Allowed

Bank of Baroda v. M/s Deepa Foods

DRT25 Jun 2026OA/828/2025

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an original application filed by Bank of Baroda for recovery of a loan defaulting around Rs. 1.01 crore plus interest and costs against the principal borrower and guarantors, who failed to adduce evidence to rebut the bank's claim.

What did the court decide?

Respondents jointly and severally liable to pay Rs. 1.01 crore with future interest; Bank entitled to proceed against hypothecated assets and other properties of respondents for realization of dues.

Bank of Baroda versus M/s Deepa Foods — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-II AT HYDERABAD DATED THIS THE 25TH DAY OF JUNE, 2026

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PRESENT: SH. RAIYESHWAR KOTHE, B.Com, L.LB. (HonS.), M.A.

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PRESIDING OFFICER

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Orlginal Application No: 828 OF 2025

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Bank of Baroda, M.G. Road, Secunderabad Branch, Hyderabad, Rep by its Principal Officer and Branch Manager

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.....Applicant

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Versus

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M/s Deepa Foods, Rep by its proprietor, Sy. No. 290 to 293, Nandigama Main Road, Patancheru, Hyderabad-502300

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lvlr. Devulapally Ram Mohan Rao, S/o Venkatappa Rao, Aged about 50^years, Occ: business, R/o H. No.6-8/1/p- 105/1, Sai Township, RTA Office road, Ma nneguda, K.V.Rangareddy-501510

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I'4r. Akkala Ramakrishna Prasad, S/o Vara Prasada Rao, Aged about major, Occ: Business, R/o Flat No.C1,4th floor, Sahithi Constructions, Sumukhi Orbit, Opp: Durgam Cheruvu, Beside bharat^{petrol pump} lane, Madhapur, ... Defendants Hyderabad-500081

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Counsel for the Applicant : Mr. N. V. Subbaraju

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Counsel for the Defendants : N4r. K. Raghavender Gupta @6tt

OA. No.828/2025

:: ORDER::

The Applicant Bank filed the present OA for the recovery of a sum of Rs.1,01,31,892/- i.e., Rs. 55,09,635/_ towards account No.5120500000386 and Rs. 46,22,257/- towards account No.5120600005331 with future interest @ 10.55o/o p.a. along with 2o/o p.a. of penal interest from the defendant Nos. 1 to 3 joinfly and severally with monthly rests from 0g.08.2025 till the date of realisation along with costs, and in default, sale of O.A. of hypothecated assets.

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The averments of the applicant bank, as stated in the OA, in brief, are that defendants applied to the applicant bank on 13.03.2025 for a Term Loan and working capital facilities under the CGTI4SE scheme totalling ?98,00,000/-. To secure repayment, Defendant No.3 executed a General Form of Guarantee dated 1g.03.2025, undertaking joint and several liability for the entire outstanding dues with interest and charges, and agreeing to be bound by any acknowledgement of liability by the principal borrower. Additional securities in the form of a letter of continuing security and a letter of undertaking in respect of book debts were also executed in favour of the bank. The Applicant Bank contends that although the defendants initially made certain remittances, they subsequenuy defaulted in meeting the repayment schedule. Owing to persistent defaults, classified the loan accounts as NpA and subsequen y issued a recall notice dated 24.07.2025 to all defendants calling upon them to clear the outstanding dues within seven days; despite service of that notice, the defendants failed to regularize the accounts or discharge their tiabilities. Hence, present Oe for recoverlfuOl

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OA, No.828/2025

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The written statement filed by the defendant nos. 1 to 3. The averments, thereof briefly, are that Defendant No.1 as a sole proprietorship concern, Defendant No.2 as its proprietor and Defendant No.3 as a guarantor denies approaching the applicant bank and availing the loan facilities in the manner alleged in the OA, asserting that the bank had obtained signatures on printed forms and blank papers which were subsequently completed to support the present claim. The execution and validity of the alleged loan documents, including sancflon letters, loan agreements, demand promissory notes, letters of undertaking and hypothecation documents, were disputed. The defendants further challenged the rate of interest, penal charges, compound interest and other amounts claimed by the bank, alleging that the bank acted contrary to applicable RBI guidelines and the agreed contractual terms. The defendants denied any willful default and contended that the classification of the loan account as a NpA was arbitrary, illegal and effected without due notice. They disputed service and validity of the recall notice dated 24.07.2025 and argued that no legally enforceable notice had been served upon them, rendering the cause of action pleaded by the bank illusory and unenforceable. Additionally, the defendants raised a plea of limitation, asserting that the OA is barred by time and that the appticant bank failed to establish a legally subsisting cause of action within the prescribed limitation period under the Recovery of Debts and Bankruptcy Act, 1993.Consequenuy, the oA is liable to be dismissed.

