Allowed

Union Bank of India v. Union Farmers Service Co. Op Bank Ltd.

DRT24 Jul 2026OA/75/2024

Case brief

AI extract

What is this about?

In an original application under Section 19 of the RDB Act for a recovery certificate, the Debt Recovery Tribunal allowed the bank's unopposed ex parte claim regarding defaulted term loans totaling over 3.31 crores, granting recovery with reduced simple interest.

What did the court decide?

Issuance of Recovery Certificate for Rs. 3,31,50,437.09 with reduced simple interest rates up to 12.00% p.a. and costs of proceedings.

Union Bank of India versus Union Farmers Service Co. Op Bank… — Company and Corporate | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

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Dated this 24^th Day of July, 2026

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Present: Sri. T. RAJESH

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Presiding Officer OA.No.75/2024

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BETWEEN:

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Union Bank of India Vidhan Bhawan Marg, Nariman point, Mumbai – 400 021 Branch office at: Mysore, Ashoka Road, Mysore – 570 001

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Represented by its Branch Manager Smt. Suma V K …APPLICANT

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AND:

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M/s. Union Farmers Service Co-operative bank ltd. Office at; Kadakola, Jayapura, Mysore Tq,. Mysore dist. – 571 311 Represented by its President/Secretary/directors

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Sri. Javaregowda S/o. late Kurimale Gowda Aged about 61 years R/at: K M Hundi, Kadakola Post, Mysore Tq., - 571 311

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Sri. Karigowda S/o. late Sathige Gowda Aged about 61 years R/at: No.71, B G Hundi, Kadakola Post, Mysore Tq., - 571 311 ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri. Satyanarayana Defendants : Ex parte

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2 OA-75/2024

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FINAL ORDER

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The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 seeking issuance of Recovery Certificate against the defendants for Rs. 3,31,50,437.09/- (Rupees Three Crores Thirty-One Lakhs Fifty Thousand Four Hundred and Thirty-Seven and paisa Nine Only) with further interest thereon from the date of filing the Application till realization.

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It is the case of the applicant that, the defendants are availed the credit facilities:

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Term loan of Rs. 51,50,000/- (Rupees Fifty lakhs Fifty Thousand Only).

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Term loan of Rs. 38,01,000/- (Rupees Thirty Eighty Lakhs One Thousand Only).

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Term loan of Rs. 55,71,000/- (Rupees Fifty-Five Lakhs SeventyOne Thousand Only).

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Term loan of Rs. 41,92,000/- (Rupees Forty-One Lakhs NinetyTwo Thousand Only)

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Term loan of Rs. 41,92,000/- (Rupees Forty-One Lakhs NinetyTwo Thousand Only).

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It is also the case of the applicant that, in view of the above availed loans, the defendants executed the necessary loan document. 4. It is further contended that, despite availing the credit facilities, agreeing to service the loan amount promptly and regularly, the defendants failed in complying the same, resulting in default in repayment and consequentially turning the loan accounts as NPA.

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3 OA-75/2024

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In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the account.

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Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set ex parte on 21.08.2024.

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The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A-1 to A-67 and got the same marked in evidence.

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Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

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The following issues arise for consideration in this matter:

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i) Whether the applicant had succeeded in proving the OA claim as against the defendants?

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ii) What order are to be passed?

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Both these issues are gone into and decided together.

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The case put forth by the applicant in the Application remains

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unrebutted as defendants remained ex parte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are

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sufficient to prove availment of credit facilities as stated in the OA,

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creation of the security interest and the defaults committed in the

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4 OA-75/2024

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accounts. The liability of the defendants and the claim of the amount due are also proved by the above documents. The claim of the applicant is well within the limitation.

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Hence in view of the findings arrived herein above, the Tribunal

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find both these issues in favour of applicant and hence, this Tribunal

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is of the view that OA is to be allowed.

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Taking into consideration the facts that the credit facilities is

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availed for Business purpose and also that the OA claim is arrived at by calculating interest at the agreed rate, this Tribunal of the view that OA can be allowed with a reduced interest of 12.00% (simple).

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In the result, OA.No.75/2024, stands allowed,

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i) The applicant is allowed to recover an aggregate sum of Rs. 3,31,50,437.09/- (Rupees Three Crores Thirty-One Lakhs Fifty Thousand Four Hundred and Thirty-Seven and paisa Nine Only) consisting of:

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a. Rs. 79,82,800.57/- (Rupees Seventy-Nine Lakhs Eighty-Two

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Thousand Eight Hundred and Paisa Fifty-Seven Only) with further

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interest @10.08 % p.a.(simple) from the date of filing OA till the realization, from the defendant no.1:

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b. 61,55,202.84/- (Rupees Sixty Lakhs Fifty-Five Thousand Two Hundred and Two and Paisa Eighty-Four Only) with further interest

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5 OA-75/2024

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@ 9.07 % p.a.(simple) from the date of filing OA till the realization, from the defendant no.1 to 3:

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c. Rs. 83,88,896.71/- (Rupees Eighty-Three Lakhs Eighty-Eight Thousand Eight Hundred and Ninety-Six and Paisa Seventy-One) with further interest @10.05 % p.a.(simple) from the date of filing OA till the realization, from the defendant nos.1 to 3:

