Dismissed

Yes Bank v. Pavani Power Systems Private Limited

DRT3 Jul 2026OA/359/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal dismissed the bank's recovery petition. The court accepted that one loan was settled and the other was regular based on undisputed evidence, holding the bank failed to prove a recoverable debt due to delayed disclosure of partial payments. The application was fully dismissed without costs.

What did the court decide?

The Original Application No. 359 of 2023 is dismissed with no order as to costs.

Yes Bank versus Pavani Power Systems Private Limited — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL.II AT HYDEMBAD

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DATED THIS THE 3"D DAY OF JULY, 2026

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PRESENT: SH. RAMESHWAR KOTHE, B.Com, L.LB.^{(Hons.), M.A.}

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PRESIDING OFFICER

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Original Application No: 359 OF 2023

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M/s YES BANK Limited

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office at # 7-8-3a7,3rd Floor, Agravanshi^Plaza, HUDA Lane, S,P. Road, Secunderabad^- 500003. Rep by its authorized signatory

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'....Applicant

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Versus

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M/s. Pavani Power Systems Pvt. Ltd., R/o. Plot No.6, KK Owners Society, Ramreddy^Nagar Dhulapally Road, leedimetla, Hyderabad^- 500055 Rep by its Director Mr.Thondangi Seshagiri^Rao

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Mr. Seshagiri Rao, S/o. T Satyanarayana^Murthy Aged about 50^years, Occ: Director of

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lY/s. Pavani Power Systems Pvt. Ltd., R/o. H No. 8-3-502/l8lL/A,^{YellareddyGuda,} Ameerpet, Hyderabad - 500073

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t'4r. Thondangi Krishna Kishore, S/o.^{T Satyanarayana Murthy} Aged about 49^years, Occ: Business

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R/o. H No. 8-3-502/18/7/A, Yellareddy^Guda, Ameerpet, Hyderabad^- 500073...Defendants

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Counsel for the Applicant counsel for Defendant Nos. 1 to 3

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Mr. M. Srinivas Reddy Ms. Kandarpa Vani

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:: (LLLEB-::

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The Applicant Bank filed the^{presentOA for the recoveryof a sum} of Rs. 27,09,187.30^ps from^{the Defendants jolntly and severallywith} future interest @ 18%^p.a. with^{monthly rests from 10.01.2023 till the} date of realisation along^{with costs, and in default, sale of OA} rL hypothecated asset.

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oA No.359/2023

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2of5

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The averments of the Applicant Bank, as statedⁱⁿ the^OA, in^brief, are that 1st defendant availed Health Care^{Equipment Loan facility for} which defendants 2 & 3 stood as^guarantors and secured the^loanby executing deed of hypothecation of OA Schedule Assets.^However,the defendants failed to adhere to loan repayment schedule due to^which account was classifled as NPA and consequently applicant bank^issueda loan recall notice dated L2.07.2023. Defendants failed to regularise the account as such, the applicant is constrained to approach this^{tribunal for} recovery of its dues.

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Defendant Nos. 1 to 3 filed a written statement wherein they assert that the Bank has suppressed material facts and failed to disclose the complete transaction history in the loan accounts. They further admit execution of the loan documents,^guarantees, hypothecation deeds, but contend that the loan recall notice dated 12.01.2023 was arbitrary. According to them, the loan account INE00060068984 has already been fully discharged and a loan closure letter has been obtained, while Loan Account No. INE000601029921 is being regularly serviced and no outstanding dues remain. On that basis, defendants deny applicant's claim and pray for dismissal of the O.A. with exemplary costs.

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In order to prove its case, Applicant Bank examined by Sai Pavan Gudivada, Legal Manager as AW-1 and marked 10 documents through him as Exhibits A-1 to A-10.

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In order to substantiate their defence, 14. Seshagiri Rao, Defendant No.2, examined himself and 1st and 3'd defendant as DW-1 and marked 2 documents through him as Ex.B-1 & 8.2.

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Heard both learned counsel for the applicant bank where as learned counsel for the defendant reported no oral arguments. Perused the written arguments filed by the defendants and also perused the material broug ht on record. @6,.ru

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oA No.359/2023

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3of5

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Learned Counsel for the applicant^{bank during the courseof} arguments reiterated^{the contentsof the applicatlonand placed reliance} upon Exs.A-1 to^{Exs.A-10 markedthrough applicant evldence (AW-1) as} proof of claim of the bank and submltted^{that the applicant bankis} entitled for recovery^{of the outstandingamounttogether with future} interest and costs^{and invokingthe hypothecation deed'}

