CANARA BANK vs M/s AMRUTHA OILS on 11 June 2026

1. M/s.Amrutha Oils,

Chakkala Community Association of India, Chammanuvilla, Venpakal P.O., Thiruvananthapuram – 695 123, Represented by the Authorised Signatory.

2. K.Ranganathan,

S/o.Krishna Pillai,

Malayala Sandesam,

Neyyattinkara P.O.,

Thiruvananthapuram District.

3. P.Mohanan,

S/o.Parameswaran Pillai,

Ambika Vilasam,

Manchadivila, Parasuvaikkal P.O.,

Thiruvananthapuram – 695 508.

4. T.Narayana Pillai,

S/o.T.Thanu Pillai,

Biju Bhavan, Venpakal P.O.,

Thiruvananthapuram District.

5. K.Madhu,

S/o.Krishna Pillai,

Veena Bhavan,

Mannamvilakam, Poovar P.O.,

Thiruvananthapuram District.

6. T.Gireesh Kumar,

S/o.Thanuvan,

Veliyancode Pattu, Puthanveedu,

Chenkavila, Ayira P.O., Thiruvananthapuram District.

7. Chakkala Community Association of India, Chammanuvilla, Venpakal P.O., Thiruvananthapuram – 695 123, Represented by the President K.Ranganathan.

…Defendants

This Original Application having been heard on 26.05.2026 in the presence of Advocate Sri.M.R.Gopalakrishnan Nair 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.19,04,318.98 due under various loan accounts together with future interest and costs from the defendants jointly and severally and by sale of ‘A’ and ‘B’ schedule properties.

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 registered office at Bangalore and a branch among other places at Kamukinkode, Thiruvananthapuram.

3. The 1st defendant is a firm functioning under the 7th defendant and engaged in the business of oil crushing in the name and style ‘M/s.Amritha Oils’ and defendants 2 to 6 are its directors. The 1st defendant submitted application for credit facilities and considering its request, applicant bank sanctioned the following facilities: Date of sanction Type of loan Amount

Availed by Guarantors Collateral security 14.11.2005 OCC [A/c No.157] Rs.4 lakhs 1st defendant through defendants 2 to 6 Defendants 2 to 6 ‘A’ and ‘B’ schedule properties 14.11.2005 Term loan [A/c No.7095] Rs.2 lakhs 1st defendant through defendants 2 to 6 Defendants 2 to 6 ‘A’ and ‘B’ schedule properties 14.11.2005 Term loan [A/c No.8250] Rs.9 lakhs 1st defendant through defendants 2 to 6 Defendants 2 to 6 ‘A’ and ‘B’ schedule properties

After availing the loans, the defendants did not adhere to the terms and conditions of sanction and the accounts became NPA. Despite recall notice was issued to the defendants, they did not settle the liability. Hence the applicant was constrained to file the OA claiming the following reliefs:

(i) To recover an aggregate sum of Rs. Rs.19,04,318.98 together with pendente lite and post-decree interest thereon from the defendants jointly and severally 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.

4. The defendants 1 to 6 jointly filed written statement contending inter alia that the applicant bank granted a term loan of Rs.2 lakhs vide sanction memorandum dated 22.10.2005 for construction of work shed, Rs.9 lakhs for procuring machinery and Rs.4 lakhs to meet the working capital expenses which includes procurement and promotion of cultivation of jatropha among the farmers. The rate of interest for the term loan sanctioned for the purpose of production and processing of jatropha seeds was at the rate of 13.25% and 12.50% respectively. Subsequently, the defendants submitted a detailed representation dated 24.10.2009 requesting the applicant bank to convert the unit as organic coconut processing unit but the same was rejected and issued a registered notice demanding an amount of Rs.18,90,306.98 with interest @13.50% per annum with monthly rests from 01.11.2009. On receipt of the demand notice, the 1st defendant submitted representations to the applicant highlighting the grievances. Without considering the same, applicant bank issued a notice dated 16.09.2010 under S.13(2) of the SARFAESI Act demanding repayment of the outstanding dues, to which the defendants sent a reply claiming that the loans come under the purview of agriculture which is exempted under the provision of the SARFAESI Act. Suppressing these facts, the applicant filed the OA which is liable to be dismissed with costs.

5. The 7th defendant adopted the contentions of defendants 1 to 6 by filing a memo dated 06.02.2012. Proof Affidavit:

6. To establish the claim on behalf of the applicant bank, one Mrs.C.Girija Devi, Manager of the bank has filed proof affidavit and produced the loan documents marked as Exhibits A1

to A46. The availing of the loans and creation of mortgage over the schedule properties are well established from the documents placed by the applicant bank.

