CANARA BANK vs Ms Kanva Fashions Limited on 2 February 2024

: - O R D E R - :

This Original Application for recovery is filed before DRT-II Bangalore, which is transferred to this Tribunal vide Government Notification S.O.No.4717(E) dated 04.10.2022 issued by the Ministry of Finance. The same was received and the 1st date of hearing before this Tribunal is 22.11.2022. This Tribunal directed the Registry to intimate the Counsel on record about the next date of hearing. Thereafter the applicant banks, which entered appearance through their counsel, had caused private notice. The notice was served on Defendant No.5 and the notice against Defendant No.2 came back as “unclaimed” and the others with a remark “having left”. DRT-II at Bangalore vide its Order sheet dated 08.10.2021 noted that the Defendants 1 to 3, D6 and D8 to D11 were placed exparte on 08.10.2021 and the Defendants 4, 5 & 7 were placed exparte on 09.02.2021. The notices were addressed by this Tribunal to comply with the principles of natural justice and the defendants did not evince any interest in this matter.

1.0 Facts of the Case:-

1.1 The Applicants namely the Canara Bank and the Bank of Baroda (erstwhile Vijaya Bank) have filed the present Original Application for recovery of a total sum of

Rs.113,45,55,104/- as on 30.04.2020 against all the defendants and seeks recovery of the same jointly and severally. The First Applicant Bank seeks recovery of Rs.84,83,44,542/- and the 2nd Applicant Bank prays for recovery of Rs.28,62,10,562/- along with different rates of interest.

1.2 It is pleaded that the 1st Defendant Company with its Directors who are Defendants 2 to 4 herein are engaged in the business of Readymade Garments, etc. Defendants 2 to 7 are the personal guarantors. Defendants 8 & 9 are the Corporate guarantors. Defendants 2, 5 & 9 along with the 1st Defendant are the mortgagors with the 1st Applicant Bank. Defendants, 2 to 4 are the personal guarantors to the 2nd Applicant Bank and Defendants 10 & 11 are the Corporate Guarantors with the 2nd Applicant Bank. Defendants 2 & 11 had mortgaged certain properties with the 2nd Applicant Bank.

1.3 It is also pleaded that D1 Company requested the Applicants which are under a bank consortium to extend working capital facilities to it for a sum of Rs.74.00 Crores (Applicant No.1 Bank Rs.49 Crores and the Other Bank Rs.25 Crores).

1.4 Apart from this outside the consortium, Canara Bank had extended the term loan facilities and vehicle loans at the request of the Defendant No.1 Company, for which a request was made by the Defendant No.1 Company vide its resolution dated 06.08.2010, which the Applicant No.1 sanctioned Rs.4.35 Crores vide sanction letter dated 12.08.2010, for which the promissory note, and hypothecation agreement dated 12.08.2010 is executed. Further, it is pleaded that D1 Company requested for enhancement for OCC Limit of Rs.4.35 Crores to Rs.8.00 Crores, which the Applicant No.1 Bank permitted vide sanction letter dated 23.08.2011.

1.5 Considering all this, the Defendant No.1 Company had executed a promissory note for Rs.85 Lakhs dated 09.06.2011 agreeing to pay the interest and a supplement hypothecation agreement was also executed on the same day. It has also executed a promissory note for a sum of Rs.2.80 Crores dated 25.08.2011 agreeing to pay the interest with the supplement common hypothecation agreement was executed. A letter of renewal dated 25.08.2011 is also executed.

1.6 It is pleaded that the Defendant No.9 Company stood as a corporate guarantee for a limit of Rs.10.89 Crores towards the loans/overdrafts on 25.08.2011.

1.7 It is also pleaded that D1 Company had sought for further enhancement of the working capital limit of Rs.15 Crores which was sanctioned vide letter 02.06.2012, for which a promissory note of Rs.7.00 Crore dated 22.06.2012 and a common hypothecation agreement, renewal letter of the same date were executed.

1.8 It is the case of the applicants that Defendant No.9 had further executed a corporate guarantee dated 22.06.2012 to the extent of Rs.27.89 Crore which is supported by the Board Resolution of D9. The Applicants also stated that at the request Defendant No.1 Company, the Applicant No.1 Bank had further sanctioned renewal of the existing OCC Limit of Rs.15.00 Crore and a fresh term loan of Rs.6.00 Crore for establishment of show rooms, purchase of vehicles as per the sanction letter dated 20.12.2013, for which the supplemental common hypothecation agreement and letter of renewal dated 03.01.2014 is executed by D1 supported by the corporate guarantee executed by D9 to the limit of Rs.33.89 Crores. This corporate guarantee is dated 03.01.2014.

1.9 It is further pleaded that in the year 2014, the sister concern of Defendant No.1 namely M/s. Kanvas Sri Sai Fabrics merged with the Defendant No.1 Company and accordingly a fresh term loan of Rs.10.50 Crores and a fresh OCC Limit of Rs.3.50 Crores was sanctioned vide letter dated 09.07.2014, for which the documents were executed on 09.07.2014.

1.10 It is also pleaded that at the request of Defendant No.1 Company the applicant No.1 Bank along with the then State Bank of Mysore (which exited) from the consortium had both sanctioned the working capital limit at Rs.45 Crores vide letter dated 12.03.2015. The details are the amount sanctioned by Canara Bank is Rs.29 Crores and State Bank of Mysore is Rs.16 Crores.

1.11 It is also their case that Canara Bank sanctioned outside the consortium a sum of Rs.5.00 Crores a fresh term loan, for which the documents like supplemental and amendatory agreement dated 31.03.2015 and a supplement joint deed of hypothecation of the same day were executed. It is also averred that Defendant No.9 Company executed a guarantee deed dated 31.03.2015 to a sum of Rs.81.89 Crores. It is pleaded that adverting to the request of Defendant No.1 Company the Canara Bank vide letter dated 30.06.2016 had renewed the working capital to Rs.49.00 Crores from Rs.29.00 Crores. It has also sanctioned vide letter dated 30.06.2016 a sum of Rs.22.50 Crores outside the consortium for setting up of new garment manufacturing unit. The documents dated 29.06.2016 executed by Defendant No.1 are the promissory note for Rs.20 Crores, supplemental common agreement and letter of renewal. This transaction is again supported by the Corporate Guarantee dated 29.06.2016 executed by Defendant No.9 to the extent of Rs.105.89 Crores.

