KARNATAKA GRAMIN BANK vs SRI. MALLAPPA on 1 February 2024

FINAL ORDER

The present Original Application (TA) is filed on 24.11.2015 under section 19 of Recovery of Debts Due to Banks and Financial Institution Act 1993 for recovery of a sum of Rs.15,85,440/- (Rupees fifteen lakh eighty five thousand four hundred and forty Only) with further interest thereon from the date of filing the Application till realization from the Defendants.

2. The application filed is within the period of limitation as prescribed under Section 24 Recovery of the Debts Due to Banks and Financial Institutions Act 1993 and the subject recovery claim falls within the jurisdiction of this Hon’ble Tribunal. Brief facts of the case:

3. The present OA is filed by Kaveri Grameena Bank and in view of amalgamation with Karnataka Gramin Bank as per the Government Notification, the claim of Kaveri Grameena Bank is continued by Karnataka Gramin Bank.

4. It is the case of the applicant bank where in the Defendant No. 1 is Deceased his LR’s of Defendant No.1 (a) & (b) are borrowers and Defendant No. 2 is the borrower. The Defendant had approached the applicant bank seeking for KCCS Loan of Rs.85,000/- (Rupees Eighty Five Thousand only) vide sanction communication letter dated 07.10.2006 in loan A/c No. 13172017252 for the purpose of development and growing in seeds manure and growing. The loan was repayable in 3 years together with minimum interest @ 13% p.a. as per bank norms and rate of interest applicable now is 12.75% in respect of the said loan.

3.1. The defendants executed necessary loan documents in favour of the applicant bank as security for the due repayment of the loans, interest, cost and charges, and Defendants executed Terms & Conditions Letter dated 07.10.2006 and Agreement for Hypothecation dated 07.10.2006 and Registered Mortgage Deed dated 06.10.2006 in favour of the applicant bank.

4. Further, the Defendants had approached the applicant bank seeking for Term Loan of Rs.3,60,000/- (Rupees Three Lakh Sixty Thousand only) vide sanction communication letter dated 07.10.2006 in loan A/c No. 13172009932 for the purpose of Tractor and accessories and crops. The loan was repayable in 9 years in 18 half yearly installments, the installment start form 07.04.2007 and the last installment ended on 07.10.2018, all the 18 half yearly installments of Rs.33,300/- together with minimum interest @ 14.25% p.a. as per bank norms and rate of interest applicable to the loan now is 14.25% in respect of the said loan.

4.1. The defendants executed necessary loan documents in favour of the applicant bank as security for the due repayment of the loans, interest, cost and charges, and Defendants executed Terms & Conditions Letter dated 01.09.2006 and Agreement for Hypothecation dated 07.10.2006 and Registered Mortgage Deed dated 06.10.2006 in favour of the applicant bank.

5. Further, the terms of the direction of the GOI/RBI/BANK under Agriculture Debt Waiver and Debt Relief Scheme-2008 (ADWDR Scheme- 2008) for the overture amount in ATL, the over due amount was bifurcated and repayment, rescheduled. The account represents the overdue portion of the ATL account as which was remained unpaid and a separate account was opened on 18.07.2008.

5.1. Under Agricultural Debt waiver and debt relief scheme a sum of Rs.1,09,524/- (Rupees one lakh nine thousand five hundred and twenty four only) granted by bifurcation account on 18.07.2008 A/c No. 13172017717. The defendants failed to repay the restructure red loan dues as per scheme.

5. The Applicant Bank submits that the Defendants, after availing the said facilities, failed to repay the loan amount and committed default. The loan account of the Defendant had been classified as a Non Performing Asset (NPA) calling upon the defendants to repay the entire outstanding loan amount. However, there was no positive response from the Defendants. Hence, this Original Application (TA) has been filed to recover the dues from the Defendants.

