Allowed

Karnataka Gramin Bank v. Rayakka and Another

DRT27 Aug 2026OA/843/2025

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the applicant bank's Original Application seeking a Recovery Certificate for Rs.30.96 lakhs. The defendants were in default on agricultural loans. The Tribunal set the interest rate at a reduced 6% p.a. and ordered issuance of the RC against mortgaged properties following an exparte hearing.

What did the court decide?

Recovery Certificate issued for Rs.30,96,463.50 plus 6% p.a. interest recoverable from defendants by proceeding against schedule properties.

Karnataka Gramin Bank versus Rayakka and Another — Banking and Recovery | DRT (2026)

¶1

IN THE DEBTS RECOVERY TRIBUNAL II, KARNATAKA AT BENGALURU

¶2

Dated this 27^th Day of August 2026

¶3

Present: Sri. T. RAJESH Presiding Officer

¶4

OA. No.843/2025

¶5

BETWEEN:

¶6

Karnataka Grameena Bank (E-Cauvery Kalpathru Gramin Bank) Nagalamadike Branch, Pavagadi Taluk, Tumakuru District-561202

¶7

…APPLICANT

¶8

AND:

¶9

Smt. Rayakka

¶10

W/o.Muthyalappa

¶11

Sri.Papanna

¶12

S/o.Muthyalappa

¶13

Both are Residing at:

¶14

Peddakodipalli Village, Pavagada Taluk, Tumakuru District-561202

¶15

Also at:

¶16

Kyathaganacherlu Village Pavagada Taluk, Tumakuru District-561202. ...DEFENDANTS

¶17

Counsel on record/appeared for:

¶18

Applicant : Sri. Mohamed Afroze Ahamed Defendants : Exparte

¶19

2 OA No.843/2025

¶20

: FINAL ORDER:

¶21

The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 for seeking issuance of Recovery Certificate against the defendants for Rs.30,96,463.50 (Rupees Thirty Lakhs Ninety-Six Thousand Four Hundred Sixty-Three and Paisa Fifty Only) with further interest thereon from the date of filing the Application till realization from the Defendants.

¶22

The Applicant Bank submits that, the Deceased Borrower Muthyalappa S/o.Papanna has died on 05.01.2012, as such Sri.Muthyalappa has not made the party to the suit. The 1st Defendant is the Class-I Legal Heir and Wife of the Deceased Borrower Muthyalappa and enjoyed the Loan Facility availed. The 2nd Defendant is the Son of the Deceased Borrower Muthyalappa and joint Owner of the Mortgaged properties. Hence made party to the Suit.

¶23

The Deceased Borrower Sri.Muthyalappa availed a sum of Rs.3,80,000.00 (Rupees Three Lakh Eighty Thousand Only) for the purpose of purchase of Tractor Trailer and Accessories.

¶24

The Deceased Borrower Sri.Muthyalappa availed a sum of Rs.1,15,000.00 (Rupees One Lakh Fifteen Thousand Only) for KCC Loan.

¶25

3 OA No.843/2025

¶26

It is also the case of the applicant that, in view of the above financed credit facility, the defendant executed necessary loan documents, being owner of the schedule properties. Apart from the creation of security interest by way of mortgage, hypothecation over the Schedule properties.

¶27

It is further contended that, despite availing the credit facility, agreeing to service the loan amount promptly and regularly, the defendant failed in complying the same, resulting in default in repayment and consequentially turning the loan account as NPA.

¶28

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.

¶29

Despite, service of summons on the defendants, they failed to appear, resulting the defendants being set exparte on 07.01.2026.

¶30

The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A1 to A13 and got the same marked in evidence.

¶31

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.

¶32

4 OA No.843/2025

¶33

The following issues arise for consideration in this matter:

¶34

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

¶35

ii) What order are to be passed?

¶36

Both these issues are gone into and decided together.

¶37

The case put forth by the applicant in the Application remains unrebutted as defendant remained exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facility as stated in the OA, creation of security interest as claimed by the applicant bank and the defaults committed in the account. The liability of the defendant and the claim of the amount due are also proved by the above documents. The claim of the applicant is well within the limitation.