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d. Rs. 61,19,130.77/- (Rupees Sixty-One Lakhs Nineteen Thousand One Hundred and Thirty and Paisa Seventy-Seven Only) with further interest @9.40 % p.a.(simple) from the date of filing OA till the realization, from the defendant nos.1 to 3:

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e. Rs. 45,04,406.20/- (Rupees Forty-Five Lakhs Four Thousand Four Hundred and Six and Paisa Twenty Only) with further interest @9.40 % p.a.(simple) from the date of filing OA till the realization, from the defendant no.1:

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After giving credit to all the amounts recovered and received during

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the pendency of the OA and allowed the same to be recovered by proceeding against defendants jointly, severally and personally and also by proceeding against schedule property. Properties schedule to the OA be the schedule to the recovery certificate.

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ii) If the sale proceeds are not found sufficient to cover the amount due and payable to the applicant bank, the defendants jointly, severally and personally and their assets are liable for balance

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6 OA-75/2024

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amounts due under the loan accounts.

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iii) The applicant bank is allowed cost of the proceedings

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which applicant to file cost memo within 7 days from the date of

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receipt of the order

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iv) The Recovery Certificate to be drawn in terms of this order

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and transferred to Recovery for execution.

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v) Interim application pending, if any, stands disposed of in

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terms of this final order.

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Communicate a copy of the order to the parties concerned in

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terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT

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(Procedure) Rules, 1993.

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[Dictated to the Stenographer (HS), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 24^th Day of July, 2026].

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Sd/-

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(T. RAJESH) PRESIDING OFFICE

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Mahesh Pokkinari, S/o. Sri. Madhusudhanan, Manager, of Applicant Bank.

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Exhibits on the part of the Applicant:

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Exhibit	Particulars
A1	Sanction Letter dt: 22.03.2018
A2	Demand PromissoryNote dt: 22.03.18
A3	Letter of Continuitydt: 22.03.18
A4	Simple Loan Agreement dt: 22.03.18

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7 OA-75/2024

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A5		General Term Loan Agreement dt: 22.03.18
A6		Interest Agreement dt: 22.03.2018.
A7		General Lien Letter dt: 22.03.18.
A8		Letter of Undertakingdt: 22.03.18
A9		Deed of Assignment dt: 23.03.18
A10		Sanction Letter dt: 03.08.2018
A11		Demand PromissoryNote dt: 07.08.18
A12		Letter of Continuitydt: 07.08.18
A13		Simple Loan Agreement dt: 07.08.18
A14		General Term Loan Agreement dt: 07.08.18
A15		Interest Agreement dt: 07.08.2018.
A16		Letter of Undertakingdt: 07.08.18
A17		Deed of Assignment dt: 07.08.18
A18		Sanction Letter dt: 18.02.2019
A19		Demand PromissoryNote dt: 18.02.19
A20		General Term Loan Agreement dt: 18.02.19
A21		Agreement dt: 18.02.2019
A22 A23	&	General Lien Letter & Undertaking dt:18.02.19
A24 A25	&	Deed of Guarantee & Guarantee Letter dt:18.02.19
A26 A28	to	Undertaking Letter & Guarantee Letter dt:18.02.19
A29		Deed of Assignment dt: 18.02.19
A30		Sanction Letter dt: 25.10.2019
A31		Demand PromissoryNote dt: 25.10.19
A32		Letter of Continuitydt: 25.10.19
A33		General Term Loan Agreement dt: 25.10.19
A34 A35	&	Simple Loan & Interest Agreement dt: 25.10.19
A36 A37	&	Undertaking & General Lien Letters dt: 25.10.19
A38 A39	&	Letter of Guarantees dt:25.10.19
A40		UndertakingLetter dt: 25.10.19
A41		Deed of Assignment dt: 25.10.19
A42		Demand PromissoryNote dt: 25.10.19
A43		Agreement dt: 25.10.19
A44		Deed of Assignment dt: 25.10.19
A45		Letter of Applicant dt: 18.11.21
A46 A48	to	Balance Conformations dt: 28.05.21(3 Nos.)
A49		1^stdefendant Letter dt: 04.02.22 with translation
A50		Copyof Legal Notice dt: 08.08.23.

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8 OA-75/2024

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A51 A59	to	Postal Receipts & Postal acknowledgements
A60		Replydt: 24.08.23 to Legal Notice of 3^rdDefendant
A61		Replydt: 02.089.23 of 1^stdefendant with translation
A62		Replydt: 11.09.23 of 2^nddefendant with translation
A63 A67	to	1. Certified copy of Loan Ledger Extracts (5 Nos.), with Certificate and Memo of Calculation
Witn	ess	Examined for the Defendants: -Nil -
List o	f D	ocuments Exhibited for the Defendants: -Nil –

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Sd/-

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(T. RAJESH) PRESIDING OFFICER

Union Bank of India v. Union Farmers Service Co. Op Bank Ltd.

Case brief

What is this about?

What did the court decide?

Union Bank of India v. Union Farmers Service Co. Op Bank Ltd.

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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