UNION BANK OF INDIA vs GOVERNMENT TELE COMMUNICATION EMPLOYEES CO OPERATIVE SOCIETY LTD on 13 November 2025

ORDER

1. The same Applicant Bank described as Applicant No.1 and 2 had filed this OA initially before DRT

for recovery a sum of Rs.158,16,07,949.98p against the defendant no. 1 only.

2. No relief is sought against the other defendants except stating that the defendant 3 to 9 are also entitled for share on pari passu basis over the security offered by the Defendant no. 1.

3. The defendant no 1 has filed the written statement on 12.12.2022. Though the, Bank had examined its witness AW-1 Ms. D. Deepa Devi, in the first part of the deposition dated 25.07.2025, this witness had relied on exhibit A 1 to A117. In the second part of the deposition she had further relied on exhibit A 118 to A151.

4. The brief facts of the case of the Applicant bank is that both the applicants are the branches of the bank which is a registered banking company. The first defendant is herein is a multi state co-operative society having its business spread across different states. The second defendant is having no banking transaction but arrayed as a party. It is also pleaded that the defendants 3 to 8 are also the lenders to defendant no. 1 under multiple banking arrangements. 4.1 The defendant no. 1 Society in its business of money lending to its members had approached the Applicant bank and the Applicant bank alleges that the defendant availed the loans Term Loan 1 by executing promissory note for Rs. 25 crore apart from executing the loan documents on 09.12.2013. Likewise the Applicant no. 2 ( e-Andhra Bank) had also accorded and sanctioned loan limit of Rs.50 crores on 06.12.2013 and the documents were executed on 23.12.2013. (the pleading are incoherent at para 8 of the OA as regards the e Andhra Bank transactions). 4.2 It is alleged that after execution of this documents, security interest came to be created over the receivables of the society and the primary receivable of the member of the society is the payment of the salary and benefits of employee of BSNL which is second defendant herein. 4.3 It is also alleged that the first defendant again approached the Applicant between 2013 – 2018 and D1 availed the following facilities : - (a) TL II– Rs. 25crores–executed documents including DPN on 29.06.2013.

(b) TL–III- Rs. 50crores executed documents including DPN on 22.03.2014.

(c) TL–IV-Rs. 50crores executed documents including DPN on 29.06.2015.

(d) TL–V- Rs. 50crores executed documents including DPN on 30.06.2017.

(e) TL–VI-Rs. 10crores executed documents including DPN on 10.10.2018.

(f) TL–VII-Rs. 10crores executed documents including DPN on 10.10.2018.

4.4 It is also pleaded that, the defendant no. 1 had given the debit balance confirmation and acknowledgment of debt on 17.10.2019 consequent to the resolution passed by defendant 1 dated 14.10.20219. The Applicant had pleaded various amounts duly acknowledged as balance on two different dates i.e. 09.10.2018with regard to term loan I to V and again on 17.10.2019 with regard to the term loans I to IV and further on 18.02.2020 as regards TL I to III. It is pleaded that the first Applicant classified loan account as NPA on 30.11.2019 and issued a demand notice dated 18.12.2019 calling upon the first defendant to pay a sum of Rs. 93,52,62,404.37 paise and the first Applicant had recalled the facilities on 02.12.2019. These sums are not paid so far. It is also pleaded that the second Applicant had recalled the facilities vide its notice dated 26.08.2019.

4.5 It is submitted that the first defendant society had kept on promising to clear thedues in its JLM convened. The minutes of the meeting held on 25.02.2020 is reproduced in the OA wherein it is noted that GTECS Officials presented the following to the JLM members : The society has been outstanding with all the lenders at about Rs. 425 crores. There are about 6000 members in the society currently with outstanding book of about Rs. 162 crores. Of these Members, around 4300 Members had opted for VRS and the total receivables to the society from these VRS Optees would be around Rs 130crores. 4.6 Based on these assurances, the bank anticipated the better performances of the Defendant – 1 Society. However, the society had not taken any positive effort to clear the outstanding dues. It is pleaded that the Defendant no. 1 is liable to make the payments as under:- (a) To the first Applicant – as on 30.11.2020 - Rs. 91,13,76,850.47p.

