Allowed

Canara Bank v. Sreelatha

DRT9 Jan 2026OA/345/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the debt recovery application filed by Canara Bank to recover dues of Rs. 24,62,991.71 from Sreelatha A. and Ajith Kumar M. The Tribunal directed payment of principal and interest, exclusion of interest on penal interest per Central Bank of India vs Ravindra, and enforced sale of mortgage schedule properties.

What did the court decide?

Directing payment of Rs. 24,62,991.71 with interest at 11.95% p.a. from date of OA; directing sale of OA schedule properties for recovery of dues and costs.

Canara Bank versus Sreelatha — Execution and Attachment | DRT (2026)

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Fair order

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IN THE DEBTS RECOVERY TRIBUNAL-1 AT ERNAKULAM

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DATED THIS 09^th DAY OF JANUARY, 2026

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PRESENT: Su. WILLYAHM, B.Sc., M.L. [DISTRICT JUDGE - Retd] PRESIDING OFFICER

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OA No.345/2023

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Between

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Canara Bank (Formerly known as Syndicate Bank) SSME- II Branch, City Centre Bank Road, Kasaragod Represented by its Senior Manager

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---Applicant Bank

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And

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Sreelatha A. W/o. Ajith Kumar M. KP XV 170, Kuttikol P.O. Kasaragod

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Ajith Kumar M. S/o. V. K. Kunhambu Nair KP XV 170, Kuttikol P.O. Kasaragod

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---Defendants

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This Original application coming on 08.12.2025 for final hearing before me in the presence of Ms. Abha K. N., Advocate appearing for the Applicant Bank and defendants having been set exparte and upon hearing the arguments of Counsel for the applicant bank and upon perusing the

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OA 345/2023

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materials on record and having stood over for consideration till this day, this Tribunal delivered the following:

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O R D E R

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This application has been filed on 18.11.2022 under Section 19 of the RDDBFI Act (now amended as the Recovery of Debts and Bankruptcy Act, 1993) by the Applicant Bank to recover from the defendants, jointly and severally, a sum of Rs.24,62,991.71 together with interest @11.95% per annum with half yearly rest and 2% penal interest per annum from the date of the OA till the date of payment and by sale of OA schedule property and with costs.

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The rights of the original applicant bank namely Syndicate Bank were vested with the Canara Bank as per the notification dated 04.03.2020.

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Defendants were duly served with summons. In spite of granting sufficient time, Vakalathnama and written statement of the Defendants were not filed. Subsequently, the Defendants were set exparte on 02.01.2025.

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The brief averments of the Original Application filed by the Applicant are as follows:-

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The 1^st defendant approached the erstwhile Syndicate Bank for agricultural loan and erstwhile Syndicate Bank sanctioned a loan to the tune of Rs.3,00,000/- on 15.03.2008 on due execution of necessary security documents on 24.03.2008 in its favour. The 2^nd defendant stood as guarantor and executed deed of guarantee dated 24.03.2008. The 1^st defendant created equitable mortgage over her property more clearly described as ‘A’ schedule to the OA and executed letter confirming deposit of title deed dated 24.03.2008.

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The defendants were highly irregular in repaying the dues in the loan account right from the inception. Since the defendants failed to pay the amount due to the applicant bank, the applicant bank filed the present Original Application for realisation of the outstanding amounts.

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Mr. Ramanna Naik N., Senior Manager of the applicant bank, as AW1 filed proof affidavit and got the documents marked as Exhs.A1 to A14 in support of its case.

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The applicant bank has charged Rs.2,15,481.68 as penal interest on the loan account availed by defendants in terms of the agreement in sanction letter. It is well settled that penal interest cannot be capitalised and no interest can be charged on penal interest. The applicant bank,

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Page 2 of 6

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OA 345/2023

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therefore, is not entitled to get any further interest on the aforesaid amount of penal interest, as laid down by the Hon'ble Supreme Court of India in Central Bank of India v. Ravindra [reported in AIR 2001 SC 3095] .

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The case of the applicant bank regarding recovery of the sum of Rs.24,62,991.71 claimed as due under the loan account with interest pendentelite and post final order interest on the sum of Rs.22,47,510.03 from the defendants is proved by the uncontroverted averments in the proof affidavit of AW1 along with Exhs.A1 to A14.

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Therefore, this Original Application is allowed as against the defendants and the defendants are directed to pay to the applicant bank, jointly and severally, as per the following lines :

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“A sum of Rs.24,62,991.71 (Rupees Twenty Four Lakhs Sixty Two Thousand Nine Hundred Ninety One and Paise Seventy One only) due under the loan account with interest pendentelite and post final order interest on the sum of Rs.22,47,510.03 (Rupees Twenty Two Lakhs Forty Seven Thousand Five Hundred Ten and Paise Three only) @ 11.95% per annum from 18.11.2022 till the date of realisation.”