1.12 It is the case of the applicants that Defendants 2 to 7 have executed the guarantee deeds dated 30.06.2016, guaranteeing the repayment to the extent of Rs.105.89 Crores.

1.13 It is further submitted that both the applicant Banks under a consortium had sanctioned the working capital of a total sum of Rs.74.00 Crores vide the sanction letter dated 10.01.2019, for which the letter of renewal of the same day is executed by the Defendant No1 Company and Defendants 2 to 6 executed the guarantee extension letters to the tune of Rs.105.89 Crores. The Defendant No.8 Company executed a corporate guarantee for this sum of Rs.105.89 Crores vide corporate guarantee dated 02.05.2018.

1.14 The applicants further state the vehicle loan of Rs.11.50 Lakhs was sanctioned on 10.08.2015 wherein the Defendant had executed the agreement dated 28.07.2015 and further hypothecated the vehicle bearing No.KA-41-MA-3249 and the hypothecation is shown in the RC. The Applicant No.1 Bank had further sanctioned Rs.13.50 Lakhs outside

the consortium for purchase of a Car on 26.04.2016, for which hypothecation agreement was executed on 29.04.2016 concerning the vehicle bearing No. KA-02-ML 4564, which is noted in the AC on 05.05.2016. Similarly a sum of Rs.88,92,265/- was sanctioned for purchase of new four vehicles for which agreement dated 30.06.2016 is executed by the Defendant No.1 Company. It is pleaded that seven vehicles are hypothecated for which documents are produced.

1.15 It is alleged that Defendants 2 & 5 had executed a memorandum of deposit of title deeds, registered on 15.02.2013 before the Sub-Registrar, Nelamangala concerning two landed properties. Defendant No.1 Company had also created equitable mortgage in respect of the landed property situated at Neelakantapuram village, Madathasi Mandal, Anantapur District by depositing the title deeds on 29.06.2016.

1.16 It is also alleged that Defendants 1 & 9 Companies along with Defendants 2 & 5 have created equitable mortgage with the Applicant No.1 on several properties for which the Registered document dated 29.06.2016 is relied upon by the applicant banks.

1.17 It is also their case that the defendant No.2 had similarly executed equitable mortgage dated 28.06.2016 and the title deeds are with the applicant Bank No.1 on 29.06.2016. It is pleaded that D1 Company has thus executed the revival letters in respect of OCC Account which are dated 22.06.2012, 03.01.2014, 29.06.2016 and 10.01.2019. The revival letter dated 05.01.2016 is concerning the term loan of Rs.10.50 Crore and Rs.6.00 Crores. The other revival letters for definite sums are 13.04.2018, which are two in numbers concerning the term loans and vehicle loans and further revival letter dated 03.01.2019.

1.18 It is specifically pleaded that the Defendant No.1 Company had failed and neglected to pay the above loan accounts of applicant No.1 Bank which was constrained to declare it as a Non Performing Asset on 31.07.2019. It demanded the payment of Rs.79,21,33,516/- as on 09.12.2019 for which the demand notice was issued on the same date under Section 13(2) of SARFAESI Act.

2.0 The case of the Applicant No.2 Bank.

2.1 The applicant No.2 Bank sanctioned working capital limits of Rs.25.00 Crores vide communication dated 21.09.2016, for which the promissory note was executed on the same day along with letter of repayment, loan agreement and hypothecation deed. To secure these loans, the Defendant No.2 & 11 have created a mortgage by way of deposit of title deeds dated 21.09.2016 in respect of certain properties, which document is registered before the Senior Sub-Registrar, Koratagere. The letter of guarantee to this transaction was executed by Defendants 2 & 3 dated 22.09.2016 and Defendant No.11 had executed a corporate guarantee on the same day. The defendant No.1 had executed supplemental working capital agreement dated 09.06.2017 along with supplemental joint deed of hypothecation.

2.2 The inter-se agreement between the applicants is also entered on 09.06.2017. The applicant Bank No.2 renewed the working capital vide its letter dated 30.06.2018 for which supplemental agreement is executed by Defendant No.1. The Defendants 2 & 3 have confirmed the balance dated 30.06.2018, reaffirming the execution of letters of guarantee dated 22.09.2016. Likewise Defendant No.11 issued a letter of confirmation of balance to this transaction. This working capital was further renewed on 26.03.2019, for which supplementary agreement was executed by Defendant No.1 and Defendants 2 to 4 have executed the letter of guarantee on 26.03.2019. The Defendant No.1 executed the corporate guarantee for this transaction through the deed dated 26.03.2019.

2.3 It is the case of the 2nd applicant that the Defendant No.1 executed the acknowledgement of liability dated 29.06.2018 and 26.03.2019, which is also acknowledged by the defendants 2 to 4 and further separately by Defendant No.11 who is a corporate guarantor.

2.4 It is alleged by the 2nd applicant that due to the non servicing of the loan, this account was classified as NPA on 28.02.2019 and demand notice dated 25.11.2019 is issued for the balance of Rs.26,96,62,258/- as on 18.11.2019.

2.5 Thus both the applicants submit that the defendants are liable to pay the applicant banks a total sum of Rs.113,45,55,104/- under 11 different heads of accounts. It is also pleaded that the applicants are eligible to claim the interest payable on these different accounts at different rates as pleaded. Thus the applicants pray for a recovery certificate.

