Allowed

Union Bank of India (Corporation Bank) v. suryaprakash

DRT3 Jul 2026OA/419/2024

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed the bank's original application for recovery of overdraft and loan dues from four defendants, holding them jointly and severally liable and rejecting the defense that agricultural land exemptions under SARFAESI applied to proceedings under the RDB Act.

What did the court decide?

Dutants ordered to pay Rs. 60,33,443/- with future interest; OA claim secured by schedule properties; bank entitled to costs.

Union Bank of India (Corporation Bank) versus suryaprakash — Banking and Recovery | DRT (2026)

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IN THE DEBTS^{RECOVERY TRIBUNAL-II AT HYDERABAD}

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DATED THIS THE 3RO^{DAY OF JULY,2026}

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PRESENT: SH. RAMESHWAR^{KOTHE,B.COM, L.LB. (HONS.), M.A.} PRESIDING OFFICER

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Original Application^{No: 419 OF 2024}

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Union Bank Of India,^{(e-CorporationBank),} #2561 C Kaditi Road,^{Bathalapalli- 515661,} Ananihupr. District,^Andhra Pradesh

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""Applicant

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Versus

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Mr. Jasthi Surya^Prakash, S/o. Late Nagarathnam,^{Male, aged 51 years,} 2-652, J A Chowdary^Colony, Dharmavaram Road,^{BathalaPalli,} Ananthapur District-^515661,A.P.

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Mr Palem Chandra^{Mohan Reddy} @ I^{Chandra Mohan Reddy,} S/o Channa Reddy,^{Male, aged 57} Years, 2-652, J A Chowdary^Colony, Dharmavaram Road,^{BathalaPalli,} Ananthapur District-^515661,A.P.

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Mr Jakkampati^{VenkataNaga Praveen,} S/o Nagabh ushanam,^{Male, Major,} 4/434, Venkateswara^ColonY, Dharmavaram Road,^{BathalaPalli,} Ananthapur- 515661,^A.P.

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Mrs lasthi Rajeswari, Wo^{JasthiSuryaprakash,Female, Major,} 2-652, ) A Chowdary^Colony, Dharmavaram^{Road, BathalaPalli,} nnuninipr. District-^{515661, A.P.}

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"-Defendants

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Counsel for the^APplicant Counsel for^{Defendants 1 & 4} Counsel for^{Defendants 2 & 3}

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: Mr. Srinivas^RaoChakrala : M/s. A. Raju : Ex-parte

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OA No.4l9/2024

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:: (LLLLL::

The Applicant Bank flled the present OA for the recovery of a sum of Rs. 60,33,443l- i.e., Rs. 76,99,457/- towards AGRTL Account No. 560931000295130 with future interest @ 11.850/o p.a., Rs. 4,34,202.07 ps towards AGROD Account No.560381001704706 with future interest @ 11.90olo p.a., Rs.27,07,319.88 ps towards Agri Term Loan Account No. 560931000298288 with future interest @ 10.55olo p.a., and Rs. 11,92,463.07 ps towards Corp Home Account No. 560631000464482 with future interest @ 12.50o/o p.a., from the Defendants joinfly and severally with monthly rests from the date of application till the date of realisation along with costs, and in default, sale of OA schedule moveable and immoveable assets/ properties.

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The averments of the Applicant Bank, as stated in the OA, in brief, are that 1st and 4th defendant availed various credit facilities where defendants stood as guarantors and secured the loan via execution of deed of hypothecation and mortgage of OA Schedule^properties in favour of the Applicant Bank. However, the defendants defaulted in repayment due to which account was classified as NpA and consequenuy applicant bank issued a demand notice dated 25.03.2024. As 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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Summonses served on Defendants 2 & 3 and were set ex parte on 7L.11.2024 as called absent and no representation.

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Defendant Nos. 1 & 4 filed a written statement wherein they denied all allegations placed in the application and challenged the authority of the bank official who instituted the proceedings. contending that no authorization letter had been furnished. They also_d-eny liability for the (_/ ,Oyr.o02

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OA No.419/2024

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claimed amount, dispute default and^{NPA classification,assert that no} statutory notices were served,^{and challengethe loan documents,equitable} mortgage, and the correctness of the^{statementof accountas well as the} interest charged. They further contend that the^{securedproperties are} agricultural lands, as reflectedⁱⁿ the^{registered Memorandum of Depositof} Title Deeds and revenue records, and therefore^{fall within the exclusion} under Section 31(i) of the SARFAESI^{Act. On that basis, they say the} SARFAESI^proceedings are null and^{void, pray for dismissalof the OA with} exemplary costs.