(b) To the second Applicant - as on 30.11.2020 - Rs. 67,02,31,099. 51p. 4.7 It is further alleged that the Defendant no. 1 society availed these loans for the benefits of its members and thus the Applicant are entitled to the interests as per the RBI guidelines. The true statements of accounts are also furnished by segregating the different claims and the interests. Thus the OA is filed for recovery of Rs.158,16,07,949.98 paise along with interest and cost. 4.8 In the prayer, it is to be noted that the Applicant have sought for recovery certificate along with the cost and also had sought for the realization of the amounts noting the share of defendants no. 3 to 9 on the pari passu basis concerning the security offered by the Defendant no. 1. The security is offered at schedule - A is the “Book debts and the receivables” as per the receivable statementdated 11.03.2020 submitted to the tune of Rs. 534.75 crores under pari passu charge and under schedule B it is described as “ all the current assets of first defendant”. 4.9 It is to be noted that the OA does not specify any immovable properties or other valuable securities owned by the defendant no. 1 society. Written Statement of Defendant -1

5. In the written statement filed by the Defendant no. 1, it is pertinent to note that the same is filed by the Secretary and the following admissions are found :- (a) The society admits availing the credited the facility to further lend the money to its members.

(b) It admits having creating charge over the receivables.

(c) It admits having paid certain EMIs. It could not pay regularly since the society was unable to recover the loans advanced to its members and thus, it failed (d) This tribunal has no jurisdiction since the exorbitant interest is charged and the bank had capitalized the penal interest.

(e) It admits the signature found on the loan document but with a rider that the same were obtained without the knowledge.

(f) Applicant has not produced the statement of the accounts.

(g) It denies having executed the security interest on the receivables (h) It also denies having executed balance confirmation and AODs.

(i) The statement of accounts produced by the Bank are also denied, however, admitting the availing of the loans to the tune of Rs. 2004,93,53,684.16 (including the claims of the Applicants).

(j) It pleads that the society has a good record for prompt repayment.

6. The D2 has not filed the written statement though one counsel had undertaken to file the Vakalathnama. The opportunity to file the WS is closed on 15.11.2022 after the matter is transferred to this Tribunal consequent to the notification of the DFS dated 04.10.2022.

7. The other defendants except D9 have not filed their written statements and the opportunity is closed. Written Statement of D9:

8. The D9 City Union Bank had filed its WS. In the WS it is submitted that the D1 society had also borrowed certain sums and this defendant had filed OA 94/2022 before DRT – 1, Chennai (Now transferred to DRT – II, Chennai bearing TA 261/2022). The D9 further submits that it filed the above claim based on the documents describedat part no. 5 of the WS. It alleges that D1 had miserably filed and neglected in making repayment of the loans and the police compliant is lodged alleging fraud. It also pleads that the D9 had pari passu charge on the securities. The prayer is to note the pari passu charge. The Case of D6:

9. The D6 Repco Bank which had not filed the WS in time which opportunity is forfeited on 15.11.2022 had filed one petition to accept the WS only on 05.01.2023 the IA is not numbered however, the WS filed shows that this bank had also accorded various credit facilities and the dues payable by the D1 & D2 is Rs.60,38,17,139 to D9. It is also submitted that this defendant is only a formal party having pari passu charge over the schedule properties mentioned in the OA. Thus the IA filed for accepting the WS is unnumbered which Dy.No. 7/2023 stands allowed and the gist of the WS of D6 is already stated. Subsequent Developments:

10. It is to be noted this applicant bank had sanctioned OTS to settle the dues at Rs.70 crores vide its letter dated 24.03.2025. It is alleged in the memo of the applicant dated 13.10.2025 (filed on 13.11.2025) that the

terms of OTS were not followed by D1 and it failed in its performance of the OTS conditions. Accordingly, the applicant bank had withdrawn and cancelled the OTS which is also communicated to the D1. The cancellation letter is dated 06.10.2025.

11. However, the applicant bank had also filed IA 155/2025 seeking attachment before judgment of the properties mentioned in the IA in which six properties are cited without showing the corresponding ownership or occupation by the D1 society. After hearing the Ld. Counsel on either side, this Tribunal is also disposes this IA with direction to D1 not to alienate the properties till proper recoveries are made – since the entire claim is admitted by D1 in their WS which is noted above. The applicant mayfile proper applications for attachment before the Recovery officer by producing relevant documents. Suffice to say that this IA stands disposed of with a direction to the D1 company not to alienate any of its immovable properties standing in the name of D1 Company.

12. The D1 had also filed IA 169/2025 with a prayer to receive the counter proof affidavit by condoning the delay of 15 days in filing the same. The same stands allowed and the CPA will be read in disposal of the case. There are no documents to be marked. Thus IA 169/2025 stands allowed.

