Allowed

Karur Vysya Bank v. M/S Priyaa Engineering

DRT20 Apr 2026TA/890/2023

Case brief

AI extract

What is this about?

The Tribunal allowed the bank's Original Application filed under Section 19 of the RDB Act. Having found the defendants failed to contest the claim after defaulting on a working capital loan, the court ordered recovery of Rs.1.05 crore with interest and costs.

What did the court decide?

Recovery of Rs.1,05,18,950.39 along with interest @ 15.85% p.a. from the date of application and costs of the Original Application.

Karur Vysya Bank versus M/S Priyaa Engineering — Banking and Recovery | DRT (2026)

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T.A. No. 890 of 2023

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20.04.2026

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 20^th day of April, 2026

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No.890 of 2023

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(Originally filed before DRT- II, Chennai as OA 371/2021 and thereafter transferred to this Tribunal and renumbered as TA No 890 of 2023)

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Karur Vysya Bank Ltd, Asset and Recovery Branch Rep by its Chief Manager 2^nd floor, No.1, Padmavathiyar road Gopalapuram, Chennai- 600 086 …Applicant

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-Vs-

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M/s Priyaa Engineering

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Rep by its Proprietrix Mrs. G.Priya Suresh No.90, Thirumudivakkam Main Road

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Thirumudivakkam- 600 075

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Mrs. G. Priya Suresh, W/o Mr.K.C.Suresh Menon Plot No.13, Door No.32A Hindustan Lever colony

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Pammal, Chennai- 600 075

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Mr. K.C. Suresh Menon, S/o Mr.Gopinath Menon Plot No.13, Door No.32A

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Hindustan Lever colony

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Pammal, Chennai- 600 075 ….Defendants

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Counsels on record / appeared:

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Counsel for Applicant : M/s. A. Arunbabu

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Defendants 1 to 3 were set ex-parte on 08.09.2023

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T.A. No. 890 of 2023

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20.04.2026

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: - FINAL ORDER- :

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This Original Application is filed on 26.07.2021 by the applicant bank 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 Rs.1,05,18,950.39p (Rupees One Crore Five Lakhs Eighteen Thousand Nine Hundred and Fifty and Thirty Nine Paise only) due in respect of Working Capital Loan (A/c No. 1760280000000038) repayable together with further interest @ 15.85% p.a. with monthly rests from the date of Application till the date of realization in full and costs of this OA.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.371 of 2021, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.371 of 2021 stood transferred to this Tribunal and renumbered as TA No.890 of 2023.

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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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It is the case of the applicant bank that the first defendant M/s Priya engineering represented by its proprietrix the second defendant herein

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T.A. No. 890 of 2023

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20.04.2026

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approached the applicant bank in the year 2015 and requested for an SOD limit of Rs.1,00,00,000/- (Rupees one Crore) towards Working Capital requirements. The applicant bank considering the request had sanctioned the said sum of Rs.1,00,00,000/- vide Credit Sanction Intimation dated 29.06.2015. The said loan is repayable in one year together with an interest @13.75% p.a. compounded with monthly rates and rests as may revised by the bank from time to time.

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It is submitted that in order to secure the loan, the first defendant had executed the following necessary loan documents on 31.07.2015:

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i) Demand promissory note ii) Agreement of secured overdraft- fixed assets iii) Deed of hypothecation of current assets.

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The applicant bank submitted that the third defendant stood as Guarantor and executed an Agreement of Guarantee on 31.07.2015 towards the loan availed by the first defendant. The second defendant mortgaged her property at Kottivakkam Village vide Memorandum of Deposit of Title Deeds dated 31.07.2015 registered as Doc No. 2123/2015 as a security towards the loan availed by the first defendant.

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The applicant submits that the first defendant further requested for an Overdraft facility of Rs.20,00,000/- in the year 2017 towards Working Capital requirements. The applicant sanctioned the said overdraft facility of Rs.20,00,000/- vide Credit Sanction Intimation dated 17.06.2017. The said loan is repayable in 75 days together with an interest @15.10% p.a. compounded at monthly rests or at such rates as may be revised by the

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T.A. No. 890 of 2023

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20.04.2026

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bank from time to time together with all costs, charges etc. The first defendant executed Demand Promissory Note dated 17.06.2017 towards the loan availed.

