Allowed

Bank of Baroda (Vijaya Bank) v. M/S Lara Impex

DRT23 Jun 2026TA/1357/2023

Case brief

AI extract

What is this about?

DRT-III, Chennai allowed an interim application by Bank of Baroda seeking security or attachment of respondent properties to secure an Original Application for recovery of Rs. 1.57 crore, subject to showing cause within 15 days.

What did the court decide?

Direction to show cause within 15 days as to why security should not be furnished; conditional attachment of specified immovable properties ordered to secure the dues of the applicant bank.

Bank of Baroda (Vijaya Bank) versus M/S Lara Impex — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 04^th day of June, 2026

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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I.A. No.326 of 2024 in T.A. No. 1357 of 2023

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Bank of Baroda Adyar Branch Represented by its Chief Manager No.77, I Main Street Gandhi Nagar, Adyar Chennai – 600 020

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….Petitioner / Applicant

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-Vs-

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M/s Lara Impex

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A Partnership Firm

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Represented by its Partners

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Mr. P. Rajaram & Mrs. Lakshmi Prabha No.B 3, Alsa Tower

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186 – 187 Poonamallee High Road

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Kilpauk, Chennai – 600 010

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Mr. P. Rajaram S/o Parathalwar G-100/1, I Floor G Block, 12^th Street Anna Nagar East Chennai – 600 102

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Mrs. Lakshmi Prabha W/o P. Rajaram G-100/1, I Floor G Block, 12^th Street Anna Nagar East Chennai – 600 102 ….Respondents/Defendants

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: - ORDER ON IA NO.326 of 2024 - :

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The Original Application is filed by the Applicant Bank against the

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Defendants, seeking for recovery of money due from Defendants jointly

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and severally to pay a sum of Rs.1,57,83,548/- (Rupees One Crore

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Fifty Seven Lakhs Eighty Three Thousand Five Hundred and Forty

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Eight only) repayable together with further interest and costs.

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The Applicant Bank has filed the present petition i.e., I.A.No.326/2024 with affidavit of the Chief Manager, ROSARB, Chennai of applicant bank, praying to direct the respondents/ defendants 1 to 3 to furnish security to the tune of claim made in the OA for the sum of Rs.1,57,83,548/- claimed in the O.A. (less Rs.15,20,000/- realised by sale of Schedule B property under SARFAESI Act) within the time fixed by the Tribunal, failing which to pass an order of attachment before judgement of the schedule mentioned property, pending disposal of the above OA.

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In the affidavit filed along with IA, it is submitted by the applicant bank that the 1^st Respondent/1^st Defendant is a Partnership Firm represented by the Respondents/ Defendants 2 and 3 as its Partners availed the sanctioned Loan Limit of Rs 1,75,00,000/ towards liquidation of dues with The Jammu & Kashmir Bank Ltd T. Nagar Branch, Chennai - 600 017 and towards Working Capital Requirements. To secure the loan limit, the Defendants 1 to 3 have executed various security loan documents in favour of the Applicant and Equitable Mortgage by Deposit of Title Deeds was jointly created by the 2nd and 3rd Defendants on 25.03.2015 in respect of OA schedule mentioned properties and executed MoTD dated 25.03.2025 registered as Document No.1046 of 2015 before SRO, Thallakulam, Madurai, after discharging the loan with The Jammu & Kashmir Bank Ltd T. Nagar Branch Chennai - 600 017. Subseqeunlty, the 2^nd Item mortgaged to the Applicant's then Vijaya Bank was later sold by the Defendants for a sum

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of Rs 70,00,000/- with the consent of the applicant bank and the entire sale proceeds was credited by them into the loan account.

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It is submitted by the applicant bank that subsequent to availing of loan, the Defendants 1 and 2 committed default in repaying the dues and allowed the loan account to be classified as Non Performing Asset as on 27.08.2018. Inspite of several demands, defendants did not come forward to repay the dues. Hence the applicant bank had filed OA No.327/2020 before DRT-II, Chennai for recovery of its dues from defendants, which was transferred to this Tribunal due to bifurcation of jurisdiction and renumbered as TA No.1357/2023.

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It is further submitted by the applicant bank during the pendency of OA, that the Authorized Officer of the Applicant sold the Schedule B property under SARFAESI ACT for a Sale Consideration of Rs 15,20,000/ and a full fledged Sale Certificate was also executed and registered in favour of the Auction Purchaser one Mr. S. Kasi Viswanathan on 12.06.2020 as Document No 1715 of 2020 SRO Thallakulam Madurai. The said amount was also credited in the loan account on 12.06.2020 itself. The Applicant has also separately filed a Part Satisfaction Memo to record Part Satisfaction of a sum of Rs 15,20,000/-.

