FEDERAL BANK vs Mohandas KE on 31 August 2026

O R D E R

1. This transferred application has been filed by the applicant bank to direct the defendants 1 & 2, to pay an amount of Rs.3,48,047.51 due under the ACC/FKCC loan No.11275500014589 with future interest @11.88% per annum with yearly rests on the sum of Rs.3,39,972.29 from the date of this application till realisation in full, personally and charged on the ‘A’ schedule property; to direct the 2nd defendant to pay an amount of Rs.1,24,289.45 due under the ACC/FKCC loan No.11275500015362 with future interest @11.88% per annum with yearly rests on the sum of Rs.1,23,969.17 from the date of this application till realisation in full, personally and charged on the ‘B’ schedule property; to direct the defendants 3 & 4, to pay an amount of Rs.6,56,580.95 due under the ACC/FKCC loan No.11275500015370 with future interest @15.13% per annum with yearly rests on the sum of Rs.6,54,888.29 from the date of this application till realisation in full, personally and charged on the ‘C’ schedule property; directing the defendants 1 to 3 to pay a sum of Rs.21,50,195.07 due under the AMTL account No.11276600012176 with future interest @14.63% per annum with quarterly rests on the sum of Rs.21,43,485/- from the date of this application till realisation in full, from them personally and charged on the ‘A, B, C & D’ Schedule properties; directing the defendants 1 to 3 to pay a sum of Rs.11,81,064.24 due under the AMTL account No.11276600012200 with future interest @14.73% per annum with quarterly rests on the sum of Rs.11,77,095/- from the date of this application till realisation in full, from them personally and charged on the ‘A, B, C & D’ Schedule properties and with costs.

2. The TA was originally filed on 13.05.2016 before the Debts Recovery Tribunal - 2, Ernakulam which was then having jurisdiction over the State

of Kerala except the districts of Ernakulam and Idukki with effect from 09.05.2016 as per notification published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (ii) dated 04.05.2016 vide S.O 1641(E) dated 02.05.2016, and was registered as ‘OA 24/2016’. In view of the amendment in area of jurisdiction in the aforesaid principal notification made by the Central Government vide notification published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (ii) dated 25.01.2017 vide S.O 253(E) dated 25.01.2017, OA 24/2016 stood transmitted to this Tribunal and the proceedings continued before this Tribunal in the newly registered number as TA 38/2017.

3. Though the defendants entered appearance through their Advocate, and in spite of granting sufficient time, written statement of the Defendants was not filed. Subsequently, the Defendants were set ex-parte on 21.03.2017.

4. Mr. Surendranath N., Chief Manager and Principal Officer of the applicant bank, as AW1 filed proof affidavit and got the documents marked as Exhs.A1 to A48 in support of its case.

5. Although the defendants remained exparte, this Tribunal examined the question of maintainability and jurisdiction and found that the OA is well maintainable and this Tribunal has jurisdiction to entertain the OA.

6. According to the applicant bank, defendants 1 and 2 on 11.05.2012, the 2nd defendant separately on 29.03.2014 and defendants 3 and 4 on 29.03.2014 availed agricultural cash credit limit respectively of Rs.2,50,000/- (FKCC), Rs.1,00,000/- (ACC) and Rs.5,00,000/- (ACC) for seasonal agricultural operations as well as defendants 1 to 3 on 06.05.2014 and 20.10.2014 availed agricultural medium term loans (AMTL) respectively of Rs.18,75,000/- and Rs.10,00,000/- for integrated farming and agricultural allied activities, on due execution of necessary security documents in its favour. The repayment of the amounts due was collaterally secured under the FKCC loan alongwith AMTLs of by the equitable mortgage created by the 1st defendant over ‘A’ schedule immovable properties, under the ACC limit by the equitable mortgage created by the 2nd defendant over ‘B’ schedule immovable properties, under the ACC limit alongwith AMTLs by the equitable mortgage created by the 3rd defendant over ‘C’ schedule immovable property and that under the AMTLs was also secured by the additional collateral security of the equitable mortgage created by the 1st defendant over ‘D’ schedule immovable property.

The repayments in the loan accounts were defaulted and therefore, the applicant bank issued recall notice dated 13.08.2015 to the defendants. Since the defendants failed to pay the amount due to the applicant bank,

the applicant bank filed the present Transferred Application for realisation of the outstanding amounts.

7. The applicant has failed to produce the English translated version of document Nos.17 to 19, 21, 22, 24, 26 and 27 as per Rule 3(2) of the Debts Recovery Tribunal (Procedure) Rules, 1993. This Tribunal is not in a position to read the contents of the documents and understand the same. However, it appears that these documents pertain to the OA schedule properties.

