CANARA BANK vs M/S MARUTI LEATHERS REP BY ITS PROPRIETRIX MRS VANITHA K on 21 September 2026

: - FINAL ORDER- :

1. This Original Application is filed on 08.03.2022 by the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendants 1 to 3, jointly and severally for recovery of a total sum of Rs.1,03,41,907/- (Rupees One Crore Three Lakhs Forty One Thousand Nine Hundred and Seven only) with the following reliefs: i. To direct the defendants 1 to 3 pay a sum of Rs.88,62,088/- due in respect of OCC account (A/c No.0933261010272) together with further interest @ 11.50% p.a., with monthly rests from the date of Application till the date of realization in full; ii. To direct the defendants 1 and 2 pay a sum of Rs.3,69,328/- due in respect of WCTL-1 account (A/c No.0933746000011) together with further interest @16.35% p.a. with monthly rests from the date of Application till the date of realization in full; iii. To direct the defendants 1 and 2 pay a sum of Rs.6,40,405/- due in respect of WCTL-2 account (A/c No.0933746000012) together with further interest @16.35% p.a., with monthly rests from the date of Application till the date of realization in full; iv. To direct the defendants 1 and 2 pay a sum of Rs.4,70,086/- due in respect of CFITL account (A/c No.0933710000002) together with further interest @11.60% p.a., with monthly rests from the date of Application till the date of realization in full; for sale of OA schedule A mentioned hypothecated assets and schedule B mentioned immovable properties and for costs of this OA.

2. Originally, this Application was filed before DRT-II, Chennai, assigned OA No.186 of 2022, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.186 of 2022 stood transferred to this Tribunal and renumbered as TA No.769 of 2023.r Brief Facts of the case:

3. The Applicant submits that the application is filed within the period of limitation as prescribed under Section 24 of the Recovery of Debts and Bankruptcy Act, 1993, and the subject recovery claim falls within the jurisdiction of this Tribunal.

4. It is the case of the applicant bank that the 1st defendant is engaged in trading of finished leather works in the name, of M/s V.G.M. IMPEX wherein the 2nd defendant is the sole proprietrix and the 3rd defendant is the guarantor, 2nd defendant is the mortgagor.

5. It is submitted by the applicant bank that at the request of the 1st defendant by its application dated 20.02.2015, the applicant by its Sanction Letter dated 20.02.2015 sanctioned an OCC/ODBD loan of Rs.75,00,000/- to the 1st defendant for development of their leather business. The 1st defendant had availed the above loan on 26.03.2015 for a sum of Rs.75 lakhs for which the 2nd defendant had executed the following documents on 26.03.2015 as a proprietrix.

a) Request for overdraft facility

b) Letter for undertaking Re: loans/advances

c) Common hypothecation agreement

6. The applicant submits that to secure the above facility availed by the 1st defendant, the 3rd defendant had executed Guarantee Agreement and Guarantee Covering Letter dated 26.03.2015 by which the 3rd defendant stood as personal guarantee for the due repayment of the advances made to the 1st defendant together with all interests and costs.

7. The applicant further submits that as security for the advances made to the 1st defendant, the 2nd defendant on 30.03.2015, deposited with the applicant bank at Saidapet, the original title deeds relating to her properties morefully described in the schedule-B to the OA with an intent to create a mortgage as security for the advances made to the 1st defendant or to be made for all the loans availed by the defendant and confirmed the same on 30.3.2015 and Memorandum of Deposit of Title Deeds was registered on 30.3.2015 before Joint SRO-II, Dindigal by registered Doc. No. 1526/2015.

8. The applicant submits that the 1st defendant by its letter dated 07.07.2015 informed the applicant that they have changed the name of the first defendant firm as ‘MARUTI LEATHERS’ but the constitution of the firm remains the same and also enclosed the TNGST Certificate dated 02.07.2015 shows that the first defendant’s name is M/s MARUTI LEATHERS.

9. It is submitted by the applicant bank that at the request of the 1st defendant by its application dated 20.12.2016, the applicant had renewed the loan OCC/ODBD facility of Rs.75 lakhs to the 1st defendant on 17.12.2016 by its sanction letter. The 1st defendant has availed the above loan on 20.12.2016 for which the 1st defendant has executed Letter of Renewal on 20.12.2016.