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It is submitted that for the balance sum due out of the OA Claim, the Applicant has to obtain a Final Order as against the Defendants 1 to 3. At this juncture, the applicant bank has made a thorough enquiry against the other personal properties of the Defendants 2 and 3 and were able to

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get information that vacant Plots Vis Plot Nos 61, 62, 63, 64 and 65 (more fully described in the accompanying petition) jointly belonging to the Defendants 2 and 3 having purchased by them in their names under a Registered Sale Deed dated 25.09.2013 (Document No 11341/2013 SRO Red Hills) for a valid consideration of Rs 40,84,800/-. While perusing the Encumbrances Certificates it transpires that the Respondents/Defendants 2 and 3 have created an Equitable Mortgage by Deposit of Title Deeds to secure a Loan Limit of Rs 60,00,000/- (Rupees Sixty Lakhs only) availed/to be availed by M/s LARA TRADERS represented by them as its Partners by execution of a Registered Memorandum of Deposit of Title Deeds dated 26.12.2013 to secure a Loan Limit and registered as Document No 14463/2013 in favour of Indian Bank Porur Branch Chennai. Still the said 1st Charge in favour of the said Indian Bank continues and subsisting. 7. The applicant bank submits that on enquiries, it is made to understand that the Plots 61, 62, 63, 64 and 65 measures in toto an extent of 13,626 sq. ft. detailed in the accompanying petition, are approximately valued at Rs 2,50,00,000/(Rupees Two Crores only). Even adding the 1st Charge with Indian Bank Porur Branch Chennai, Applicant's present claim in this Application, there will a surplus in the value of the said Plots. Under such circumstances, the Defendants 2 and 3 being the present joint owners of the above said property, to defeat the rights of the Petitioner/Applicant, they may if settle fully the said loan limit with the said Indian Bank, Porur Branch, Chennai and get back the title deeds, the Petitioner/Applicant may be deprived of the right to proceed as against the said 5 Plots unless until

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they are ordered to be attached after the Respondents/Defendants 1 to 3 after having been called for to furnish security to an extent of Rs 1,57,83,548/ (Rupees One Crore Fifty Seven Lakhs Eighty Three Thousand Five Hundred and Forty Eight only) less Rs 15,20,000/ (Rupees Fifteen Lakhs Twenty Thousand only) recovered under SARAFAESI ACT after filing this Original Application by sale of the mortgaged immovable property. It is therefore just and necessary that an order attaching the schedule property before judgment of is passed. Unless an order attaching the schedule property is passed, the petitioner/applicant will not be able to recover its dues and thus will be put to grave and irreparable loss and hardship. Now the balance claim amount in the above O.A. is unsecured. Hence the present application is filed praying to direct the respondents 1 to 3 / defendants 1 to 3 to furnish security to the OA claim, failing which to order attachment of the properties mentioned in the Schedule to the IA, till the disposal of the OA.

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The respondents / defendants after receipt of notice in IA, filed their counter to the IA denying the averments contained in the IA, except those that are specifically admitted therein and is liable to be dismissed in limine, as the Applicant has failed to satisfy the mandatory statutory and judiciallysettled requirements governing the grant of such extraordinary relief. The TA is still pending adjudication and there is no final determination of liability or issuance of any Recovery Certificate by this Tribunal as on date. In the absence of imposition of liability and quantification by this Tribunal, the

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Applicant is not entitled to seek attachment of personal properties of the Respondents under the guise of Attachment Before Judgment.

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It is submitted that only two immovable properties were given as security and both the properties were sold, without the knowledge and consent of the Petitioner. One property was sold for less than 50% of the prevailing market value at that point in time. One such secured property was sold by the Respondents with the knowledge and consent of the Applicant Bank and the sale proceeds were duly appropriated towards the loan account, resulting in part satisfaction. The other secured property was sold by the Applicant Bank by invoking the provisions of the SARFAESI Act for a paltry and grossly inadequate consideration, without issuing any prior notice or intimation to the Respondents and without affording them an opportunity to participate in or object to the sale. Having thus exhausted the secured assets, and having appropriated the sale proceeds thereof, the Applicant cannot now seek to attach other personal properties of the Respondents which were never part of the loan transaction or offered as security, and such an attempt is arbitrary, oppressive and bad in law.

