DHANALAKSHMI BANK vs M/S.A B GOLD P LTD & OTHER(BANGALORE) on 6 October 2025

FINAL ORDER

1. The Application was filed before the Debts Recovery Tribunal-I, Bengaluru on 07.07.2015 Under Section 19 (1) of the Recovery of Debt And Bankruptcy Act, 1993 and numbered as OA No. 276/2015, seeking for issuance of a Recovery Certificate for Rs. 10,79,23,612/- (Rupees ten crores seventy-nine lakhs twenty-three thousand six hundred and twelve only). Subsequently, owing to bifurcation of jurisdiction vide Government of India Gazette Notification dated 30.01.2017, the Application (OA No. 276/2015) was transferred from Debts Recovery Tribunal -I, Bangalore to this Tribunal and renumbered as TA No. 2002/2017.

2. It is the case of the Applicant that Defendants No. 1 is a company, Defendant No.2 is the Managing Director and Defendant No.3 is the Director of the Defendant No.1. Defendant No.1 represented by Defendant No.2 availed a credit facility of Rs. 10,00,00,000/- (Rupees ten crore only) for the purpose of working capital. For the said credit facility Defendant No.2 to 6 stood as guarantors and Defendant No.7 & 8 stood as the corporate guarantors.

3. It is also the case of the Applicant that, in view of the above loan, the Defendants executed necessary loan documents in favour of the Applicant bank to secure the loan and also had created mortgage over the schedule property.

4. It is the case of the Applicant that the Defendants, despite availing the credit facility, along with the Terms and Conditions for the loan, failed in complying with the same, resulting in defaults and consequentially turning the loan accounts as Non- Performing Asset (NPA).

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

6. Summons were issued to the Defendants. Defendant No. 4 & 5 entered appearance by filing a vakalat but failed to file written statement. Defendant Nos. 1 to 3 and 6 to 8 were called out; however, they failed to appear and are therefore set ex parte.

7. The Applicant had let in evidence through AW-1, who filed Proof Affidavit reiterating the contentions taken in the TA and also produced Exhibits A-1 to A-24, got the same marked in evidence.

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

9. The following issues arise for consideration in this matter: i) Whether the Applicant succeeded in proving the TA claim as against the Defendants? ii) If so, to what extent?

Both these issues are gone into and decided together.

10. The applicant contends in their evidence that the mortgaged Schedule ‘A’ property was sold for a sum of Rs. 5,78,00,000/-, and this sale was challenged by Defendant No. 4 in SA No. 243/2015, which was subsequently dismissed. Thereafter, Defendant No. 5 approached the applicant seeking to settle the liability of Defendant No. 1 under a One-Time Settlement (OTS). Accordingly, Defendant No. 5 issued six cheques of Rs. 50 lakhs each. In terms of the OTS, Defendant No. 5 paid a total sum of Rs. 2 crores to the applicant; however, the cheques were returned due to insufficient funds. After the filing of the Original Application (OA), Defendant No. 5 again approached the applicant with a proposal for OTS but failed to comply with the terms. Subsequently, Defendant No. 5 issued a letter requesting an extension of the OTS period. Further submits that, as on 30.04.2025, the defendants are due a sum of Rs. 14,15,49,271.43 (Rupees Fourteen Crore Fifteen Lakh Forty-Nine Thousand Two Hundred Seventy-One and Paise Forty-Three only) to the applicant.

11. The evidence tendered by the Applicant remains uncontroverted and undisputed. The evidence put forth by the Applicant is found admissible and sufficient to prove the averments made in the TA, and the default committed by the Defendants in repaying the loan amount due. The liability of the Defendants and the loan amount due are also proved by the above documents. The claim of the Applicant is well within the limitation.

12. The amount stated in the evidence affidavit has been calculated by including penal interest as well as future interest.

However, this Tribunal is not bound to grant permission to the applicant bank solely on the basis of the amount claimed. Upon due consideration of the records and the circumstances of the case, the Tribunal finds it appropriate to grant permission to the applicant bank to proceed with the recovery of the claimed amount, after deducting the amounts received and recovered during the period, which shall remain subject to the final adjudication of the matter.

13. Hence in view of the above findings this Tribunal comes to the conclusion that the TA is liable to be allowed.

14. Taking into consideration the fact that the loan is availed by the Defendants for business purposes and also the fact that TA claim is arrived at by calculating interest at the agreed rate, pendente lite and future interest is awarded at 12.00% (simple).

15. In the result, TA.No.2002/2017, is allowed,

i) The Applicant is allowed to recover an aggregate sum of Rs.10,79,23,612/- (Rupees ten crore seventy nine lakh twenty three thousand six hundred and twelve only) with pendente lite and future interest of 12.00% p.a. (simple) from the date of filing TA till the realization, from the Defendants jointly, severally and personally after giving credit to all the amounts recovered including Rs. 5,78,00,000/- received by sale of Schedule A property, as well as any further amounts recovered during the pendency of the TA if any, and allow the same to be recovered by proceeding against the schedule ‘B’ and ‘C’ properties. Properties schedule to the OA be the schedule to the Recovery Certificate.

ii) Defendants jointly, severally, personally and their assets are liable to be proceeded against for the shortfall if any to recover the balance amount due.

iii) The applicant bank is allowed cost of the proceedings for which Applicant to file cost memo within seven 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.

16. 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. (Dictated to PY directly on the Computer, after its transcription, corrected and pronounced by me in the open Court on this the 06th day of October, 2025)

Sd/- (T. RAJESH) PRESIDING OFFICER

ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Sri. Som Deo Singh, Cheif Manager, of Applicant Bank. Exhibits on the part of the Applicant:

Exhibit Nos. Date Particulars of Documents A1 20.05.2013 Board Resolution A2 24.04.2013 Credit Sanction intimation A3 21.06.2013 Demand promissory note A4 21.06.2013 Demand promissory note delivery A5 21.06.2013 Master credit agreement A6 21.06.2013 Power of attorney in respect of book debts/receivables A7 18.06.2013 Power of attorney A8 19.06.2013 Power of attorney A9 21.06.2013 Deed of Guarantee A10 19.06.2013 Deed of Guarantee A11 27.05.2013 CIBIL declaration A12 19.06.2013 Deed of Guarantee A13 19.06.2013 CIBIL declaration

A14 21.06.2013 Deed of Guarantee along with board resolution & CIBIL declaration A15 21.06.2013 Deed of Guarantee along with board resolution & CIBIL declaration A16 23.05.2013 Memorandum of Deposit of title deeds A17 27.05.2013 Confirmation letter from the mortgagor A18 27.05.2013 Memorandum of Deposit of title deeds A19 21.12.2012 Sale deed A20 29.05.2013 Confirmation letter A21 -- General Hypothecation agreement A22 -- Form-8 A23 10.10.2014 Notice along with acknowledgement A24 -- Account extract

Witness Examined for the Defendant: -Nil - List of Documents Exhibited for the Defendant: -Nil -

Sd/- (T. RAJESH) PRESIDING OFFICER