Partly allowed

Bank of Baroda v. M/S Vvd Traders Prop. of Mr. Arumugam.M

DRT12 Feb 2026TA/982/2023

Case brief

AI extract

What is this about?

The DRT granted the bank's interim application directing the second respondent to furnish security for the outstanding loan amount. In default, the Tribunal ordered conditional attachment of the respondent's immovable property to secure the dues pending disposal of the main recovery application.

What did the court decide?

Directed second respondent to furnish security within 15 days; ordered conditional attachment of specified property if security is not furnished.

Bank of Baroda versus M/S Vvd Traders Prop. of Mr. Arumugam.M — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 12^th day of February, 2026

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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I.A. No.1330 of 2023 in T.A. No. 982 of 2023

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BANK OF BARODA

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Rep. By its Chief Manager, No.234, T.H. Road Tondiarpet, Chennai-600 081.

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….Petitioner/Applicant

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-Vs-

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M/s. VVD TRADERS Prop. of Mr. Arumugam. No.174/22, T.H. Road Tondiarpet, Chennai-600 081.

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Mr. M. ARUMUGAM S/o. Manickam No.76/2, Thandavarayan Street

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Tondiarpet, Chennai-600 081. .…Respondents/Defendants

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: - ORDER ON IA NO. 1330 of 2023 in TA No.982 of 2023 - :

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The Original Application is filed by the Applicant Bank against the Defendants, seeking for recovery of money due from Defendants jointly and severally to pay a sum of Rs.68,35,344.98p (Rupees Sixty Eight

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Lakhs Thirty Five Thousand Three Hundred and Forty Four and

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Ninety Eight Paise 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.1330/2023 with affidavit of the Senior Manager, Tondiarpet Branch of applicant bank, praying to direct the 2^nd respondent / 2^nd defendant to

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furnish security to the extent of OA claim as may be sufficient to satisfy the OA claim amount and in default of the same, the Tribunal may be pleased to order the attachment of the petition schedule mentioned property belonging to the 2^nd defendant / 2^nd respondent, pending disposal of the above OA.

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It is the case of applicant bank that the Respondents / Defendants availed Cash Credit Hypothecation Limit to the tune of Rs.40 lakhs vide Sanction Letter dated 27.01.2013, which was subsequently enhanced from time to time at the request of the borrower and Working Capital Term Loan of Rs.10 lakhs from the respondent bank, after executing necessary loan and security documents in favour of applicant bank. For the due repayment of the loans, the 1^st respondent / 1^st defendant had hypothecated the Stocks of Steel, Steel Tubes, Converted Steel Tubes and Plates and Book Debts in favour of applicant bank.

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It is submitted that the respondents neither repaid the loan amounts, except for a few repayments, which was not sufficient for maintaining the loan account. Hence the loan account was declared as NPA and the defendants are due and payable to the applicant bank a sum of Rs.68,35,344.98p together with future interest. Inspite of several demands, defendants did not come forward to repay the dues. Hence the applicant bank had filed the OA No.159/2022, since transferred to the Tribunal and re-numbered as TA No.982/2023 for recovery of its dues from defendants.

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It is further submitted by the applicant bank that the immovable property applicant bank is having a valid charge by way of hypothecation over the movable property whose realizable value is not now ascertainable since no stock statements were submitted since 10.08.2021 as against the O.A. claim of Rs. 68,35,344.98/- as on 14.02.2022. It was given to understand that the 2^nd respondent is owning the immovable property at Old Door No.10, New Door No.11, Narayanasamy Garden, III Main Raod, Kodungaiyur, Chennai-600 118 in Plot No.10 in Binny Employees Colony Building Schemes, Selavayal Village, Kodungalyur morefully described in the schedule to the IA. The said property was mortgaged in favour of LIC Housing Finance as evidenced by the Memorandum of Deposit of title deeds dated 21.03.2017 executed at SRO, Madhavaram and subsequently the LIC has executed the Deed of Receipt dated 01.06.2023 vide Doc. No.4079/2023 in favour of Mr. Arumugan and therefore the petition schedule property is now free from all encumbrances. The value of the above property is more than Rs.60 Lakhs.