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It is further contended that the Applicant has not pleaded or proved that the Respondents are attempting to dispose of, alienate, encumber or remove any property with an intention to defeat execution of any prospective order. In fact Applicant is genuinely making efforts to settle his legal dues and in regular contact with the officials of the Applicant Bank. This IA is founded entirely on vague apprehensions and speculative

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assumptions, without reference to any concrete act, document, agreement, negotiation or third-party transaction indicating imminent alienation. Mere pendency of recovery proceedings or ownership of immovable property cannot, in law, constitute a ground for Attachment Before Judgment.

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It is further contended by the respondents that the property sought to be attached were purchased by Respondents 2 and 3 under a registered Sale Deed dated 25.09.2015 bearing Document No. 1341 of 2015 on the file of the Sub-Registrar, Red Hills, for valid consideration and constitute their absolute personal properties and that the said property was never offered as security to the Applicant Bank, does not form part of the loan transaction or agreement, and is not covered under any sanction memo, mortgage, hypothecation or security document executed in favour of the Applicant. The Applicant is therefore an unsecured creditor insofar as the said property is concerned and has no charge, lien or security interest over the said property. The property sought to be attached in the present IA is already subjected to an Equitable Mortgage by Deposit of Title Deeds in favour of Indian Bank, Purasawalkam Branch, Chennai, which subsists as on date. The Respondents 2 and 3 had created the said Equitable Mortgage by Deposit of Title Deeds in respect of the Red Hills property to secure a loan facility of ₹60,00,000/- (Rupees Sixty Lakhs only) availed by M/s. Lara Traders, much prior to the filing of the present OA. The said equitable mortgage was duly recorded under a Registered Memorandum of Deposit of Title Deeds bearing Document No. 1446 of 2013, and the charge in favour of Indian Bank continues to be valid, subsisting and enforceable as

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on date. It is further submitted that the said property is presently under acquisition negotiations by the Indian Air Force authorities, and at this crucial juncture, any order creating a further charge or attachment over the property would cause unnecessary hardship to the Respondents, materially prejudice ongoing acquisition proceedings and adversely affect the fair valuation of the property.

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It is submitted that in respect of the said property there is not privity of contract with the Applicant and more importantly the Applicant does not hold any charge, lien or security interest over the Red Hills property and does not enjoy any first charge or preferential right in respect thereof, whereas Indian Bank is a prior secured creditor by virtue of the subsisting equitable mortgage. Any order of Attachment Before Judgment over a property already subjected to a prior equitable mortgage would necessarily be subordinate to the rights of the secured creditor, ineffective for execution and incapable of conferring any executable advantage upon the Applicant. Even assuming that the Applicant has got a means to attach the Property which is not secured, the secured creditor who has got charge over the property is necessary to be put to Notice before pleading for creation of a charge over the Property.

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The Respondents does not have any intention to defeat or delay recovery and submit that the Respondents have at all times acted bona fide, cooperated with the Applicant, acknowledged liabilities and permitted enforcement proceedings under the SARFAESI Act without obstruction. The

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Applicant themselves admits that the Red Hills property is approximately valued at 2,50,00,000/- and seeking attachment of such high-value property, when the alleged claim is yet to be adjudicated and when the property is already encumbered, is arbitrary, oppressive and disproportionate. Thus submitting, respondents / defendants prayed for dismissing the IA.

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Heard both sides and perused the records produced along with the IA.

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The Applicant Bank has filed the above I.A. on the premise that the respondents / defendants may alienate or dispose of or create third-party interest on the properties morefully described in the schedule to the IA. 15. It is a matter of record that the OA was filed for recovery of sum of Rs.1,57,83,548/-, which is a colossal sum of money. The applicant bank had initiated proceedings under SARFAESI Act and sold Schedule B property for a sale consideration of sum of Rs.15,20,000/-. As admittedly, another mortgaged property has already been sold by defendants with the consent of the applicant bank for a sum of Rs.70,00,000/- even before filing of OA by applicant bank.

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During the course of arguments, it was submitted that the OA No.209/2021 has been filed by Indian Bank before this Tribunal, wherein the IA schedule property, sought to be attached, was offered as security. The Indian Bank had reported full satisfaction of the OA claim and the same was duly recorded vide proceedings dated 06.05.2026 and documents

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marked as Ex A-1 to A-28 were ordered to be returned to the applicant bank under proper acknowledgment. Hence the contention of the respondents that any order of Attachment Before Judgment over a property already subjected to a prior equitable mortgage would necessarily be subordinate to the rights of the secured creditor, ineffective for execution and incapable of conferring any executable advantage upon the Applicant has become infructuous.

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Considering the amount of claim involved in this case and the balance of convenience, the present IA is to be allowed by keeping open the merits of the case and without prejudice to the rights of both the parties. By doing so, no prejudice, no harm and loss will be caused to the Defendants.

