks and Financial Institutions Act,

¶24

Uploaded on 03.07.2026 at 15:30 hours

¶25

O.A. No.292 of 2023

¶26

¶27

03.07.2026

¶28

against the defendants 1 and 2, jointly and severally for recovery of a total sum of Rs.78,00,288/- (Rupees Seventy Eight Lakhs Two Hundred and Eighty Eight only) due in respect of Cash Credit facility (A/c No. 06750600004881) repayable together with further interest @10.65% p.a. with monthly rests from the date of Application till the date of realization in full, for sale of schedule A mentioned hypothecated property and schedule B mentioned immovable property and for costs of this OA.

¶29

Brief Facts of the case:

¶30

The Applicant submits that the application is filed within the period of limitation as prescribed under Section 24 of the Recovery of Debts and Bankruptcy Act, 1993, and the subject recovery claim falls within the jurisdiction of this Tribunal.

¶31

It is the case of the applicant bank that the first defendant is a Proprietorship Concern, represented by its Proprietor, second defendant herein. First defendant represented by its Proprietor, second defendant approached the applicant bank and applied for Term Loan of Rs.95 Lakhs on 04.10.2021.

¶32

It is submitted by the applicant bank that considering the said request of defendants, the applicant bank had sanctioned the Term Loan of Rs.80,00,000/- on 18.11.2021 and the defendants have availed the same in loan A/c No.06750600004881 after agreeing to the terms and conditions as per the sanction.

¶33

Uploaded on 03.07.2026 at 15:30 hours

¶34

O.A. No.292 of 2023

¶35

¶36

03.07.2026

¶37

The defendants agreed to the terms and conditions of the above sanction and executed the relevant loan documents in favour of the applicant bank which are as follows:

¶38

i. Demand Promissory Note for Rs.80,00,000/- (Rupees Eighty Lakhs only) dated 19.11.2021

¶39

ii. Letter of Sole Proprietorship dated 19.11.2021

¶40

iii. Letter of installment with acceleration clause dated 19.11.2021

¶41

iv. Declaration cum Undertakings cum Authority dated 19.11.2021

¶42

v. Composite Hypothecation Agreement dated 19.11.2021 vi. Letter of Undertaking dated 19.11.2021

¶43

vii. Power of Attorney in respect of book-debts facility dated 19.11.2021

¶44

The applicant bank submits that the defendants have agreed to repay the principle sum of Rs.80,00,000/- along with interest there on at the rate of 8.15%p.a.

¶45

In order to secure the loan, the defendants have hypothecated the raw materials, stocks in process, finished goods and all the book debts, movable plant and machinery/vehicles/crafts, consumable stores and spares, both present and future as a prime security to the above credit facility availed by the defendants and executed a composite Hypothecation Agreement on 19.11.2021.

¶46

Further, the Second defendant Mr. L. Selvam has equitably

¶47

Uploaded on 03.07.2026 at 15:30 hours

¶48

O.A. No.292 of 2023

¶49

03.07.2026

¶50

¶51

mortgaged the properties morefully described in Schedule-B to the OA as collateral security to the above credit facility availed by them and executed relevant loan documents which are as follows:

¶52

i. Memorandum of entry dated 19.11.2021

¶53

ii. Declaration in the matter of mortgage by deposit of title deeds in respect of immovable’s dated 19.11.2021

¶54

iii. Annexure ‘A’ dated 19.11.2021

¶55

iv. Annexure ‘B’ dated 19.11.2021

¶56

It is submitted by the applicant bank that the Second defendant Mr. L. Selvam confirmed the above equitable mortgage by executing a registered Memorandum of Deposit of Title Deeds dated 20.12.2021 registered as Doc.No.15469/2021 by SRO, Guduvancherry and also executed Letter of Confirmation of Mortgage on 20.11.2021.

¶57

It is submitted that subsequent to availing of loan, the defendants did not abide with the agreement and have defaulted in repayment of their liabilities with the applicant bank and did not repay the above loans availed as agreed by them. Hence the loan account of the defendants was classified as Non-Performing Asset (NPA) on 17.11.2022 when there was an outstanding of Rs.74,14,335/in the Term Loan A/c No.06750600004881.

¶58

The applicant bank demanded the defendants to repay the outstanding in the loan account but there were no repayments made by the defendants. Inspite of repeated demands from the applicant bank, the defendant failed to repay the outstandings to the applicant bank. Hence,

¶59

Uploaded on 03.07.2026 at 15:30 hours

¶60

O.A. No.292 of 2023

¶61

03.07.2026

¶62

¶63

the present Original Application (OA) has been filed by the applicant bank for recovery of its dues from the defendants.

