Allowed

Canara Bank v. M/S.Sreelatha Textiles

DRT21 Jul 2026OA/352/2025

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed the original application filed by Canara Bank for recovery of Rs. 1,69,52,931.55 plus interest against two defendants. The court rejected defenses regarding execution of blank papers and limitation based on acknowledgement evidence.

What did the court decide?

Defendants ordered to pay Rs. 1,69,52,931.55 with future interest; appellantentitled to proceed against mortgaged and hypothecated properties.

Canara Bank versus M/S.Sreelatha Textiles — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-I AT HYDERABAD

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DATED THrS THE 2OrH DAY OF JULY, 2026

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PRESENT: SRI GUMMADI GOPTCHAND, PRESIDING OFFICER

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OA.No.352 ot 2025

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Between:

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Canara Bank, Hanumakonda branch, Hanumakonda,

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Warangal district, TS - 506 001. Represented by its Chief Manager

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... Applicant

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VERSUS

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M/s. Sreelatha Textiles, Represented by its Proprietor Sri Chiluka Ramchander, Plot no.249, Survey no.L79t, Madikonda Village, Kazipet mandal, Warangal (urban)

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Telangana - 506 142.

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Mr. Chiluka Ramchander S/o Chiluka Kishtaiah, aged 50 years, Occ: business, H.No.3-110, Madipalli gramam, Thourur mandal, Warangal, Telangana - 506 163.

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Defenda nts

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Counsel for the Parties:

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For the Applicant Sri G. Adrian Kiran Raj Defendants Sri V. Ravinder t4.07.2026 20:Q7.2026 20.07.2026

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(oA. No.3s2l202s)

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ORDER

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The Applicant Bank filed the present OA against Defendants for recovery of a total sum of Rs.1,69,52,931.55ps^(Rupees One Crore Sixty Nine Lakhs Fifty Two Thousand Nine Hundred Thirty one and paise Fifty five only) (term loan+ working capital⁺ OD/ OCC + GECL and GCL 1.0 loan accounts) with future interest @^{11olo p.a} with monthly^{rests from} 08.07.2025^{till the date of} realization and in default for sale of hypothecated movables and mortgaged property as mentioned in the schedule to OA.

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As per the averments in the application, the Applicant Bank states that the defendant No.1 which is a proprietorship firm represented by its proprietor/ defendant no.2 availed term loan facility for a sum of Rs.92,50,000/-, working capital of Rs.7.50 lakhs, OD/OCC facility of Rs.35.00 lakhs, GECL limit of Rs.3.40 lakhs and GECL 1.0 limit of Rs.85.00 lakhs and agreed to repay along with interest. The defendants hypothecated the machinery as mentioned in schedule^to OA and executed supplementary hypothecation and^personal guarantee in favour of Applicant bank. The defendants mortgaged

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and executed necessary documents in favour is submitted by the Applicant bank that the said loan facilities and failed to keep up the

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toefln$a$g drm"d fi s such the account was classified as NPA.

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made by Applicant the defendants have not

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(oA.No.352 /202sl,

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regularized the account, so the Applicant bank issued demand notice dated 28.07.2025, but the defendants did not come forward to repay the same. The total claim of Applicant against defendants is of Rs.1,69,52t931.55ps (Rupees one crore sixty Nine Lakhs Fifty Two Thousand Nine Hundred Thirty one and paise Fifty five only) (term loan* working capital + oD/ occ + GECL and GCL 1.o loan accounts) with future interest @ Lto/o p.a with monthly rests from 08.07.202s till the date of realization. Hence the oA.

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The Defendants filed written statement admitting that they availed various loan facilities from the Applicant bank. The contention of the defendants is that at the time of sanction of loan, the applicant bank obtained signatures of defendants on various blank papers and they are misused by the applicant bank. The further contention of the defendants is that even though there is no requirement of obtaining collateral security, the applicant bank obtained equitable mortgage of schedule property and that the claim of the applicant bank is barred by limitation. Hence prayed for dismissal of OA.

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I have perused orirecord.

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Heard

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(OA. No.3s2l202s)

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Mr. lakka Nagaraju, Chief Manager /^{AW.1 is examined on behalfof} the Applicant. Exhibits A.1 to A.34 are marked through^AW'1. Defendant No.2 examined himself as DW.1 but no documents^are exhibited by him.

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Now, the points that arise for consideration^are:

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i) Whether the Applicant Bank^{has provedits claim as made in OA} against the defendants^?

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ii) To what relief^?

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Point No.i):

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On behalf of the applicant^{bank, Shri lakka Nagaraju, Chief Manager} who is examined as^{AW.1 deposed clearly about the liability of the} defendants and also^{about the execution of various documentsfiledby} theapplicantbank.AW.lisnotcrossexaminedbythedefendants. So the evidence of^{AW.1 is not challengedby the defendants'} Defendants have not^{come forward for giving evidence. For reasons} best known to the^{defendants they shunned the witnessbox. so the} evidence of AW.1^{stood unrebutted by the defendants. Even though} defendant no. himself as DW.1, his^{evidenceis no way} helpful to blishing the contentions^{raised by the} oJ'0.JUt ts exhibited by the Applicant^bank nt documents are executed bY^the of tra nsaction. So the contention^of

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(oA.No.3s2l202s)

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the defendants that the applicant bank obtained their signatures on blank documents is not tenable. The contention of defendants that there is no necessity of obtaining collateral security by the applicant is also not tenable as no material is placed by the defendants for establishing that for various loan facilities availed by the defendants, collateral security is not required. The other contention of defendants is that the claim made by Applicant bank in OA is barred by limitation. But in view of the fact that defendants executed acknowledgement letter by acknowledging their liability and as the said documents are executed within 3 years from the date of filing of OA, the claim of the applicant bank is within time. Considering all the circumstances, I am of opinion that the defense taken by the defendants is not tenable. Hence the applicant bank is entitled to claim the OA amount from defendants.

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Point No.ii)

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B. In the result, the present Original application is allowed with costs as u nder:

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The Defendants are jointly and severally liable to pay to Applicant Bank a totalsum 69,52,931.55ps (Rupees One Crore Sixty Nine nd Nine Hundred Thirty one and paise Frrty nve o + working capital + oDl occ + GECL lo'5 )^{with future interest} @^{11olo p.a from} "iaccr-?rlb 08.07.20?s realization;

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(OA. No.3s2l202s)

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The applicant bank is entitled to^proceed against the mortgaged property and hypothecated movables as mentioned in the schedule to OA towards realization of the debt due.

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The Applicant bank is also entitled to^proceed against the^person and properties of defendant No.2 and properties of defendant no.1 towards realization of the debt due.

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The Applicant Bank is entitled to the costs of the OA.

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t2. The Applicant shall file a cost memo within two weeks from the date of receipt of order.

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Issue Recovery certificate accordingly.

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t4. Communicate a copy of the order to the^parties concerned.

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(Dictated 60 the P.A., transcribed by her, corrected, signed and pronounced by me in the open court on this the 20th day of July, 2026)

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sdl_

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(G. GOPTCHAND) PRESIDING OFFICER

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20JUt202[

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DRT-I, Hrc3q.4i,,11.

Canara Bank v. M/S.Sreelatha Textiles

Case brief

What is this about?

What did the court decide?

Canara Bank v. M/S.Sreelatha Textiles

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

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