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The applicant bank understands that the 2^nd respondent is making attempts to dispose off or otherwise further encumber the petition schedule property situated at Selavayal Village, in order to deprive the Petitioner Bank the fruits of the Recovery Certificate that may ultimately be granted in favour of the Petitioner and the Petitioner may not be in a position to recover the Certificate amount which may ultimately be issued in favour of the Bank. As the value of Hypothecation of stocks and book debts are not ascertainable, the dues in the above O.A. is unsecured. Hence the present

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application is filed praying to direct the 2^nd respondent to furnish security within the time frame fixed by the Tribunal, failing which to grant an order of Attachment before Judgment of the schedule mentioned property belonging to 2^nd respondent, till the disposal of the OA.

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Heard the counsel for applicant bank and perused the records of produced along with the IA.

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The Applicant Bank has filed the above I.A. on the premise that 2^nd respondent may alienate or dispose of or create third-party interest on the property morefully described in the schedule to the IA.

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The defendants are contesting the case and has been served with copy of the IA No.1330/2023 on 07.09.2023 itself. However, no counter has been filed till date. There was no representation on behalf of defendants today.

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It is a matter of record that the OA was filed for recovery of sum of Rs.68,35,344.98p which is a colossal sum of money. Considering the amount of claim involved in this case and the balance of convenience, the present IA has to be considered 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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As per Section 19 (13)(A) & 15 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

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(ii)is about to remove the whole or any part of the property from the local limits of the jurisdiction of the Tribunal; or

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(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

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as the properties secured in his favour or otherwise owned by the

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defendant as appears sufficient to satisfy any certificate for the recovery of debt.

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15. The Tribunal may also in the order direct the conditional attachment of the whole or any portion of the property specified under Sub-Section (13)”

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As the Applicant Bank has prima facie established the essential ingredients for granting an order of temporary injunction restraining the 2^nd respondent in respect of the property 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, 2^nd respondent is hereby directed to show cause as to why he should not furnish security to the tune of OA claim in a sum of Rs.68,35,344.98p within 15 days from the date of receipt of this order, failing which to attach the IA schedule mentioned property belonging to 2^nd respondent to answer the OA claim herein.

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Meanwhile, conditional attachment of the petition schedule mentioned property to the extent of OA claim of Rs.68,35,344.98p together with further interest is hereby ordered to secure the dues of the applicant bank.

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The Registry is directed to issue show cause notice to 2^nd respondent and also communicate this Order to the Concerned Sub Registrar Office/ Village Officer for necessary action and for records.

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13. IA Schedule property shall form part of this order.

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Sd/-

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

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(Dictated to PS, transcribed by her, corrected, signed and pronounced by me on this the 12^th day of February, 2026)

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SCHEDULE PROPERTY

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All that piece and parcel of land and building bearing Municipal Old Door No.10, New No.11, Narayanasamy Garden, III Main Road, Kodungaiyur, Chennai-600 118, Plot No.10, in Binny Employees Colony Building SchemeII, L.A. No.98/74, O.S. No.139/1A1 (part), T.S. No.202, Block No.I, Selavoyal Village, Kodungaiyur Division and measuring an extent of 2400 sq. ft. or 222.96 sq. mtr. and bounded on

North by: Plot No.11

South by: Plot No.34

East by: Plot No.23

West by : 30 Feet Road

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Within the Sub Registration District of Sembium and Registration District of Chennai North and morefully described in the Sale Deed dated 28.08.2008 bearing Doc. No. 6747/2008, SRO at Sembiam.

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Sd/-

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

Bank of Baroda v. M/S Vvd Traders Prop. of Mr. Arumugam.M

Case brief

What is this about?

What did the court decide?

Bank of Baroda v. M/S Vvd Traders Prop. of Mr. Arumugam.M

Case brief

What is this about?

What did the court decide?

What the court decided

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