¶64

After the filing of the OA, summons were sent to the Defendants 1 and 2 through Registered Post with Acknowledgment Due, which was served in respect of D-2, while summons to D-1 returned unserved. However, defendants entered appearance through their counsel and filed vakalath. Despite receiving copy of OA on 20.02.2024 and availing three adjournments, defendants did not file Written statement. When OA was taken up on 08.04.2024 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 and 2 were placed ex-parte on 08.04.2024.

¶65

Heard the submissions of Applicant Bank and perused the

¶66

records.

¶67

To prove the case of the Applicant Bank, Sh. S.V. Venkata Ratnam, Chief Manager of the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW-1 and list of documents came to be marked as Ex A-1 to A-17.

¶68

A careful examination of the pleadings in the Proof Affidavit and documents Exhibits A-1 to A-17 evidence that the borrowal of credit facilities and execution of loan and security documents are true, in terms of averments made in Original Application as well as Proof Affidavit filed by applicant bank establishing its claim. Applicant bank filed Statement of Accounts duly certified under Bankers’ Book Evidence Act, evidencing

¶69

Uploaded on 03.07.2026 at 15:30 hours

¶70

O.A. No.292 of 2023

¶71

03.07.2026

¶72

¶73

the amount claimed against defendants.

¶74

The defendants were set ex-parte on 08.04.2024, but till this day they did not take any action to set aside the ex-parte order and did not choose to contest the claim. Further, a careful scrutiny of records makes it clear that present application is filed well within limitation and this Tribunal possesses necessary and proper jurisdiction to entertain and adjudicate the claim. No oral or documentary evidence on the side of defendants are produced or filed to dispute the claim of applicant bank. Hence, it can be concluded that applicant bank has proved its claim against defendants.

¶75

With regard to the amount advanced, the interest applied the conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled for a final order on the following terms:

¶76

: O R D E R :

¶77

17. The OA is allowed with costs,

¶78

(a) The applicant bank is allowed to recover from the Defendants 1 and 2 jointly and severally, a total sum of Rs.78,00,288/(Rupees Seventy Eight Lakhs Two Hundred and Eighty Eight

¶79

only) due in respect of Cash Credit facility (A/c No. 06750600004881) repayable together with further interest @10.65% p.a. with monthly rests from the date of Application till the date of realization in full, along with costs of this application.

¶80

(b) In the event of failure of the Defendants to pay the aforesaid

¶81

Uploaded on 03.07.2026 at 15:30 hours

¶82

O.A. No.292 of 2023

¶83

03.07.2026

¶84

¶85

amount, the bank is at liberty to recover the amount by sale of the Schedule A mentioned hypothecated assets and Schedule B mentioned immovable property morefully detailed in the OA schedule.

¶86

¶87

(d) The applicant bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by Defendants to the applicant bank.

¶88

(e) The applicant bank shall file memo of costs within ten days from the date of receipt of this final order.

¶89

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

¶90

A copy of this order be communicated to the parties concerned.

¶91

Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

¶92

(Dictated to Roshnee, transcribed by her, corrected, signed and pronounced by me on this the 03^rd day of July, 2026)

¶93

Uploaded on 03.07.2026 at 15:30 hours

¶94

O.A. No.292 of 2023

03.07.2026

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK :

¶99

AW-1: Sh. S.V. Venkata Ratnam, Chief Manager of the Applicant Bank

¶100

Exhibits on the part of the Applicant:

¶101

Sl.	Date	Description of Documents	Exhibit
No.			No.
1.	04.10.2021	Loan application	A-1
2.	18.11.2021	Sanction letter	A-2
3.	19.11.2021	Demand promissory note for Rs.80,00,000/-	A-3
4.	19.11.2021	Letter of sole proprietorship	A-4
5.	19.11.2021	Letter of instalment with acceleration clause	A-5
6.	19.11.2021	Declaration cum undertakings cum authority	A-6
7.	19.11.2021	Composite hypothecation agreement	A-7
8.	19.11.2021	Letter of undertaking	A-8
9	19.11.2021	Power of attorney in respect of books- debts facility	A-9
10	19.11.2021	Annexure-A	A-10
11.	19.11.2021	Annexure-B	A-11
12.	19.11.2021	Memorandum of entry	A-12
13.	19.11.2021	Declaration in the matter of mortgage by deposit of title deeds in respect of immovables	A-13
14.	20.11.2021	Letter of confirmation of mortgage	A-14
15.		Registered memorandum of deposit of title deeds by Mr.Selvam, S/o Lakshmanan in favour of Bank of Baroda, registered as Doc.No.15469/2021 by SRO, Guduvanchery	A-15
16.	08.10.2021	Registered sale deed by Mr.K.C.Bose represented by his GPA, Vignesh in favour of Mr. Selvam registered as Doc.No.13451/2021 by SRO, Guduvanchery	A-16
17.	-	Statement of loan A/c No. 06410500004881	A-17