10. The applicant submits that at the request of the 1st defendant by its Letter of Renewal dated 10.4.2018 the applicant by its sanction letter dated 10.04.2018 has renewed the loan OCC/ODBD facility of Rs.75 lakhs to the 1st defendant on 10.4.2018 for which the 1st defendant has executed the following documents on 10.04.2018 in favour of the applicant bank:

a) Acknowledgement of debt and security

b) Request for overdraft facility

c) Demand promissory note dated 10.4.2018 for Rs.75 lakhs promising to repay the amount together with interest thereon at 2.55% p.a. above/below the ongoing base rate(base rate at present being 10.95%) or at such other rates as may be revised by the bank from time to time compounded monthly/quarterly/half yearly/for value received.

d) Letter of undertaking Re-loans/advances

e) Cash credit agreement

11. It is submitted by the applicant bank that at the request of the first defendant by its application dated 05.08.2019, the applicant by its

Sanction Letter dated 08.08.2019 further renewed the above loan for the same amount. The 1st defendant has executed the following documents on 09.08.2019 for the renewal of the above loan:

a) Letter of renewal

b) Acknowledgement of Debt and Security

12. For the above renewal of the loan of Rs.75 lakhs, the 3rd defendant has also executed an acknowledgement of liability dated 09.08.2019 wherein he acknowledged his liabilities as a guarantor.

13. It is the further case of the applicant bank that at the request of the 1st defendant by its application dated 29.09.2019 for restructuring the loan, the applicant had restructured the loan under one time restructuring scheme for MSME sector for a Working Capital Term Loan-1 for a sum of Rs.3 lakhs on 29.09.2019 by its Sanction Letter. The 1st defendant had availed the same on 29.09.2019 executed the following documents on 29.09.2019 in favour of applicant bank:

a) Draft letter of undertaking from guarantors

b) Debt restructuring agreement

c) Debtor and creditor agreement

14. The applicant submits that at the request of the first defendant by its application dated 28.09.2019 for restructuring of the loan, the applicant had restructured the loan under one time restructuring scheme under MSME sector for Working Capital Term Loan-2 for a sum of Rs.5.6 lakhs on 29.09.2019 by its sanction letter. The 1st defendant had availed the same on 29.09.2019 and executed the following documents on

29.09.2019 in favour of applicant bank:

a) Draft letter of undertaking from guarantors

b) Debt restructuring agreement

c) Debtor and creditor agreement

15. The applicant submits that in accordance with COVID-19 regulatory package announced by RBI, interest accrued on CC/OPD for the period March to August 2020 was debited in the accounts. The accrued interest has been converted into FUNDED INTEREST TERM LOAN (FITL) carrying the same interest applicable to this facility and should be repayable at 6 monthly instalments. The applicant submits that the 1st defendant has sanctioned the FITL facility of Rs.4,70,086/- on 01.09.2020 under the above scheme to the 1st defendant and the same was accepted by the 1st defendant on 01.09.2020. The 1st defendant has availed the said loan on 01.09.2020.

16. It is submitted by the applicant bank that subsequent to availing of loan, the operation of the accounts by the defendants was very irregular and inspite of several requests, the defendants have not regularized the account. Till date the defendants have not cleared the outstanding. Consequently, the loan account became Non-Performing Asset (NPA) on 19.05.2021. The applicant also made demand to the defendants but there was no response. Finally, the applicant sent notice dated 25.05.2021 under Section 13(2) of the SARFAESI Act on 04.02.2022 and Possession Notice under Section 13(4) of the Act, but there was no response and payment.

17. In view of the default in the payment of the dues by the defendant as agreed upon in terms of the secured facilities aforesaid, the applicant is entitled to demand repayment from the defendant, the amount due as aforesaid and enforce the rights against the mortgaged properties described in Schedule A & B to the OA and cause the mortgaged property described in schedule B to be sold for recovery of the dues as aforesaid. Hence, the present Original Application (OA) has been filed by the applicant bank for recovery of its dues from the defendants.

