CANARA BANK vs T K Velumani on 2 January 2024

O R D E R

1. This Original Application is filed by the Applicant Bank, under Section 19 (1) of the RDDB & FI Act, 1993, 2 TA 903/2019

a. to direct the Defendants personally, jointly & severally to pay to the Applicant Bank a sum of Rs.16,66,660/- with interest at the rate of 17.50% per annum with monthly rests, from the date of Application, till the date of its realization, failing which

b. to direct to sell the, hypothecated movable property more fully described in the Schedule ‘A’ and mortgaged immovable properties described in the Schedule ‘B’, which are mentioned hereunder and the sale proceeds appropriated for recovery of Rs.16,66,660/- with interest at the rate of 17.50% per annum with monthly rests, from the date of Application, till the date of its realization, with Costs of this OA.

BRIEF FACTS

2. The Averments made by the Applicant Bank in the Application are stated as follows:

2.1. The Defendants approached the Applicant Bank and gave Loan Application on 20.03.2006 for Agricultural Term Loan for the purchase of John Deere 5310 Tractor, Trailer and its Accessories. The Applicant Bank sanctioned the loan for a sum of Rs.7,34,000/- to the Defendants on the same date vide Sanction Memorandum dated 20.03.2006. The Defendants executed necessary documents in favour of the Applicant Bank, such as i. Memorandum of Agreement for Agricultural Loan dated 24.03.2006, ii. Agreement Relating to Deposit of Title Deeds dated 22.03.2006 for security for the loan availed, on and 10.03.2011, the Defendants executed Acknowledgement of Debt and Security in favour of the Applicant Bank.

2.2. The Rate of interest payable on the amount of loan under Agriculture Scheme has been revised from time to time as per Guidelines of Reserve Bank of India and Bank Guidelines. The Defendants are liable to pay interest at the rate of 15.50% towards 3 TA 903/2019

Agriculture loan together with penal interest at the rate of 2% per annum.

2.3. The Defendants to repay the liability in defaulted manner. As such the Accounts became irregular and classified as Non Performance Assets. Inspite of repeated Demands and several reminders made by the Applicant Bank to the Defendants, the Defendants did not pay the due loan amounts. The Defendants are liable to pay a sum of Rs.16,66,660/- with interest at the rate of 17.50% with compounded monthly rests from the date of Application, till the date of its realization. Therefore, the Applicant Bank filed this OA against the Defendants for recovery of the OA amount, and this Hon’ble Tribunal may be allowed the OA with Costs.

3. The Averments made by the 1st Defendant in the Reply Statement and the same is adopted by 2nd Defendant are stated as follows:

3.1. The Applicant Bank suppressed the various payments by the 1st Defendant and claimed more interest than mentioned in the Demand Promissory Note and the Hypothecation Agreement.

3.2. The Person who represents the Applicant Bank has no locus standi to plea and signs the Original Application. Therefore, the alleged Power of Attorney is not produce before the Hon’ble Tribunal. The Applicant Bank is liable to prove the same by documentary evidence.

3.3. The Loan Application of the 1 Defendant dated 20.03.2006, sanction of the loan of Rs.7,30,000/- to the Defendants and the alleged execution of Memorandum of Agreement for Agricultural Loan dated 24.03.2006 are all denied. The execution of Agreement relating to deposit of Title Deeds dated 22.03.2006 are not admitted and denied.

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3.4. The creation of Equitable Mortgage by Deposit of Title Deeds, the intention to create the mortgage by the Debtor is sine-qua-non. There is no pleadings by the Applicant Bank about the intention to the 1st Defendant to create the Equitable Mortgage in respect of the “B” Schedule Property. The 1st Defendant has no intention to put forth the “B” Schedule Property as security to the above said both loans. The Mortgage dated 22.03.2006 is not legally admissible and the Applicant Bank could not claim the Recovery Certificate upon the “B” Schedule Property.

3.5. The Acknowledgement of Debt dated and 10.03.2011 are not admitted, because the 1st Defendant is not known the English Language. The rate of interest and the penal interest is not admitted. The Loan is agricultural nature, as such the rate of interest is exorbitant. Numerous repayments is not enter in the loan accounts by the Applicant Bank. In these circumstances, the alleged statement of accounts is liable to be proved by the proper documentary evidence. The Applicant Bank could not avail the benefits of the Bankers Book Evidence Act, in respect of the alleged Statement of Accounts. The claim in respect of Tractor Loan is not sustainable, since it is calculated by the interest more than mentioned in Demand Promissory Note and Hypothecation Agreement and the Reserve Bank Guidelines.

3.6. The “A” & “B” Schedule properties of the Original Application are not correct. As per the Directions of the Reserve Bank of India, the loan amount upto Rs.20,00,000/- to be referred to the Lok Adalat instead of filing case. As such this OA is liable to be dismissed. The 1st Defendant is an Agriculturist, therefore, he is entitled to get the benefits of Debt Relief Act. Therefore, the 1st Defendant prays this Hon’ble Tribunal, the OA may be dismissed with exemplary costs.

