Allowed

Union Bank of India v. Neo Organics

DRT22 Jun 2026OA/566/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's original application for recovery of a loan of Rs. 56.67 lakhs with interest and costs. The court held that the bank's primary witness and documents were unchallenged as the contesting defendants failed to produce evidence for their forgery allegations.

What did the court decide?

Direct payment of Rs. 56,67,574.01 plus interest and costs; permission to proceed against mortgaged property and persons of defendants for realization.

Union Bank of India versus Neo Organics — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY^{TRIBUNAL-IIAT HYDERABAD}

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

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Original Application No: 566 OF 2022

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Union Bank of India Gunrock Enclave, Tirumalgiri Mandal, Hyderabad District, Telangana State Represented by its Authorized Officer

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.....Applicant

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Versus

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Neo Organics rep by G Jagadish Kumar

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Aged: Major, Occ: Business Sy No 82/L, Agricultural Market

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Bowenpally, Secunderabad, Hyderabad

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G Jagadish Kumar

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Aged: Major, Occ: Business Sy No 82/1, Agricultural Market Bowenpally, Secunderabad, Hyderabad

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GSKKishore

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Aged: Major, Occ: Business Sy No 82/L, Agricultural Market Bowenpally, Secunderabad, Hyderabad

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G Sita Devi

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Aged: Major, Occ: Business Sy No 82/t, Agricultural Market

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Bowenpally, Secunderabad, Hyderabad

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.. Defendants

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: Mr. B Praveen Kumar Counsel for the Applicant Counsel for Defendants 1 & 2 : Mr. Sunil Deshpande Counsel for Defendants 3 & 4 : Shri P-,S.ttt. Ravindra ://,',/'\5*

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OA No.566/2022

:: ORDER::

The Applicant Bank filed the present OA for the recovery of a sum of Rs. 56,67,574.01 ps with future interest @ 18o/o p.a.,from the defendant Nos. 1to 4 are jointly and severally with monthly rests from 0L.07.2022til| the date of realisation along with costs, and in default, sale of O.A. mortgaged property.

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The averments of the applicant bank, as per OA, briefly, are that the Bank sanctioned a loan of Rs.60,00,000/- on 05.02.2010 to Defendant No.1 for working capital requirements, at an interest rate of 10.50o/o^per annum, repayable on demand. Defendant No.2 approached the^Bankon behalf of Defendant No.1. To secure the loan, the Defendants executed various security documents, including a Demand Promissory Note, Deed of Hypothecation, Continuity Letter, General Power of Attorney,^and Guarantee Agreements. Defendants No. 2, 3 and 4 stood as^guarantors. Additionally, a residential^property admeasuring 532 Sq.^{Yards, situated at} Plot No.71, Prashasan Nagar, Road No.4, Sy.No.403,^{Jubilee Hills,} Hyderabad, was mortgaged as security. The^{Defendantsdefaultedin} repayment of the loan instalments. The loan account^{was classifiedas a} NPA on 30.06.2019 in accordance with RBI^{guidelines' A notice under} Section 13(2) of the SARFAESI^{Act was issued to the Defendants} demanding repayment. The Defendants^{had acknowledged the debt} through letters dated 01.02.2013, 21.0L.2016, and^{tl-12.2018.Having} violated the terms of repayment of the said^loan, the^{presentOA is being} filed.

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Though the Defendants 1 & 2 entered appearance through their counsel Mr. Sunil Deshpande, they did not choose to file written statement. Accordingly, defendant's right of filing written statement was forfeited vide docket order dated 03.07.2023. /&o"n

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OANo.s6612022

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Defendants 3 & 4^{filed written statement. They have stronglydenied} the averments made^{in the Application.They have put the Applicant Bank} to strict^proof of almost^{all the averments. The Defendantsspecifically deny} having executed the^{key loan documents, such as the DemandPromissory} Note, DP Note, Hypothecation^{Deed, continuityLetter,General Power of} Attorney. They allege^{defendants1 and 2 forgedtheir signatures' They are} not aware of loan availed^{by defendants 1 and 2 and they are not liable to} pay any amount as claimed by the applicant^{bank' Hence OA maybe} dismissed.

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In order to Prove its case, Applicant^{Bank examlnedby Mr. P. Satish} as AW-1 and marked^{14 documents throughhim as} Kumar, Chief Manager, Exhibits A-1 to A-14.

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Defendants 1 & 2 right of adducing^{evidencewas forfeited though} vide docket order dated^25.06.2025. posted as a last chance

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To substantiate their^{pleas, D3 & D4 examined3'd defendant Mr. G S} K Kishore as DW-1^{and markedno documents'}

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B.TherightofApplicantBanktoadvanceargumentswasforfeitedon 30'03.2026afteraffordingampleopportunityWhereasLearnedCounselfor the Defendants^{reported no arguments but filed written arguments.} Perused the written^{argumentsfiled by the contesting Defendants and also} perused the material^{placed on record.}

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Learned counsel for^{the Defendants, vide written submissions,in} reiteration of the^{contentsof the written statement, submittedthat they} nevgr.-execlted.ahror.fte.loarrr-docurrrentsincludingtheDemand Promissory Note,^{HypothecationDeed, Guararrye- Agreement'or other} ul///)Wou*

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oANo.566/2022

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papers dated 08.02.2010. They allege that their signatures are forged in collusion with defendants 1 and 2. They are not liable to pay the amount as claimed by applicant banks and accordingly sought for dismissal of the OA with costs.

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, The point that arises for consideration is:-^.

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Whether the Applicant Bank proved its OA claim against the Defendants and O.A. schedule property?

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As stated supra, defendants l and 2 were set ex parte. The contesting defendants 3 and 4 allege that their signatures have been forged in collusion with defendants l and 2. Except the bald allegation, these defendants failed to produce any material document evidencing that criminal or civil action has been taken for the alleged fraud. It is settled law that mere allegation without material evidence is of no avail. Further they deny execution of any loan documents. On the contrary, the Applicant Bank examined its witness (AW-1) and marked 14 documents as Exs.A.1to A. 14 in order to prove its claim. The evidence affidavit of AW-1 coupled with recitals in Exhibits A-1 to A-14 remains unchallenged and un-rebutted. Hence, I hold that the 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 costs.

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In the result, the present Original Application No.566/2022 is allowed as under: -

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(i) The Defendant Nos. 1 to 4 are jointly and severally liable to pay to the Applicant Bank a sum of Rs. 56,67,574.01 ps with future interest rate of 10.50o/o p.a. simple from OL,Q7^2022 till the date of rearization, (ryOr,*

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oA No.566/2022

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(ii) the OA claim is secured by way of^{mortgage of} property, as described in the schedule^{annexed to} the OA and applicant bank^{is entitledto proceed} against the same for^{realisation of dues;}

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(iii) the applicant is also entitled to^{proceedagainst 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 within2 weeks from} the date of receiPt^{of this Order.}

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t4. Issue Recovery^{Certificateaccordingly.}

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15.Communicateacopyofthisordertothepartiesconcernedand upload on the official^website.

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(Dictatedtothesteno,corrected,signedandpronouncedbymeintheopencourtonthisthe 22"d day ofJune, 2026) . .., ^^

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.., ^^

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ESHWAR KOTHE) PRESIDING OFFICER

Union Bank of India v. Neo Organics

Case brief

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What did the court decide?

Union Bank of India v. Neo Organics

Case brief

What is this about?

What did the court decide?

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