18. After the filing of the OA, summons were sent to the Defendants 1 to 3 through Registered Post with Acknowledgment Due, which was served in respect of D-1 and D-2, while summons to D-3 returned with postal endorsement as ‘Left’. Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 13.09.2023 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 to 3 were placed ex-parte on 13.09.2023. Heard the submissions of Applicant Bank and perused the records.

19. To prove the case of the Applicant Bank, Sh.Kumar Gaurav, Chief Manager of the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW-1 and list of documents came to be marked as Ex A-1 to A-37.

20. A careful examination of the pleadings in the Proof Affidavit and documents Exhibits A-1 to A-37 evidence that the borrowal of credit facilities and execution of loan and security documents are true, in terms of averments made in Original Application as well as Proof Affidavit filed by applicant bank establishing its claim. Applicant bank filed Statement of Accounts duly certified under Bankers’ Book Evidence Act, evidencing the amount claimed against defendants.

21. The defendants were set ex-parte on 13.09.2023, but till this day they did not take any action to set aside the ex-parte order and did not choose to contest the claim. Further, a careful scrutiny of records makes it clear that present application is filed well within limitation and this Tribunal possesses necessary and proper jurisdiction to entertain and adjudicate the claim. No oral or documentary evidence on the side of defendants are produced or filed to dispute the claim of applicant bank. Hence, it can be concluded that applicant bank has proved its claim against defendants.

22. With regard to the amount advanced, the interest applied, the conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled for a final order on the following terms:

: O R D E R :

23. The OA is allowed with costs,

(a) The applicant bank is allowed to recover from the Defendants 1 to 3 jointly and severally, a total sum of Rs.1,03,41,907/-

(Rupees One Crore Three Lakhs Forty One Thousand Nine Hundred and Seven only) as follows: i. A sum of Rs.88,62,088/- due in respect of OCC account (A/c No.0933261010272) repayable by defendants 1 to 3, together with further interest @ 11.50% p.a., with monthly rests from the date of Application till the date of realization in full; ii. A sum of Rs.3,69,328/- due in respect of WCTL-1 account (A/c No.0933746000011) repayable by defendants 1 and 2 together with further interest @16.35% p.a. with monthly rests from the date of Application till the date of realization in full; iii. A sum of Rs.6,40,405/- due in respect of WCTL-2 account (A/c No.0933746000012) repayable by defendants 1 and 2 together with further interest @16.35% p.a., with monthly rests from the date of Application till the date of realization in full; iv. A sum of Rs.4,70,086/- due in respect of CFITL account (A/c No.0933710000002) repayable by defendants 1 and 2 together with further interest @11.60% p.a., with monthly rests from the date of Application till the date of realization in full along with costs of this OA.

(b) In the event of failure of the Defendants to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the hypothecated assets and immovable properties morefully detailed in Schedule A and B to the OA schedule.

(c) OA Schedule shall be appended to this final order.

(d) If the sale proceeds of the hypothecated assets and immovable properties are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the 2nd and 3rd Defendants (both movable and immovable) to recover the balance dues as required under law for which the 2nd and 3rd Defendants to disclose to the Tribunal particulars of other properties or assets owned by the Defendants 2 and 3.

(e) The applicant bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by Defendants to the applicant bank.

(f) The applicant bank shall file memo of costs within ten days from the date of receipt of this final order.

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

24. A copy of this order be communicated to the parties concerned.

Sd/- (S.V. GOWRAMMA)

PRESIDING OFFICER, DRT-III, CHENNAI

(Dictated to Roshnee, transcribed by her, corrected, signed and pronounced by me on this the 21st day of September, 2026) ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Sh. Kumar Gaurav, Chief Manager of the Applicant Bank Exhibits on the part of the Applicant:

Sl. No. Date Description of Documents Exhibit No.