8. A perusal of the material records available on record and averments of the OA and proof affidavit along with Exhs.A1 to A48 filed by Mr. Surendranath N., Chief Manager and Principal Officer of the applicant bank, shows that the defendants after having availed various credit facilities committed default in repayment of the outstanding dues.

9. The applicant bank has charged Rs.8,415.71, Rs.323.83, Rs.1,714.71, Rs.7,084/- and Rs.4,186/- as penal interests on the ACC/FKCCs and AMTLs accounts respectively availed by defendants in terms of the agreement in sanction letters. It is well settled that penal interest cannot be capitalised and no interest can be charged on penal interest. The applicant bank, therefore, is not entitled to get any further interest on the aforesaid amount of penal interest, as laid down by the Hon'ble Supreme Court of India in Central Bank of India v. Ravindra [reported in AIR 2001 SC 3095].

10. It is pertinent to mention here that the applicant bank calculated interest at monthly rests in Exhs.A37 and A38 accounts relating to the AMTL Loans against the dictum laid down by the Hon'ble Supreme Court in Central Bank of India v. Ravindra [reported in AIR 2001 SC 3095]. Therefore, the applicant bank was directed to file a revised statement of account showing the amount due with interest at annual or half-yearly rests. However, the learned counsel for the applicant bank during the course of arguments, submitted that the there is no necessity for revised account statement in respect of the said accounts.

11. In the above circumstances, the case of the applicant bank regarding recovery of the sum of Rs.3,48,047.51 claimed as due relating to ACC/FKCC loan No.11275500014589 with interest pendentelite and post final order interest on the sum of Rs.3,39,631.80 from defendants 1 & 2; a sum of Rs.1,24,289.45 claimed as due relating to the ACC/FKCC loan No.11275500015362 with interest pendentelite and post final order interest on the sum of Rs.1,23,965.62 from the 2nd defendant; a sum of Rs.6,56,580.95 claimed as due relating to the ACC/FKCC loan No.11275500015370 with interest pendentelite and post final order interest

on the sum of Rs.6,54,866.24 from the defendants 3 & 4; a sum of Rs.21,50,195.07 claimed as due relating to the AMTL account No.11276600012176 with interest pendentelite and post final order interest on the sum of Rs.21,43,111.07 from the defendants 1 to 3; and a sum of Rs.11,81,064.24 claimed as due relating to the AMTL account No.11276600012200 with interest pendentelite and post final order interest on the sum of Rs.11,76,878.24 from the defendants 1 to 3 is proved by the uncontroverted averments in the proof affidavit of AW1 along with Exhs.A1 to A48. Having regard to the agricultural advances availed by the defendants, this Tribunal in exercise of its discretionary power provided under Section 19(20) of the Act is inclined to award pendente lite and post final order interest @ 9% per annum in ACC/FKCC accounts and @6% per annum in AMTL Loan accounts respectively.

12. Thus this Tribunal holds that since the applicant bank has proved its case through its proof affidavit and the documents marked, the Original Application is allowed, as per the following lines :

(i) The defendants 1 & 2, are directed to pay to the applicant bank, jointly and severally, a sum of Rs.3,48,047.51 (Rupees Three Lakhs Forty Eight Thousand Forty Seven and Paise Fifty One only) due under ACC/FKCC loan No.11275500014589 with interest pendentelite and post final order interest on the sum of Rs.3,39,631.80 (Rupees Three Lakhs Thirty Nine Thousand Six Hundred Thirty One and Paise Eighty only) @9% per annum from 13.05.2016 till the date of realisation;

(ii) The 2nd defendant is directed to pay to the applicant bank, a sum of Rs.1,24,289.45 (Rupees One Lakh Twenty Four Thousand Two Hundred Eighty Nine and Paise Forty Five only) due relating to the ACC/FKCC loan No.11275500015362 with interest pendentelite and post final order interest on the sum of Rs.1,23,965.62 (Rupees One Lakh Twenty Three Thousand Nine Hundred Sixty Five and Paise Sixty Two only) @9% per annum from 13.05.2016 till the date of realisation;

(iii) The defendants 3 & 4 are directed to pay to the applicant bank, jointly and severally, a sum of Rs.6,56,580.95 (Rupees Six Lakhs Fifty Six Thousand Five Hundred Eighty and Paise Ninety Five) due relating to the ACC/FKCC loan No.11275500015370 with interest pendentelite and post final order interest on the sum of Rs.6,54,866.24 (Rupees Six Lakhs Fifty Four Thousand Eight Hundred Sixty Six and Paise Twenty Four only) @9% per annum from 13.05.2016 till the date of realisation;