3.0 As noted earlier and at the cost of repetition, it is necessary to note that this Original Application for recovery is filed before DRT-II Bangalore, which is transferred to this Tribunal vide Government Notification SO No.4717(E) dated 04.10.2022 issued by the Ministry of Finance. The same was received and the 1st date of hearing before this Tribunal is 22.11.2022. This Tribunal directed the Registry to intimate the Counsel on record about the next date of hearing. Thereafter the applicant banks, which entered appearance through their counsel, had caused private notice. The notice was served on Defendant No.5 and the notice against Defendant No.2 came back as “unclaimed” and the others with a remark “having left”. DRT-II at Bangalore vide its Order sheet dated 08.10.2021 noted that the Defendants 1 to 3, D6 and D8 to D11 were placed exparte on 08.10.2021 and the Defendants 4, 5 & 7 were placed exparte on 09.02.2021. The notices were addressed by this Tribunal to comply with the principles of natural justice and the defendants did not evince any interest in this matter.

3.1 The defendants having remained exparte, the Ld. Predecessor i.e. the DRT-II Bengaluru had examined two witnesses on behalf of the applicants. One Ms.Saraswathi, the Manager of the 1st Applicant Bank from ARM-1 Branch had filed her affidavit and marked certain documents from Exh. A1 to Exh.A77, which includes Exh.A1 being the affidavit and list of documents at Exh.A2.

3.2 The Applicant No.2 examined by filing of affidavit of AW2 Shri. C.Nagabhushana, Senior Manager of ZOSAR Branch, Bangalore, who exhibited documents as Exh. A3 to A27.

4.0 After transfer of this matter to this Tribunal, the matter is heard from the side of the applicants through the Ld. Counsel Shri. M.L. Ganesh. He had also filed the written arguments. Perused the pleadings the evidence by way of affidavit and the documents marked during the evidence. After hearing the Ld. Counsel for the applicant banks, the only point that arises for consideration before this Tribunal is:- ‚Whether the applicants are entitled for the Recovery Certificate as prayed for in the application and if so to what relief?‛

5.0 Claim of Applicant No.1 Bank:-

5.1 The Applicant No.1 Bank namely the Canara Bank seeks recovery of a sum of Rs.84,83,44,542/-, the details are:-

(i) Rs.59,88,25,761/- (Rupees Fifty Nine Crore Eighty Eight Only) under the OCC Account No. 0445261005259 with Canara Bank (Consortium Account)

(ii) Rs.2,59,97,372/- (Rupees Two Crore Fifty Nine Lakh Ninety Seven Thousand Three Hundred and Seventy Two Only) under the Term Loan Account No. 0445773007997 with Canara Bank (Non Consortium Account).

(iii) Rs.2,01,39,523/- (Rupees Two Crore One Lakh Thirty Nine Thousand Five Hundred and Twenty Three Only) under the Term Loan Account No. 0445773008004 with Canara Bank (Non Consortium Account)

(iv) Rs.3,13,19,704/- (Rupees Three Crore Thirteen Lakh Nineteen Thousand Seven Hundred and Four Only) under the Term Loan Account No. 0445773008015 with Canara Bank (Non Consortium Account),

(v) Rs.16,82,00,226/- (Rupees Sixteen Crore Eighty Two Lakh Two Hundred and Twenty Six Only) under the Term Loan Account No. 0445773008019 with Canara Bank (Non Consortium Account).

(vi) Rs.6,57,926/- (Rupees Six Lakh Fifty Seven Thousand Nine Hundred and Twenty Six Only) under the Term Loan Account No. 0445768000130 with Canara Bank (Non Consortium Account).

(vii) Rs.6,98,538/- (Rupees Six Lakh Ninety Eight Thousand Five Hundred and Thirty Eight Only) under the Term Loan Account No. 0445603008287 with Canara Bank (Non Consortium Account).

(viii) Rs.25,05,492/- (Rupees Twenty Five Lakh Five Thousand Four Hundred and Ninety Two Only) under the Term Loan Account No. 0445603008307 with Canara Bank (Non Consortium Account) together with interest, charges, costs etc., thereon.

5.2 To substantiate their case, Applicant No.1 Bank has examined Ms. S.K.Saraswathi, Manager of ARM-1 Branch, before the Ld. Predecessor. She has relied on Exhibits A3 to A77. After perusal of the documents, the case of the Applicant No.1 Bank to the claim is supported by the documentary evidence. AW1’s testimony with regard to the documents and particularly the letters of revival establishes the claim and the defendants did not participate in the proceedings nor there is any evidence to disbelieve the case of AW1. Therefore this Tribunal has no hesitation to hold that the Applicant No.1 Bank is entitled for recovery of the above sum.

5.3 The Applicant No.1 Bank namely the Canara Bank seeks recovery of a sum of Rs.84,83,44,542/-, the details are:-

(i) Rs.59,88,25,761/- (Rupees Fifty Nine Crore Eighty Eight Only) under the OCC Account No. 0445261005259 with Canara Bank (Consortium Account)

(ii) Rs.2,59,97,372/- (Rupees Two Crore Fifty Nine Lakh Ninety Seven Thousand Three Hundred and Seventy Two Only) under the Term Loan Account No. 0445773007997 with Canara Bank (Non Consortium Account).

(iii) Rs.2,01,39,523/- (Rupees Two Crore One Lakh Thirty Nine Thousand Five Hundred and Twenty Three Only) under the Term Loan Account No. 0445773008004 with Canara Bank (Non Consortium Account)

(iv) Rs.3,13,19,704/- (Rupees Three Crore Thirteen Lakh Nineteen Thousand Seven Hundred and Four Only) under the Term Loan Account No. 0445773008015 with Canara Bank (Non Consortium Account),

(v) Rs.16,82,00,226/- (Rupees Sixteen Crore Eighty Two Lakh Two Hundred and Twenty Six Only) under the Term Loan Account No. 0445773008019 with Canara Bank (Non Consortium Account).

