Allowed

Federal Bank v. Firoz Acharath

DRT9 Jun 2026OA/794/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the applicant bank's application for recovery of outstanding dues of agricultural medium term loans totaling approx. Rs. 99.18 lakhs along with interest from five respondents who failed to repay loans and did not appear in the proceedings.

What did the court decide?

Recovery of Rs. 99,18,040.25 along with interest and costs from all five respondents jointly and severally by sale of schedule properties.

Federal Bank versus Firoz Acharath — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated this the 9^th day of June, 2026

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ORIGINAL APPLICATION No.794/2022

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Between

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The Federal Bank Ltd., Chavakkad Branch, Lima Tower, Main Road, (Opp. Police Station), Chavakkad, Thrissur District – 680 506. …Applicant

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And

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1. Firoz Acharath, S/o.Kunhavaran, Acharath House, Guruvayoor Road, Nagalassery, Kottanad P.O., Palakkad District – 679 533.

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2. Saniba Firoz, W/o.Firoz Acharath, Acharath House, Guruvayoor Road, Nagalassery, Kottanad P.O., Palakkad District – 679 533.

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3. Safya N., W/o.late Ummer Haji M.N., Mambullinjalil House, Thrithala P.O., Palakkad District – 679 534.

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4. Farzana M.N., W/o.Shabeer K., Kulangara House, Kaladithara, Sukappuram, Vattamkulam, Malappuram District – 679 576.

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OA 794/2022

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5. Jasna M.N., Wo.Ali Askar, Pazhaya Puthenveettil House, Unniyal, Niramaruthur P.O., Malappuram District – 676 109. …Defendants

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This Original Application having been heard on 21.05.2026 in the presence of Advocate Sri.Anoop Elias for the applicant bank and stood over to this day for consideration, the Tribunal delivered the following:

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F I N A L O R D E R

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This Original Application has been filed under S.19(1) of the Recovery of Debts and Bankruptcy Act, 1993 for recovery of an aggregate sum of Rs.99,18,040.25 due under agricultural medium term loan accounts together with future interest on the sum of Rs.95,79,305.18 @12.35% per annum with monthly rests and penal interest @4% per annum from the defendants jointly and severally and by sale of the schedule properties.

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Facts of the case:

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The applicant is a banking company constituted under the Companies Act, 2013 having its registered office at Aluva and a branch among other places at Chavakkad in Thrissur District.

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In August, 2018, the defendants approached the applicant bank seeking financial assistance for purchase and

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OA 794/2022

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development of agricultural properties. Considering their request,

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applicant bank sanctioned the following facilities:

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Date of sanction	Type of loan	Amount	Availed by	Co- borrowers	Collateral security
10.08.2018	Agricultural medium- term loan	Rs.40 lakhs	1^st defendant	Defendants 2 to 5	Schedule properties
10.08.2018	Agricultural medium- term loan	Rs.32 lakhs	2^nd defendant	Defendants 1 & 3 to 5	Schedule properties

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According to the applicant bank, after availing the loans, the defendants did not utilize the fund for the purpose for which it was advanced and also failed to keep up their commitments to repay the loans. Due to default in repayments, the accounts turned NPA. Consequently, applicant bank issued lawyer notices to the defendants calling upon them to repay the outstanding dues but they did not settle the liability. In such premises, the applicant was constrained to file the OA claiming the following reliefs:

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(i) To recover a sum of Rs.99,18,040.25 together with pendente lite and post-decree interest on the sum of Rs.95,79,305.18 from the defendants jointly and severally and by sale of the schedule properties;

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OA 794/2022

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(ii) To recover the costs, charges and expenses from the defendants;

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(iii) To issue Recovery Certificate to the Recovery Officer with a direction to recover the amount and pay it to the applicant bank.

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All the defendants were duly served with summons. Defendants 1 and 2 entered appearance and sought adjournment for filing written statement but they did not file the same despite sufficient opportunity granted and thereafter remained absent from the proceeding. Defendants 3 to 5 neither appeared nor were they represented in this case.

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Proof Affidavit :

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To establish the claim on behalf of the applicant bank, one Mrs.Sunitha Ismail, Associate Vice President and Branch Head of the bank has filed proof affidavit and produced the loan documents marked as Exhibits A1 to A25. The proof affidavit filed by AW1 and the documents produced in this case are not challenged by the defendants. The availing of the loans is well established from the documents placed by the applicant bank. An aggregate sum of Rs.99,18,040.25 is outstanding in the loan accounts as on 13.12.2022, which is clearly established from the

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OA 794/2022

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account statements marked as Exts.A17, A18, A20, A22, A23 and A25.

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Considering the amount advanced, interest and penal

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interest applied, repayments effected and default committed, I am of the view that the applicant bank is entitled to get pendente lite and post-decree interest @10% per annum, which is reasonable in the facts and circumstances of the case.