7. The defendants filed counter proof affidavit reiterating the averments in their written statement. It is claimed that the defendants preferred SA No.241/2012 before the Tribunal challenging the securitisation proceeding and obtained an order against the dispossession of the secured asset and prayed to dismiss the OA with costs.

8. The learned counsel appeared for the defendants submitted in the proceeding dated 16.04.2025 that he relinquished the vakalath after informing the party. Thereafter, none appeared and represented for the defendants.

9. Heard arguments advanced by the learned counsel for the applicant bank. The sole issue arises for consideration is whether the applicant is entitled to recover the amount as claimed in this case?

10. There is no dispute with regard to the availing of loans and creation of mortgage over the subject matter properties. It appears that while availing the loans on 14.11.2005, the 1st defendant through defendants 2 to 6 executed security documents marked as Exts.A2 to A8. The defendants 2 to 6 had also executed guarantee agreements marked as Exts.A9 to A13 guaranteeing due repayment of the outstanding loan amount. Subsequently, the loans were renewed on 13.07.2007 and executed Exts.A14 to A19 to secure the renewed limits. The 7th defendant executed Ext.A20 letter dated 14.11.2015 confirming the deposit of title deeds in respect of the subject matter properties with the applicant bank on 11.11.2005 towards collateral security for the loans availed by the 1st defendant. The defendants had also executed acknowledgement of debt and security dated 13.07.2007 and 24.03.2010 marked as Exts.A36 to A41 acknowledging the liability under the loan accounts.

11. Challenging the securitization proceeding initiated by the applicant bank, the 1st defendant filed SA No.241/2012 before the Tribunal which was dismissed on 09.12.2022. Further, it could be seen that the defendants had preferred W.P.(C) No.19615/2016 before the Hon'ble High Court of Kerala seeking three months’ time to repay the entire dues but they did not clear the liability despite indulgence was shown by the Hon'ble High Court. An aggregate sum of Rs.19,04,318.98 is outstanding under the loan accounts as on 30.09.2010, which is established from the account statements marked as Exts.A43 to A45. In view of the specific admission made by the defendants regarding the availing of loans coupled with acknowledgment of liability and failure to repay the dues though they undertook to clear the entire liability in three equal monthly installments commencing from 08.07.2016 before the Hon'ble High Court, the applicant is entitled to recover the amount claimed in this case. The issue is answered accordingly.

12. It is averred in paragraph No.4 of the proof affidavit that the applicant has charged a sum of Rs.8,022/-, Rs.26,416/- and Rs.11,638/- by way of penal interest in the OCC A/c No.157, term loan A/c No.8250 and term loan A/c No.7095 respectively. 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 amount charged in the loan accounts.

13. Considering the amount advanced, interest and penal interest applied and default committed, 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.

14. The applicant bank, therefore, is entitled to get a final order on the following lines:

In the result, applicant bank is given a final order allowing it to recover the amount as shown below: OCC A/c No.157 Rs.6,24,482.98 (Rupees six lakhs twenty four thousand four hundred and eighty two and Paise ninety eight only) together with pendente lite and post-decree interest on the sum of Rs.6,16,460.98 (Rupees six lakhs sixteen thousand four hundred and sixty and Paise ninety eight only) @12% per annum from 01.11.2010 till realization from the defendants jointly and severally and by sale of ’A’ and ‘B’ schedule properties; Term loan A/c No.8250 Rs.8,62,431/- (Rupees eight lakhs sixty two thousand four hundred and thirty one only) together with pendente lite and post-decree interest on the sum of Rs.8,36,015/- (Rupees eight lakhs thirty six thousand fifteen only) @12% per annum from 01.11.2010 till realization from the defendants jointly and severally and by sale of ’A’ and ‘B’ schedule properties; Term loan A/c No.7095 Rs.4,17,405/- (Rupees four lakhs seventeen thousand four hundred and five only) together with pendente lite and post-decree interest on the sum of Rs.4,05,767/- (Rupees four lakhs five thousand seven hundred and sixty seven only) @12% per annum from 01.11.2010 till realization from the defendants jointly and severally and by sale of ’A’ and ‘B’ schedule properties; and costs and expenses borne by it for realization of the loans from the defendants.

15. ‘A’ and ‘B’ schedules to the OA shall be appended to this final order.

