Corporation Bank versus Sheela

¶1

T.A. No. 601 of 2023

¶2

19.05.2026

¶3

1

¶4

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

¶5

Dated this the 19^th day of May, 2026

¶6

Present: SMT. S.V. GOWRAMMA Presiding Officer

¶7

TRANSFERRED APPLICATION No.601 of 2023

¶8

(Originally filed before DRT- II, Chennai as OA No.863 of 2019 and thereafter transferred to this Tribunal and renumbered as TA No.601 of 2023)

¶9

***** Union Bank of India (Erstwhile Corporation bank) Shastri Nagar Branch, New No.5, Old No.11 First Avenue, Shastri Nagar, Adyar, Chennai- 600 020 …Applicant

¶10

***** ( Amended vide order in memo dated 21.10.2021 in view of merger)

¶11

-Vs-

¶12

Mrs. Sheela. M. Sheth, W/o Mr. Mukesh K.Sheth, No.33, Rajiv Gandhi Salai, Flat No.13 E&F, 13^th floor, Sapphire Block Olympia Opaline, Opp.AGS Cinemas & ETA Techno Park, Navalur, Chennai 603 103

¶13

Also at Mrs. Sheela. M. Sheth No.7, 2^nd Canal road, Gandhi nagar, Adayar, Chennai- 600 020

¶14

Mr. Mukesh K.Sheth S/o Kanthibhai C. Sheth, No.33, Rajiv Gandhi Salai, Flat No.13 E&F, 13^th floor, Sapphire Block Olympia Opaline, Opp.AGS Cinemas & ETA Techno Park, Navalur, Chennai 603 103

¶15

Uploaded on 19.05.2026 at 17:00 hours

¶16

T.A. No. 601 of 2023

¶17

2

¶18

19.05.2026

¶19

Also at Mr. Mukesh K.Sheth No.7, 2^nd Canal Road, Gandhi Nagar, Adayar, Chennai- 600 020

¶20

Mr.Rudra M.Sheth, S/o Mr. Mukesh K.Sheth No.33, Rajiv Gandhi Salai, Flat No.13 E&F, 13^th floor, Sapphire Block Olympia Opaline, Opp.AGS Cinemas & ETA Techno Park, Navalur, Chennai 603 103

¶21

Also at Mr.Rudra M.Sheth No.7, 2^nd Canal Road, Gandhi Nagar, Adyar, Chennai- 600 020 ….Defendants

¶22

Counsels on record / appeared:

¶23

Counsel for Applicant : M/s. S. Sethuraman

¶24

Defendants 1 to 3 were set ex-parte on 21.10.2021

¶25

: - FINAL ORDER- :

¶26

This Original Application is filed on 09.09.2019 by Erstwhile Corporation Bank (since merged with Union Bank of India), under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants 1 to 3, jointly and severally for recovery of a total sum of

¶27

Rs.1,04,10,334.65p (Rupees One Crore Four Lakhs Ten Thousand

¶28

Three Hundred and Thirty Four and Sixty Five paise only) due in

¶29

Uploaded on 19.05.2026 at 17:00 hours

¶30

T.A. No. 601 of 2023

¶31

3

¶32

19.05.2026

¶33

respect of Housing loan (A/c No.560631001770961) repayable together with further interest @ 10.85% p.a. with monthly rests from the date of Application till the date of realization in full and for costs of this OA.

¶34

Originally, this Application was filed before DRT-II, Chennai, assigned OA No. 863 of 2019, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No. 863 of 2019 stood transferred to this Tribunal and renumbered as TA No.601 of 2023.

¶35

Brief Facts of the case:

¶36

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.

¶37

It is the case of the applicant bank that at the request of the defendants, the applicant bank sanctioned Term Loan of Rs.1,08,04,000/(Rupees One Crore Eighty Lakhs and Four Thousand only) and took over the existing liability of the defendants under Housing loan availed by them for purchase of the schedule mentioned property from the ICICI bank. The said loan, as per sanction letter dated 01.09.2015, was agreed to be repaid in 167 monthly instalments of Rs. 1,19,414/- with interest 9.90% p.a. (Floating rate linked to the base rate interest and is calculated on daily reducing balance on monthly rest and debited to the account on

¶38

Uploaded on 19.05.2026 at 17:00 hours

¶39

T.A. No. 601 of 2023

¶40

19.05.2026

¶41

4

¶42

every month). The terms and conditions contained in the sanction letter were accepted by the defendants in token of their acceptance they signed therein.

