CANARA BANK vs M/S GAYATHRI INDUSTRIES on 24 June 2026

FINAL ORDER

1. The present Original Application in short (OA) has been filed under section 19 of Recovery of Debts and Bankruptcy Act 1993 seeking issuance of Recovery Certificate against the defendants for Rs. 1,10,21,616/- (Rupees One Crore Ten Lakh Twenty One Thousand Six Hundred Sixteen Only) with further interest thereon from the date of filing the Application till realization.

2. It is the case of the applicant that the defendant No. 1 is the Proprietary concern represented by its proprietor, rest of the defendants are the mortgagor and guarantors availed the following loan facilities:- I. OD Limit of Rs. 95 Lakhs originally sanctioned in 2013, enhanced on 27.07.2020. II. GECL Loan of Rs.5 Lakhs on 29.05.2020.

3. It is also the case of the applicant that, in view of the above availed loans, the defendant executed necessary loan documents along with Registered memorandum of Deposit of Title Deeds, Common Hypothecation agreement.

4. It is further contended that, despite availing the credit facilities, 3 TA -21/2023

agreeing to service the loan account promptly and regularly, the defendants failed in complying the same, resulting in default in repayment and consequentially turning the loan accounts as NPA.

5. In the above circumstances, the applicant approached this Tribunal by filing this OA seeking issuance of Recovery Certificate for the amount due in the account.

6. Despite, taking out summons the defendants failed to appear, resulting the defendants being set exparte on 04.08.2025.

7. The applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the OA and also produced Exhibits A-1 to A-37 and got the same marked in evidence.

8. Heard the Ld. Counsel for the Applicant and considered the contentions as taken in the OA in the light of documentary evidence and proof affidavit.

9. The following issues arise for consideration in this matter: i) Whether the applicant had succeeded in proving the OA claim as against the defendants? ii) What order are to be passed?

Both these issues are gone into and decided together.

10. The case put forth by the applicant in the Application remains 4 TA -21/2023

unrebutted as defendant remained exparte. The evidence tendered by the applicant remains uncontroverted and undisputed. The evidences put forth by the applicant were found admissible and are sufficient to prove availment of credit facilities as stated in the OA, creation of Mortgage and Hypothecation as claimed by the applicant bank and the defaults committed in the accounts. The liability of the defendants and the claim of the amount due are also proved by the above documents. The claim of the applicant is well within the limitation.

11. Hence in view of the findings arrived herein above, the Tribunal find both these issues in favour of applicant and hence, this Tribunal is of the view that OA is to be allowed.

12. Taking into consideration the facts that the credit facilities are availed for business purpose and also that the OA claim is arrived at by calculating interest at the agreed rate, this Tribunal in view of the OA can be allowed with a reduced interest of 10.00% (simple).

13. In the result, OA.No.21/2023, stands allowed,

i) The applicant is allowed to recovery an aggregate sum of Rs.1,10,21,616/- (Rupees One Crore Ten Lakh Twenty One Thousand Six Hundred Sixteen only) consisting of:

a. Rs.1,06,87,737 /- with further interest of 10.00% p.a.(simple) from 5 TA -21/2023

the date of filing OA till the realization from the defendant No. 1 to 5 in respect of OD A/c.

b. Rs.3,33,879/- with further interest of 10.00% p.a.(simple) from the date of filing OA till the realization from the defendant No.1 & 2 in respect of GECL A/c from the defendants jointly, severally and personally after giving credit to all the amount recovered and received during the pendency of the OA and allowed the same to be recovered by proceedings against the schedule property. Properties schedule to the OA be the schedule to the recovery certificate.

ii) If the sale proceeds are not found sufficient to cover the amount due and payable to the applicant bank, the defendants jointly, severally and personally and their assets are liable for the amounts due under the loan accounts.

iii) The applicant bank is allowed cost of the proceedings which applicant to file cost memo within 7 days from the date of receipt of the order.

iv) The Recovery Certificate to be drawn in terms of this order and transferred to Recovery for execution.

v) Interim application pending, if any, stands disposed of in terms of this final order.

14. Communicate a copy of the order to the parties concerned in terms 6 TA -21/2023

of Section 19(21)(i) of the RDB Act, read with Rule 16 of DRT (Procedure) Rules, 1993. [Dictated to the Stenographer (DV), transcribed by her, corrected and signed and pronounced by me in the Open Court, this the 24th Day of June, 2026].

Sd/- (T. RAJESH) PRESIDING OFFICER

ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: K Shiva Prasad, Manager of the applicant Bank Exhibits on the part of the Applicant:

Annexure Date List of Documents OD Limit of Rs. 95 Lakhs in A/c No. 0519261000905 originally sanctioned on 27.07.2020 A1 25.05.2013 Letter of Proprietorship A2 25.05.2013 Request for OD facilities A3 25.05.2013 Pronote A4 25.05.2013 Common hypothecation agreement The following documents were executed by 1st and 2nd defendants for renewal of the limit of Rs. 25 Lakhs in the years 2014 to 2019 A5 13.05.2014 Sanction of renewal A6 13.05.2014 Letter of renewal A7 13.05.2015 Sanction letter A8 13.05.2015 Letter of renewal A9 15.07.2016 Sanction letter A10 15.07.2016 Letter of renewal A11 15.07.2016 Sanction letter A12 15.07.2017 Letter of renewal A13 15.07.2017 Letter of renewal

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A14 24.08.2018 Sanction letter A15 24.08.2018 Letter of renewal A16 29.08.2019 Sanction letter Documents executed for enhancement of the OD limit from Rs. 25 Lakhs to Rs. 95 Lakhs A17 27.07.2020 Application form A18 27.07.2020 Sanction Memorandum A19 27.07.2020 Request for OD facilities A20 27.07.2020 Supplemental to the common hypothecation agreement A21 27.07.2020 Pronote A22 To A27 27.07.2020 Guarantee covering letters and guarantee agreement A28 27.07.2020 Letter of Renewal GECL Loan of Rs. 5 Lkahs Sanction on 29.05.2020 in A/c No. 0519755000001 A29 29.05.2020 Application for loan A30 29.05.2020 Sanction memorandum A31 & A32 29.05.2020 Pronote along with take delivery note A33 29.05.2020 Supplemental Common hypothecation agreement A34 & A35 07.06.2023 Legal Notice & Postal receipts A36 & A37 -- Statement of accounts

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

Sd/- (T. RAJESH) PRESIDING OFFICER

8 TA -21/2023