(iv) The defendants 1 to 3 are directed to pay to the applicant bank, jointly and severally, a sum of Rs.21,50,195.07 (Rupees Twenty One Lakhs Fifty Thousand One Hundred Ninety Five and Paise Seven only) due relating to the AMTL account No.11276600012176 with interest pendentelite and post final order interest on the sum of Rs.21,43,111.07 (Rupees Twenty One Lakhs Forty Three Thousand One Hundred Eleven and Paise Seven only) @6% per annum from 13.05.2016 till the date of realisation; and

(v) The defendants 1 to 3 are directed to pay to the applicant bank, jointly and severally, a sum of Rs.11,81,064.24 (Rupees Eleven Lakhs Eighty One Thousand Sixty Four and Paise Twenty Four only) due relating to the AMTL account No.11276600012200 with interest pendentelite and post final order interest on the sum of Rs.11,76,878.24 (Rupees Eleven Lakhs Seventy Six Thousand Eight Hundred Seventy Eight and Paise Twenty Four only) @6% per annum from 13.05.2016 till the date of realisation.

13. On failure to pay the above said debts to the Applicant Bank, the Applicant Bank is directed to bring the OA Schedule properties, for sale to realize its dues and its proportionate costs.

14. The Registry is directed to prepare DRC in terms of this final order. The Applicant Bank shall file memo of costs within 10 days from the date of this order. Registry is directed to communicate the copy of this order to both parties as provided in Rule 16 of the Debts Recovery Tribunal (Procedure) Rules, 1993, as amended in 2003.

Typed by PS, transcribed, corrected and pronounced by me in the open court on this the 31st day of August, 2026.

(Su. WILLYAHM) PRESIDING OFFICER

SCHEDULE A Item No.1 All that piece and parcel of land to an extent of 92 cents of Re. Sy. No.23/1 situated in Alakode Village, Taliparamba Taluk, Kannur District together with all improvements thereon. Boundaries East

: Property of Vijayan South

: Property of Mathai West

: Property of Sreedharan

North

: Thode

Item No.2 All that piece and parcel of land to an extent of 22 cents in Re. Sy. No.23/1 situated in Alakode village, Taliparamba Taluk, Kannur District together with all improvements thereon. Boundaries East

: Property of Poulose South

: Property of Siddhan West

: Property of Gopi

North

: Thode

Item No.3 All that piece and parcel of land to an extent of 40 cents in Re. Sy. No.23/1 situated in Alakode village, Taliparamba Taluk, Kannur District together with all improvements thereon.

Boundaries East

: Property of Mohandas and Sidharthan South

: Property of Joseph/Balance property West

: Property of Thankamma

North

: Thode

Schedule – B Item No.1 All that piece and parcel of land to an extent of 15 cents in Re. Sy. No.23/1 situated in Alakode Village, Taliparamba Taluk, Kannur District together with all improvements thereon. Boundaries East

: Property of Kalappurackal Poulose South

: Property of Sidhan West

: Property of Mohandas

North

: Property of Mohandas

Item No.2 All that piece and parcel of land to an extent of 40 cents in Re. Sy. No.23/1 situated in Alakode Village, Taliparamba Taluk, Kannur District together with all improvements thereon. Boundaries East

: Property of Kilirkunnel Eacharan South

: Remaining property of Joseph West

: Property of Thankamma

North

: Thode

Schedule – C All that piece and parcel of land to an extent of 1 acre 80 cents in Re. Sy. No.23/1 situated in Alakode Village, Taliparamba Taluk, Kannur District together with all improvements thereon. Boundaries East

: Property of Soman South

: Property of Kilirkunnel Eacharan West

: Property of Sivaraman

North

: Thode

Schedule – D All that piece and parcel of land to an extent of 20.23 Ares in Re. Sy. No.23/1 situated in Alakode Village, Taliparamba Taluk, Kannur District together with all improvements thereon. Boundaries East

: Property of Sidharathan South

: Property of K.K.Bhaskaran West

: Property of K.K.Soman

North

: Property of K.Damodaran (Property mortgaged by the D3 covered under purchase certificate No.763/1982 dated 06.10.1982 of Land Tribunal, Kannur).

