Allowed

Karnataka Gramin Bank v. Sri Channegowda

DRT24 Jul 2026OA/979/2023

Case brief

AI extract

What is this about?

In OA No.979/2023, Karnataka Grameena Bank sought a recovery certificate for defaulted KCC and cash credit loans. The Tribunal, finding the evidence uncontroverted due to defendants' default, allowed the application, granting recovery of principal and interest capped at 8% p.a.

What did the court decide?

Recovery of Rs.29,49,132.30 jointly and severally from respondents, with future interest capped at 8% p.a., payable via schedule properties and other assets; Recovery Certificate to be drawn.

Karnataka Gramin Bank versus Sri Channegowda — Banking and Recovery | 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

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OA. No.979/2023

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BETWEEN:

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Karnataka Grameena Bank

Hagare Branch,

Hagare,

Belur Taluk,

Hassan District-573216

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… APPLICANT

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AND:

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Sri.Channegowda

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S/o.Huligowda,

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R/at: Pandithanahallu,

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Sahavasihalli Post,

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Belur Taluk,

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Hassan District,

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Sri.Mallaiah

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S/o.Basavaiah R/at: Shivayogipura Village, Belur Taluk,

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Hassan District.

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Sri.B.N.Channegowda

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S/o.Channegowda R/at: Pandithanahally, Sahavasihalli Post, Belur Taluk,

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Hassan District.

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OA. No.979/2023

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Sri.B.P.Prakash S/o.Puttswamy Gowda, R/at:Savasihalli, Halebidu Hobali, Beluru Taluk, Hassan District. ...DEFENDANTS

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Counsel on record/appeared for:

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Applicant : Sri.B.Prasanna Kumar Defendant : Exparte

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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 for seeking issuance of Recovery Certificate against the defendant for Rs.29,49,132.30/(Rupees Twenty-Nine Lakhs Forty-Nine Thousand One Hundred and Thirty-Two and Paisa Thirty Only) with further interest thereon from the date of filing the Application till realization from the Defendant.

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The Defendant No.1 availed 1^st Loan of Rs.11,00,000/(Rupees Eleven Lakhs Only) for Agricultural purposes under KCC loan facility, further defendant No.2 herein stood as a personal guarantee. The Defendant No.1 & 3 has executed simple mortgage deed to the above loan. The Defendant executed Agreement and Deed of Hypothecation.

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OA. No.979/2023

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The Defendant No.1 availed 2^nd Loan of Rs.45,000/- (Rupees Forty-Five Thousand Only) under cash credit loan facility for purpose of Grocery business.

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The Defendants No.1 & 4 also executed on demand promissory note, further the defendant No.4 stood as a personal guarantee to 2^nd Loan.

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It is also the case of the applicant that, in view of the above financed credit facility, the defendants executed necessary loan documents. Apart from the creation of security interest by way of mortgage over the Schedule property.

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It is further contended that, despite availing the credit facility, 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 account as NPA.

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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 exparte on 02.04.2026.

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OA. No.979/2023

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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 A1 to A12 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 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

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OA. No.979/2023

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

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Taking into consideration the facts that the credit facility was availed for agricultural 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 8% p.a.(simple).

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In the result, OA.No.979/2023 stands allowed,

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i) The applicant is allowed to recover an aggregate sum

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of Rs.29,49,132.30/- (Rupees Twenty-Nine Lakhs Forty-Nine Thousand One Hundred and Thirty-Two and Paisa Thirty Only) in the following manner:

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a) The defendants 1 to 3 herein to pay jointly and severally a total sum of Rs.29,36,137/- (Rupees Twenty-Nine Lakhs Thirty-Six Thousand One Hundred and Thirty-Seven Only)

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OA. No.979/2023

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b) The defendants 1 & 4 herein to pay jointly, severally and personally a total sum of Rs.12,995.30/- (Rupees Twelve Thousand Nine Hundred and Ninety-Five and Paisa Thirty Only)

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with further and future interest @ 8% (simple) p.a from the respective defendants jointly severally and personally after giving credit to all the amounts recovered and received during the pendency of the OA if any, in the respective accounts and allowed the same to be recovered by proceeding the schedule properties. The schedule property to the OA be the schedule property to the Recovery Certificate.

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ii) If the sale proceeds are not found sufficient to cover

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the amount due and payable to the applicant bank, the respective defendants jointly, several and personally and their other assets are liable for all such amounts due in respective loan accounts.

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iii) The applicant bank is allowed cost of the proceeding

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

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

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order and transferred to Recovery for execution.

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OA. No.979/2023

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v) Interim Application pending, if any, stands disposed of

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with this Final Order.

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16. Communicate a copy of the order to the parties concerned

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

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DRT (Procedure) Rules, 1993.

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[Dictated to the Stenographer (GS), 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/(T. RAJESH) PRESIDING OFFICER

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK:

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AW-1: Smt.Manasa K. Chief Manager of the applicant bank.

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Exhibits on the part of the Applicant:

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Sl. No.	Description of Documents	Exhibit Number
1.	A copy of the loan application dated 26.02.2013	A1
2.	A copy of the Sanction letter with Terms and conditions dated 02.07.2013	A2
3.	A copy of the Hypothecation agreement dated 02.07.2013	A3
4.	A copy of the Guarantor Agreement dated 02.07.2013	A4
5.	A copy of the registered simple mortgage deed dated 27.06.2013	A5

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OA. No.979/2023

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6.	A copy of letter of commitment dated 28.06.2016	A6
7.	A copy of Acknowledgement of liabilities letter dated 19.12.2016, 27.03.2019, 27.04.2020 letter of commitment dated 28.06.2016	A7
8.	A copy of the legal notices dated 20.05.2021 and 22.02.2022	A8
9.	A copy of the Postal receipt and Postal Acknowledgment	A9 & A10
10.	A copy of the statement of Agricultural cash credit under KCC loan account NO.12059130000541	A11
11.	A copy of the statement of cash credit loan Ac.No.120591300000102	A12

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Sd/(T. RAJESH) PRESIDING OFFICER

Karnataka Gramin Bank v. Sri Channegowda

Case brief

What is this about?

What did the court decide?

Karnataka Gramin Bank v. Sri Channegowda

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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