1. 20.02.2015 Application by 1st defendant A-1

2. 20.02.2015 Sanction letter by applicant A-2

3. 26.03.2015 Request for OD facilities by 1st defendant A-3

4. 26.03.2015 Letter of undertaking Re: loans/advances A-4

5. 26.03.2015 Common hypothecation agreement A-5

6. 26.03.2015 Guarantee agreement by 3rd defendant. A-6

7. 26.03.2015 Guarantee covering letter by 3rd defendant A-7

8. 30.03.2015 MOD by 2nd defendant A-8

9. 07.07.2015 Letter by 1st defendant for change o firm A-9

10. 02.07.2015 TNGST change of name of the firm A-10

11. 20.12.2016 Application by 1st defendant A-11

12. 17.12.2016 Renewal of sanction A-12

20.12.2016 Letter of renewal A-13

14. 10.04.2018 Letter of renewal A-14

15. 10.04.2018 Sanction by applicant A-15

16. 10.04.2018 AOD By 1st defendant A-16

17. 10.04.2018 Request for OD facilities A-17

18. 10.04.2018 DPN for Rs.75 lakhs by 1st defendant A-18

19. 10.04.2018 Letter of undertaking Re: Loans/advances A-19

20. 10.04.2018 Cash credit agreement A-20

21. 05.08.2019 Loan application by 1st defendant A-21

22. 08.08.2019 Renewal sanction letter A-22

23. 09.08.2019 Letter of renewal A-23

24. 09.08.2019 AOD by first defendant A-24

25. 09.08.2019 AOD by third defendant A-25

26. 29.09.2019 Application for restructuring WCTL-1 for Rs.3 lakhs A-26

27. 29.09.2019 Draft letter of undertaking from guarantors A-27

28. 29.09.2019 Debt restructuring agreement A-28

29. 29.09.2019 Debtor and creditor agreement A-29

30. 28.09.2019 Application for restructuring WCTL-2 for Rs.5.6 lakhs A-30

31. 29.09.2019 Draft letter of undertaking from guarantors A-31

32. 29.09.2019 Debt restructuring agreement A-32

33. 29.09.2019 Debtor and creditor agreement A-33

34. 25.05.2021 13(2) SARFAESI notice by applicant A-34

35. 04.02.2022 13(4) SARFAESI notice by applicant A-35

36. - Certified statement of accounts A-36

37. 17.12.2014 Registered sale deed executed by POA Selvaraj in favour of Mrs.K.Vanitha Dod.No. 6970/2014 A-37

Witness Examined for the Defendants: -Nil- List of Documents Exhibited for the Defendants: -Nil –

:-SCHEDULE-A: All the hypothecated stocks of leather products and goods lying at the 1st defendant premises i.e.41/3 Ground floor, Periana Maistry street, Periamet, Chennai 600 003 or stored or to be stored in transit or wherever found or stored. :- SCHEDULE-B -: (Property belongs to Mrs.Vanitha, 3rd defendant) Description of the immovable property

In Dindigul district, Dindigul Joint-II Sub Registrar Office, Dindigul Taluk, Thottanathu Village Comprised in S.No ad the land measuring S.No. 155/1A- 1.44 Acres

S.No. 155/1B- 2.88 Acres

S.No. 154/12.03 Acres

S.No. 155/2-0.50 Acres

S.No. 155/2-1.87 Acres

S.No. 155 0.32 Acres

In total 9.04 Acres were divided into Plots under the name and style as V.P.R. Garden Within this

Item No.1

1. S.No. 154/2, the Plot No. 180 measuring 1200 sq.ft

2. S.No. 154/2, the Plot No. 181 measuring 1200 sq.ft

3. S.No. 154/2, the Plot No. 182 measuring 1200 sq.ft Boundaries (Plot nos. 180, 181 & 182)

North by: 20 feet road South by: Plot Nos. 187A, 189 & 190 East by: Plot No. 183 West by: Plot No. 178A Extend of lands Plot No. 180 measuring 1200 sq.ft East- West on both sides 30 ft West by: North on both sides 40 ft

Plot No. 181 measuring 1200 sq.ft East- West on both sides 30 ft West by: North on both sides 40 ft