¶38

Hence in view of the above findings which cover both the issues raised in this manner, this Tribunal is of the view that OA is liable to be allowed.

¶39

Taking into consideration the facts that the credit facility was availed for Agriculture Purpose and also that OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of 6% p.a.(simple)

¶40

5 OA No.843/2025

¶41

In the result, OA.No.843/2025 stands allowed,

¶42

i) The applicant is allowed to recover an aggregate sum of

¶43

Rs.30,96,463.5 (Rupees Thirty Lakhs Ninety-Six Thousand Four Hundred Sixty-Three and Paisa Five Only) along with current and future interest 6% from the date of filing the application till the date of realization, from the Defendants, after giving credit to all the amounts recovered and received during the pendency of the OA if any, and allowed the same to be recovered by proceeding against the schedule properties. The schedule property to the OA be the schedule property to the Recovery Certificate.

¶44

ii) The applicant bank is allowed cost of the proceeding which applicant to file cost memo within 7 days from the date of receipt of the order.

¶45

iii) The Recovery Certificate to be drawn in terms of this order and transferred to Recovery for execution.

¶46

iv) Interim Application pending, if any, stands disposed of with this Final Order.

¶47

Communicate a copy of the order to the parties concerned in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

¶48

6 OA No.843/2025

¶49

[Dictated to the Stenographer (GS), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 27^th Day of July 2026].

¶50

Sd/(T. RAJESH) PRESIDING OFFICER

¶51

ANNEXURES

¶52

WITNESSES EXAMINED FOR THE APPLICANT BANK:

¶53

AW-1: Sri. Vasantha Ranjani P.S, Branch Manager of the applicant bank.

¶54

Exhibits on the part of the Applicant:

¶55

Sl. No.	Description of Documents	Date	Exhibits Number
	Sanction Communication for Tractor and		A1
1.	Trailer Loan executed by the Deceased Borrower Muthyalappa	25.09.2007
	Terms, Regulations, and Sanction		A2
2.	Intimation Letter executed by the Deceased Borrower Muthyalappa	24.11.2007
	Mortgage Deed Agreement executed by the		A3
3.	Deceased Borrower Muthyalappa and 2^nd defendant with English Translation	24.11.2007
	Registered Mortgage Deed executed by the		A4
4.	Deceased Borrower Muthyalappa and 2^nd defendant with English Translations	05.10.2007
	Letter of Commitment executed by the		A5
5.	Deceased Borrower Muthyalappa and 2^nd defendant	01.01.2010
6.	Agreement to repay time Barred Debt executed by the 1^stdefendant	08.06.2002	A6

¶56

7 OA No.843/2025

¶57

	Copy of the R.C. Book in respect to the		A7
	Tractor and Trailer issued by R.T.O
7.	Tumakuru Vide bearing Regn No.KA 06-TA- 5780 and 5781, which stands in the name Deceased Borrower Muthyalappa	20.11.2007
	Sanction Communication for KCC Loan		A8
8.	executed by the Deceased Borrower Muthyalappa	02.01.2008
	Mortgage Deed Agreement executed by the		A9
9.	Deceased Borrower Muthyalappa and 2^nd defendant with English Translations	19.01.2008
	Registered Mortgage Deed executed by the		A10
10.	Deceased Borrower Muthyalappa and 2^nd defendant with English	04.01.2008
11.	Letter of Commitment executed by the Deceased Borrower Muthyalappa	01.01.2011	A11
	Acknowledgement of Security/ Liability		A12
12.	from the Legal heirs of deceased Mortgagor executed by the 1^stdefendant	04.01.2020
13.	Agreement to repay time Barred Debt executed by the 1^stdefendant	08.06.2022	A13

¶58

Sd/(T. RAJESH) PRESIDING OFFICER

Karnataka Gramin Bank v. Rayakka and Another

Case brief

What is this about?

What did the court decide?

Karnataka Gramin Bank v. Rayakka and Another

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

Similar cases

Icici Bank Limited versus Shilpy

Bank of India versus Sh. Hardev Singh

Bank of India versus Amarjit Kaur

Santosh Kumari versus Central Bank of India

State Bank of India versus Mokksh

Ms Tamanna Enterprises versus Indian Bank