13. The IA filed in IA 170/2025 by the D9 seeking condoning the delay in filing the CPA also stands allowed and the CPA filed will be read in evidence.

14. IA 171/2025 filed by the D9 to produce additional documents stands dismissed, after having noted that the D9 has already filed one OA and further no relief having been claimed by the applicant bank against D9 City Union Bank. Evidence on record:

15. The applicant has examined the same witness twice as AW-1 which is adduced evidence on behalf of applicant no. 1 and 2. In the evidence this witness had relied on documents at exhibit A1 to A 151.

16. There is the no evidence of the D6.

17. On behalf of D1the counter proof affidavit is filedby one D. Veeramani who is the secretary of the defendant. The same will be discussed while answering the points for determination. Points for determination:

18. In the context of above pleadings and evidence on record and after hearing the Ld. Counsel the only point that arises for determination in this OA proceedings is as under:

a. Whether the applicant is entitled for recovery certificate against defendant no. 1 if so, what order? Answer for the point for Determination:

19. The Ld. Counsel for the applicant Shri. Grish, submits that applicant is entitled for recovery certificate in view of the clear admissions found in the WS of D1. On the otherhand the Ld. Counsel for the D1 submits that the admissions are not clear and further the claim is barred under limitation. He submits that the OA may be dismissed.

20. The contentions of the other contesting defendants are that the D6 Repco Bank also claims some amounts to the tune of Rs.60 crores for which they have not filed any suit or applications as submitted by the Ld. Counsel Shri. N. Saravanan, Adv.

21. The claim of D9 is pending adjudication in TA 261/2022 before the Ld. DRT – II, Chennai as submitted by the Ld. Counsel for D9 Ms. Varsha Jain.

22. The only contention of the 1st defendant in their CPA is that the bank had not given due credits to the payments and that the documents executed by the D1were signed in blank. It is also contended that the D1 society had not executed the acknowledgement of debts. This witness further deposed that due to VRS opted by its members, the repayment of loans granted to its members by this society had affected the recovery and consequently the failure in discharging the debt of the applicant.

23. All these contentions deposed through its CPA does not call for any indulgence or appreciation for the following reasons.

a. The aspect of the limitation urged in the evidence of one Veeramani of the D1 society goes in to the oblivion in view of the same society having approached the applicant bank which had accorded the OTS vide its letter dated 24.03.2025 for a sum of Rs. 70 crores. Further, after considering the documentary evidence at exhibit A 23 letter of continuity dated 29.06.2013 and exhibit A - 47 dated 31.03.2016 and exhibit A – 78 dated 09.10.2018 consisting of and exhibit A -96 dated 17.10.2019, fresh DPN at exhibit A -97, letter of undertaking and promise at exhibit A – 98, DPN for the term loan – III and other documents at exhibit A – 94 to A – 106, the contention of the D1 company that the debt is barred by limitation cannot be accepted. It is more so in the context of the D1 Company having approached the bank for OTS which failed. The Ld. Counsel for the D1 does not dispute the OTS offer and its failure.

b. The contention of the deponent on behalf of D1 that the officials of the society have signed the blank papers cannot be accepted since the high officials who are the employees of BSNL who are the members and elected to the society of such employees are all educated and this defense is taken only to circumvent the situation. Therefore, this contention cannot be accepted.

c. The other contention is that the statement of accounts does not show the proper remittances made by the D1 company also falls to the ground since the D1 has not produced the remittance slips / Challans and had not even given the dates of such payments and the amounts. Therefore, this contention cannot be accepted.

24. This Tribunal has gone through the documentary evidence of the statement of accounts pertaining to term loans – I to VI produced at exhibits A – 111 to A – 116 and the certificate issued under Section 2(A) of Bankers book of evidence Act at Exhibit A – 117.

25. The statement of accounts produced at exhibit A -111 to A -116 is not disputed by the D1.

26. There is no recovery sought against the other defendants except D1.

27. After careful perusal of the documentary evidence and after considering the admissions found in the WS coupled with the subsequent developments noted above, the contention of the applicant bank that they are entitled of the recovery above sum as prayed for in the OA against D1 cannot be rejected. This Tribunal is of the considered opinion that the OA succeeds against D1. It is also made clear that the applicants have no securities except the books of accounts and receivables of D1 company as mentioned int eh OA. Consequently the following:

ORDER

The OA filed by the applicant bank is allowed. The D1 is directed to pay a sum of Rs.158,16,07,949.98p to the applicants bank along with interest at the rate of 9% per annum from the date of filing i.e., 18.12.2020 till realization along with the costs. It is also made clear that while enforcing the recovery by way of sale of any of immovable assets of the D1, the pari passu charge of the other defendant bank / lenders be also taken care and the proceeds be shared accordingly by the banks. An injunction against D1 restraining it from alienating any of its immovable assets lies till the recovery of the above sums. Any sums paid during the pendency of this OA be properly given deductions in the recovery. Recovery Certificate be issued accordingly only against D1. A copy of this order be communicated to all the parties concerned as per Rules.

