CANARA BANK vs GEORGE P. MATHEW on 9 September 2026

1. George P. Mathew,

Residing at Puthenpurackal,

Pambadi P.O., Kottayam.

Proprietor, M/s.Cammelia Distributors,

Thamarassery Buildings,

Muttambalam, Kottayam.

2. Biju Thomas,

Proprietor, Elamthottam Enterprises,

H.P.C. Dealers, Erattupetta. …Defendants This Original Application having been heard on 08.09.2026 in the presence of Advocate Sri.N.D.Premachandran 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 TA 781/2016 (OA 115/2009)

sum of Rs.32,57,608/- due under current account together with future interest thereon @18% per annum including penal interest @2% per annum from the defendants jointly and severally and their assets. 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 Bangalore and one of its branches at Temple Road, Kottayam.

3. The 1st defendant is the current account holder of the applicant bank and he was given cheque discounting facility with the bank. The 1st defendant submitted three cheques bearing Nos.250999, 251000, 250998 for Rs.8.40 lakhs, Rs.6.35 lakhs and Rs.10.45 lakhs respectively drawn on Bank of Baroda, Kanjirappilly Branch by the 2nd defendant and he requested the applicant to discount the cheques. Accordingly, applicant bank discounted the cheques and the amount was credited in the current account bearing No.CA 919 of the 1st defendant. The applicant sent the aforesaid three cheques to Bank of Baroda, Kanjirappilly Branch for encashment but the same were returned with the endorsement ‘account closed’. Consequently, applicant TA 781/2016 (OA 115/2009)

bank sent notices to defendants 1 and 2 intimating them about the dishonour of three cheques and demanded to pay the amount covered by the cheques. Despite receipt of the notices, the defendants did not remit the amount nor send any reply to the notice. In such premises, applicant bank was constrained to file the OA claiming the following reliefs:

(i) To recover the sum of Rs.32,57,608/- together with pendente lite and post-decree interest thereon from the defendants jointly and severally and their assets;

(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 were duly served with summons. The 1st defendant entered appearance as early on 12.06.2009 and sought adjournment for filing written statement but he did not file written statement within the time granted. Thereafter, he presented a written statement along with IA No.1325/2020 to accept the same. Since none appears to move IA No.1325/2020, the same was rejected on 07.10.2024 and as such, written statement of the 1st defendant was not accepted. Though the 2nd TA 781/2016 (OA 115/2009)

defendant appeared in this case on 23.10.2009, he neither filed vakalath nor written statement and hence he was set exparte on 26.03.2010. Proof Affidavit:

5. To establish the claim on behalf of the applicant bank, one Mr.Subramoniam T.N., Senior Manager of the bank has filed proof affidavit and produced the loan documents marked as Exhibits A1 to A18. The proof affidavit filed by AW1 and the documents produced in this case are not challenged by the defendants. The availing of the cheque discounting facility is well established from the documents placed by the applicant bank. An amount of Rs.32,57,608/- is outstanding in the current account as on 28.02.2009, which is clearly established from the account statements marked as Exts.A14 and A15.

6. It could be seen from Ext.A15 statement that applicant bank has charged a sum of Rs.78,981/- by way of penal interest in the 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 amount charged in the account.

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7. Pending the OA, the Tribunal passed an order of attachment in respect of the properties scheduled to IA No.1286/2013 belonging to the 1st defendant on 19.09.2014. Similarly, conditional attachment was granted in IA No.2586/2012 on 28.09.2012 in respect of two items of properties obtained by the 1st defendant as legal heir of his late father Sri.P.T.Mathew and the said order was made absolute on 08.09.2026. Hence the applicant bank is entitled to realize the amount found due as above by sale of the attached properties also.