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

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

18. 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 11th day of June, 2026)

[SOVAN KUMAR DASH] PRESIDING OFFICER

A P P E N D I X Witness for Applicant: AW1: Smt.C.Girija Devi, Manager of the applicant bank.

Witness for Defendant(s): Nil

Applicant’s Exhibits

Ext.No Date Particulars of documents

A1 14.11.2005 Loan application submitted by the 1st defendant. A2 14.11.2005 Demand promissory note for Rs.4 lakhs executed by the 1st defendant through defendants 2 to 6. A3 14.11.2005 Cash credit agreement executed by the 1st defendant through defendants 2 to 6. A4 14.11.2005 Take delivery letter and pronote for Rs.2 lakhs executed by the 1st defendant through defendants 2 to 6. A5 14.11.2005 Term loan agreement executed by the 1st defendant through defendants 2 to 6. A6 14.11.2005 Take delivery letter to DPN and pronote for Rs.9 lakhs executed by the 1st defendant through defendants 2 to 6. A7 14.11.2005 Deed of hypothecation of machinery executed by the 1st defendant through defendants 2 to 6. A8 14.11.2005 Letter of undertaking executed by the 1st defendant through defendants 2 to 6. A9 14.11.2005 Guarantee agreement executed by the 2nd defendant. A10 14.11.2005 Guarantee agreement executed by the 3rd defendant. A11 14.11.2005 Guarantee agreement executed by the 4th defendant. A12 14.11.2005 Guarantee agreement executed by the 5th defendant. A13 14.11.2005 Guarantee agreement executed by the 6th defendant.

A14 13.07.2007 Letter of renewal executed by the defendants. A15 13.07.2007 Letter of renewal executed by the 2nd defendant. A16 13.07.2007 Letter of renewal executed by the 3rd defendant. A17 13.07.2007 Letter of renewal executed by the 4th defendant. A18 13.07.2007 Letter of renewal executed by the 5th defendant. A19 13.07.2007 Letter of renewal executed by the 6th defendant. A20 14.11.2005 Letter evidencing deposit of title deeds executed by the 7th defendant. A21 11.12.2002 Sale deed No.3854/2002. A22 03.12.2002 Sale deed No.3765/2002. A23 03.12.1998 Sale deed No.3410/1998. A24 31.10.1994 Copy of sale deed No.3110/1994. A25 30.07.1994 Copy of registered settlement deed No.2078/1994. A26 17.02.1982 Copy of sale deed No.483/1982. A27 17.09.1987 Settlement deed No.2240/1987. A28 02.06.2005 Tax receipt No.947812. A29 29.10.2005 Possession certificate issued by Athiyanoor Village Office. A30 29.10.2005 Location certificate issued by Athiyanoor Village Office. A31 29.10.2005 Location sketch issued by Athiyanoor Village Office. A32 29.10.2005 Thandaper extract issued by Athiyanoor Village Office. A33 04.11.2005 Encumbrance certificate No.5140/2005. A34 18.12.2001 Copy of power of attorney No.99/2001. A35 07.11.2005 Affidavit executed by one Pushpavally. A36 13.07.2007 Acknowledgement of debt and security in respect of term loan A/c No.8250 executed by the defendants. A37 13.07.2007 Acknowledgement of debt and security in respect of term loan A/c No.7095 executed by the defendants.

A38 13.07.2007 Acknowledgement of debt and security in respect of OCC loan executed by the defendants. A39 24.03.2010 Acknowledgement of debt and security in respect of term loan A/c No.8250 executed by the defendants. A40 24.03.2010 Acknowledgement of debt and security in respect of term loan A/c No.7095 executed by the defendants. A41 24.03.2010 Acknowledgement of debt and security in respect of OCC loan executed by the defendants. A42 18.04.2010 Copy of notice issued to the defendants by the applicant bank. A43 … Certified copy of the statement of account relating to the OCC loan. A44 … Certified copy of the statement of account relating to term loan A/c No.8250. A45 … Certified copy of the statement of account relating to term loan A/c No.7095. A46 … Statement showing the rate of interest applied in 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 11th June, 2026

TA No.1220/2016 (OA NO.464/2010)

Between

Canara Bank, Kamukinkode Branch, Thiruvananthapuram. …Applicant

And

M/s.Amrutha Oils, Chakkala Community Association of India, Chammanuvilla, Venpakal P.O., Thiruvananthapuram – 695 123, Represented by the Authorised Signatory & 6 others. …Defendants

F I N A L O R D E R