BANK OF BARODA vs M/s NITRO HOME ESSENTIALS INDIA PRIVATE LIMITED on 5 March 2026

1. M/s.Nitro Home Essentials India Private Limited, Door No.769, Pulimoottil Building, Mannanchery, Kalavoor Road, Alappuzha – 688 538.

2. M/s.Nitro Digital Controls,

Pulimoottil Building,

Mannanchery, Kalavoor Road,

Alappuzha – 688 538,

Represented by its Managing Partner

Gopalakrishna Pillai.

3. M/s.Manu Traders,

Pulimoottil Building,

Mannanchery, Kalavoor Road,

Alappuzha – 688 538,

Represented by its proprietrix

Raja Lakshmi P.

4. Gopalakrishna Pillai,

Director,

M/s.Nitro Home Essentials India Private Limited, Pulimoottil Building, Mannanchery, Kalavoor Road, Alappuzha – 688 538.

5. Rajalakshmi,

Director, M/s.Nitro Home Essentials India Private Limited, Pulimoottil Building, Mannanchery, Kalavoor Road, Alappuzha – 688 538.

&

Partner, M/s.Nitro Digital Controls,

Pulimoottil Building,

Mannanchery, Kalavoor Road,

Alappuzha – 688 538.

6. Manu Mohan G.,

Managing Director, M/s.Nitro Home Essentials India Private Limited, Pulimoottil Building, Mannanchery, Kalavoor Road, Alappuzha – 688 538.

7. Karunakaran Nair K.P. (Dead) (5th defendant is his legal heir and hence no substitution petition is filed as per memo dt.27.09.2017), Pulimoottil Building, Mannanchery, Kalavoor Road, Alappuzha – 688 538.

…Defendants This Original Application having been heard on 23.01.2026 in the presence of Advocate Sri.Santhosh Kumar K. for the applicant bank and stood over to this day for consideration, the Tribunal delivered the following: F I N A L O R D E R

This Original Application has been filed under S.19(1) of the Recovery of Debts and Bankruptcy Act, 1993 for recovery of an aggregate sum of Rs.4,12,19,711.73 due under various loan accounts together with future interest and costs from the defendants and by sale of ‘A’ and ‘B’ schedule properties to the OA. Facts of the case:

2. The applicant is a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its head office at Mandvi, Baroda and one of its branches at Alleppey.

3. At the request of the defendants, applicant bank sanctioned the following credit facilities: Date of sanction Type of loan Amount

Availed by Guarantors Collateral security 28.03.2014 Cash credit Rs.2.25 crores 1st defendant Defendants 4 to 7 ‘A’ schedule and item Nos.1 &

properties in ‘B’ schedule to the OA. [Item No.1 property in ‘B’ schedule was mortgaged by defendants 5 and 7 wherein the 7th defendant was having life interest over the same and item No.2 property in ‘B’ schedule was mortgaged by the 4th defendant] 01.03.2011 Cash credit Rs.70 lakhs Defendants 2 and 5 Defendants 4 and 5 ‘A’ schedule properties and item No.2 property in ‘B’ schedule to the OA 28.03.2014 Cash credit Rs.45 lakhs 3rd defendant Defendants 4, 6 and 7 ‘A’ schedule and item Nos.1 &

properties in ‘B’ schedule to the OA.

28.03.2014 Term loan Rs.7 lakhs 3rd defendant Defendants 4, 6 and 7 ‘A’ schedule and item Nos.1 &

properties in ‘B’ schedule to the OA.

At the time of availing the loans, the defendants had undertaken to abide by the terms and conditions of the grant of loans but failed to do so and the accounts became highly irregular. Hence the applicant issued a lawyer notice to the defendants on 01.03.2016 calling upon them to repay the outstanding dues but they did not clear the liability. In such premises, the applicant was constrained to file the OA claiming the following reliefs:

(i) To recover an aggregate sum of Rs.4,12,19,711.73 together with pendente lite and post-decree interest thereon from the respective defendants and by sale of ‘A’ and ‘B’ schedule properties to the OA;

(ii) To recover the costs, charges and expenses from the defendants;

(iii) To issue Recovery Certificate to the Recovery Officer with a direction to recover the amount and pay it to the applicant bank.