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18. As per Section 19 (13)(A) of RDB Act,

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“ Where, at any stage of the proceedings, [the Tribunal on an application made by the applicant along with particulars of property to be attached and estimated value thereof, or otherwise] is satisfied that the defendant, with intent to obstruct or delay or frustrate the execution of any order for the recovery of debt that may be passed against him

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(i)is about to dispose of the whole or any part of his property; or (ii)is about to remove the whole or any part of the property from the local limits of the jurisdiction of the Tribunal; or (iii)is likely to cause any damage or mischief to the property or affect its value by misuse or creating third party interest,

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the Tribunal may direct the defendant, within a time to be fixed by it, either to furnish security, in such sum as may be specified in the order, to produce and place at the disposal of the Tribunal, when required, the said property or the value of the same, or such portion thereof as may be sufficient to satisfy the certificate for the recovery of debt, or to appear and show cause why he should not furnish security.

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(B)Where the defendant fails to show cause why he should not furnish security, or fails to furnish the security required, within the time fixed by the Tribunal, the Tribunal may order the attachment of the whole or such portion of the properties claimed by the applicant as the properties secured in his favour or otherwise owned by the defendant as appears sufficient to satisfy any certificate for the recovery of debt.”

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As the Applicant Bank has prima facie established the essential ingredients for granting an order of temporary injunction restraining the defendants 2 and 3 / respondents 2 and 3 in respect of the properties mentioned in the schedule to the petition, this Tribunal proceeds to pass the following order:

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:ORDER:

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In the circumstances pleaded, respondents / defendants hereby directed to show cause as to why they should not furnish security to the tune of OA claim in a sum of Rs.1,57,83,548/claimed in the O.A. (less Rs.15,20,000/- realised by sale of

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Schedule B property under SARFAESI Act) within 15 days from the date of receipt of this order, failing which to order attachment the

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IA schedule mentioned property to answer the OA claim herein.

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Meanwhile, conditional attachment of the IA schedule mentioned property to the extent of OA claim of Rs.1,57,83,548/claimed in the O.A. (less Rs.15,20,000/- realised by sale of Schedule B property under SARFAESI Act), together with further interest, is hereby ordered to secure the dues of the applicant bank.

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The Registry is directed to communicate this Order to the Concerned

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Sub Registrar Office/ Village Officer for necessary action and for records.

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21. IA Schedule properties shall form part of this order.

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Sd/-

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(Dictated to PS, transcribed by her, corrected, signed and pronounced by me on this the 04^th day of June, 2026)

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IA SCHEDULE PROPERTY

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SCHEDULE OF IMMOVABLE PROPERTIES FOR ATTACHMENT

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All that piece and parcel of Vacant 5 (Five Plots) at Vijayalakshmi Nagar, bearing Plot Nos 61, measuring 2908 sq. ft., Plot No 62 measuring 3508 sq. ft., Plot No 63 measuring 2400 sq. ft., Plot No 64 measuring 2400 sq. ft., Plot No 65 measuring 2400 sq. ft., and in total measuring 13616 sq. ft. comprised in S. No 223/4E of Old No 4, New No 114, Nallur Village, Ponneri Taluk, Thiruvallur District, and the Plots being bounded on the:

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North by: Plot No 66 South by : Plot No 60, East by Plot Nos 71,72,and 73 West by 30 Feet Wide Road and Measuring Plot No 61, On the North: 68 Feet, On the South: 60 Feet On the East : 30+3 Feet On the West : 53 + 4 Feet

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Plot No 62 On the North: 60.6 Feet, On the South: 68 Feet On the East: 40 +3 Feet On the West: 60+4 Feet Plot No 63 On the North: 60 Feet, On the South: 60 Feet On the East: 40 Feet On the West : 40 Feet

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Plot No 64

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On the North: 60 Feet, On the South: 60 Feet On the East: 40 Feet On the West : 40 Feet

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Plot No 65

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On the North: 60 Feet, On the South: 60 Feet On the East: 40 Feet On the West : 40 Feet

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And all the Plots 61, 62, 53, 64 and 65 totally measuring 13616 sq. ft. and situated within the Registration District of North Chennai and

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Sub Registration District of Red Hills (Approximately valued at Rs 2,50,00,000/ Rupees Two Crores Fifty Lakhs only)

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Sd/-

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

Bank of Baroda (Vijaya Bank) v. M/S Lara Impex

Case brief

What is this about?

What did the court decide?

Bank of Baroda (Vijaya Bank) v. M/S Lara Impex

Case brief

What is this about?

What did the court decide?

What the court decided

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