(vi) Rs.6,57,926/- (Rupees Six Lakh Fifty Seven Thousand Nine Hundred and Twenty Six Only) under the Term Loan Account No. 0445768000130 with Canara Bank (Non Consortium Account).

(vii) Rs.6,98,538/- (Rupees Six Lakh Ninety Eight Thousand Five Hundred and Thirty Eight Only) under the Term Loan Account No. 0445603008287 with Canara Bank (Non Consortium Account).

(viii) Rs.25,05,492/- (Rupees Twenty Five Lakh Five Thousand Four Hundred and Ninety Two Only) under the Term Loan Account No. 0445603008307 with Canara Bank (Non Consortium Account) together with interest, charges, costs etc., thereon.

6.0 Case of the Applicant Bank No.2:-

6.1 The Applicant Bank No.2 is for recovery of Rs.28,62,10,562/-. The 2nd Applicant has examined one Mr.Nagabhushana as AW2 who is the Senior Manager of ZOSAR Branch. He deposited to the facts and that the erstwhile Vijaya Bank, now merged into Bank of Baroda, has extended various credit facilities and the Defendants have availed the same. He has also relied on documentary evidence at A32 and A28. The say of AW2 also goes unrebutted.

7.0 The Ld. Counsel for the applicant banks had submitted in the written arguments that the defendants neglected to service the interest and failed to pay the outstanding loan amounts and their accounts were classified as NPA on 28.02.2019. The Banks have also issued demand notices, which were not heeded to. He also submits that the charge on the movable assets and the mortgage of the immovable properties are also registered

with the Registrar of Companies. He argues that the statement of accounts produced with the application is strictly in accordance with the Banks book evidence Act, which is also marked as AW1/A77 and Exh. AW2/A28. Therefore, it is argued that the applicants are entitled for the reliefs and the applicants are also entitled to sell the movable and immovable properties as per the schedule.

8.0 Having given careful thought to the pleadings, the evidence available on record including the documentary evidence, this Tribunal does not find any reason to decline the relief of recovery of the above sums in favour of the Applicant Banks.

9.0 As far as the rates of interest concerning the period of litigation and the future interest, it is to be noted that the general recession and the economic slowdown occurred during the Covid 19 Pandemic, which affected the industrial activity and the commercial viability. The matter was fixed for applicant’s evidence by 07.01.2022 and thereafter evidence was concluded by 22.04.2022. The matter was fixed for final arguments by 28.06.2022 and thereafter the transfer of the OA owning to the notification occurred and evidence was closed on 08.03.2023. While dictating the final orders, this Tribunal had noted certain errors in the cause title and description in Defendant No.1 Company and the amendment to the OA was allowed by this Tribunal on 26.10.2023 in IA No.197/2023 and thereafter the amended OA is filed. Keeping in view of the progression of the case, thought the Defendants remained exparte, this Tribunal is of the view that the rate of interest during the pendency and post decree is ordered at @9% p.a. In view of the above, the following reliefs are ordered.

10.0 Relief:-

10.0 The claim of the Applicant Banks are allowed with costs as follows:- 10.1 The Applicant Banks are entitled to recover a total sum of Rs.113,45,55,104/- as on 30.04.2020 against all the defendants jointly and severally. (The share of the First Applicant Bank shall be Rs.84,83,44,542/- and that of the 2nd Applicant Bank is Rs.28,62,10,562/-. The defendants are directed to pay the above sums within one month after the receipt of this final order along with the interest @9% p.a. from the date of filing of this OA till date of realisation.

10.2 It is further hereby ordered that the banks would be at liberty to recover the aforesaid amount by proceeding against the schedule mentioned properties of the Defendants as per the mortgages executed to recover the whole amount along with the costs. In case of any balance to be recovered adjusting such sale proceeds, the Defendants named shall be held personal liable to such balance dues if any. 10.3 It is also ordered that any amounts remitted or realized, if any, during the course of the proceedings, shall be given due credit to the loan account of the defendants. 11.0 The applicants are directed to file costs memo within two weeks of the receipt of this order.

12.0 Issue recovery certificate in favour of the applicants in terms of this final order, which indicates the separate schedules of the movable and immovable properties hypothecated / mortgaged with the respective applicant banks.

13.0 Communicate a copy of the order to the parties concerned in terms of Rule 16 read with Rule 2(c) of DRT (Procedure) Rules, 1993.

Sd/-

(Dictated to PS on the system corrected, signed and pronounced by me on this 2nd Day of February, 2024)

Annexure:-

1. List of Exhibits marked by Applicants

2. Detailed Schedule of Movable and Immovable Properties.

Exhibits marked by Applicant Bank No.1:- Sl. No. Description of Documents Exhibit No.

Board Resolution of M/s Kanva Fashions Ltd. Dated 06.08.2010 A3

2. Sanction Communication Letter dated 12.08.2010 A4

3. Demand Promissory Note for Rs.4.35 Crore dated 12.08.2010 A5

4. Request for OD facilities dated 12.08.2010 A6

5. Common Hypothecation Agreement dated 12.08.2010 A7

6. Sanction Letter dated 23.08.2011 Demand Promissory Note for Rs.85 Lakhs A8

7. Demand Promissory Note for Rs.85 Lakh dated 09.06.2011 along with Link

A9

8. Supplemental Common Hypothecation Agreement dated 09.06.2011 A10

9. Demand Promissory Note for Rs.2.80 Crores dated 25.08.2011 along with Link Letter dated 25.08.2011 A11

10. Supplemental Common Hypothecation Agreement dated 25.08.2011 A12

11. Letter of Renewal dated 25.08.2011 A13

Corporate Guarantee executed by M/s Kanva Developers Ltd., dated 25.08.2011 A14

13. Board Resolution of M/s Kanva Fashions Ltd., Dated 01.06.2012 A15

Sanction Letter dated 02.06.2012 A16

Demand Promissory Note for Rs.7 Crore dated 22.06.2012 along with Link Letter dated 22.06.2012 A17