Plot No. 182 measuring 1200 sq.ft

East- West on both sides 30 ft West by: North on both sides 40 ft

Item No.2

4. S.No. 154/1, 155/2, the Plot No. 186 measuring 800 sq.ft

5. S.No. 154/1, the Plot No. 187 measuring 1200 sq.ft

6. S.No. 154/1, the Plot No. 187A measuring 1200 sq.ft

7. S.No. 154/2, the Plot No. 189 measuring 1200 sq.ft Boundaries (Plot Nos. 186,187,187A & 189)

North by: Plot Nos. 181 to 184

South by: 20 feet road

East by: Plot No. 195 belongs to Temple

West by: Plot No. 190

Extend of lands Plot No. 186 measuring 800sq.ft

East- West on both sides 20 ft South – North on both sides 40 ft Plot No. 187 measuring 1200 sq.ft

East- West on both sides 20 ft South – North on both sides 40 ft Plot No. 187A measuring 1200 sq.ft East- West on both sides 30 ft South – North on both sides 40 ft Plot No. 189 measuring 1200 sq.ft East- West on both sides 30 ft South – North on both sides 40 ft Item No.3

8. S.No. 154/1, 154/2 the Plot No. 191 measuring 1929-1/4 Sq.ft

9. S.No. 154/1, 154/2 the Plot No. 192 measuring 1200Sq.ft

10. S.No. 154/1, 154/2 the Plot No. 193 measuring 1200Sq.ft

11. S.No. 154/1, 154/2, 155/2 the Plot No. 194 measuring 730 Sq.ft

12. S.No. 154/1, 154/2 the Plot No. 195A measuring 1806Sq.ft Boundaries (Plot Nos 191,192,193,194 & 195A)

North by: 20 Feet Road South by: Plot No.196, 196A, 198,199 & 200 East by: 20 Feet road West by: 20 Feet road Extent of lands Plot No. 191 measuring 1478-1/4+451=1929 ¼ sq.ft East- West on both sides 36 ft South – North on both sides 40 ft

= 1478 Y4 Sq.ft East- west on the northern side 22 ft

On the southern side 0 ft South-North on the eastern side- straight 41 ft On the Western sidelanting 42 ft

= 451 sq.ft Plot No. 192 measuring 1200 sq.ft

East West on both sides 30 ft South – North on both sides 40 ft Plot No. 193 measuring 1200 sq.ft East- West on both sides 30 ft South – North on both sides 40 ft Plot No. 194 measuring 730sq.ft East- West on Northern side 20 ft

On the southern side 16 ½ ft South – North on eastern side- 40 ft

On the western sidelanting 40ft Plot No.195A measuring 1806sq.ft East- West on Northern side 40 ft

On the southern side 44 ft South – North on eastern side- 43 ft

On the western sidelanting 43ft Item No.4

13. S.No. 154/2, 155/2 the Plot No. 196A measuring 1200Sq.ft

14. S.No. 154/2 the Plot No. 198 measuring 1200Sq.ft

15. S.No. 154/2 the Plot No. 199 measuring 1200Sq.ft

16. S.No. 154/2 the Plot No. 200 measuring 1190Sq.ft Boundaries (Plot No.196A 198, 199,200) North by: Plot No.191,192,193,194,195A South by: 20 Feet Road East by: Plot No. 196 West by: 20 Feet Road Extent of lands Plot No. 196A measuring 1200sq.ft

East- West on both sides 30 ft South – North on both sides 40 ft Plot No. 198 measuring 1200 sq.ft

East- West on both sides 30 ft South – North on both sides 40 ft Plot No. 199 measuring 1200 sq.ft East- West on both sides 30 ft South – North on both sides 40 ft

Plot No.200 measuring 1190 sq.ft (920+270=1190) East- west on the northern side 23 ft

On the Southern side 23 ft South- North on the eastern side-40ft

On the western sidelanting 40 ft

=920 Sq.ft East-West on the northern side 13 ½ ft

On the Southern side: 0ft South North on the Eastern side: 40ft

On the Western sidelanting 40 ¾ ft

= 270Sq.ft

Plot Nos.180, 181, 182, 186, 187, 187A, 189, 191, 192, 193, 194, 195A, 196A, 198, 199, 200 total measuring 19655 4 Sq.ft. The property lies within the jurisdiction of Office of Dindigul, Joint-II Sub Registrar Office.

Sd/- (S.V. GOWRAMMA)

PRESIDING OFFICER, DRT-III, CHENNAI