KAVERI GRAMEENA BANK vs SRI.B.T. KUNNAPPA on 8 April 2024

FINAL ORDER

The present Original Application (OA) is filed on 30-06-2015, under section 19 of the Recovery of Debts due to Banks and Financial Institutions Act 1993 for recovery of a sum of Rs.20,75,001/-(Rupees Twenty Lakhs Seventy Five Thousand and One Rupee Only) with further interest thereon from the date of filing till realization from defendants.

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

3. The present OA is filed by Kaveri Grameenan 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. The Defendants 1 and 2 approached applicant bank and requested for sanction of several loans on 30.07.2004, KCCS loan was sanctioned on 02.05.2005, Agriculture term loan for Construction of Farm House purchase of Tractor and Tailer, Purchase of Generator Loan availed on 04.05.2005. The defendants are the borrowers. The 1st and 2nd defendant has availed the agricultural KCC Crop Loan Limit of Rs.2,00,000/- on 30.07.2004 for the purpose of investing in seeds manure, pesticides etc for growing crops. The loan was secured by hypothecation of standing crops as per agreement of hypothecation dt.30.07.2004 and by mortgage of ‘B’ Schedule properties on 30.07.2004. The loan was repayable in three years together with minimum interest at 14% p.a. as per Bank norms and the rate of interest applicable now is 13.75%. The Defendants have executed the following documents in respect of the said loan for themselves and as guardian of their minor children.

(i) Sanction Communication Letter dt. 30.07.2004 executed by defendants 1 and 2. (ii) Agreement for Hypothecation dt.30.07.2004

executed by 1st and defendant. (iii) Registered Mortgage Deed dt.30.07.2004 execute by defendants.

5. The 1st and 2nd defendants availed the agricultural term loan Limit of Rs.8,50,000/- granted on 04.05.2005 for the purpose of development of agriculture land to grow fruits and for Construction of Farm House, Purchase of Tractor and Trailers, the Tractor bearing No.KA-06-TA.3185 and Trailer No.KA-06-TA-3186 and accessories, Purchase of 20 KV Generator, Sprayer etc., The loan was secured by hypothecation of standing crops as per agreement of hypothecation dt.04.05.2005 and by mortgage of ‘B’ Schedule properties. The loan was repayable in 10 years in 9 yearly installments, the 1st installment of Rs.81,800/-, 2nd and 3rd installment of Rs.90,600/- respectively, 4th installment of Rs.94,000/-, 5th to 8th installments of at 14.50% p.a. as per Bank norms and the rate of interest applicable to the loan now is 14.55%. The Defendants 1 and 2 have executed the documents in respect of the said loan. Sanction Communication Letter dt. 04.05.2005 executed by defendants. Agreement of Hypothecation dt.04.05.2005 executed by 1st and defendants. Registered Mortgage Deed dt. 02.05.2005 executed by defendants 1 and 2 for themselves and as father and guardian of the minor children defendants 3 to 5.

6. The Defendants by the Applicant Bank on the terms and conditions enumerated in the various loan/security documents executed by defendants. The A & B schedule properties are common and interlinked security for two loans. The causes of action for both two loans are common and interlinked and borrowers are one and the same. The sanction was communicated to the defendants on 30.07.2004 and 04.05.2005 and in token of having accepted the terms and conditions the defendants have executed the loan documents. In consideration of the Applicant Bank sanctioning the loan to the Defendants, they have executed loan documents and created registered mortgage of 'B' schedule properties a security for the loans in favour of applicant Bank and deposited the title deeds in respect of 'B' schedule properties registered on 30.07.2004 and 02.05.2005.

7. The Defendants failed to make the repayments of the loan dues as agreed conditions agreed by defendants. That due to aforesaid, irregularity and defaults committed by the defendants they have become liable to pay forthwith all the outstanding loan dues together with interest. The 1st defendant has executed the letter of commitments on 26.03.2009, 22.10.2009, 25.02.2012, 20.03.2015. The Applicant Bank submits that the Defendants, after availing the loans, failed to repay the loan amount and committed default. However, there was no positive response from the defendants. Hence, this Original Application (OA) has been filed to recover the dues from the defendants.

8. After the filing of the OA, summons was sent to the Defendants No.1 to 3 by RPAD ON 09.06.2016, summons served to D4 held sufficient, D5 is minor duly served on 24.02.2023 When OA was taken up on 08.12.2023, even after giving sufficient time, there was no appearance or representation from the defendants, Defendants No.1 to 4 placed ex- parte. The Defendant No.5 is a minor, has been appointed though a Court Guardian, IA No.129/2018 stands allowed, he never appeared before this Tribunal on behalf of the Defendant No.5 Hence the Written Statement of Defendant No.5 is closed.

Heard the submissions of Counsels and perused the records.