(Su. WILLYAHM) PRESIDING OFFICER

LIST OF DOCUMENTS FILED BY THE APPLICANT BANK Sl. No. Date Description of document Exhibits

11.05.2012 Demand Promissory note executed by defendants 1 & 2 in favour of the applicant bank Ex.A-1

11.05.2012 Security delivery letter executed by defendants 1 & 2 in favour of the applicant bank Ex.A-2

11.05.2012 Agreement for Agricultural loans executed by defendants 1 & 2 in favour of the applicant bank Ex.A-3

29.03.2014 Demand Promissory note executed by 2nd defendant in favour of the applicant bank Ex.A-4

29.03.2014 Security delivery letter executed by 2nd defendant in favour of the applicant bank Ex.A-5

29.03.2014 Agreement for Agricultural loans executed by 2nd defendant in favour of the applicant bank Ex.A-6

29.03.2014 Demand Promissory note executed by defendants 3 & 4 in favour of the applicant bank Ex.A-7

29.03.2014 Security delivery letter executed by defendants 3 & 4 in favour of the applicant bank Ex.A-8

29.03.2014 Agreement for Agricultural loans executed by defendants 3 & 4 in favour of the applicant bank Ex.A-9

06.05.2014 Demand Promissory note executed by defendants 1 to 3 in favour of the applicant bank Ex.A-10

06.05.2014 Security delivery letter executed by defendants 1 to 3 in favour of the applicant bank Ex.A-11

06.05.2014 Agreement for Agricultural loans executed by defendants 1 to 3 in favour of the applicant bank Ext.A-12

20.10.2014 Demand Promissory note executed by defendants 1 to 3 in favour of the applicant bank Ext.A13

20.10.2014 Security delivery letter executed by defendants 1 to 3 in favour of the applicant bank Ext.A14

20.10.2014 Agreement for Agricultural loans executed by defendants 1 to 3 in favour of the applicant bank Ext.A15

21.10.2014 Letter confirming creation of mortgage executed by 1st defendant in favour of the applicant bank Ext.A-16

05.11.1982 Settlement deed No.1055/1982 of SRO, Alakode Ext.A-17

10.11.1997 Jenmam deed No.3427/1997 of SRO, Alakode Ext.A18

27.12.1997 Jenmam deed No.725/1998 of SRO, Alakode Ext.A19

21.10.2014 Letter confirming creation of mortgage executed by 2nd defendant in favour of the applicant bank Ext.A20

11.03.2003 Jenmam deed No.729/2003 of SRO, Alakode Ext.A21

27.12.1997 Jenmam deed No.18/1998 of SRO, Alakode Ext.A22

21.10.2014 Letter confirming creation of mortgage executed by 3rd defendant in favour of the applicant bank Ext.A23

07.08.1995 Settlement deed No.3307/1995 of SRO, Alakode Ext.A24

21.10.2014 Letter confirming creation of mortgage executed by 1st defendant in favour of the applicant bank Ext.A25

06.10.1982 Purchase certificate No.763/1982 issued by Land Tribunal, Kannur Ext.A26

22.06.1982 Certified copy of the order passed by Land Tribunal, Kannur Ext.A27

08.05.2015 Balance confirmation letter executed by defendants 1 & 2 in favour of the applicant bank Ext.A28

13.08.2015 Recall notice issued by the applicant bank to the defendants Ext.A29

13.08.2015 Recall notice issued by the applicant bank to the defendants Ext.A30

13.08.2015 Recall notice issued by the applicant bank to the defendants Ext.A31

13.08.2015 Recall notice issued by the applicant bank to the defendants Ext.A32

13.08.2015 Recall notice issued by the applicant bank to the defendants Ext.A33

---- Statement of account pertaining to ACC/FKCC account No.11275500014589 Ext.A34

---- Statement of account pertaining to ACC/FKCC account No.11275500015362 Ext.A35

---- Statement of account pertaining to ACC/FKCC account No.11275500015370 Ext.A36

---- Statement of account pertaining to AMTL Loan account No.11276600012176 Ext.A37

---- Statement of account pertaining to AMTL Loan account No.11276600012200 Ext.A38

---- Statement showing Penal interest charged in ACC/FKCC Ext.A39

---- Statement showing Penal interest charged in ACC/FKCC Ext.A40

---- Statement showing Penal interest charged in ACC/FKCC Ext.A41

---- Statement showing Penal interest charged AMTL Ext.A42

---- Statement showing Penal interest charged AMTL Ext.A43

---- Statements showing varying rate of interest applied in ACC/FKCC Ext.A44

---- Statements showing varying rate of interest applied in ACC/FKCC Ext.A45

---- Statements showing varying rate of interest applied in ACC/FKCC Ext.A46

---- Statements showing varying rate of interest applied in AMTL Loan Ext.A47

---- Statements showing varying rate of interest applied in AMTL Loan Ext.A48

(Su. WILLYAHM) PRESIDING OFFICER