Supplemental Common Hypothecation Agreement dated 22.06.2012 A18

A19

Corporate Guarantee executed by M/s Kanva Developers dated 22.06.2012 A20

Sanction Letter dated 20.12.2013 A21

Supplemental Common Hypothecation Agreement dated 03.01.2014 A22

A23

Corporate Guarantee executed by M/s Kanva Developers dated 03.01.2014 A24

Permission Letter dated 09.07.2014 with Sanction Letter dated 08.01.2013 along with Sanction Letter dated 08.01.2013 A25

Common Hypothecation Agreement dated 26.02.2013 A26

Supplemental Common Hypothecation Agreement dated 09.07.2014 A27

Sanction Letter dated 12.03.2015 A28

Supplemental & Amendatory Agreement dated 31.03.2015 A29

Supplemental Joint Deed of Hypothecation dated 31.03.2015 A30

Corporate Guarantee executed by M/s Kanva Developers dated 31.03.2015 A31

Sanction Letter dated 30.06.2016 A32

Demand Promissory Note for Rs.20 Crore dated 29.06.2016 along with Link Letter dated 29.06.2016 A33

Supplemental Common Hypothecation Agreement dated 29.06.2016 A34

A35

Corporate Guarantee executed by M/s Kanva Developers dated 29.06.2016 A36

Personal Guarantee executed by Defendant No. 2 dated 30.06.2016 A37

Personal Guarantee executed by Defendant No. 3 dated 30.06.2016 A38

Personal Guarantee executed by Defendant No. 4 dated 30.06.2016 A39

Personal Guarantee executed by Defendant No. 5 dated 30.06.2016 A40

Personal Guarantee executed by Defendant No. 6 dated 30.06.2016 A41

Personal Guarantee executed by Defendant No.7 dated 30.06.2016 A42

Sanction Letter dated 10.01.2019 A43

A44

Guarantee Extension Letter executed by Defendant No. 2 dated 10.01.2019 A45

Guarantee Extension Letter executed by Defendant No. 3 dated 10.01.2019 A46

Guarantee Extension Letter executed by Defendant No.4 dated 10.01.2019 A47

Guarantee Extension Letter executed by Defendant No. 5 dated 10.01.2019 A48

Guarantee Extension Letter executed by Defendant No. 6 dated 10.01.2019 A49

Corporate Guarantee executed by M/s Kanva Star Resorts dated 02.05.2019 A50

Sanction Communication Letter of Canara Vehicle Loan (sanctioned on 28.07.2017) dated 10.08.2015 A51

Can Mobile Agreement dated 28.07.2015 A52

Letter of Undertaking dated 28.07.2015 A53

Sanction Letter dated 26.04.2016 A54

Hypothecation Agreement re: Vehicles dated 29.04.2016 A55

Letter of Undertaking dated 29.4.2016 A56

Sanction Letter dated 30.06.2016 along with amended Sanction Letter dated 31.12.2016 A57

Can Mobile Loan Agreement dated 30.06.2016 A58

Memorandum of Deposit of Title Deeds dated 15.02.2013 A59

Letter Evidencing Deposit of Title Deeds Dated 29.06.2016. A60

Letter Evidencing Deposit of Title Deeds Dated 29.06.2016. A61

Letter of Revival in respect of OCC Account dated 22.06.2012 A62

Letter of Revival in respect of OCC Account dated 03.01.2014 A63

Letter of Revival in respect of OCC Account dated 29.06.2016 A64

Letter of Revival in respect of OCC Account dated 10.01.2019 A65

Letter of Revival in respect of Term Loans (Rs.10.50 Crore and Rs.6 Crore) dated 05.01.2016 A66

Letter of Revival in respect of Term Loans (Rs.5 Crore ,Rs.22.50 Crore and Rs.1.20 Crore) dated 13.04.2018 A67

Letter of Revival in respect of Vehicle Loans (Rs.11.50 Lakh and Rs.13.50 Lakh) dated 13.04.2018 A68

Letter of Revival in respect of Term Loans (Rs.10.50 Crore and Rs.6 Crore) dated 03.01.2019 A69

Copy of the statement of account certified under Bankers’ Book of Evidence Act., showing the outstanding liabilities under OD/OCC Account No.0445261005259 with Canara Bank A70

Copy of the statement of account certified under Bankers’ Book of Evidence Act.,showing the outstanding liabilities under Term Loan Account No.0445773007997 with Canara Bank A71

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under Term Loan Account No.0445773008004 with Canara Bank A72

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under Term Loan Account No.0445773008015 with Canara Bank A73

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under Term Loan Account No.0445773008019 with Canara Bank A74

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under Term Loan Account No.0445768000130 with Canara Bank A75

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under Vehicle Loan Account No.0445603008287 with Canara Bank A76

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under Vehicle Loan Account No.0445603008307 with Canara Bank A77

Exhibits marked by Applicant Bank No.2:- Sl. No. Description of Documents Exhibit No.

Sanction Letter dated 21.09.2016 A3

2. Demand Promissory Note for Rs.25 Crore dated 22.09.2016 A4

3. Letter of Repayment dated 22.09.2016 A5

4. Loan Agreement cum Hypothecation Deed Dated 22.09.2016 A6

5. Memorandum of Deposit of Title Deeds dated 21.09.2016 A7

6. Letter of Guarantee executed by Defendant No.2 dated 22.09.2016 A8

7. Letter of Guarantee executed by Defendant No.3 dated 22.09.2016 A9

8. Corporate Guarantee executed by M/s. Kanva Garments Pvt. Ltd dated 22.09.2016 A10

9. Sanction Letter dated 30.06.2018 A11

10. Supplementary Agreement executed by Defendant No.1 Company in favour of Applicant No.2 Bank dated 30.06.2018 A12

11. Letter of Confirmation of Balance executed by Defendant No.2 & 3 dated 30.06.2018 A13

Letter of Confirmation of Balance executed by Defendant No.11 – M/s.Kanva Garments dated 30.06.2018 A14

