ICICI BANK LIMITED vs MRS. BEENA LAWRENCE & ANR (BLR) on 31 December 2025

FINAL ORDER

1. The Application was filed before the Debts Recovery Tribunal-I, Bengaluru on 28.12.2015 Under Section 19 (1) of the Recovery of Debt

And Bankruptcy Act, 1993 and numbered as OA No. 37/2016, seeking for issuance of a Recovery Certificate for Rs. 40,43,229/- (Rupees forty lakh forty-three thousand two hundred and twenty-nine only). Subsequently, owing to bifurcation of jurisdiction vide Government of India Gazette Notification dated 30.01.2017, the Application (OA No. 37/2016) was transferred from Debts Recovery Tribunal -I, Bangalore to this Tribunal and renumbered as TA No. 1359/2017.

2. It is the case of the applicant that Defendant No. 1, as the principal borrower, and Defendant Nos. 2 as the co-borrowers, availed housing loan. The applicant disbursed a total sum of Rs. 19,50,000/- (Rupees Nineteen lakh fifty thousand only) vide 2 installments on 27/06/2006 and 29/01/2008.

3. It is also the case of the Applicant that, in view of the above loan, the Defendants executed the necessary loan documents in favour of the Applicant Bank to secure the loan and also created the requisite security interest over the scheduled property to secure the loan.

4. It is the case of the Applicant that the Defendants, despite availing the credit facility, after agreeing 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 duly served on the Defendants. The Defendants entered appearance through their counsel and filed their written statement. They also led evidence by examining DW1 and, along with the written statement, filed certain documents such as sale agreement, loan disbursement notes and absolute sale deed are marked as Annexures D1 to D5. The Applicant filed a proof affidavit, produced documents, and got them marked as Ext. A3 to A10.

7. In their written statement, the Defendants themselves admitted the availment of the credit facility. The Defendants contended that they entered into a sale agreement with the builder, M/s. Palary Engineers and Developers, on 23.05.2006, agreeing to purchase the schedule apartment for a total sale consideration of Rs. 20,03,230/- (Rupees Twenty Lakh Three Thousand Two Hundred and Thirty only). The Defendants submitted the said sale agreement along with the title documents to the Applicant for processing the loan.

8. The Defendants further contended that there was fraudulent collusion between the Applicant and the builder in disbursing the loan amount to the builder and that the bank released a major portion of the loan amount to the builder. Furthermore, the Defendants contended that when about 40% of the construction work on the schedule apartment was yet to be completed, on 31.01.2008, the builder executed the sale deed of the schedule apartment in favour of the Defendants, and the Applicant paid the stamp duty payable on the sale deed to the Sub-Registrar.

9. After the execution of the sale deed, the builder abandoned the apartment project and absconded from Bangalore. There are 16 apartments in the said project. The Defendants and other purchasers of apartments in the project filed police complaints against the builder, and despite police investigation, the builder’s whereabouts are not known till date. The Defendants prayed that the Bank be directed to proceed under the SARFAESI Act, 2002, to recover the dues from the secured asset (the schedule property) before proceeding personally against the Defendants.

10. The Defendants have admitted to availing the loan from the Applicant Bank. The admission of the Defendants regarding the availment of the credit facility is clear and unequivocal. The contention of the Defendants that they entered into a sale agreement with the builder, M/s. Palary Engineers and Developers, on 23.05.2006, and submitted the said agreement and title documents to the Applicant for processing the loan, only reinforces the fact that the loan was availed by the Defendants for purchase of the schedule apartment. Once the Defendants have admittedly sought and obtained the credit facility, they are bound by the terms and conditions governing the loan transaction. The disputes, if any, between the Defendants and the builder cannot absolve the Defendants of their contractual liability towards the Applicant.