9. To prove the case, Sri.M.C. Sreenivasulu S/o. Sri.M.C. Nanjappa , aged about 50 years, Manager of the Applicant Bank, has filed Affidavit by way of evidence and same was considered as evidence of AW.1 and marked as Ex.A1, and documents came to be marked as Ex.A3 to A13. As the defendants remained ex-parte, the OA claim remains unchallenged. There is no contra evidence available on record to repudiate the claim of the Applicant Bank.

10. Having regard to the amount advanced, the interest applied, documents executed, the conduct and operations in the loan 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:

11. The OA is allowed with costs,

(a) The Applicant bank is allowed to recover from defendant Nos.1 to 5

jointly or severally, a sum of Rs. 20,75,001 /- (Rupees Twenty Lakhs Seventy Five Thousand and One Rupee Only) being the amount claimed in the application together with future interest at the rate of 14.25% in respect of loan accounts 1 and 2 from 23.11.2015

from the date of filing Original Application till the date realization.

(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 properties in the OA;

(c) Schedule mentioned properties in the OA 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 movables and immovables) to recover the balance dues as required under law; (e) 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 defendants 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.

(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.

12. A copy of this order be communicated to the parties concerned.

Dictated to the (GS), transcribed by him, corrected and signed by me on this the 08th day April 2024].

Sd/-

PRESIDING OFFICER

DRT-II, BENGALURU

ANNEXURES

WITNESSES EXAMINED FOR THE APPLICANT BANK:

AW-1: Sri. Ravindra, Manager of the Applicant Bank.

Exhibits on the part of the Applicant:

Sl. No. PARTICULARS DATE Exhibits I Agricultural Banking Kalpa Kisan Credit Card Scheme Loan limit of Rs.2,00,000/- granted on 30.07.2004 A/c. No.13157026978

Sanction Communication Letter executed by defendants 1 and 2 30.07.2004 A3

Agreement for Hypothecation executed by 1st and defendant 30.07.2004 A4

Registered Mortgage Deed execute by defendants 30.07.2004 A5 II AGRICULTURAL TERM LOAN LIMIT OF Rs.8,50,000/- GRANTED ON 04.05.2005 ACCOUNT No.13157023149

Sanction Communication Letter executed by defendants 04.05.2005 A6

Agreement of Hypothecation executed by 1st and defendants 04.05.2005 A7

Registered Mortgage Deed executed by defendants and for themselves and as father and guardian of the minor children defendants 3 to 5 02.05.2005 A8

Letter dt.05.09.2013 issued by the 1st Defendant 05.09.2013 A9

Letter dt.05.09.2013 issued by the 1st Defendant 05.09.2013 A10

Office copy of Legal Notice 18.07.2012 A11

Copy of Postal acknowledgment

A12

Loan account statement A13

Witness Examined for the Defendants: -Nil –

List of Documents Exhibited for the Defendants: -Nil –

SCHEDULE PROPERTY

SCHEDULE-A

Hypothecated Crops Sprayer, Tractor bearing No.KA-06-TA.3185 and Trailer bearing No.KA-06-TA3186 and other movables available in schedule B- Schedule Properties.

SCHEDULE-“B”

Item No. 1

Property bearing Sy. No.9/2, Measuring 3 Acre 9 guntas, situated at Badaobanahalli village, Midgeli Hobli, Madhugiri Taluk, Tumkur District and bounded on :

East by : Kunappanna Property

West by : Road

North by : Gram Tana

South by : B.T. Nagaraja Property

Item No. 2

Property Bearing Sy. No.10/1A, Measuring 2 Acre, situated at Badaobanahalli village, Midgeli Hobli, Madhugiri Taluk, Tumkur District and bounded on :

East by : Halla

West by : Kunappanna property

North by : Ramakrishnaiah property

South by : Narsimaiah Property

Item No.3

Property Bearing Sy. No.10/1A, Measuring 2 Acre ½ Guntas, situated at Badaobanahalli village, Midgeli Hobli, Madhugiri Taluk, Tumkur District and bounded on :

East by : Halla

West by : Kunappanna property

North by : Ramakrishnaiah property

South by : Narsimaiah Property

Item No.4

Property Bearing Sy. No.61, Measruing 4 Acre 5 guntas, situated at Vittalpura Village, Dodderi Hobli, Madhugiri Taluk, Tumkur District and bounded on:

East by : Road

West by : Sri.Ramanna Property

North by : Sri.Shivakumar Property

South by : Kamanna Property

Item NO.5

Property bearing Sy. No.63/2, Measuring 3 Acre, situated at Vitalpura Village, Dodderi Hobli , Madhugiri Taluk, Tumkur District and bounded on:

East by : Sri. Kempanna Property

West by : Sri. Narsimaiah Property

North by : Sri. Jairam Property

South by : Sri. Siddram Property

Sd/-

PRESIDING OFFICER DRT-II, BENGALURU