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In order to prove its case, Applicant Bank examined by Mr. Arun Kumar, Chief Manager & Branch Head, as AW-1 and marked 12 documents through him as Exhibits A_1 to A_1

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OA. No. 828/2025

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The right of Defendant Nos.1 to 3 to adduce evidence stands forfeited vide docket order dated 08.04.2026, after affording ample oPPortunities.

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Heard Learned Counsel appearing for the Applicant Bank whereas the right of Defendants to advance arguments was forfeited on 19.06.2026 after affording ample opportunity. Perused the material placed on record.

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Learned Counsel for the applicant bank submlts that defendants availed term loan and working capital facilities aggregating to Rs.98 lakhs secured vla guarantee deed dated 18.03.2025,^however defendants defaulted in repayment of the loan due to^whichaccount was classlfied as NPA and subsequently a loan recall^noticedated 24.07 -2025 was also issued. Learned^{counsel placesrelianceupon} Exs.A-1 to Exs.A-12 marked throuqh applicant^{evidence (AW-1)as} proof of claim of the bank and submitted that the applicant bank is entitled for recovery of the outstanding amount together^{with future} interest and costs and invoking the^{guarantee deed.}

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The^point that arises for^{considerationis:-}

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Whether the Applicant Bank^{is entitled for the OA claim} against the Defendants^{and O.A. hypothecatedassets?}

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As stated supra,^{Defendants,apart from making general denials in} the written^{statementand disputing the claim of the APplicant Bank'} have failed to^{substantiatetheir defence by adducingany oral or} documentary^{evidence.The Defendants also di!- not avail the} W'w

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OA. No. 828/2025

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opportunity to cross-examine AW-1 so as to discredit the testimony of the witness or challenge the genuineness and correctness of Exs.A-1 to A-12 relied upon by the Applicant Bank. It is well settled that mere pleadings or bald assertions, unsupported by evidence, cannot be accepted as proof of the facts pleaded. On the contrary, the Applicant Bank has placed on record both oral and documentary evidence in support of its claim. The testimony of AW-1, coupled with the documentary evidence marked as Exs.A-1 to A-12, has remained uncontroverted and unrebutted. Accordingly, this Tribunal is satisfied that the Applicant Bank has successfully established its claim. Hence, Defendant Nos.1 to 3 are held jointly and severally liable to pay the O.A. claim to,the Appllcant Bank together with future interest and costs, in accordance with law.

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In the result, the present Original Application No.828/2025 is allowed as under: -

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i) The Defendant Nos. 1 to 3 are jolntly and severally liable to pay to the Applicant Bank a sum of Rs.1,01,31,892/- with future interest rate of 10.5570 simple from the date of application till the date of realization;

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ii) the OA claim is secured by way of hypothecation of assets as described in the schedule annexed to the OA and applicant bank is entltled to proceed against the same for realisation of dues;

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iii) the applicant is also entitled to proceed against the Person^{and properties of the} Nos. 1 to 3 for realization of dues; and +

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OA. No. 828/202s

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iv) the applicant bank is entiUed for the costs.

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9' The Applicant Bank is directed to fire cost Memo within 2 weeks from the date of receipt of this Order.

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Issue Recovery Certificate accordingly.

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Communicate a copy of this order to the parties concerned.

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(Dictated to the steno, corrected, signed and pronounced by me in the gBertourt on this the

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, '^{' +i!i.\"}

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(RAMESHWAR KOrHE) PRESIDING OFFICER

Bank of Baroda v. M/s Deepa Foods

Case brief

What is this about?

What did the court decide?

Bank of Baroda v. M/s Deepa Foods

Case brief

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