Sd/-

(Dictated to Steno who typed in the system, corrected, signed and pronounced in open court on this 13thDay of November, 2025)

List Of Exhibits

S.No Particulars Exhibit

Letter of Authorization in favour of the signatory to the 1st applicant A1 06.02.2013 Board Resolution of 1st defendant for Term Loan I A2

09.02.2013 General Term Loan – I Agreement A3 Term loan – I Agreement (Hypothecation of movables) A4 Hypothecation (Book Debts) Agreement – Term Loan I A5 Agreement of rate of interest (For Base Rate) – Term loan I A6 Letter of continuity Ad – 09 – Term Loan I A7 DPN for Term Loan – I A8

Loan – I A9 11.02.2013 Scrutiny Report for vetting of documents A10 25.02.2013 1st defendant letter to 1st applicant bank A11 26.02.2013 1st defendant letter to 1st applicant bank w.r. to submitting NOC from other banks A12 01.03.2013 1st defendant letter to 1st applicant bank for disbursement of sanction loan A13 01.03.2013 1st defendant letter to 1st applicant bank A14 28.06.2013 Sanction letter for Term Loan II A15 28.06.20113 Board Resolution of 1st defendant for Term Loan II A16 28.06.2013 1st defendant letter to 1st applicant Bank wrt submitting NOC from the other banks A17 28.06.2013 1st defendant letter to 1st applicant bank agreeing to terms of sanction letter A18

29.06.2013 General Term Loan – II Agreement A19 Term Loan – II Agreement (Hypothecation of movables) A20

loan II A21 Agreement on rate of interest (For Base Rate) Term loan II A22 DPN for Term Loan II A23 Letter of continuity AD - 09 – Term Loan II A24 Undertaking letter for disclosure to CIBIL – Term Loan II A25 05.07.2013 1st Defendant letter to 1st applicant bank A26 06.07.2013 Scrutiny of Documents by Advocate A27 18.03.2014 Sanction of Term Loan III A28 20.03.2014 Board resolution of 1st Defendant for Term Loan III A29 20.03.2014 1st Defendant letter to 1st applicant bank wrt submitting NOC from other Banks A30

General Term loan - III Agreement A31

22.03.2014 Term Loan – III Agreement (Hypothecation of Movables) A32 Hypothecation (Book Debts) Agreement – Term Loan III A33 Agreement on rate of interest (For Base Rate) – Term Loan III A34 DPN for Term Loan III A35 Undertaking letter for disclosure to CIBIL – Term Loan III A36 22.03.2014 Debit Balance Confirmation and Acknowledgement A37 24.03.2014 Scrutiny of Documents by Advocate A38

29.06.2015 Board Resolution of 1st Defendant for Term Loan IV A39 General Term Loan – IV Agreement A40 Term Loan – IV Agreement (Hypothecation of Movables) A41

Loan IV A42 Agreement on rate of interest (For Base of Rate) – IV Term Loan A43 DPN for Term Loan IV A44 Undertaking letter of disclosure to CIBIL – Term Loan IV A45 29.06.2015 1st Defendant letter to 1st applicant bank A46

Debit Balance confirmation and acknowledgement A47 30.06.2015 Scrutiny of Documents by Advocate A48 30.09.2016 Central Bank of India – Letter ceding pari passu charge A49 04.10.2016 Inter office letter of 1st applicant bank recommendation letter A50 04.01.2017 1st applicant bank letter to central bank of India ceding of pari passu charge A51 04.01.2017 Inter office letter of 1st applicant bank recommendation letter A52 06.04.2017 1st applicant bank letter of ceding pari passu charge to banks A53 15.06.2017 Inter office letter of 1st applicant bank recommendation letter A54 30.06.2017 Inter office letter of 1st applicant bank issued by Chief Manager, Overseas Branch A55 30.06.2017 Inter office letter of 1st applicant bank A56 30.06.2017 Sanction letter for Term loan V A57