¶102

Witness Examined for the Defendants: -Nil-

¶103

List of Documents Exhibited for the Defendants: -Nil –

¶104

Uploaded on 03.07.2026 at 15:30 hours

¶105

O.A. No.292 of 2023

¶106

¶107

03.07.2026

¶108

SCHEDULE OF PROPERTIES

¶109

SCHEDULE-A

¶110

(Hypothecated assets)

¶111

The whole of the borrowers stocks both present and future and including but without prejudice to the generality of the foregoing words all stocks of raw materials, work in process, semi finished goods and finished goods such as rice whatsoever and wheresoever situate and/ or in transit whether now belonging to or that may at any time during the continuance of this security belong to the borrower or that may be held by any party anywhere to the order and disposition of the borrower.

¶112

All the present and future book debts, outstanding money, receivables, claims, bills, contracts, engagements and securities which are now due and owing or which may at anytime hereafter during the continuance of this security become due and owing to the borrower in the course of its business by any person, firm , company or body corporate or by the government of India or any state government of Indian railways or any Government of India or any state Government or Indian railways or any Government Department or office or any Municipal or local or public or semi-government body or authority whatsoever including those relating to the assets leased out and/or given or hire purchase basis.

¶113

All the tangible movables machinery and plant and cranes, boats and crafts and all the vehicles of the borrower together with spares, tools and accessories and other movables, both present and future and the furniture, fixtures and fittings and office equipment whether installed or

¶114

Uploaded on 03.07.2026 at 15:30 hours

¶115

O.A. No.292 of 2023

¶116

¶117

03.07.2026

¶118

not and whether lying loose or incase which are now lying or stored in or about or shall be bought into or to be stores in or about or shall be brought into or to be stored or to be in or upon or about the borrowers premises and godowns or wherever else the same may be or be held by

¶119

any party to the order or disposition of the borrower (including those or lease or hire-purchase) relating or pertaining to the borrower works at ground and first floor, No.3, 31^st street, TNHB Korattur, Chennai- 600080.

¶120

SCHEDULE-B

¶121

(Mortgaged assets)

¶122

All that piece and parcel of vacant land sites, Plot No.191, an extent of 2000sq.ft and plot no.192, an extent of 2400sq.ft total an extent of 4400sq.ft, MG nagar part XIV, Adhanur village, Sriperumbudur, Kancheepuram district comprised in Old S.Nos.285 and 287, patta no.920 as per the New S.No.285/1A1 and 287/1A1, DTCP approved no.773/88, Aadhanur village.

¶123

Plot No.191 bounded by:

¶124

North by: Vacant land

¶125

South by: Plot no.194

¶126

East by: 23 feet road

¶127

West by: Plot no.192

¶128

Admeasuring:

¶129

Northern side: 50 feet Southern side: 50 feet Eastern side: 40 feet

¶130

Western side: 40 feet

¶131

Uploaded on 03.07.2026 at 15:30 hours

¶132

O.A. No.292 of 2023

03.07.2026

Total: 2200sq.ft

Plot No.192 bounded by

¶137

North by: Vacant land

¶138

South by: Plot no.193 East by: Plot no.191

¶139

West by: 23 feet road

¶140

Admeasuring:

¶141

Northern side: 60 feet Southern side: 60 feet

¶142

Eastern side: 40 feet

¶143

Western side: 40 feet

¶144

Total 2400sq.ft with SRO Guduvanchery and registration District of South

¶145

Chennai

¶146

Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

¶147

Uploaded on 03.07.2026 at 15:30 hours

Bank of Baroda v. Akshaya Foods

Case brief

What is this about?

What did the court decide?

Bank of Baroda v. Akshaya Foods

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Kesavan K versus Indian Overseas Bank

Dbs Bank Limited versus a. Anbudurai

K Kesavan versus Indian Overseas Bank

Shri Bharath Vasan versus State Bank of India

State Bank of India versus Gulab

Bank of Baroda versus Koilraj