CANARA BANK vs M/S P G MERCANTILE PRIVATE LIMITED on 30 September 2026

: - FINAL ORDER- :

1. This Original Application is filed on 30.07.2019 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.2,95,25,590/- (Rupees Two Crores Ninety Five Lakhs Twenty Five Thousand Five Hundred and Ninety only) due in respect of Term Loan (A/c No.1283773013306) repayable together with further interest @ 12.15% p.a. with monthly rests from the date of Application till the date of realization in full, for sale of immovable property morefully detailed in schedule to the OA and for costs of this OA.

2. Originally, this Application was filed before DRT-II, Chennai, assigned OA No.807 of 2019, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No. 807

of 2019 stood transferred to this Tribunal and renumbered as TA No.934 of 2023. 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 represented by its Director had approached the applicant bank for sanction of Term Loan on 23.08.2010 and on request of defendants, the bank had sanctioned the Term Loan facility to the tune of Rs.8.57 crores for setting up Wind Mill for Generation of Power comprising 1 WTG of 2.00MW with a total project cost of Rs.12.25 crores in A/c No. 1283773013306 with interest at rate of 13.00% p.a. with monthly rests.

5. The applicant bank submits that in order to secure the loan, the defendants executed the following loan and security documents in favour of the applicant bank:

a) Demand promissory note executed by defendants in favour of bank for Rs.8,57,00,000/- on 09.06.2011

b) A letter evidencing the deposit of title deeds executed by 1st defendant in favour of bank for Rs.8,57,00,000/- on 09.06.2011

c) Common hypothecation agreement dated 9.6.2011 executed by 1st defendant represented by its directors in favour of bank d) Guarantee agreement dated 9.6.2011 were executed by 2nd and 3rd defendant in favour of bank

e) Sub ordination agreements dated 9.6.2011 was executed by 1st defendant represented by its directors in favour of bank

f) Acknowledgement of debt and security for Rs.6,64,17,500/- executed by the defendants in favour of bank dated 4.6.2014. Acknowledgement of debt and security for Rs.4,11,79,171.25/- was executed in favour of bank.

6. It is submitted by the applicant bank that in order to secure the Term Loan availed by the defendants, the 1st defendant represented by its Directors have mortgaged the immovable property as primary security held in its name vide Document No.2550 of 2010 dated 03.08.2010 morefully detailed in the schedule to the OA. The 1st defendant had purchased the said specific portion of the property measuring 81R from T.S. Wind Power and the 1st defendant’s name is registered as Doc. No.2550 of 2010 dated 03.08.2019 in Sub Registrar Office, Khatav (Vaduj), Maharashtra and recorded by M.E. no.260 dated 05.08.2010. The 1st defendant had created Equitable Mortgage for the above said property.

7. The applicant bank submits that in order to further secure the Term Loan facility, the borrowers have executed two Common Hypothecation Agreements dated 09.06.2011 i.e., one Wind Energy Generator (Kenersys make K-82, 2MW vehicles including accessories and implements) as primary security.

8. It is submitted by the applicant bank that the interest payable on the loan availed by the defendants on the outstanding amount in respect of Term Loan have been revised from time to time in accordance with the direction of the RBI. Since the amount outstanding in the credit facilities account has become overdue, the defendants are liable to pay penal interest at the rate of 2% p.a. The interest / compound interest has been charged at such rates and capitalised at such periodical rates as are permitted and do not run against the directives of Reserve Bank of India.

9. The applicant bank submits that subsequent to availing of loan, the 1st defendant represented by its Directors, 2nd and 3rd defendants have failed to respond to the reminders, personal contacts and repeated demands made by the applicant bank. The defendants are liable to pay 2% additional interest chargeable for default in making repayment till the date of realization along with costs due to the applicant bank. Consequently, the applicant bank had classified the borrower’s account as Non-Performing Asset (NPA) on 11.6.2019. The defendants are jointly and severally liable to pay a sum of Rs.2,95,25,590.87/- which is rounded off to Rs.2,95,25,590/- as on 01.07.2019. Despite repeated requests and demands, as defendants did not come forward to repay the dues, the present Original Application (OA) has been filed by the applicant bank for recovery of its dues from the defendants.