13. Board Resolution of Defendant No.1 Company dated 20.03.2019 A15

Sanction Communication Letter dated 26.03.2019 A16

Supplementary Agreement executed by Defendant No.1 Company in favour of Applicant No.2 Bank dated 26.03.2019 A17

Letter of Guarantee executed by Defendant No.2 dated 26.03.2019 A18

Letter of Guarantee executed by Defendant No.3 dated 26.03.2019 A19

Letter of Guarantee executed by Defendant No.4 dated 26.03.2019 A20

Corporate Guarantee executed by M/s. Kanva Mart Ltd dated 26.03.2019 along with copy of Board Resolution dated 20.03.2019 A21

Acknowledgement of Liability executed by Defendant No.1 Company dated 29.06.2018 A22

Acknowledgement of Liability executed by Defendant No.1 Company dated 26.03.2019 A23

Acknowledgement of Liability executed by Defendant No.2, 3 & 4 dated 26.03.2019 A24

Acknowledgement of Liability executed by M/s. Kanva Garments Pvt. Ltd. Dated 26.03.2019 A25

Demand Notice issued to Borrower by Applicant No.2 Bank dated 25.11.2019 A26

Demand Notice issued to Guarantors by Applicant No.2 Bank dated 25.11.2019 A27

Copy of the statement of account certified under Bankers’ Book of Evidence Act, showing the outstanding liabilities under OCC Account No.1578062110000017 with Bank of Baroda. A28

Sd/-

DETAILED SCHEDULE OF MOVABLE AND IMMOVABLE PROPERTIES

SCHEDULE 'A'

DESCRIPTION OF THE HYPOTHECATED ASSETS OF DEFENDANT NO. 1 COMPANY VIZ: CURRENT ASSETS-STOCK, BOOK DEBTS ETC., FIRST CHARGE PARIPASSU WITH APPLICANT BANK NO.1 (CANARA BANK) & APPLICANT BANK NO.2(BANK OF BARODA)

The Whole of the Current Assets of the Defendant No.1 Company, viz., Stocks of Raw materials, Stocks in Process, Semi-Finished and Finished Good, Bills Receivables, Book Debts, both present and future, whether now lying loose or in cases or which are now lying or stored in or about or shall hereinafter from time to time during the continuance of the security of these presents be brought into or upon be stored or be in or about of the Defendant's factories, premises and godowns wherever else the same may be or be held by any party to the order or disposition of the Defendant or in the course of transit or on high seas or on order or delivery, howsoever and wheresoever’s in the possession of the Defendant No.1 Company.

SCHEDULE-'B'

DESCRIPTION OF THE HYPOTHECATED ASSETS OF DEFENDANT NO. 1 COMPANY VIZ: PLANT & MACHINERY, EQUIPMENTS ETC HYPOTHECATED TO APPLICANT BANK NO.1-CANARA BANK

i) Plant and Machineries, decorations, Furniture and Fixture, Software, Computers, Office equipments, Electrical Fittings etc in Sy. No.1, Kongenahallii Village, Kasaba hobli, Koratagere Taluk, Tumkur District.

ii) Plant and Machineries, Electrical equipments of Garment Manufacturing unit at Sy. No.200, Neelakantpuram village, Madakasira Mandal, Ananthapura Dist, Andhra pradesh State

SCHEDULE-‘C’ DETAIL OF 10 VEHICLES HYPOTHECATED TO APPLICANT BANK NO.1-CANARA BANK

NO.1

Type of Vehicle LMV CAR-L.M.V (CAR) Year of Vehicle

Make of Vehicle TATA MOTORS LTD., Model of Vehicle Safari EX 4*2 2.2L DICOR Vehicle VIN/ Serial Number - Registration Number KAMIMA3249 Engine Number 22LDICOR09GUYJ08673 Chassis Number MATA03725FNG04103

NO.2

Type of Vehicle 5 DOOR SEDAN CAR Year of Vehicle

Make of Vehicle HYUNDAI MOTORS INDIA LTD., Model of Vehicle CRETA 1.6 CRDI SX+ Vehicle VIN/ Serial Number - Registration Number KA02ML4564 Engine Number D4FBGM077836 Chassis Number MALC381ULGM096532

NO.3

Type of Vehicle SALOON Year of Vehicle

Make of Vehicle SKODA AUTO INDIA LTD., Model of Vehicle RAPID STYLE PLUS AT 1.5TDICR Vehicle VIN/ Serial Number - Registration Number KA04MR8490 Engine Number CWX134630 Chassis Number TMBBUENA3GG013323

NO.4

Type of Vehicle SALOON Year of Vehicle

Make of Vehicle RANAULT NISSAN AUTO I P LTD., Model of Vehicle RENAULT DUSTER 4x4 RXZ DCI Vehicle VIN/ Serial Number - Registration Number KA04MR8544 Engine Number K9KR856D051629 Chassis Number MEEHSRCFNG6000620

NO.5

Type of Vehicle SALOON Year of Vehicle

Make of Vehicle MAHINDRA AND MAHINDRA LTD., Model of Vehicle XUV500 R FWD W10 AT Vehicle VIN/ Serial Number - Registration Number KA51MJ3249 Engine Number SPG4B22834 Chassis Number MAIYU2SPVG6C18199

NO.6

Type of Vehicle 5 DOOR SEDAN CAR Year of Vehicle

Make of Vehicle HYUNDAI MOTORS INDIA LTD Model of Vehicle 120 ACTIVE VTVT S Vehicle VIN/ Serial Number - Registration Number KA02ML6402 Engine Number G4LAGM057121 Chassis Number MALBM51BLGM259102

