ARCIL vs Sarasee Bai K on 9 September 2025

1. Sarasee Bai K., W/o.Rajendran A., Greeshma, Palappoor, Vellayani P.O., Trivandrum - 695 522.

2. Rajendran A., S/o.Arjunan, Greeshma, Palappoor, Vellayani P.O., Trivandrum - 695 522.

3. Shinoj Rajendran S., S/o.Rajendran, Greeshma, Palappoor, Vellayani P.O., Trivandrum - 695 522.

…Defendants

This TA (OA) having been heard on 20.08.2025 in the presence of Advocate Sri.B.S.Suresh Kumar for the applicant bank and the defendants being exparte and stood over to this day for consideration, the Tribunal delivered the following:- F I N A L O R D E R

This is an application filed under S.31A of the Recovery of Debts and Bankruptcy Act, 1993 by State Bank of India, who is the applicant in P.L.P. No.60/2013, for issuance of Recovery Certificate in terms of the award dated 09.02.2013 for recovery of the amount due thereunder.

2. State Bank of India, Stressed Asset Recovery Branch, Thiruvananthapuram filed a Pre-Litigation Petition bearing P.L.P. No.60/2013 before the Kerala State Legal Services Authority, Ernakulam against defendants 1 and 2 for recovery of the amount due and with the concurrence of defendants 1 and 2, the bank obtained an award dated 09.02.2013 in PLP No.60/2013, directing defendants and to pay the compromise amount of Rs.14,00,000/- to the bank on or before 09.05.2013; and in the event of failure to pay the amount as stated above, defendants 1 and 2 shall forfeit the benefits of the compromise and the bank is entitled to recover the whole amount as claimed in the PLP i.e.,

Rs.17.77 lakhs with interest @9% per annum till recovery in full and costs from the defendants 1 and 2 personally, jointly and severally and concurrently by sale of the mortgaged property and from their other assets, both movable and immovable, after adjusting the amount, if any, paid by defendants 1 and 2 and the bank shall be at liberty to file an application before the DRT for issuance of recovery certificate to recover the entire dues as claimed in the P.L.P along with interest, costs, charges and expenses.

3. According to the applicant, defendants 1 and 2 did not pay any amount due under the award, and it is entitled to get the sum of Rs.17.77 lakhs together with interest thereon @9% per annum from 09.02.2013 till the date of payment from the defendants jointly and severally and concurrently by sale of the mortgaged property. The prayer is to issue Recovery Certificate accordingly.

4. Defendants 1 to 3 were duly served with summons. But they neither appeared nor were they represented and hence the 1st defendant and defendants 2 and 3 were declared exparte on 24.06.2015 and 23.07.2014 respectively.

5. S.31A was incorporated by way of amendment made to the Act as per Act 1 of 2000, which came into force on 17.01.2000, which deals with issuance of Recovery Certificate in respect of decrees for recovery of debt passed by any court prior to the commencement of Act 1 of 2000. When any decree passed by a civil court after introduction of S.31A in the statute, which remained unexecuted and the decreetal debt grew after calculating the interest beyond Rs.10 lakhs (Rs.20 lakhs w.e.f. 01.07.2019), can be executed by the Tribunal not by the civil court in view of the ratio decided by the Hon'ble High Court of Kerala in the case titled V.D.Mathew v. State Bank of Travancore, reported in 2008 (2) D.R.T.C 695 (Kerala) wherein it was held that “If that be so, after the decree was passed, the debt under it remains a decree debt and when the outstanding under that decree grew to be beyond Rupees Ten Lakhs, it was amenable to the jurisdiction of the Tribunal, as cause of action, against the debtor.” Here in this case at the time of passing the Award, the decreetal amount was Rs.17.77 lakhs and the total recoverable amount at the time of initiation of this proceeding was Rs.17.77 lakhs plus interest @9% per annum from 09.02.2013. The ratio decided by the Hon'ble High Court is squarely applicable to the facts and circumstances of this case and this proceeding is maintainable in this forum and the Tribunal is empowered to issue Recovery Certificate for recovery of amount due under the award (i.e., the decree passed on or after 17.01.2000) which grew beyond the statutory limit of Rs.10 lakhs. Any other interpretation would make S.31A of the Act redundant and a decree holder bank, after obtaining a decree after the commencement of Act 1 of 2000 for recovery of amount with interest which has exceeded of Rs.10 lakhs, would be unable to approach for recovery of such amount either before the Tribunal or the civil court which is not the intention of legislature. The Tribunal, therefore, is required to issue Recovery Certificate for recovery of the amount due under the award.

6. As per S.21 of the Legal Services Authorities Act, 1987, every award of the Lok Adalat shall be deemed to be a decree of a civil court and shall be binding on all the parties to the dispute. Section 21 reads as follows:

21. Award of Lok Adalat.—

Every award of the Lok Adalat shall be deemed to be a decree of a civil court or, as the case may be, an order of any other court and where a compromise or settlement has been arrived at, by a Lok Adalat in a case referred to it under sub- section (1) of section 20, the court-free paid in such case shall be refunded in the manner provided under the Court Fees Act, 1870 (7 of 1870).—

Every award made by a Lok Adalat shall be final and binding on all the parties to the dispute, and no appeal shall lie to any court against the award.

7. It is pertinent to mention here that the decree holder bank viz., State Bank of India had obtained an award in PLP No.60/2013 against defendants 1 and 2 but they filed the OA against three defendants i.e., by incorporating one Shinoj Rajendran S. as 3rd defendant in the party array, which is not legally sustainable. Since State Bank of India has obtained the award only against defendants 1 and 2, the applicant is entitled to get a final order as against defendants 1 and 2 only for recovery of the debt due in terms of the award.

8. In view of the above discussion, the applicant is entitled to get a final order directing to issue Recovery Certificate on the following lines: In the result, it is ordered to issue Recovery Certificate in terms of the award dated 09.02.2013 in PLP No.60/2013 of the Lok Adalat organized by Kerala State Legal Services Authority, Ernakulam for recovery and payment to the applicant the sum of Rs.17,77,000/- (Rupees seventeen lakhs seventy seven thousand only) with further interest thereon @9% per annum from 09.02.2013 till realization and also the costs of the applicant in this proceeding from defendants 1 and 2 personally and jointly and severally and by sale of the schedule property.

9. The schedule to the OA shall be appended to this final order.

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

11. 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, 2025)

[SOVAN KUMAR DASH] PRESIDING OFFICER

PRESIDING OFFICER

IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

Dated the 9th September, 2025

TA No.1081/2016 (OA No.339/2013)

Between

Asset Reconstruction Co. India Ltd., 1G, 1st floor, Century Plaza, No.560-562, Anna Salai, Teynampet, Chennai. …Applicant

And

Sarasee Bai K., W/o.Rajendran A., Greeshma, Palappoor, Vellayani P.O., Trivandrum - 695 522 & 2 others.

…Defendants

F I N A L O R D E R