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The applicant bank, therefore, is entitled to get a final order on the following lines:

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In the result, applicant bank is given a final order allowing it

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to recover the amount as shown below:

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Agricultural medium- term loan of Rs.40 lakhs	Rs.56,03,861.26 (Rupees fifty six lakhs three thousand eight hundred and sixty one and Paise twenty six only) together with_pendente lite_and post-decree interest on the sum of Rs.54,05,987.04 (Rupees fifty four lakhs five thousand nine hundred and eighty seven and Paise four only) @10% per annum from 14.12.2022 till realization from the defendants jointly and severally and by sale of the schedule properties;
Agricultural medium- term loan of Rs.32 lakhs	Rs.43,14,178.99 (Rupees forty three lakhs fourteen thousand one hundred and seventy eight and Paise ninety nine only) together with_pendente lite_and post-decree interest on the sum of Rs.41,73,318.14 (Rupees forty one lakhs seventy three thousand

Agricultural
medium-
term
loan
of
Rs.40
lakhs

Rs.56,03,861.26 (Rupees
fifty six lakhs three
thousand eight hundred and sixty one and Paise
twenty six only) together with_pendente lite_and
post-decree interest on the sum of Rs.54,05,987.04
(Rupees fifty four lakhs five thousand nine hundred
and eighty seven and Paise four only) @10% per
annum from 14.12.2022 till realization from the
defendants jointly and severally and by sale of the
schedule properties;

Agricultural
medium-
term
loan
of
Rs.32
lakhs

Rs.43,14,178.99 (Rupees forty three lakhs fourteen
thousand one hundred and seventy eight and Paise
ninety nine only) together with_pendente lite_and
post-decree interest on the sum of Rs.41,73,318.14
(Rupees forty one lakhs seventy three thousand

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OA 794/2022

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three hundred and eighteen and Paise fourteen only) @10% per annum from 14.12.2022 till realization from the defendants jointly and severally and by sale of the schedule properties; and

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costs and expenses borne by it for realization of the loans from the defendants.

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The schedule to the OA shall be appended to this final

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order.

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The applicant bank shall file memo of costs within ten

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days from the date of this final order.

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Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.

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Communicate copy of this order to both parties as provided in R.16 r/w R.2(c) of the Debts Recovery Tribunal (Procedure) Rules, 1993.

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(Dictated to my PA, corrected and pronounced by me in the open Tribunal on this the 9^th day of June, 2026)

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[SOVAN KUMAR DASH] PRESIDING OFFICER

OA 794/2022

A P P E N D I X

Witness for Applicant: AW1: Smt.Sunitha Ismail, Associate Vice President and Branch Head of the applicant bank.

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Witness for Defendant(s): Nil

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Applicant’s Exhibits

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Ext.No	Date	Particulars of documents
A1	10.08.2018	Sanction order issued by the applicant bank sanctioning the loan of Rs.40 lakhs to the 1^st defendant.
A2	10.08.2018	Letter addressed to the 1^stdefendant regarding sanction of loan of Rs.40 lakhs.
A3	10.08.2018	Agreement for agricultural loans executed by the defendants.
A4	10.08.2018	Sanction order issued by the applicant bank sanctioning the loan of Rs.32 lakhs to the 2^nd defendant.
A5	10.08.2018	Letter addressed to the 2^nddefendant regarding sanction of loan of Rs.32 lakhs.
A6	10.08.2018	Agreement for agricultural loan of Rs.32 lakhs executed by the defendants.
A7	01.08.2005	Sale deed No.1404/2005 of Erumapetty SRO.
A8	13.08.2018	Letter executed by defendants 2 to 5 confirming the deposit of title deed with the applicant bank.
A9	28.07.2021	Letter executed by the 1^stdefendant undertaking to discharge the entire liability in both the loan accounts.
A10	09.10.2021	Copy of lawyer notice in respect of the loan of Rs.40 lakhs issued to the defendants calling upon them to repay the outstanding dues.
A11	11.10.2021	Acknowledgement cards signed by defendants 1 to 4.
A12	18.10.2021	Returned postal envelope addressed to the 5^th defendant.

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OA 794/2022

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A13	09.10.2021	Copy of lawyer notice in respect of the loan of Rs.32 lakhs issued to the defendants calling upon them to repay the outstanding dues.
A14	11.10.2021	Acknowledgement cards signed by defendants 1 to 4.
A15	18.10.2021	Returned postal envelope addressed to the 5^th defendant.
A16	13.12.2022	Certificate showing the rate of interest applied in the loan of the 1^stdefendant.
A17	09.12.2022	Certified copy of the statement of account relating to the agricultural medium term loan of Rs.40 lakhs.
A18	…	Statement showing the interest accrued under Ext.A17 account.
A19	13.12.2022	Statement showing the penal interest applied in Ext.A17 account and capitalized portion thereof.
A20	13.12.2012	Statement of claim in respect of the loan of Rs.40 lakhs.
A21	13.12.2022	Certificate showing the rate of interest applied in the loan of the 2^nddefendant.
A22	09.12.2022	Certified copy of the statement of account relating to the agricultural medium term loan of Rs.32 lakhs.
A23	…	Statement showing the interest accrued under Ext.A22 account.
A24	13.12.2022	Statement showing the penal interest applied in Ext.A22 account and capitalized portion thereof.
A25	13.12.2012	Statement of claim in respect of the loan of Rs.32 lakhs.

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Defendants’ Exhibits – Nil

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PRESIDING OFFICER

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OA 794/2022

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PRESIDING OFFICER

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated the 9^th June, 2026

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OA NO.794/2022

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Between The Federal Bank Ltd., Chavakkad Branch, Lima Tower, Main Road, (Opp. Police Station), Chavakkad, Thrissur District. … Applicant

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And

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Firoz Acharath, S/o.Kunhavaran, Acharath House, Guruvayoor Road, Nagalassery, Kottanad P.O., Palakkad District – 679 533 & 4 others. ...Defendants

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F I N A L O R D E R

Federal Bank v. Firoz Acharath

Case brief

What is this about?

What did the court decide?

Federal Bank v. Firoz Acharath

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

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