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On failure to pay the above said debts to the Applicant Bank, the Applicant Bank is directed to bring the OA schedule property, for sale to realize its dues and its proportionate costs.

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The Registry is directed to prepare DRC in terms of this final order. The Applicant Bank shall file memo of costs within 10 days from the date of this order. Registry is directed to communicate the copy of this order to both parties as provided in Rule 16 of the Debts Recovery Tribunal (Procedure) Rules, 1993, as amended in 2003.

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Typed by PS, transcribed, corrected and pronounced by me in the open court on this the 09^th day of January, 2026

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(Su. WILLYAHM) PRESIDING OFFICER

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OA 345/2023

A SCHEDULE

(Immovable Properties mortgaged by Defendants)

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Item No.1

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State	: Kerala
District	: Kasaragod
Sub District	: Uduma
Taluk	: Kasaragod
Village	: Kuttikol
Sy. No.	: 21/7
Extent	: 19.02 Ares (47 Cents)

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Description

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All the pieces and parcel of land with all improvement having a total extent of 19.02 Ares (47 Cents) in Re. Sy. No.21/7 in Kuttikole Village, Kasaragod Taluk, Kasaragod District alongwith all easements and other rights appurtenant thereto more particularly mentioned in Sale Deed No.2596/1999 dated 10.08.1999 of Uduma Sub Registrar’s Office.

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Boundaries

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East : Property of Melath Savithri Amma South : Property in Re. Sy. No.21/7 West : Property of Krishnan Nair North : Road

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Item No.2

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State	:	Kerala
District	:	Kasaragod
Sub District	:	Uduma
Taluk	:	Kasaragod

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Page 4 of 6

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OA 345/2023

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Village	: Kuttikol
Sy. No.	: 21/7
Extent	: 23.46 Ares (58 Cents)

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Description

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All the pieces and parcel of land with all improvement having a total extent of 23.46 Ares (58 Cents) in Re. Sy. No.21/7 in Kuttikole Village, Kasaragod Taluk, Kasaragod District alongwith all easements and other rights appurtenant thereto more particularly mentioned in Sale Deed No.1107/2001 dated 28.04.2001 of Uduma Sub Registrar’s Office.

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Boundaries

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East : Item No.1 property mentioned above South : Property of Meleth Savithri Amma West : Property of C. Madhavi North : Property in Re. Sy. No.71

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(Su. WILLYAHM) PRESIDING OFFICER

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Page 5 of 6

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OA 345/2023

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LIST OF DOCUMENTS FILED BY THE APPLICANT BANK

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Sl. No.	Date	Description of document	Exhibits
1	15.03.2008	Application for agricultural loan applied by1^st defendant	Ex.A-1
2	15.03.2008	Sanction order issued by the bank to the defendants	Ex.A-2
3	24.03.2008	Agreement for agricultural advanced executed by 1^stdefendant in favour of the applicant bank	Ex.A-3
4	24.03.2008	Deed of guarantee for agricultural advances executed by 2^nddefendant in favour of the applicant bank	Ex.A-4
5	24.03.2008	Demand Promissory Note executed by defendants in favour of the applicant bank	Ex.A-5
6	24.03.2008	Letter confirmation of deposit of title deeds executed by 1^stdefendant in favour ofthe applicant bank	Ex.A-6
7	10.08.1999	Sale Deed No.2596/1999 of SRO Uduma	Ex.A-7
8	28.04.2001	SaleDeedNo.1107/2001ofSRO Uduma	Ex.A-8
9	19.03.2013	Agreement for agricultural advance executed by defendants in favour of the applicant bank	Ex.A-9
10	20.11.2019	Letter of time barred debts executed by 1^st defendantin favouroftheapplicant bank	Ex.A-10
11	20.11.2019	Demand Promissory Note executed by 1^st defendantin favouroftheapplicant bank	Ex.A-11
12	----	Statement of account pertaining to loan account	Ex.A-12
13	----	Statement of interest and penal interest levied in the loan account	Ex.A-13
14	----	Statement of rate of interest charged from time to time in the loan account	Ex.A-14

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(Su. WILLYAHM) PRESIDING OFFICER

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Canara Bank v. Sreelatha

Case brief

What is this about?

What did the court decide?

Canara Bank v. Sreelatha

Case brief

What is this about?

What did the court decide?

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