Allowed

Indian Overseas Bank v. Dcs Fitness Studio

DRT10 Feb 2026OA/99/2022

Case brief

AI extract

What is this about?

The DRT allowed the Original Application filed by the bank for recovery of a term loan against a fitness studio proprietor defaulted on repayment. The court found the claim well-founded due to lack of defense from ex-parte respondents and ordered recovery with interest.

What did the court decide?

Recovery of Rs. 34,96,334/- with interest at 12.45% p.a., costs, and liberty to sell hypothecated and respondent 2's personal assets.

Indian Overseas Bank versus Dcs Fitness Studio — Contract and Commercial Disputes | DRT (2026)

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O.A. No. 99 of 2022

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10.02.2026

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 10^th day of February, 2026

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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ORIGINAL APPLICATION No. 99 of 2022

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M/s. Indian Overseas Bank, KOLATHUR Branch, old No 2,new no 17 Vivekananda main road

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Kolathur, Chennai – 600099.

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Rep. by its Senior Manager & Constituted Attorney ….Applicant

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-Vs-

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M/s Royal DCS FITNESS STUDIO Rep.by its proprietor. OA. Chinna 98, Paper mills road, Peravallur,

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Chennai – 600 011.

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Mr. OA. Chinna

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S/o Mr.Adivaiayh

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No;5 Thilagarstreet, Ponniammanmedu

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Chennai-600 110. …..Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. K. Radhakrishnamurthy

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Defendants were set ex-parte on 02.08.2022

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: - FINAL ORDER - :

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This Original Application is filed on 01.10.2021 by the Applicant Bank under Section 19 (1) of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the Defendants 1 & 2 jointly and severally for recovery of a

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total sum of Rs.34,96,334/- (Rupees Thirty-Four Lakhs Ninety-six

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O.A. No. 99 of 2022

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10.02.2026

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Thousand Three Hundred Thirty-Four only) due in respect of Term Loan (Account No.189303628000001) repayable together with further interest @ 12.45% p.a. with monthly rests from the date of filing the OA, till date of realization in full and for sale of schedule mentioned property morefully detailed in Schedule to the OA, and for costs of this application.

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Brief Facts of the case:

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The Applicant submits that the application is filed within the period of limitation as prescribed under Section 24 of the Recovery of Debts and Bankruptcy Act, 1993, and the subject recovery claim falls within the jurisdiction of this Tribunal.

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The Applicant submits that the First Defendant is a Proprietorship concern wherein the Second Defendant is the sole proprietor. The First Defendant was carrying on Fitness studio. The Second Defendant had executed all the documents on behalf of the First Defendant.

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The Applicant submits that at the request of the First defendant by their application dated 19.03.2018 the Applicant sanctioned a Term loan Limit against hypothecation of Machineries of Rs.30,00,000 /- Under Standup India Scheme to the First Defendant on 13.06.2018. The First Defendant has availed the Term loan Limit of Rs.30,00,000 /- on 13.06.2018 and executed the following documents on 13.06.2018:

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a) Demand Promissory Note dated 13.06.2018 for Rs.30 Lakhs promising to repay the amount together with interest thereon at 10.45 % per annum compounded monthly rest subject to

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O.A. No. 99 of 2022

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10.02.2026

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Reserve Bank of India/Bank rates may be revised from time to time.

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b) Letter of Repayment

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c) Agreement of Term loan and Hypothecation

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d) Declaration in respect of Term loan

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e) Letter of Hypothecation

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f) Undertaking Letter Regarding Interest

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g) IOB Term loan agreement

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h) Undertaking Letter to deal exclusively with the Bank

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The applicant bank submits that subsequent to availing of loan, the operation of the account by the defendants was not satisfactory. In spite of several demands made to the defendants, they did not regularize the account. Consequently, the loan account was classified as Non-Performing Asset (NPA) on 30.06.2019. The Applicant Bank made several Demands to

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the Defendants to repay the loan outstanding and had also sent a Demand Notice dated 02.08.2019 to the Defendants, but there was no response and no payment. However, by Letter dated 08.11.2019 the first Defendant admitted his liabilities and requested time to pay the outstanding balance. The applicant also sent a Demand Notice dated 11.12.2019 under section 13(2) of the SARFAESI act and Possession Notice dated 11.02.2020 was also issued to the defendants. However, the first defendant had executed a Revival letter dated 24.05.2021 wherein they acknowledged their liabilities, but no payment has been made. The Applicant submits that as per the directions of the Bank/Reserve Bank of India the present rate of

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O.A. No. 99 of 2022

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10.02.2026

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interest on the outstanding is 12.45% per annum with monthly rests (including 2% penal interest). Despite repeated requests and demands, as defendants did not come forward to repay the dues, the present Original Application (OA) has been filed by the applicant bank for recovery of its dues from the defendants.

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After the filing of the OA, summons were sent to the Defendants 1 and 2 through Registered Post with Acknowledgment Due, summons to D- 1 and D-2 returned unserved with postal endorsement as ‘left’. Applicant bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 02.08.2022 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, defendants 1 and 2 were placed ex-parte on 02.08.2022.

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Heard the submissions of Applicant Bank and perused the

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records.

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To prove the case of the Applicant Bank, Mr. Omgee Chaudhry, Chief Manager of the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW-1 and list of documents came to be marked as Ex A-1 to A-16 .