6. After the filing of the OA, summons was sent to the Defendant No.1

(a) & D-2 through Registered Post with Acknowledgment Due the same is duly served on 02.07.2019 & 11.02.2016 and Defendant No.(b) was returned unserved with postal shara “Addressee Out of Station”. Hence, summons through substitute service was taken and the Applicant Bank published on 25.02.2021 in two daily leading newspapers, “The New Indian Express” in English Newspaper and “Kannaba Prabha” in Kannada Newspaper. The Defendant No.1 is the Deceased his Legal Heirs of Defendant No.1 (a) & (b). When OA was taken up on 11.08.2023 even after giving sufficient time, there was no appearance or representation from the Defendants; hence, Defendant No.1(a) (b) & D- 2 were placed exparte on 11.08.2023. Heard the submissions of Applicant Bank and perused the records

7. To prove the case of the Applicant Bank, Sri. Kiran H.N., Branch Manager, has filed Affidavit by way of evidence and same was considered as evidence of AW.1 and marked as Ex.A1, the list of Document came to be marked as Ex.A2 and documents came to be marked as Ex.A3 to A15. There is no contra evidence available on record to repudiate the claim of the Applicant Bank.

8. Having 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 to a final order on the following terms:

: O R D E R:

9. The TA is allowed with costs,

(a) The applicant bank is allowed to recover from Defendant Nos.1 & 2

jointly and severally to pay an amount of Rs.15,85,440/- (Rupees fifteen lakh eighty five thousand four hundred and forty Only) together with future interest @ 14.25% in respect of loan accounts 1 to 3 from 23.11.2015 and till the date of realizations.

(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 schedule mentioned property in the TA;

(c) Schedule mentioned property in the TA shall be appended to this final order; (d) If the sale proceeds of the schedule mentioned properties 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) respectively to recover the balance dues as required under law; (e) The applicant bank shall file the latest memo of calculation of TA amount together with interest, costs etc., to be paid by the defendant duly considering the amounts, if any, paid by the defendants and/or amount realized by sale of assets etc., during the intervening period after the filing of the TA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by the respective defendants to the applicant bank.

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

(g) Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.

10. A copy of this order be communicated to the parties concerned. [Dictated to the (CS), transcribed by her, corrected and signed by me on this the 1st Day of February 2024].

Sd/- PRESIDING OFFICER

DRT-II, BENGALURU

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK: AW-1: Sri. Kiran H.N., Branch Manager, of Applicant Bank. Exhibits on the part of the Applicant:

Exhibit Nos. Particulars of Documents Date A1 Applicant Evidence

A2 List of Documents.

Agricultural Banking Kalpa Kisan Credit Card Scheme Loan Limit of Rs.85,000/- granted on 07.10.2006, No.13172017252.

A3 Sanction communication letter executed by Defendants. 07.10.2006 A4 Terms and Conditions Letter executed by Defendants. 07.10.2006 A5 Agreement for Hypothecation executed by Defendants. 06.10.2006 A6 Simple Mortgage Deed executed by Defendants. 06.10.2006 A7 Letter of commitment 08.08.2009 A8 Letter of commitment 18.05.2012 A9 Letter of commitment 10.07.2013

Agricultural Term Loan Limit of Rs.3,60,000/- granted on 07.10.2006, No.13172009932

A10 Sanction communication letter executed by Defendants. 02.09.2006 A11 Terms and Conditions Letter executed by Defendants. 07.10.2006 A12 Agreement for Hypothecation executed by Defendants. 07.10.2006 A13 Letter of commitment 01.09.2009 A14 Letter of commitment 04.08.2012 A15 Letter of commitment 10.07.2013

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

SCHEDULE - A (Hypothecated Assets) Tractor bearing No. KA 06 TA 3804 and trailer bearing No. KA-06 TA 3805 and accessories and Crops & movables and standing crops in the Schedule “B” properties.

SCHEDULE- B Item No.1 Property bearing Sy.No.72, measuring 4 acre 16 guntas situated at Devapura, Kasaba Hobli, Sira Taluk, Tumkur District and bounded on:

East by: Land of Katumbi West by: Govt. Land North by: Land of Krishnappa

South by: Land of Lalyanaika

Item No.2 Property bearing Sy.No.53/p-p1, measuring 43 23 acre 38 guntas situated at Devapura, Kasaba Hobli, Sira Taluk, Tumkur District and bounded on:

East by: Land of Krishnappa West by: Land of Sevyanaika North by: Govt. Land South by: Land of Bheemanna.

Sd/- PRESIDING OFFICER

DRT-II, BENGALURU