Written statement

4. The defendants 1 to 6 filed written statement admitting the availing of all the four loans from the applicant bank and creation of mortgage over ‘B’ schedule properties. It is also admitted that due to certain upsets in the business, the defendants were unable to regularise the account. It is contended that the amount claimed in the OA is not correct and the penal interest is to disallowed. The defendants prayed to dismiss the OA with costs.

5. Despite sufficient opportunity granted, defendants 1 to 6 did not file counter proof affidavit nor adduced any documentary evidence to rebut the claim of the applicant bank. It is submitted by the learned counsel for the defendants in the proceeding dated 21.10.2024 that he has relinquished his vakalath for defendants 1 to 6. Thereafter, though a fresh vakalath was filed for the defendants, none appeared and represented for the defendants from 23.04.2025. Proof Affidavit:

6. In order to establish the claim on behalf of the applicant bank, one Mr.Suresh Balaraman Nair, Senior Branch Manager and Mr.Deepak S., Chief Manager have filed proof affidavit and additional proof affidavit and produced the loan documents marked as Exhibits A1 to A63.

7. The availing of loans and creation of charge over the schedule properties are well established from the documents placed by the applicant bank. As on 18.04.2016, an aggregate sum of Rs.4,12,19,711.73 is outstanding under the loan accounts which is established from the account statements marked as Exts.A58 to A61. Though the defendants have disputed the claim amount, no material is produced to substantiate their case.

8. The account statement marked as Ext.A62 would show that the applicant bank has charged a sum of Rs.667/- by way of penal interest in the term loan account. It is well settled that penal interest cannot be capitalized and no interest can be charged on penal interest and hence the applicant bank is not entitled to get any pendente lite and post-decree interest on the aforesaid penal interest of Rs.667/- charged in the term loan account.

9. In the additional proof affidavit filed by the applicant bank, it is averred that during the pendency of the OA, recovery proceedings were initiated under the provisions of SARFAESI Act and item Nos.1 and 2 properties in ‘B’ schedule to the OA were sold for Rs.1,42,60,000/- and Rs.72,10,000/- respectively on

29.02.2020 and 24.12.2019. It is also stated that the sale proceeds were adjusted towards the loan account after deducting tax. The account statement marked as Ext.A63 would show that Rs.72,10,000/- and Rs.1,41,17,400/- were credited in loan account No.07600500000019.

10. Considering the amount advanced, interest and penal interest applied, repayments effected and substantial recovery effected by sale of the secured assets, I am of the view that the applicant bank is entitled to get pendente lite and post decree interest in the manner stated below, which is reasonable in the facts and circumstances of the case.

11. The applicant bank, therefore, is entitled to get a final order on the following lines: In the result, the applicant bank is given a final order allowing it to recover: the sum of Rs.2,73,32,924.62 (Rupees two crores seventy three lakhs thirty two thousand nine hundred and twenty four and Paise sixty two only) together with future interest thereon @12% per annum from 22.04.2016 till realization, less the amount recovered by the applicant bank by sale of the secured assets as stated in paragraph No.9 of Cash credit A/c No.07600500000019

this final order, from defendants 1 and 4 to 6 jointly and severally and by sale of ‘A’ schedule properties; in case of any shortfall, the same shall be recovered from the assets inherited by the 5th defendant from the deceased 7th defendant; the sum of Rs.82,35,458/- (Rupees eighty two lakhs thirty five thousand four hundred and fifty eight only) together with future interest thereon @12% per annum from 22.04.2016 till realization from defendants 2, 4 and 5 jointly and severally and by sale of ‘A’ schedule properties; Cash credit A/c No.07600500000010 the sum of Rs.50,50,708.11 (Rupees fifty lakhs fifty thousand seven hundred and eight and Paise eleven only) together with future interest thereon @12% per annum from 22.04.2016 till realization from defendants 3 to 6 jointly and severally and by sale of ‘A’ schedule properties; in case of any shortfall, the same shall be recovered from the assets inherited by the 5th defendant from the deceased 7th defendant; Cash credit A/c No.07600500000018 the sum of Rs.6,00,621/- (Rupees six lakhs six hundred and twenty one only) together with future interest @12% per annum on the sum of Rs.5,99,954/- (Rupees five lakhs ninety nine thousand nine hundred and fifty Term loan A/c No.07600600005841