NO.7

Type of Vehicle LMVCAR-L.M.V.(CAR) Year of Vehicle

Make of Vehicle HYUNDAI MOTORS INDIA LTD Model of Vehicle EON SPORTZ BSIV Vehicle VIN/ Serial Number - Registration Number KA02ML6378 Engine Number G3HAGM413036 Chassis Number MALA351ALGM453403

NO.8

Type of Vehicle LMVCAR-L.M.V.(CAR) Year of Vehicle

Make of Vehicle HYUNDAI MOTORS INDIA LTD Model of Vehicle I 10 SPORTZ 1.1L Vehicle VIN/ Serial Number - Registration Number KA02ML6405 Engine Number G4HGGM936033 Chassis Number MALAM51BLGM681612

NO.9

Type of Vehicle 5 DOOR SEDAN CAR Year of Vehicle

Make of Vehicle HYUNDAI MOTORS INDIA LTD Model of Vehicle I20 MAGNA VTVT Vehicle VIN/ Serial Number - Registration Number KA02ML6418 Engine Number G4LAGM77432 Chassis Number MALBM51BLGM266328

NO.10

Type of Vehicle MOTOR CAR (LMV) Year of Vehicle

Make of Vehicle MARUTI SUZUKI INDIA LTD Model of Vehicle SWIFT VXI BSIV Vehicle VIN/ Serial Number - Registration Number KA51MJ5857 Engine Number K12MN18***2 Chassis Number MA33KHKD1S00B****3

SCHEDULE-‘D’

IMMOVABLE PROPERTIES MORTGAGED TO THE APPLICANT BANK NO.1 – CANARA BANK

DETAILS OF IMMOVABLE PROEPRTIES BELONGING TO DEFENDANT NO.1 COMPANY

– M/S KANVA FASHIONS LTD MORTGAGED TO THE APPLICANT BANK NO.1– CANARA BANK PROEPRTY NO.1

All that piece and parcel of Commercial converted Land measuring 34 Guntas (37206 sq.ft) under Sy.No.1/3 situated at Sheshagiri Rao Palaya, DasanapuraHobli, Bangalore North Taluk and bounded by EAST: PROPERTY OF SRI NANJUNDAIAH WEST: PROPERTY OF BYRAPPA NORTH: PROPERTY OF CHIKKALINGAIAH SOUTH: PROPERTY OF DODDA REVANNA

All that piece and parcel of Building & Land measuring 20 acres 2.08 guntas under New Sy No.7/1 situated at Kongenahalli Village, KasabaHobli, KoratagereTaluk, Tumkur Dist and bounded by:

EAST: PROPERTY IN Sy No. 19,20,21,22 &23 WEST: PROPERTY IN Sy No. 4 &10 NORTH: PROPERTY IN Sy No. 5 SOUTH: PROPERTY IN Sy No. 7/2 & ROAD

PROPERTY NO.3

All that piece and parcel of Garment Manufacturing Unit factory building and Land measuring 10 acres 4 cents under Sy No. 200 situated at Neelakantpuram village, Madakasira Mandal, Ananthapura Dist, Andhrapradesh State and bounded by:

EAST: PROPERTY OF B NARASINHA MURTHY WEST: PROPERTY OF GANGADHAR NORTH: GOVT ROAD SOUTH: PROPERTY OF SMT OBAMMA

DETAILS OF IMMOVABLE PROPERTIES BELONGING TO DEFENDANT NO. 9 COMPANY-M/S. KANVA DEVELOPERS MORTGAGED TO THE APPLICANT BANK NO. 1-CANARA BANK

PROPERTY NO.1

All that piece and parcel of Industrial Land measuring 36 Guntas under Sy No. 34/81(old No.34) and 26 Guntas under Sy No. 34/82(old No. 34) totally 1 acre 22 guntas situated at Ramapalya Village, Dasanapura Hobli, Bangalore North Taluk and bounded by EAST: PROPERTY OF UJJINAPPA WEST: PROPERTY OF STEPHEN NORTH: BOUNDARY OF HUSKUR & ROAD SOUTH: PROPERTY OF MAYARANI IN Sy No. 96

All that piece and parcel of Commercial Office Unit at 1st Floor, measuring 1800 sq.ft, undivided share in total land measuring 5400 sq ft at Site No.861,Kanva Sri Sai Complex, Opp. Modi Hospital, West of Chord Road, 2nd Stage, Rajaji Nagar, Bangalore- 560086 and bounded by:

EAST : SITE No. 860 WEST : SITE No. 862 NORTH: 80 FT MODI HOSPITAL ROAD SOUTH: 12TH CROSS ROAD, RESIDENTIAL AREA

DETAILS OF IMMOVABLE PROPERTIES BELONGING TO DEFENDANT NO.2- SRI NANJUNDAIAH MORTGAGED TO THE APPLICANT BANK NO. 1-CANARA BANK

All that piece and parcel of Residential converted Land measuring 10 Guntas under Sy No. 66/1 situated at Mallapura Village, Kasaba Hobli, Nelemangala Taluk, Bangalore Rural District and bounded by

EAST : LAND OF VENDORS WEST : PROPERTY OF MAZARAHI NORTH: PROPERTY OF RAFEEQ AHMED SOUTH: PROPERTY OF MANJUNATH

PROPERTY NO.2

All that piece and parcel of Vacant Land measuring 2 acres 30 Guntas in Sy No.96/2 situated at Mallapura village, Kasaba Hobli, Nelemangala Taluk, Bangalore Rural District and bounded by EAST: Remaining Property of Sy No.96 WEST: Property of others NORTH: Property of Thipperamaiah SOUTH: Property of Venkataramaiah

Residential vacant Land at Sy.No.60/1 measuring 2 acres and 7gutas, Sy.No.60/3 measuring

7. guntas, Sy No.65/2 measuring 26 guntas situated at Mallapura village, Arisinakunte Grama Panchayat, Kasaba Hobli, Nelemangala Taluk, Bangalore Rural District and bounded by Sy.No.60/1 measuring 2 acres and 7guntas, EAST: Property of Shanbagh N Nagappa WEST: Property of Sampayya S/o Giriyappa NORTH: Kodihalli and Prop of Appaiah SOUTH: Old Kunigal Road and Prop. Of Gowdaiah