30.06.2017 Board Resolution of 1st defendant for Term Loan V A58 General Term Loan - V Agreement A59 Term Loan – V Agreement (Hypothecation of movables) A60 Hypothecation (Book Debts) Agreement - Term Loan V A61

Letter of confirmation of MCLR Loans A62 Agreement on rate of interest (For MCLR Loans) – Term Loan V A63 Letter of consent of 1st defendant stamped A64 DPN for Term loan V A65 Undertaking letter for disclosure to CIBIL – Term Loan V A66 30.06.2017 1st Defendant letter to 1st applicant bank wrt submitting NOC from other banks A67 30.06.2017 1st Defendant letter to 1st applicant bank undertaking for creating escrow account A68 30.06.2017

transfer of sums to DSRA a/Counsel A69 30.06.2017 1st defendant letter to 1st applicant bank for disbursement of loan A70 01.07.2017 Letter of 1st applicant bank ceding paripassu charge to banks A71 10.07.2017 Scrutiny of documents by Advocate A72 07.09.2018 Board Resolution of 1st defendant A73 07.09.2018 Letter of 1st defendant to chief GM of Telecom, TN Circle A74 09.10.2018 Debit balance confirmation and acknowledgement form term loans I - VI A75 09.10.2018 Sanction letter for Term Loan VI A76 10.10.2018 Board Resolution of 1st defendant for term Loan VI A77

General Term Loan – VI Agreement A78

Term Loan – VI Agreement (Hypothecation of Movables) A79

Loan VI A80

Agreement on rate of interest (For MCLR Loans) – Term Loan VI A81

DPN for Term Loan VI A82

Letter of continuity for DPN Term Loan VI A83

Letter of undertaking not to alienate hypothecated goods A84

Undertaking letter for disclosure to CIBIL – Term Loan VI A85

Letter of Lien (Deposits) A86 10.10.2018 1st defendant letter to 1st applicant bank undertaking A87 11.10.2018 Scrutiny of documents by Advocate A88 12.10.2018 Letter of 1st applicant bank to chief GM of Telecom TN Circle A89 15.10.2018 1st Defendant letter to 1st applicant wrt remittance to escrow a/Counsel A90

16.10.2018 Letter of 2nddefendant to 1st applicant bank A91 22.10.2018 Legal Audit Report by Advocate A92 26.06.2019 1st applicant letter to account officer, HCM payroll TN Telecom circle A93 17.10.2019 Letter of undertaking / fresh promise in cases of time barred debts – Term Loan I A94 17.10.2019 Fresh DPN(MCLR Linked) Term Loan I A95 17.10.2019 Letter of undertaking / fresh promise in cases of time barred debts – Term Loan II A96 17.10.2019 Fresh DPN(MCLR Linked) Term Loan II A97 17.10.2019 Letter of undertaking / fresh promise in cases of time barred debts – Term Loan III A98 17.10.2019 Fresh DPN(MCLR Linked) Term Loan III A99 17.10.2019 Letter of undertaking / fresh promise in cases of time barred debts – Term Loan IV A100 17.10.2019 Fresh DPN(MCLR Linked) Term Loan IV A101

Letter of continuity A102 17.10.2019 Letter of confirmation (For MCLR Loans) – Term Loan I & II A103 17.10.2019 Interest Agreement (For MCLR Loans) Term loan I & II A104 17.10.2019 Interest Agreement (For MCLR Loans) Term loan III & IV A105 17.10.2019 Letter of confirmation (For MCLR Loans) – Term Loan III & IV A 106 18.10.2019 Board Resolution of 1st defendant A107 13.11.2019

A108 02.12.2019 Recall letter to 1st defendant A109 18.12.2019 Demand notice of 1st applicant bank issued under S.13(2) to 1st defendant A110

Statement of accounts – TL-I A111

Statement of accounts – TL-II A112

Statement of accounts – TL-III A113

Statement of accounts – TL-IV A 114

Statement of accounts – TL-V A115

Statement of accounts – TL- VI A116

Certificate issued u/s 2A of the Bankers Book of Evidence Act A117

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SCHEDULE – A

(Book Debts and receivables)

As per receivables statement dt 11.03.2020 submitted as of December 2019, the Receivable / advances is Rs. 534.75 Crore under paripassu charge with member banks under multiple banking arrangement.

SCHEDULE – B

All the current assets of the 1st Defendant.

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