four only) from 22.04.2016 till realization from defendants 3 to 6 jointly and severally and by sale of ‘A’ schedule properties; in case of any shortfall, the same shall be recovered from the assets inherited by the 5th defendant from the deceased 7th defendant; and costs and expenses borne by it for realization of the loans from the defendants, in proportion to the amount ordered to be recovered from them.

12. ‘A’ schedule to the OA shall be appended to this final order.

13. The applicant bank shall file memo of costs within ten days from the date of this final order.

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

15. Communicate copy of this order to both parties as provided in R.16 r/w R.2(c) of the Debts Recovery Tribunal (Procedure) Rules, 1993. (Dictated to my PA, corrected and pronounced by me in the open Tribunal on this the 5th day of March, 2026)

[SOVAN KUMAR DASH] PRESIDING OFFICER

A P P E N D I X Witness for Applicant: AW1: Sri.Suresh Balaraman Nair, Senior Branch Manager of the applicant bank. AW2: Sri.Deepak S., Chief Manager of the applicant bank.

Witness for Defendant(s): Nil

Applicant’s Exhibits

Ext.No Date Particulars of documents

A1 28.03.2014 Sanction letter issued by the applicant bank sanctioning cash credit limit of Rs.225 lakhs to the 1st defendant. A2 16.04.2014 Resolution passed by the board of directors of the 1st defendant. A3 16.04.2014 Demand promissory note for Rs.225 lakhs executed by defendants 4 and 6. A4 16.04.2014 Letter of continuing security executed by defendants 4 and 6. A5 16.04.2014 Power of attorney in respect of the book debts executed by defendants 4 and 6. A6 16.04.2014 Letter of undertaking executed by defendants 4 and 6. A7 16.04.2014 Declaration-cum-undertaking cum authority executed by defendants 4 and 6. A8 16.04.2014 Composite hypothecation agreement executed by defendants 4 and 6. A9 16.04.2014 General form of guarantee executed by defendants 4 to 7 in favour of the applicant bank. A10 01.03.2011 Demand promissory note for Rs.70 lakhs executed by defendants 2 and 5. A11 01.03.2011 Letter of continuing security executed by defendants 2 and 5. A12 01.03.2011 Instrument of hypothecation of goods executed by defendants 2 and 5.

A13 01.03.2011 Declaration cum undertaking cum authority executed by defendants 2 and 5. A14 16.08.2013 General form of guarantee executed by defendants 4 and 5 in favour of the applicant bank. A15 28.03.2014 Sanction letter issued by the applicant bank sanctioning cash credit limit of Rs.45 lakhs and term loan of Rs.7 lakhs to the 3rd defendant. A16 08.04.2014 demand promissory note for Rs.45 lakhs executed by the 3rd defendant. A17 08.04.2014 Letter of continuing security executed by the 3rd defendant. A18 08.04.2014 Letter of sole proprietorship executed by the 3rd defendant. A19 08.04.2014 Power of attorney in respect of book-debts facility executed by the 3rd defendant. A20 08.04.2014 Letter of undertaking executed by the 3rd defendant. A21 08.04.2014 Declaration cum undertaking cum authority executed by defendants 3, 4, 6 and 7. A22 08.04.2014 Composite hypothecation agreement executed by the 3rd defendant. A23 08.04.2014 General form of guarantee executed by defendants 4, 6 and 7 in favour of the applicant bank. A24 08.04.2014 Demand promissory note for Rs.7 lakhs executed by the 3rd defendant. A25 08.04.2014 Letter of sole proprietorship executed by the 3rd defendant. A26 08.04.2014 Letter of installment with acceleration clause executed by the 3rd defendant. A27 08.04.2014 Declaration cum undertaking cum authority executed by defendants 3, 4, 6 and 7. A28 08.04.2014 Composite hypothecation agreement executed by the 3rd defendant. A29 08.04.2014 General form of guarantee executed by defendants 4, 6 and 7 in favour of the applicant bank.

