HDFC BANK LIMITED vs Mr. K. Karupannaraja on 13 May 2026

FINAL ORDER

1. This application is filed by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 against the defendants’ seeking issuance of a Recovery Certificate for recovery of an aggregate sum of Rs.44,36,827.59p comprising a sum of Rs.9,72,193/- together with interest at the rate of 11% p.a. with monthly rests being the amount due under Cash Credit facility and a sum of Rs.34,64,634.59p together with interest at the rate of 12% p.a. with monthly interest being the amount due under Term Loan account from the date of the application till the date of realisation along with costs of the application and for sale of schedule mentioned properties.

2. The subject matter of the case is the credit facilities availed by the defendants from the Applicant Bank.

3. It is the case of the applicant that the defendant vide loan application dated 20.09.2016 approached the applicant bank for grant of Cash Credit Limit and Term Loan facility and the applicant considering the said request vide sanction letters dated 04.10.2016 sanctioned Cash Credit facility of Rs.7,00,000/- and Term Loan facility of Rs.22,70,000/-. The defendants executed the loan agreement on 05.10.2016. The loan amounts were disbursed to defendants 1 and 2 herein and the 3rd defendant stood as a guarantor to the facilities availed by defendants 1 and 2.

4. The 1st defendant deposited the title deeds of the schedule mentioned property with the applicant with an intention to create equitable mortgage over the same and confirmed the same by executing Memorandum of Deposit of Title deeds dated 19.10.2016 registered as Doc. No.4667 of 2016, SRO, Bodinyakanur.

5. It is also the case of the applicant that the borrowers were highly irregular in repayment and failed to regularize the loan account despite repeated demands and hence the loan account was classified as NPA. It is further stated that as the defendants did not come forward to clear the outstanding dues, the applicant issued legal notice on 16.08.2021 requesting the defendants to clear the outstanding dues but in vain. Hence the present application is filed for recovery of its dues.

6. Summons was taken out to the defendants are served. Though the defendants were represented by a Ld. Counsel no written statement is filed and as the defendants was also absent on 22.06.2023 and as there was no representation for the defendants on that day, they were set ex-parte on that day. Applicant Bank filed Proof Affidavit along with 12 documents, which were marked as Ex. A-1 to A-12 on 05.04.2024. The Ld. Counsel for Applicant Bank made his submissions on 20.03.2026 and thereafter the matter stood till this date for passing final orders.

7. The following issues arise for consideration in the matter: - (a) Whether the applicant had succeeded in proving the liability of the defendants?

(b) What order as to cost of the proceedings need be passed?

These issues are considered together.

8. Heard the Ld. Counsel for the applicant, perused the OA averments and the record placed before the Tribunal.

8. The evidence of the applicant is led by AW1 who produced the documents Exhibit A-1 to A-12 along with the proof affidavit. The documents produced in evidence are all found admissible. The proof affidavit of the applicant bank remained unchallenged and unrebutted. Therefore, on careful consideration of proof affidavit along with exhibits filed on behalf of the applicant bank, besides the material placed before the Tribunal, the Tribunal is satisfied that the applicant bank has successfully proved the OA claim against the defendants. Further, the statement of accounts in respect of the loan account produced and certified under the Banker’s

Book Evidence Act, clearly indicates that the amount claimed by the applicant is due from the defendants. It is clear from the statement of accounts that penal interest is not capitalized.

9. In view of the foregoing, it is clearly evident that the application filed by the applicant bank is well within the period of limitation and this Tribunal possesses the territorial and pecuniary jurisdiction to entertain this OA.

10. In view of the fact that the loan facility availed by the defendants is a Cash Credit facility and Term loan for its business and the applicant has claimed interest at contractual rate till the date of filing of the OA, this Tribunal is of the view that the pendente lite interest can be awarded at reduced rates.

11. In view of the afore mentioned discussions, the only conclusion this Tribunal can draw is that the applicant had clearly proved the disbursement of the loan, which the applicant is entitled to realize. Hence, OA is disposed off in the following manner: - (a) TA No.624 of 2023 stands allowed.

(b) Applicant is permitted to realize an aggregate sum of Rs.44,36,827.59p with further interest @9% per annum (simple) from the date of filing of the application till the date of realization in full, from the defendants jointly and severally after deducting all the amounts received / realized by them during the pendency of OA and also by selling the schedule property and other assets of the defendants.

(c) If the sale proceeds are not found sufficient to cover the amount due and payable to the Applicant Bank, the defendants are personally liable for all such amounts due as ordered above.

(d) Applicant is permitted to realize cost of the proceedings and shall file cost memo within 15 days from the date of receipt of the copy of the order.

(e) The Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of this final order.

12. Communicate a copy of the order to the parties concerned in terms of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993.

SD/-

(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 13th day of May, 2026)

EXHIBITS MARKED BY APPLICANT BANK S. No. Date Description of Documents Exhibit Nos.

1. 04.10.2016 Loan application A-1

2. 04.10.2016 Sanction letter for Cash Credit Facility A-2

S. No. Date Description of Documents Exhibit Nos.

3. 04.10.2016 Sanction letter for Term Loan facility A-3

4. 05.10.2016 Loan Agreement towards Loan Account No. 50200021692746. A-4

5. 05.10.2016 Loan Agreement towards Loan Account No.82224846 A-5

6. 19.10.2016 Memorandum of Deposit of Title deeds – Doc. No.4667 of 2016 A-6

7. 16,08.2021 Legal notice A-7

8. 21.08.2021 Proof of service of legal notice on 1st defendant A-8

9. 21.08.2021 Returned cover of the legal notice w.r.t. 2nd defendant. A-9

10. 21.08.2021 Proof of service of legal notice on 3rd defendant A-10

11. 13.08.2021 Statement of Accounts – A No.50200021692746 A-11

12. 16.08.2021 Statement of Account – A/c No.82224846 A-12

Sd/-

DESCRIPTION OF PROPERTY

Item No.1

Theni District, Periyakulam RD, Bodinayakanur Sub District Bodinayakanur North Hills, Mallipatti Pulam, in Zamin Pymash No.856, in Patta No.368, in comprised in Survey No.310, for the extent of 5 acre 19 cents out of 3 acre 60 cents totally out of 28 acre 65 cents of Coffee Estate along with Trees in the said land with

East

: Bothaimedu West

: Mallipatti River and land in Survey No.310/part South : Coffee Estate belonged to Sethuraman North

: Land belongs to S V Ramasamy Chettiar

Item No.2

Theni District, Periyakulam RD, Bodinayakanur Sub District Bodinayakanur North Hills, Mallipatti Pulam, in Zamin Pymash No.856, in Patta No.368, in comprised in Survey No.310, for the extent of 8 acre 44 cents out of 28 acre 65 cents of Coffee Estate along with Trees in the said land with East : Bothaimedu West

: Bothaimedu South

: Coffee Estate belonged to Sakthivel and Arunachalam North : Estate belonged to Ramasamy Chettiar and Sakthivel & others.

For the total extent of 2 items measured 13 acres 63 cents of coffee estate land.

Sd/-