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Per contra, learned^{counsel for the defendants contended that} clalm is false and^{misconceived because the defendants had availed the} two loan facilities^{in September/October2020 by executingall necessary} loan documents, and the^{loansweredisbursedaccordingly' After the} recall notice dated^{12.01.2023, one loan account was fully settledand} closed and Bank^{also issueda No Objection Certificateand Loan Account} Closure Letter.^{The said factis admittedby the applicantsin lts evidence} affidavit. As to the^{remainingother loan account, the Defendants contend} that they have regularly^{paid 51 out of 60 EMIS and that only nine} instalments totalling^{Rs.2,92,57U-remains payableand theyare} continuing to^{pay the instalments.Learnedcounsel relied uponEx B l} (loan closure certificate) and^{Ex.B.2 (statementof accountin respect of} loan A/c No.IN E000601029921,^{dated 03.72.2025)} '^{It is further} contended that^{whilefiling Part satisfactionMemo dated 11 03 2026, the} applicant bank stated^{that there is a due of Rs.r0,24,2O11- without} updating the^{payments,and hence defendants raised objections'} Learned counsel^{furtherarguethat the Bank failed to give proper credit} for the^payments already^{made, dellberatelysuppressedthe true balance} outstanding, and^{attemptedto force premature foreclosure, so the O A'} is liable to be dismissed^{with exemplarycosts'}

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The^point that^{arisesfor consideration is:-}

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Whether the Applicant^{Bank is entitled} for the balance^OA claim against the^Defendants OA hypothecated assefs ?

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oA No.3s9/2023

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40f5

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It is not in dispute that Defendant No.1 had availed the loan facilities from the Applicant Bank and that Defendant Nos.2 and 3 executed deeds of guarantee in respect thereof. The execution of the loan documents, guarantees and deed of hypothecation has also been admitted by the Defendants in their written statement. The Applicant Bank marked Exs,A.1 to A.10 through AW-1 in order to prove its claim. Thus, the contractual relationship of Applicant Bank and Defendants is not in dispute.

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It is also an admitted fact that during the pendency of the Original Application, the Applicant Bank filed a part Satisfaction Memo dated 17.03.2026 stating that, out of the original claim amount of Rs.27,09,187.30, a sum of Rs.16,84,985.35 had already been received and adjusted on 02.77.2023 towards Loan Account No. iNE000600689184, and consequenHy the said loan account stood settled. The Applicant thereafter restricted its claim to an amount of Rs.10,24,201.98 towards Loan Account No. INE000601029921. Defendants filed objections to the part-satisfaction memo stating that according to Ex.B.2, they are regular in payment of instalments, they have already paid substantial repayment and there are no outstanding dues. There is no dispute on closure of the Loan Account No. INE000600689184. Defendants raised objection on demand of Rs.10,24,201.98 ps since the Loan Account No. INEOO0601029921 is regular without any default, They relied upon Ex.B.2 which remained undisputed, since the Applicant Bank neither filed rebuttal-evidence nor did it take steps for cross-examination of DW-1 to disprove the veracity of Ex.B.2. A perusal of Exhibit A.10, being the statement of account produced by the ApplicantBank, discloses regular credits towards repayment of the Loan Account No. INE00O6O1O2992L up to 23.12.2022. Further, Exhibit 8.2, being the subsequent statement of account produced by the Defendants covering the period up to 22.11.2025, also reflects continued repayments in the said Loan Account No.

OW"'

OA No.359/2023

5of5

INE00O6O 1029921.^{As stated supra,Ex.B.2remained undisputed.Thus,} it is clearly manifest^{from the recordsthat the irregularLoanAccount No'} INEOOO6O0689184 was^closed during^{the pendencyof OAproceedings} and the other Loan Account No.^{INE000601029921 is regular as per} Ex.B.1 from the beginning.^{There remains nothingthat could be ordered} for recovery in a regular^{account Under such circumstances,this} Tribunal is of the considered^{view that the Applicant Bank has failedto} prove the existence of a legally recoverable^{debt in respectof Loan} Account No. INEOOO6O1029921^{and accordingly oA is liable to be} dismissed.

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Further, it is^{pertinentto note that, admittedly Applicant Bank} received an amount of^{Rs.16,84,985.35 ps on 02.11.2023,however the} Applicant disclosed the^{same to this Tribunalonly on 11.032026 i'e',} after more than two^{years. Being a responsiblebanking institution, the} Applicant Bank was^{under a duty to make a fair, complete and timely} disclosure of all^{subsequentevents having a direct bearingon the} proceedlngs. The unexplained delay in^{reporting the substantial recoveTy} reflects lack of due diligence^{in prosecutingthe Original Applicationand} resulted in the^{proceedings continuingon the basis of the originalclaim} despite substantial^{recovery having already been effected'}

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In the result, the^{present Original APplicationNo'359/2023 is} dismissed.

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t4. No order as^{to costs.}

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Communicate a^coPYof this order to the^{parties concernedand}

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upload on the official^website.

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(Dictated to the steno, corrected, signed and^{pronoonced by me in theopencourt on this} the 3'd day^{ofJulY, 2026)}

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B6.r* ESHWAR KOTHE) PRESIDING OFFICER

Yes Bank v. Pavani Power Systems Private Limited

Case brief

What is this about?

What did the court decide?

Yes Bank v. Pavani Power Systems Private Limited

Case brief

What is this about?

What did the court decide?

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