10. 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 to D-3. No representation from Defendants.

Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 26.10.2021 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1 to 3 were placed ex-parte on 26.10.2021. Heard the submissions of Applicant Bank and perused the records.

11. To prove the case of the Applicant Bank, Smt. Khushpoo Sharma, Senior 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-15.

12. A careful examination of the pleadings in the Proof Affidavit and documents Exhibits A-1 to A-15 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.

13. The defendants were set ex-parte on 26.10.2021, 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.

14. 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 :

15. The OA is allowed with costs,

(a) The applicant bank is allowed to recover from the Defendants 1 to 3 jointly and severally, a sum of Rs.2,95,25,590/- (Rupees Two Crore Ninety Five Lakhs Twenty Five Thousand and Five Hundred and Ninety only) due in respect of Term Loan (A/c No.1283773013306) repayable together with further interest @ 12.15% p.a. with monthly rests from the date of Application till the date of realization in full along with costs of this application.

(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 immovable property and hypothecated assets morefully detailed in the OA schedule.

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

(d) If the sale proceeds of the immovable property and hypothecated assets are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the Defendants (both movable and immovable) to recover the

balance dues as required under law for which the Defendants to disclose to the Tribunal particulars of other properties or assets owned by the Defendants.

(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.

16. 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 30th day of September, 2026) ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Smt. Khushpoo Sharma, Senior Manager of the Applicant Bank

Exhibits on the part of the Applicant:

Sl. No. Date Description of Documents Exhibit No.

1. 23.08.2010 Application form request for term loan facility A-1

2. 21.05.2011 Sanction note A-2

3. 09.06.2011 Promissory note executed by defendants A-3

4. 09.06.2011 Common hypothecation agreement executed by defendants A-4

5. 09.06.2011 Sub ordination agreement executed by defendants A-5

6. 09.06.2011 Term loan agreement executed by defendants A-6

7. 09.06.2011 Guarantee agreement with covering letter executed by defendants A-7

8. 04.06.2014 Acknowledgement of debt and security executed by defendants A-8

9. 25.05.2017 Acknowledgement of debt and security executed by defendants A-9

10. 25.05.2011 Board resolution A-10

11. 02.06.2014 Board resolution A-11

12. 03.08.2010 Sale deed registered under Sr. No. 2550 of 2010 dated 03.08.2010 A-12

13. 09.06.2011 Letter evidencing deposit of title deeds by defendants A-13

14. 22.07.2019 Legal notice issued to the defendants A-14

15. 01.07.2019 Statement of account along with certificate of bankers book of Evidence act A-15

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

:-SCHEDULE OF IMMOVABLE PROPERTY-:

All that piece and parcel of land bearing Gat No. 487, total area admeasuring 24 H 39R, Pot Kharab 1H.53R i.e. 25 H.92 R, out of this area 0 H.81 R and bounded as: On and towards east: Gat No.487 On and towards South: Gat No.487

On and towards West: Village Boundary of Arvi On and towards North: Gat No. 488 Located at/post-Village Landewadi, Tal- Kahtav, District Satara (Maharashtra state) standing in the name of P.G. Mercantile Pvt. Ltd, Mumbai. The 1st defendant had purchased the said the specific portion property measuring 81R from T.S. Wind power and the 1st defendant’s name is registered as Doc. No. 2551 of 2010 dated 03.08.2010 in Sub registrar office, Khatav (Vaduj), Maharashtra state and recorded by M.E. No. 260 dated 05.08.2010. SCHEDULE OF PRIMARY SECURITY

One Wind energy Generator (Kenersys make K-82, 2MW Vehicles) including accessories and implements as primary security, Village- Landewadi, Khatar Taluk, Satara District.

Sd/- (S.V. GOWRAMMA)

PRESIDING OFFICER, DRT-III, CHENNAI