¶43

It is submitted by the applicant bank that the defendants 1 and 2 are the applicant and co-applicant to the loan transactions, whereas the 3^rd defendant is the guarantor to the loan disbursed. In order to execute the loan, the defendants executed the following documents in favour of applicant bank:

¶44

a) Agreement of Term Loan dated 18.09.2015 executed by the defendants for Rs.1,08,04,000/-.

¶45

b) Encumbrance free declaration from the borrower dated 18.09.2015 executed by the defendants 1 and 2 declaring that no litigation in respect of the property is pending. Further they undertook not to create any lien/mortgage/lease.

¶46

c) Letter of undertaking/declaration from the defendants dated 18.09.2015 declaring inter-alia that they are not enjoying any credit facility from any other bank to insure the building mortgaged etc, authorizing the bank to debit their savings bank account agreeing to disclose their names to CIBIL or any other authorities may be specified by the RBI.

¶47

d) Affidavit cum undertaking letter signed by the defendants dated 14.09.2015.

¶48

e) Request for disbursement of loan dated 18.09.2015 signed by the defendants.

¶49

Uploaded on 19.05.2026 at 17:00 hours

¶50

T.A. No. 601 of 2023

¶51

19.05.2026

¶52

5

¶53

f) Memorandum of Deposit of Title Deeds dated 27.10.2015 registered as Doc.No.13474 of 2015 confirming the deposit of title deeds on 12.10.2015 executed by the defendants 1 and 2, who are the owners of the property more specifically set out in the schedule mortgaged to secure the Housing Loan and also the Working Capital facility and Bank Guarantee facility availed by M/s. Sugesan Transport (P) Limited for whom they stood as Guarantor. The total amount availed by the defendants and the facilities of M/s. Sugesan Transport was Rs.16,08,04,000/(Rupees Sixteen Crore Eight Lakhs and Four Thousand only)

¶54

The applicant submits that subsequent to availing of loan, the defendants were irregular in making payment of the installments of the Term Loan availed under Corp Home loan facility. Since the defendants 1 and 2 created mortgage over the schedule mentioned property also for securing credit facilities to M/s Suagesan transport (P) Ltd besides the security created to secure home loan, the applicant filed O.A. No. 904 of 2018 against the defendants 1 and 2 and M/s Sugesan Transport (P) ltd and the said O.A is still pending. The documents relating to mortgage property are filed in the OA No.904 of 2018. Since the Term Loan for Housing is payable in installments and the loan would become due only after recalling the dues by cancelling the Terms of loan agreement, a demand notice recalling the Home Loan has been issued by the bank under the provisions of the SARFAESI Act dated 02.04.2019. Despite the said notice even after taking possession by issuing notice for possession

¶55

Uploaded on 19.05.2026 at 17:00 hours

¶56

T.A. No. 601 of 2023

¶57

19.05.2026

¶58

6

¶59

dated 26.06.2019, the defendants did not make any payment.

¶60

The applicant submits that the interest for the aforesaid loan has been charged by the applicant bank at the contractual rate as applicable from time to time with monthly rests in pursuance of the statutory directives of the Reserve Bank of India under sections 21 and 35-A of the Banking regulations Act, 1949. The applicant is maintaining true and correct account with respect to the said account of the first defendant in the normal and ordinary course of business transaction and a copy of the statement of accounts by way of computer print outs maintained by the applicant bank in the normal and ordinary usual course of business and certified under the Banker’s Evidence Act, 1891 are produced along with this application. 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.

¶61

After the filing of the OA, summons were sent to the Defendants 1 to 3 through Registered Post with Acknowledgment Due, which was duly served in respect of D-1 to D-3. When OA was taken up on 21.10.2021 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 to 3 were placed ex-parte on 21.10.2021.

¶62

Heard the submissions of Applicant Bank and perused the

¶63

records.

