STATE BANK OF INDIA vs K.V JACOB on 26 May 2026

1. K.V.Jacob,

S/o.Varkey Joseph,

Kurianthadathil,

Kattampak P.O.,

Njeezhoor (via),

Kottayam District – 686 610.

2. Tessy Jacob,

W/o.K.V.Jacob,

Kurianthadathil,

Kattampak P.O.,

Njeezhoor (via),

Kottayam District – 686 610. …Defendants

This Original Application having been heard on 22.05.2026 in the presence of Advocate Sri.C.N.Baby 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 a sum of Rs.77,74,971/- due under KCC loan accounts together with future interest and costs from the defendants and by sale of ‘A’ and ‘B’ schedule properties. Facts of the case:

2. During July, 2010 the defendants approached the erstwhile State Bank of Travancore seeking financial assistance for agricultural operations in their properties. Considering their request, applicant bank sanctioned an agricultural crop loan (KCC) of Rs.25 lakhs to the 1st defendant and agricultural crop loan (KCC) of Rs.18 lakhs to the 2nd defendant on 19.07.2010 to meet the expenses of pineapple cultivation. The 1st defendant created equitable mortgage over ‘A’ schedule property to secure the two loans and the 2nd defendant created mortgage over ‘B’ schedule property to secure the loan of Rs.18 lakhs availed by her. The defendants hypothecated the crops raised/to be raised over the properties. The 1st defendant stood as guarantor for the loan of Rs.18 lakhs availed by the 2nd defendant. On 20.07.2010, defendants 1 and 2 executed memorandum of deposit of title deeds confirming the deposit of respective title deeds with the applicant bank. The defendants availed the facilities but committed default in repayment. Consequently, the accounts turned NPA on 31.03.2014 and the bank initiated proceeding under the SARFAESI Act by issuing demand notice under S.13(2) of the SARFAESI Act on 26.09.2014 demanding repayment of the outstanding dues. Though the defendants had assured to close the loan accounts, they did not settle the liability. Hence the applicant was constrained to file the OA claiming the following reliefs:

(i) To recover the sum of Rs.77,74,971/- together with pendente lite and post-decree interest thereon from the defendants and by sale of ‘A’ and ‘B’ schedule properties;

(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.

3. The defendants filed written statement admitting the availing of the subject loans and creation of mortgage over the schedule properties. The interest rate demanded by the applicant for the agricultural loans is very high. When the loans were sanctioned, rate of interest was fixed at 10.50% and additional base rate at 2.25% per annum but in the OA, the bank has claimed the rate of interest at 15.90% per annum which is illegal and arbitrary. It is submitted that they had already remitted Rs.15 lakhs towards the loan accounts and sought some time to settle the entire dues. Proof Affidavit:

4. In order to establish the claim on behalf of the applicant bank, one Mr.George C.Kuruvilla, Chief Manager and Mr.Sudheesh J., Chief Manager have filed proof affidavit and additional proof affidavit respectively and produced the loan documents marked as Exhibits A1 to A24. In the additional proof affidavit, it is averred that the interest rate mentioned in the hypothecation agreements marked as Exts.A2 and A4 are wrong and what is stated in Exts.A1 and A3 arrangement letters are correct and that the rate of interest applicable for two loans was 12.75% per annum.

5. Despite time granted, the defendants have not filed counter proof affidavit and hence the chance of filing the same stood closed on 14.10.2019.

6. Heard arguments advanced by the learned counsel for the applicant bank. The defendants remained absent from the proceeding from 15.12.2018.

7. The sole issue arises for consideration is whether the applicant bank is entitled to get the relief as claimed in this case?

8. Admittedly, the defendants have availed the subject loans from the applicant bank and created mortgage over ‘A’ and ‘B’ schedule properties. Concededly, there is default in repayment of the loans. The only dispute raised by the defendants is with regard to the rate of interest charged for the agricultural loans. In the letters of arrangement marked as Exts.A1 and A3, it is mentioned that interest will be charged at the rate of 5% above SBT base rate with a minimum of 12.75% per annum. The defendants have countersigned Exts.A1 and A3 in token of having accepted the terms and conditions thereof. Though the defendants have contested the interest charged in the accounts, they sought some time to settle the dues. As on 30.04.2016, a sum of Rs.77,74,971/- is outstanding in the two loan accounts which is established from the account statements marked as Exts.A22 to A24. In the above circumstance, the applicant is entitled to recover the amount claimed in this case from the defendants. It is submitted by the applicant bank that no hypothecated goods are available at present to be proceeded against to recover the dues.