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In order to^prove its^{case,Applicant Bankexamined by Mr. Y. Hari} Krishna, Senior Manager as AW-1^{and marked 51 documentsthrough him} as Exhibits A-1 to A-51.

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In order to substantiate the defence,^{Mr. lasthi Surya Prakash,} Defendant No. 1, examined^{himself as DW-1 and markedno documents.}

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Heard both learned counsel for the^{applicantand learned counselfor} the defendant. Perused^{the material brought on record.}

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Learned Counsel for the applicant^{during the courseof arguments} reiterated the contents of^{the appllcationand placed reliance uponExs A-1} to Exs.A-s1 marked through^{applicant evidence (AW-1) as proofof claim of} the bank. He further submitted that^{the defendantsfailed to establish that} the^property is agricultural.^{He submittedthat the applicant bank is entitled} for recovery of the outstanding^{amounttogether with future interestand} costs and invoking the^{mortgagedeed and hypothecationdeedas} described in the OA^{schedules.Accordingly he sought to allow the OA'}

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Per contra, learned^{counsel for the defendants 1 & 4 challenged the} OA claim on the^grounds of^{undervaluation of the propertles,limitation,} interest being charged against^{RBI guidellnes,wrongfulclasslfication of}

kirb

OA No.4t9/2924

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account as NPA, no notices being served on them. Learned counsel further contended that the property being the agricultural, is exempted from the SARFESI proceedings under Section 31(i) of the SARFAESI Act. While denying the OA claim, learned counsel sought for dismissal of the OA along with exemplary costs.

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The point that arises for consideration is:-

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Whether the Applicant Bank is enti ed for the OA ctaim against the Defendants and OA schedule moveable and immoveable propefties?

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The contesting Defendants 1 and 4, except making bald allegations of undervaluation of properties, exorbitant interest, wrongful classification of account as NPA, non-service of notices, limitation etc., they failed to substantiate their pleas by marking any relevant documentary evidence or by confronting the witness of the Applicant Bank by way of crossexamination to disprove the veracity of Exhibits A-1 to A-51. It is settled law that mere allegations without sufficient evidence are of no avail. On the other hand. the Applicant produced documents and marked them through AW-1 as proof of its claim.

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Another contention is that mortgaged property being agricultural in nature, exempted under section 31(i) of the SARFAESI Act, 2002. The contention is meritless as there is no such bar in the proceedings under the RDB Act, 2002.

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Under the above circumstances, it is concluded that the evidence affidavit of AW-1 coupled with the recitals in Exhibits A_1 to A_51 remains unchallenged and un-rebutted. Hence, I hold that Defendant Nos. 1 to 4 are jointly and severally liable to pay to the Applicant Bank the claim made in the oA with future interest and corts. /ffA,*

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OA No.419/2024

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In the result, the^present Original^{ApplicationNo.419/2024 is allowed} as under: -

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(i) The Defendant Nos. 1 to 4 are liable to^pay to^the Applicant Bank a sum of Rs. 60,33,443l- with^future interest rate of 10.55olo simple from the date^of application till the date of realization;

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(ii) the OA claim is secured by way of mortgage of ScheduleA to C properties and hypothecation of Schedule-^D &^E assets, and applicant bank is entitled to^proceed against the same for realisation of dues;

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(lii) the applicant is also entitled to proceed against the person and properties of the Defendant Nos. 1 to 4 for realization of dues; and

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(iv) the applicant bank is entitled for the costs;

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The Applicant Bank is directed to file Cost^Memo within^{2 weeksfrom} the date of receipt of this Order.

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I rr. Issue Recovery Certificate accordingly.

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Communicate a copy of this order to the^{partiesconcernedand} upload on the official website.

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(Dictated to the steno, corrected, signed and pronounced by me in the open court on this^the 3'd dayofJuly,2o26)

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'$6.r'$ ESHWAR KOTHE) PRESIDING OFFICER

Union Bank of India (Corporation Bank) v. suryaprakash

Case brief

What is this about?

What did the court decide?

Union Bank of India (Corporation Bank) v. suryaprakash

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

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