¶64

Uploaded on 19.05.2026 at 17:00 hours

¶65

T.A. No. 601 of 2023

¶66

19.05.2026

¶67

7

¶68

To prove the case of the Applicant Bank, Sh. J. Vetri Selvan, 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-9 .

¶69

A careful examination of the pleadings in the Proof Affidavit and documents Exhibits A-1 to A-9 evidence that the borrowal of credit facilities and execution of loan and security documents are true, in terms of averments made in Original Application as well as Proof Affidavit filed by applicant bank establishing its claim. Applicant bank filed Statement of Accounts duly certified under Bankers’ Book Evidence Act, evidencing the amount claimed against defendants.

¶70

The defendants were set ex-parte on 21.10.2021, 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.

¶71

During the pendency of OA before DRT-II, Chennai, Applicant Bank had reported part satisfaction of OA claim in a sum of Rs.85,00,000/- by way of sale of Schedule mentioned immovable property under SARFAESI Act and sale certificate has been issued on 13.01.2021.

¶72

Uploaded on 19.05.2026 at 17:00 hours

¶73

T.A. No. 601 of 2023

¶74

8

¶75

19.05.2026

¶76

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:

¶77

: O R D E R :

¶78

14. The OA is allowed with costs,

¶79

(a) The applicant bank is allowed to recover from the Defendants 1 to 3 jointly and severally, for recovery of a total sum of Rs.1,04,10,334.65p (Rupees One Crore Four Lakhs Ten Thousand Three Hundred and Thirty Four and Sixty Five paise only) due in respect of Housing loan (A/c No.560631001770961) repayable together with further interest @ 10.85% p.a. with monthly rests from the date of Application till the date of realization in full, along with costs of this OA.

¶80

(b) The sum of Rs.85,00,000/- realized by way of sale under SARFAESI Act is directed to be given credit to the borrower’s loan account as on the date of realization.

¶81

(c) 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 Defendants to the applicant bank.

¶82

Uploaded on 19.05.2026 at 17:00 hours

¶83

T.A. No. 601 of 2023

¶84

9

¶85

19.05.2026

¶86

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

¶87

(e) Recovery Certificate shall be drawn up and issued to the

¶88

Recovery Officer in terms of the final order.

¶89

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

¶90

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

¶91

(Dictated to Roshnee, transcribed by her, corrected, signed and pronounced by me on this the 19^th day of May, 2026)

¶92

ANNEXURES

¶93

WITNESSES EXAMINED FOR THE APPLICANT BANK :

¶94

AW-1: Sh. J. Vetri Selvan, Chief Manager of the Applicant Bank

¶95

Exhibits on the part of the Applicant:

¶96

Sl. No.	Date	Description of Documents		Exhibit No.
1.	13.08.2015	Crop Home Loan Application		A-1
2.	01.09.2015	Credit sanction intimation		A-2
3.	18.09.2015	Agreement for Term Loan		A-3
4.	18.09.2015	Encumbrance free declaration		A-4
5.	18.09.2015	Letter of undertaking/ declaration		A-5
6.	18.09.2015	Affidavit-cum undertaking		A-6
7.	18.09.2015	Request for disbursement		A-7
8.	31.01.2018	Acknowledgement		A-8
9.		Statement of accounts with certificates	BBE	A-9

¶97

Uploaded on 19.05.2026 at 17:00 hours

¶98

T.A. No. 601 of 2023

¶99

10

¶100

19.05.2026

¶101

Witness Examined for the Defendants: -Nil-

¶102

List of Documents Exhibited for the Defendants: -Nil –

¶103

:-SCHEDULE-:

¶104

Mortgaged property has been sold under SARFAESI Act.

¶105

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

¶106

Uploaded on 19.05.2026 at 17:00 hours

Corporation Bank v. Sheela

Case brief

What is this about?

What did the court decide?

Corporation Bank v. Sheela

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

Canara Bank versus Jayabharatham Lifespaces International Pvt. Ltd. and Five others

M Praveen Kumar versus City Union Bank Limited

Sri Kumaran Stores versus Canara Bank

Idbi Bank versus S Poorna Sadagopan

Indian Bank versus K Sumana

Mr M Barkathhulla Son of Mamuth Khan versus State Bank of India