A30 30.01.2014 Letter of acknowledgement of debt executed by defendants 2 and 5 acknowledging the liability under the cash credit account. A31 29.04.2014 Photocopy of attendance sheet signed by the mortgagors. A32 29.04.2014 Memorandum of entry regarding mortgage of individual property prepared by the applicant bank. A33 … Declaration signed by the mortgagors. A34 18.12.1998 Partition deed No.3993/1998. [Returned to the applicant bank as per order dated 23.04.2025 in IA No.1649/2025] A35 28.04.2014 Basic tax receipt No.2716604 issued by Mannancherry Village Office. A36 14.03.2014 Possession and non-attachment certificate issued by Village Officer, Mannancherry. A37 14.03.2014 Possession certificate issued by Village Officer, Mannancherry. A38 29.04.2014 Building tax issued by Mannancherry Grama Panchayat. A39 29.07.2011 Encumbrance certificate No.4791/2011. A40 12.03.2014 Encumbrance certificate No.1858/2014. A41 30.04.2014 Letter of confirmation of equitable mortgage executed by the mortgagors. A42 … Declaration executed by the 4th defendant. A43 … Declaration regarding mortgage by deposit of title deeds executed by the 4th defendant. A44 01.03.2011 Memorandum of entry executed by the 4th defendant. A45 14.07.2000 Sale deed No.2450/2000 of Mararikulam SRO. [Returned to the applicant bank as per order dated 23.04.2025 in IA No.1649/2025] A46 09.12.2010 Possession certificate issued by the Village Officer, Mannanchery. A47 09.12.2010 Possession and non-attachment certificate issued by the Village Officer, Mannancherry. A48 25.04.2014 Tax receipt No.2704678 issued by the Village Officer, Mannancherry.

A49 11.10.1976 Purchase certificate No.6204 issued by Land Tribunal. A50 04.12.2010 Encumbrance certificate No.7079 issued by Mararikulam SRO. A51 22.08.2011 Encumbrance certificate issued by Mararikulam SRO. A52 03.03.2011 Letter of confirmation of mortgage executed by the mortgagor. A53 25.04.2014 Letter of extension of mortgage prepared by the applicant bank. A54 26.04.2014 Letter of confirmation of equitable mortgage executed by the 4th defendant. A55 01.03.2016 Copy of lawyer notice issued to the defendants calling upon them to repay the outstanding dues. A56 01.03.2016 Postal receipts evidencing the despatch of lawyer notice to the defendants. A57 … Returned postal cover containing the lawyer notice addressed to the defendants. A58 … Certified copy of the statement of account relating to cash credit A/c No.07600500000019. A59 … Certified copy of the statement of account relating to cash credit A/c No.07600500000010. A60 … Certified copy of the statement of account relating to cash credit A/c No.07600500000018. A61 … Certified copy of the statement of account relating to loan A/c No.07600600005841. A62 … Statement showing the penal interest charged in Ext.A61 account.

Defendants’ Exhibits – Nil

PRESIDING OFFICER

PRESIDING OFFICER

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

Dated the 5th March, 2026

TA No.694/2016 (OA NO.359/2016)

Between

Bank of Baroda, Aleppey Branch, J & J Avenue, Mullakkal, VCSB Road, Near Y.M.C.A Junction, Alappuzha – 688 011. …Applicant

And

M/s.Nitro Home Essentials India Private Limited, Door No.769, Pulimoottil Building, Mannanchery, Kalavoor Road, Alappuzha – 688 538 & 6 others.

…Defendants

F I N A L O R D E R