Sy.No 60/3 measuring 7guntas

EAST: Prop of Yellappa WEST: Prop of Rangaiah NORTH: Prop of Sy.No.65/2 SOUTH: Prop of Sy No.60/2

Sy No.65/2 measuring 26 guntas, EAST: Prop of Yellappa WEST: Prop of Rangaiah NORTH: Kodi Valley SOUTH: Prop of Sy No.60/2

DETAILS OF IMMOVABLE PROPERTIES BELONGING TO DEFENDANT NO. 5- SMT. PRAVEENA MORTGAGED TO TH APPLICANT BANK NO. 1-CANARA BANK

PROPERTY NO.1 All that piece and parcel of Vacant Land measuring 3 acres 6 Guntas Sy No. 94/1 situated at Mallapura village,Kasaba Hobli, Kasaba Hobli,Nelemangala Taluk, Bangalore Rural District and bounded by EAST: Sy No. 84 WEST: Sy No. 98 & 92 NORTH: REMAINING LAND IN SAME PROPERTY SOUTH: Sy No. 93

All that piece and parcel of Residential converted Land measuring 34 Guntas (37026 sq.ft) under Sy No. 84/2 situated at Hulegondana Village Dasanapura Hobli, Bangalore North Taluk and bounded by EAST: PROPERTY OF M MUNIYAPPA & ROAD WEST: PROPERTY OF VENKATAPPA NORTH: PROPERTY OF MUNIYAPPA & ROAD SOUTH: GOVT ROAD

SCHEDULE-'E' IMMOVABLE PROPERTIES MORTGAGED TO THE APPLICANT BANK NO. 2- BANK OF BARODA DETAILS OF IMMOVABLE PROPERTIES BELONGING TO DEFENDANT NO.2- SRI.NANJUNDAIAH MORTGAGED TO THE APPLICANT BANK NO.2- BANK OF BARODA. PROPERTY NO-1 All that piece and parcel of converted dry land measuring 5 acres 21 guntas under Sy No.28 situated at Chigarenahalli Village Kasaba Hobli, Koratagere Taluk,Tumkur Dist and bounded by EAST: PROPERTY OF SIRAJ AHMED SHERIFF WEST: PROPERTY OF CHANDRASHEKHAR

NORTH: PROPERTY OF NARASIMHAIAH & LAKSHMAIAH SOUTH: PROPERTY OF MUDDAIAH & RAMAIAH

PROPERTY NO.2

All that piece and parcel of converted dry Land measuring 4 acres 00 Guntas under Sy No.31/1 New Sy No.31/3 situated at Chigarenahalli Village KasabaHobli,Koratagere Taluk,Tumkur Dist and bounded by EAST: PROPERTY OF CHANDRASHEKHAR WEST: PROPERTY OF PRAVEEN & SHAMIULLA NORTH: PROPERTY OF DASTAGIR SAB SOUTH: PROPERTY OF BIBI JAN

All that piece and parcel of converted dry Land measuring 3 acres 39 Guntas and 1 acre 12 Guntas of Kharab under Sy No.32/1 New Sy No.32/5 situated at Chigarenahalli Village, KasabaHobli, Koratagere Taluk, Tumkur Dist and bounded by EAST: PROPERTY OF CHANDRASHEKHAR & DASTAGIR WEST: PROPERTY OF LAKSMAMMA & MADHANLAL NORTH: PROPERTY OF NYAMADABEARAHALLI SOUTH: PROPERTY OF NAGARANGAIAH & PRAVEEN

PROPERTY NO.4A

All that piece and parcel of converted dry Land measuring 1 acres 8 Guntas under Sy No. 61/2A situated at Hanchihalli Village, Kasaba Hobli, Koratagere Taluk,Tumkur Dist and bounded by:

EAST: BORDER OF MADAVARA CHIG ARAHALLI WEST: ROAD NORTH: PROPERTY OF SAMPANGIRAMAIAH SOUTH: PROPERTY OF NARASIYAPPA

PROPERTY NO.4B

All that piece and parcel of converted dry Land measuring 2 acres 18 Guntas under Sy No. 61/2A new Sy No. 61/7 situated at Hanchihalli Village, Kasaba Hobli, Koratagere Taluk, Tumkur Dist and bounded by:

EAST: BORDER OF MADAVARA CHIGARANAHALLI WEST: ROAD NORTH: PROPERTY OF DODDAIAH SOUTH: PROPERTY OF VINOD CHAND

PROPERTY NO.4C

All that piece and parcel of converted land measuring 1 acres 9 Guntas under Sy No. 61/2A new Sy No. 61/8 situated at Hanchihalli Village, Kasaba Hobli, Koratagere Taluk,Tumkur Dist in the name of Sri Nanjundaiah and bounded by:

EAST: BORDER OF MADAVARA CHIG ARAHALLI WEST: ROAD NORTH: PROPERTY OF DODDAIAH SOUTH: PROPERTY OF VINOD CHAND

DETAILS OF IMMOVABLE PROPERTIES BELONGING TO DEFENDANT NO. 11 COMPANY-M/S. KANVA GARMENTS PVT LTD MORTGAGED TO THE APPLICANT BANK NO. 2- BANK OF BARODA

All that piece and parcel of converted Land measuring 21 acres 29 guntas and 4 acres 13 guntas kharab under Sy No. 4 new Sy No 4/1 situated at Kongenahalli Ihalli Village, Kasaba Hobli, Koratagere Taluk, Tumkur Dist and bounded by:

EAST: PROPERTY OF RE Sy No. 5&7 WEST: PROPERTY OF RE Sy No. 3 NORTH: PROPERTY OF RE Sy No. 4/2 SOUTH: PROPERTY OF RE Sy No. 7 Sd/-