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The applicant submits that even though the defendants had executed necessary documents towards the loan availed, the repayment towards the said loan was highly irregular and despite various demands and reminders made by the applicant bank, the defendants had failed and neglected to repay the amount dues. Hence the amount had become NonPerforming Asset (NPA) on 23.05.2018 as per the RBI norms.

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It is further submitted that since the account turned NPA with no other option the applicant bank on 15.06.2018 had issued Demand Notice by initiating SARFAESI proceedings against the property that was given as a security towards the loan account. The applicant bank took symbolical possession of the property by issuing possession notice to the defendants on 12.09.2018. Inspite of the notices the defendants did not come forward to settle the issues. Even after repeated reminders made by the applicant bank, the defendants had failed and neglected to repay the amount dues. Hence the applicant bank issued an Auction Sale Notice on 13.10.2020 fixing the auction sale on 31.10.2020. The applicant bank sold the mortgaged property through e-auction to Mrs.S.Geetha & Mrs.M.Mythili vide a bid confirmation letter dated 02.11.2020 who were declared as successful bidders in the auction conducted on 31.10.2020 for a sum of Rs.99,10,000/- (Rupees Ninety nine lakhs and ten thousand) and the sale proceeds were duly credited into the SOD loan account of the first

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T.A. No. 890 of 2023

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20.04.2026

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defendant. A sale certificate dated 24.03.2021 registered as Doc.No.842/2021 was also issued in the regard. The applicant bank issued an after sale letter to the borrowers dated 22.04.2021 intimating the outstanding balance to be paid by the defendants towards the SOD loan availed, despite which the defendants did not come forward to repay the dues. Hence, 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 was sent to the Defendants 1 to 3 through Registered Post with Acknowledgment Due, which was returned with remarks “Left” in respect of D-1, while summons to D-2 and D-3 are duly served. Since D-2 is Proprietor of D-1, summons to D-1 is deemed to be served. Although defendants entered appearance and file their vakalath on 26.05.2022, did not choose to file written statement till September, 2023. When OA was taken up on 08.09.2023 even after giving sufficient time, as Written Statement was not filed, Defendants 1 to 3 were placed ex-parte on 08.09.2023.

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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, Sh. P.S. Sundaravarathan, 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

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T.A. No. 890 of 2023

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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 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.

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The defendants were set ex-parte on 08.09.2023, 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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15. The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendants,

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a sum of Rs.1,05,18,950.39p (Rupees One Crore Five Lakhs Eighteen Thousand Nine Hundred and Fifty and Thirty Nine

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T.A. No. 890 of 2023

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20.04.2026

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Paise only) due in respect of Working Capital Loan (A/c No. 1760280000000038) repayable together with further interest @ 15.85% p.a. with monthly rests from the date of Application till the date of realization in full along with costs of this OA.

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(b) 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.

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

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

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

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(Dictated to Roshnee, transcribed by her, corrected, signed and pronounced by me on this the 20^th day of April, 2026)

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T.A. No. 890 of 2023

20.04.2026

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Sh. P.S. Sundaravarathan, Chief Manager of the Applicant Bank

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Exhibits on the part of the Applicant:

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Sl. No.	Date	Description of Documents	Exhibit No.
1.	29.06.2015	Credit sanction intimation	A-1
2.	31.07.2015	Demandpromissorynote	A-2
3.	31.07.2015	Agreement for secured overdraft- Fixed assets	A-3
4.	31.07.2015	Deed of Hypothecated of current assets	A-4
5.	31.07.2015	Agreement of Guarantee	A-5
6.	31.07.2015	Memorandum of deposit of title deeds registered as Doc.No.2123/2015	A-6
7.	09.02.2012	Deed of settlement registered as Doc.No.268/2012	A-7
8.	17.06.2017	Credit sanction intimation	A-8
9.	17.06.2017	Demandpromissorynote	A-9
10.	17.06.2017	Demand notice	A-10
11.	12.09.2018	Possession notice	A-11
12	13.10.2020	Sale notice	A-12
13.	02.11.2020	Bid confirmation letter	A-13
14.	24.03.2021	Sale certificate registered as Doc.No.842/2021	A-14
15.	22.04.2021	After sale letter to borrower &mortgagor	A-15
16.		Statement of Accounts	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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-: SCHEDULE :-

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NIL

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

Karur Vysya Bank v. M/S Priyaa Engineering

Case brief

What is this about?

What did the court decide?

Karur Vysya Bank v. M/S Priyaa Engineering

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

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