11. The contention of the Defendants alleging fraudulent collusion between the Applicant and the builder in the disbursement of the loan

amount is wholly unsubstantiated and unsupported by any material evidence. Mere allegations of collusion, without proof, cannot be accepted. The disbursement of the loan amount was made strictly in accordance with the loan terms and on the basis of documents submitted by the Defendants themselves. The execution of the sale deed dated 31.01.2008 in favour of the Defendants further establishes that the Defendants acquired title to the schedule apartment. The payment of stamp duty by the Applicant to the Sub-Registrar was in accordance with banking practice and does not, in any manner, establish collusion or illegality. Hence, the said contention of the Defendants is untenable and liable to be rejected.

12. The subsequent conduct of the builder in abandoning the project and absconding from Bangalore, and the filing of police complaints by the Defendants and other purchasers, though unfortunate, has no bearing on the contractual obligations of the Defendants towards the Applicant. The Applicant is not a party to the disputes between the Defendants and the builder. Any criminal proceedings or investigation against the builder cannot extinguish or postpone the liability of the Defendants arising out of the loan transaction. Therefore, the said contention does not afford any defence to the Defendants against the claim of the Applicant.

13. The prayer of the Defendants seeking a direction from this Tribunal to the Applicant to proceed under the provisions of the SARFAESI Act,

2002, against the secured asset cannot be acceded to. In this regard, this Tribunal is not in a position to issue any specific direction to the Applicant Bank to proceed under any particular statute, including the SARFAESI Act, 2002, for recovery of the loan amount, as prayed for by the Defendants.

14. Hence, the Applicant’s evidence remain un-rebutted and hence proved. The documents produced by the Applicant are found to be admissible and are sufficient to prove the TA claim. Hence the Applicant is to be found entitled for the TA claim as the only issue as to the proof of TA claim is answered in favour of the applicant. The TA claim is made within limitation and there is no capitalization of penal interest.

15. Since the TA claim is arrived at by calculating interest with default interest and also that the facilities are availed in respect of their Housing loan facility the pendent lite and future interest is awarded at simple rate that too at reduced rate of 8.00%(Simple).

16. In view of the above i. TA 1359 OF 2017 stands allowed ii. Applicant is permitted to recover an amount of Rs. 40,43,229/- (Rupees forty lakh forty three thousand two hundred twenty nine only) with future and pendent lite interest @ 8.00% (Simple) from the date of filing of the TA till realization from the defendants jointly, severally and personally after giving credit to all the amount recovered and received during the

pendency of the TA if any, and allow the same to be recovered by proceedings against schedule property. Property schedule to the TA be the schedule to the Recovery Certificate. iii. If the sale proceeds are not found sufficient to clear the loan amount due from Defendants jointly, severally and personally, then the Applicant bank is at liberty to proceeded against their other assets for the recovery of the balance due. iv. Interim application pending, if any, stands disposed of in terms of this final order. v. A Recovery Certificate is to be drawn and issued to the recovery Officer to enable recovery of the as per the above terms. vi. Applicant is allowed to realize cost of the proceeding for which cost memo is to be filed in 7 days’ time from the date of receipt of the copy of the order.

17. 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 31st day of December, 2025)

Sd/- (T. RAJESH)

PRESIDING OFFICER

ANNEXURES WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Sri. Premjith R, Manager, of Applicant Bank.

Exhibits on the part of the Applicant:

Exhibit Nos. Date Particulars of Documents A1 -- Proof affidavit A2 -- List of documents A3 -- Power of attorney A4 26.05.2006 Loan application A5 26.06.2006 Loan agreement A6 21.05.2011 Loan recall notice A7 & A8 02.07.2015 Certified statement of account A9 31.01.2008 Sale deed A10 14.06.2006 Offer letter

Witness Examined for the Defendants:

DW-1: Sri. Binoy C. Varghese, Defendant No.2 List of Documents Exhibited for the Defendants:

D1- Proof affidavit

Sd/- (T. RAJESH) PRESIDING OFFICER