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A careful examination of the pleadings in the Proof Affidavit and documents Exhibits A-1 to A-16 evidence that the borrowal of credit facilities and execution of loan and security documents are true, in terms

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of averments made in Original Application as well as Proof Affidavit filed by applicant bank establishing its claim. Applicant bank filed Statement of

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O.A. No. 99 of 2022

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10.02.2026

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Accounts duly certified under Bankers’ Book Evidence Act, evidencing the amount claimed against defendants.

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The defendants were set ex-parte on 02.08.2022, but till this day they did not take any action to set aside the ex-parte order and did not choose to contest the claim. Further, a careful scrutiny of records makes it clear that present application is filed well within limitation and this Tribunal possesses necessary and proper jurisdiction to entertain and adjudicate the claim. No oral or documentary evidence on the side of defendants are produced or filed to dispute the claim of applicant bank. Hence, it can be concluded that applicant bank has proved its claim against defendants.

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With regard to the amount advanced, the interest applied, the conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled for a final order on the following terms:

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: O R D E R :

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11. The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendants jointly and severally, a total sum of Rs.34,96,334/- (Rupees ThirtyFour Lakhs Ninety-six Thousand Three Hundred Thirty-Four only) due in respect of Term Loan (Account No.189303628000001) repayable together with further interest @ 12.45% p.a. with monthly rests from the date of filing the OA, till date of realization in full along with costs.

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O.A. No. 99 of 2022

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10.02.2026

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(b) In the event of failure of the Defendants to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the schedule mentioned hypothecated assets.

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(d) If the sale proceeds of the hypothecated assets are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the 2^nd Defendant (both movable and immovable) to recover the balance dues as required under law for which the 2^nd Defendant to disclose to the Tribunal particulars of other properties or assets owned by the 2^nd Defendant.

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(e) The applicant bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by Defendant to the applicant bank.

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(f) The applicant bank shall file memo of costs within ten days from the date of receipt of this final order.

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

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O.A. No. 99 of 2022

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10.02.2026

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A copy of this order be communicated to the parties concerned.

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Sd/-

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(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to Steno (Suriya), transcribed by him, corrected, signed and pronounced by me on this the 10^th day of February, 2026)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Mr. Omgee Chaudhry, Chief Manager representing the Applicant Bank.

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Exhibits on the part of the Applicant:

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Sl. No.	Dated	Description of Documents	Exhibit No.
1.	19.03.2018	Application	A-1
2.	13.06.2018	Sanction letter	A-2
3.	13.06.2018	Demand Promissory Notefor Rs.30 lakhs	A-3
4.	13.06.2018	Letter of repayment	A-4
5.	13.06.2018	Agreement of Term loanand Hypothecation	A-5
6.	13.06.2018	Declaration in respect TL	A-6
7.	13.06.2018	Letter of Hypothecation	A-7
8.	13.06.2018	Undertaking letter regarding interest	A-8
9.	13.06.2018	IOB TL agreement	A-9
10.	13.06.2018	Undertaking letter to deal with the Bank only	A-10
11.	02.08.2019	Demand notice	A-11
12.	08.11.2019	Letter by defendants	A-12
13.	11.12.2019	13(2) notice issued by applicant bank	A-13
14.	11.02.2020	13(4) notices issued by applicant bank	A-14
15.	24.05.2021	Revival letter	A-15
16.		Statement of Account	A-16

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Witness Examined for the Defendants: -Nil-

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List of Documents Exhibited for the Defendants: -Nil –

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O.A. No. 99 of 2022

10.02.2026

:- SCHEDULE -:

All the hypothecated stocks, i.e. goods such as Gym machineries furniture & fixtures, machineries, and other hypothecated item are lying at the First Defendant premises i.e.98, paper mills road, Peravallur Chennai – 600011. or stored or to be stored or transit or wherever found.

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EQUIPMENT NAME QUANTITY

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1. Treadmill	-	2
2. Motion trainer	-	2
3. Spin bike	-	2
4. Air rower	-	1
5. Air bike	-	1
6. Lat pull down/Seated row	-	1
7. PEC fly/ Rear delt	-	1
8. LEG extension	-	1
9. Multi press	-	1
10. Assisted chin DIP	-	1
11. Cable Crossover	-	1
12. Incline chest press	-	1
13. Shoulder press	-	1
14. Triceps dip	-	1
15. Pull down	-	1
16. Bicep’s curl	-	1
17. 45-degree leg press	-	1
18. Half squat	-	1
19. Smith machine	-	1
20. Olympic flat bench	-	1
21. Olympic incline bench	-	1
22. Ulti adjustable bench	-	1
23. Multipurpose	-	1
24. Flat bench	-	1
25. Adjustable ab bench	-	1
26. Row	-	1
27. Power tower	-	1
28. Multi ab bench	-	1
29. Hyper ab bench	-	1
30. Squat stand	-	1
31. Forearm machine	-	1
32. Viva force plates	-	1500kg

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O.A. No. 99 of 2022

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33.	Rods 7 feet -	2
34.	Rods 5 feet -	2
35.	Rods 4-ez bar -	2
36.	Bicep’s rod -	1
37.	Resistance tube -	2
38.	Triceps rope -	1
39.	Siting and standing twister	1
40.	Push up bar -	1
41.	Medicine ball -	1
42.	Kettle bell -	1
43.	Gym ball -	3
44.	Yoga mat -	5
45.	V rod -	1
46.	D rod -	1
47.	Barbell -	2
48.	Safety squat bar -	1

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

Indian Overseas Bank v. Dcs Fitness Studio

Case brief

What is this about?

What did the court decide?

Indian Overseas Bank v. Dcs Fitness Studio

Case brief

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