STATE BANK OF INDIA vs Shree Krishna Tex on 7 October 2026

: - FINAL ORDER- :

1. This Original Application is filed on 01.12.2021 by the applicant bank under Section 19(1) of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the Defendants 1 and 2, jointly and severally for recovery of a total sum of Rs.21,78,991/- (Rupees Twenty One Lakhs

Seventy Eight Thousand Nine Hundred and Ninety One only) due in respect of Cash Credit Facility (A/c No.38464021635) repayable together with further interest @ 9.85% p.a. with monthly rests from the date of Application till the date of realization in full and for costs of this OA.

2. Originally, this Application was filed before DRT-II, Chennai, assigned OA No.356 of 2022, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.356 of 2022 stood transferred to this Tribunal and renumbered as TA No.264 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 defendants have approached State bank of India, Broadway Branch, Chennai and sought for a loan for development of their business and submitted the loan application dated 02.05.2019.

5. It is submitted that the defendants have accepted all the terms and conditions of the applicant bank. Therefore, after scrutinizing the defendant’s application favourably, the applicant bank had sanctioned the Cash Credit to the limit of Rs.20,00,000/- subject to terms and conditions of the sanction.

6. The applicant submits that to secure the said loan account, the defendants executed the necessary loan documents on 22.05.2019 i.e. Letter of Arrangement and Agreement of Loan cum Hypothecation in favour of the applicant. The defendants agreed to repay the loan with interest @12.1% p.a. at monthly rests with incidental expenses, cost, charges etc. The interest rate will be subject to changes as per the RBI directives and as per the discretion of the bank from time to time.

7. The applicant submits that the Cash Credit facility has been sanctioned on 04.05.2019, which is available for 24 months from the date subject to review every 12 months, when it may be cancelled/reduced depending upon the conduct and utilisation of the advance or as per the bank’s scheme. The defendants submit that above loan is covered under CGFMU.

8. It is submitted by the applicant bank that subsequent to availing of loan, the defendants have failed to repay the above said loan amount. The operation and conduct of the accounts by the defendants were irregular and unsatisfactory. Consequently, the applicant bank had classified the defendant’s loan account as Non Performing Asset(NPA) on 28.06.2021 as they have become chronic defaulter in repayment of the loan. The applicant herein made several representations including demand/irregular notices issued to the defendants for the repayment of the outstanding loan amount. Inspite of efforts of the applicant, the defendants failed and neglected to clear the entire dues and regularize the loan account. The 2nd defendant visited the applicant bank on 21.08.2020 and assured to repay the entire outstanding along with interest, while so he executed the Revival Letter dated 21.08.2020 in favour of the applicant but he failed to comply his promise. Therefore, the applicant issued registered Legal Notice dated 15.08.2021 to the defendants and the said notice was returned.

9. The applicant submits that the defendants have failed to repay the principal and interest due under the loan account, consequently it has become NPA in the books of the applicant and the loan account is now maintained by State Bank of India, SME Centre, 5th floor, No.157 Anna salai, Chennai 600 002 for the purpose of maintenance, administration and recovery of loan on behalf of the Broadway Branch, Chennai which is the operative branch for repayment in terms of internal policy of the applicant.

10. The defendants have wilfully and wantonly neglected to repay the above said amount despite repeated requests and demands. Hence, the present Original Application (OA) has been filed by the applicant bank for recovery of its dues from the defendants.

11. After the filing of the OA, summons were sent to the Defendants 1 and 2 through Registered Post with Acknowledgment Due, which was returned unserved in respect of D-1 and D-2. Applicant Bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 07.12.2023 even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendants 1

and 2 were placed ex-parte on 07.12.2023. Heard the submissions of Applicant Bank and perused the records.

12. To prove the case of the Applicant Bank, Smt. M. Thamizhkodi, Manager of the Applicant Bank, filed 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-7.

13. A careful examination of the pleadings in the Proof Affidavit and documents Exhibits A-1 to A-7 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.

14. The defendants were set ex-parte on 07.12.2023, 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.

15. 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 :

16. The OA is allowed with costs,

(a) The applicant bank is allowed to recover from the Defendants 1 and 2 jointly and severally, a total sum of Rs.21,78,991/- (Rupees Twenty One Lakhs Seventy Eight Thousand Nine Hundred and Ninety One only) due in respect of Cash Credit Facility (A/c No.38464021635) repayable together with further interest @ 9.85% p.a. with monthly rests from the date of Application till the date of realization in full along with costs of this application.

(b) 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.

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

(d) Recovery Certificate shall be drawn up and issued to the

Recovery Officer in terms of the final order.

17. 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 07th day of October, 2026) ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Smt. M. Thamizhkodi, Manager of the Applicant Bank Exhibits on the part of the Applicant:

Sl. No. Date Description of Documents Exhibit No.

1. 15.02.2019 Loan application A-1

2. 22.05.2019 Letter of arrangement A-2

3. 22.05.2019 Agreement of loan cum hypothecation A-3

4. 21.08.2020 Revival letter A-4

5. 15.08.2021 Legal notice A-5

6. - Returned covers A-6

7. 12.11.2021 Statement of Accounts A-7

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

:-SCHEDULE-: -NIL-

Sd/-

(S.V. GOWRAMMA)

PRESIDING OFFICER, DRT-III, CHENNAI