8. Considering the nature of transaction involved in this case, interest and penal interest applied and default committed in repayment of the amount, I am of the view that the applicant bank is entitled to get pendente lite and post decree interest @14% per annum on the sum of Rs.31,78,627/- (i.e., after excluding the penal interest of Rs.78,981/- from the OA claim amount of Rs.32,57,608/-), which is reasonable in the facts and circumstances of the case.

9. 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:

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(i) the sum of Rs.32,57,608/- (Rupees thirty two lakhs fifty seven thousand six hundred and eight only) due under the current account from the defendants jointly and severally and by sale of the properties attached under IA No.2586/2012 and IA No.1286/2013;

(ii) pendente lite and post-decree interest @14% per annum on the sum of Rs.31,78,627/- (Rupees thirty one lakhs seventy eight thousand six hundred and twenty seven only) from 23.03.2009 till realization from the defendants jointly and severally and by sale of the properties attached under IA No.2586/2012 and IA No.1286/2013; and

(iii) costs and expenses borne by it for realization of the amount from the defendants.

10. The schedule to IA No.2586/2012 and IA No.1286/2013 shall be appended to this final order.

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

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

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13. 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 9th day of September, 2026)

[SOVAN KUMAR DASH] PRESIDING OFFICER

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A P P E N D I X Witness for Applicant: AW1: Mr.Subramoniam T.N., Senior Manager of the applicant bank. Witness for Defendant(s): Nil

Applicant’s Exhibits

Ext.No Date Particulars of documents A1 25.09.2007 Certified copy of cheque No.250999 for Rs.8.40 lakhs drawn in favour of the 1st defendant. A2 25.09.2007 Certified copy of cheque No.251000 for Rs.6.35 lakhs drawn in favour of the 1st defendant. A3 03.10.2007 Certified copy of cheque No.250998 for Rs.10.45 lakhs drawn in favour of the 1st defendant. A4 11.02.2008 Copy of cheque return memo for Rs.8.40 lakhs issued to the applicant bank by Bank of Baroda. A5 11.02.2008 Copy of cheque return memo for Rs.6.35 lakhs issued to the applicant bank by Bank of Baroda. A6 11.02.2008 Copy of cheque return memo for Rs.10.45 lakhs issued to the applicant bank by Bank of Baroda. A7 03.10.2007 Bill purchase lodging forms in respect of the cheque for Rs.8.40 lakhs. A8 03.10.2007 Bill purchase lodging forms in respect of the cheque for Rs.6.35 lakhs. A9 03.10.2007 Bill purchase lodging forms in respect of the cheque for Rs.10.45 lakhs. A10 18.02.2008 Copy of lawyer notice issued to the defendants calling upon them to pay the sum of Rs.8.40 lakhs. A11 18.02.2008 Copy of lawyer notice issued to the defendants calling upon them to pay the sum of Rs.6.35 lakhs. A12 18.02.2008 Copy of lawyer notice issued to the defendants calling upon them to pay the sum of Rs.10.45 lakhs. A13 … Copy of complaint filed by the applicant bank before the Station House Officer, Kottayam West Police Station.

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A14 … Certified copy of the statement of account relating to the current account. A15 … Statement showing the penal interest charged in Ext.A14 account. A16 … Statement showing the rate of interest applied in Ext.A14 account from time to time. A17 … Certified copy of the statement of account of the 1st defendant. A18 12.06.1986 Copy of power of attorney executed by the applicant bank in favour of AW1.

Defendants’ Exhibits – Nil

PRESIDING OFFICER

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SCHEDULE TO IA No.2586/2012

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SCHEDULE TO IA No.1286/2013

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PRESIDING OFFICER

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

Dated the 9th September, 2026

TA No.781/2016 (OA NO.115/2009)

Between

Canara Bank, Temple Road Branch, Kottayam.

…Applicant

And

George P. Mathew, Residing at Puthenpurackal, Pambadi P.O., Kottayam. Proprietor, M/s.Cammelia Distributors, Thamarassery Buildings, Muttambalam, Kottayam. & another.

…Defendants

F I N A L O R D E R