9. Considering the amount advanced, interest applied (interest ranging from 12.75% to 16.15% was charged in the KCC loan of Rs.25 lakhs), repayments effected and the facilities granted being agricultural loans, I am of the view that the applicant bank is entitled to get pendente lite and post decree interest @6% per annum, which is reasonable in the facts and circumstances.

10. 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:

(i) the sum of Rs.45,91,154/- (Rupees forty five lakhs ninety one thousand one hundred and fifty four only) due under KCC loan A/c No.67116975583 together with pendente lite and post-decree interest thereon @6% per annum from 05.05.2016 till realization from the 1st defendant and by sale of ‘A’ schedule property;

(ii) the sum of Rs.31,83,817/- (Rupees thirty one lakhs eighty three thousand eight hundred and seventeen only) due under KCC loan A/c No.67116964593

together with pendente lite and post-decree interest thereon @6% per annum from 05.05.2016 till realization from the defendants jointly and severally and by sale of ‘A’ and ‘B’ schedule properties; and

(iii) 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.

11. ‘A’ and ‘B’ schedule properties to the OA shall be appended to this final order.

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

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

14. 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 26th day of May, 2026)

[SOVAN KUMAR DASH] PRESIDING OFFICER

A P P E N D I X Witness for Applicant: AW1: Sri.George C.Kuruvilla, Chief Manager of the applicant bank. AW2: Sri.Sudheesh J., Chief Manager of the applicant bank.

Witness for Defendant(s): Nil

Applicant’s Exhibits

Ext.No Date Particulars of documents

A1 19.07.2010 Letter of arrangement issued by the applicant bank sanctioning KCC limit of Rs.25 lakhs to the 1st defendant. A2 19.07.2010 Hypothecation agreement executed by the 1st defendant in favour of the applicant bank. A3 19.07.2010 Letter of arrangement issued by the applicant bank sanctioning KCC limit of Rs.18 lakhs to the 2nd defendant. A4 19.07.2010 Hypothecation agreement executed by the 2nd defendant in favour of the applicant bank. A5 19.07.2010 Deed of guarantee executed by the 1st defendant. A6

08.11.2004 Duplicate of partition deed No.2914/2004 of Kuravilangad SRO. A7

20.07.2010 Memorandum of deposit of title deeds executed by the 1st defendant. A8

16.03.2007 Sale deed No.769/2007 of Kuravilangad SRO. A9

20.07.2010 Memorandum of deposit of title deeds executed by the 2nd defendant. A10 30.04.2012 Letter submitted by the 1st defendant to the applicant bank undertaking to close the loan accounts. A11 17.05.2013 Revival letter executed by the 1st defendant in respect of the KCC limit of Rs.25 lakhs. A12 17.05.2013 Revival letter executed by the 2nd defendant in respect of the KCC limit of Rs.18 lakhs.

A13 17.05.2013 Revival letter executed by the 1st defendant in respect of the KCC limit of Rs.18 lakhs. A14 17.02.2014 Letter submitted to the applicant bank by the 1st defendant agreeing to repay the interest and principal amount by March, 2014. A15 10.03.2014 Copy of recall notice issued to the 1st defendant. A16 10.03.2014 Copy of recall notice issued to the 2nd defendant. A17 15.12.2015 Revival letter executed by the 1st defendant in respect of the KCC limit of Rs.25 lakhs. A18 15.12.2015 Revival letter executed by the 2nd defendant in respect of the KCC limit of Rs.18 lakhs. A19 15.12.2015 Revival letter executed by the 1st defendant in respect of the KCC limit of Rs.18 lakhs. A20 15.01.2016 Letter submitted by the 1st defendant to the applicant bank undertaking to close the loan accounts within 15 days. A21 … Statement showing the rate of interest applied in the loan accounts from time to time. A22 … Certified copy of the statement of account relating to the KCC loan of the 1st defendant. A23 … Certified copy of the statement of account relating to the KCC loan of the 2nd defendant. A24 … Statement showing the total amount due under the loan accounts.

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 26th May, 2026

TA No.586/2016 (OA NO.390/2016)

Between

State Bank of India, Successor of State Bank of Travancore, Kaduthuruthy Main Branch, Kottayam District.

…Applicant And

K.V.Jacob, S/o.Varkey Joseph, Kurianthadathil, Kattampak P.O., Njeezhoor (via), Kottayam District & another.

...Defendants

F I N A L O R D E R