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4. The Defendants were called absent and set ex-parte on 01.02.2023.

5. The Applicant Bank, in order to prove its claim, has filed Proof Affidavit executed by Mr.P.Chandran, Branch Manager of the Applicant Bank and marked the documents as Exts.A-1 to A-18 in support of its claim in the OA. A cumulative analysis of both the Proof Affidavit and Documents marked by the Applicant Bank would prove the claim of the Applicant Bank in the OA.

6. Therefore, in view of the observations made supra, the OA stands allowed and the Applicant Bank is entitled to recover

a. from the Defendants personally, jointly & severally, a sum of Rs.16,66,660/- with interest at the rate of 12% (Agricultural Loan) per annum with monthly rests, from the date of Application, till the date of its realization, failing which

b. the Applicant Bank is directed to bring the hypothecated movable property described in Schedule “A” and mortgaged immovable properties described in Schedule “B” for sale and appropriated for recovery a sum of Rs.16,66,660/- with interest at the rate of 12% (Agricultural Loan) per annum with monthly rests, from the date of Application, till the date of its realization, with Costs of this OA.

7. In the result,

a. it is hereby directed the Defendants personally, jointly & severally, to pay to the Applicant Bank a sum of Rs.16,66,660/- with interest at the rate of 12% (Agricultural Loan) per annum with monthly rests, from the date of Application, till the date of its realization.

b. On failure, the Applicant Bank is directed to bring the hypothecated movable property described in Schedule “A” and mortgaged immovable properties described in Schedule “B” for sale, and the sale proceeds appropriated for recovery a sum of 6 TA 903/2019

Rs.16,66,660/- with interest at the rate of 12% (Agricultural Loan) per annum with monthly rests, from the date of Application, till the date of its realization, with Costs of this OA.

8. All the pending IAs. if any, stand closed and disposed of by this Tribunal.

9. The Registry is directed to prepare DRC in terms of this Final Order. The Applicant Bank shall file memo of costs within 15 days from the date of this Order.

10. The Registry is directed to communicate the copy of this Order to both parties as provided in Rule 16 of the Debts Recovery Tribunal (Procedure) Rules, 1993 as amended in 2016. (Dictated to Steno, directly typed on the Computer corrected and pronounced by me in the open Tribunal, this the 2nd day of January, 2024).

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SCHEDULE “A” John Deere 5310 Tractor bearing Registration No.TN-36-J-6176, Trailer bearing Registration No.TN-36-J-6194 and its accessories. SCHEDULE “B” Erode Registration District, Anthiyur Sub Registration District, Bhavani Taluk, Vempathy Village, R.S.No.575/3,R.S.No.575/4 Extent Acre 3.19 cent Boundaries of Property. Plot No.1 North : Rangasamy South : Muthusamy Gr. East : Pallam West : S. Sivaprakasam Plot No.2 Vempathy Village, R.S.No.575/3, R.S.No.575/4 Boundaries of property North : Muthusamy Gr. South : T.P. Velumani East : T.P. Velumani West : Pallam Sd/-

PROOF AFFIDAVIT OF THE APPLICANT BANK

1. Sri. P. Chandran, Branch Manager. LIST OF DOCUMENTS MARKED BY THE APPLICANT BANK Sl. No. Date Description of Document Exhibits

20.03.2006 Original -Loan Application submitted by the Defendants to the Applicant Bank. A.1

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20.03.2006 Original – Sanction Memorandum of the Applicant Bank addressed to the Defendants. A.2

24.03.2006 Original – Memorandum of Agreement for Agricultural Loan executed by the Defendants. A.3

Original – Acknowledgement of Debt & Security executed by the Defendants in favour of the Applicant Bank. A.4

10.03.2011 Original – Acknowledgement of Debt & Security executed by the Defendants in favour of the Applicant Bank. A.5

22.03.2006 Original – Agreement relating to Deposit of Title Deeds in favour of Applicant Bank. A.6

25.06.1972 Xerox Copy of Registered Partition Deed executed between Palanimalai Gounder, Muthusamy Gounder, Betha Gounder & Velayammal. A.7

19.04.1995 Original – Sale Deed executed by Betha Gounder, Velayammal, Valliammal in faavour of T.K. Velumani. A.8

02.02.2006 Chitta Extract in respect of S.F.No.575/2, 575/3 & 575/4 of 038 Vembathi, Bhavani. A.9

02.02.2006 RSR Extract in respect of S.F.No.575/2, 575/3 & 575/4 of 038 Vembathi, Bhavani. A.10

13.02.2006 True Copy of Adangal Extract in respect of S.F.No.575/2,

&

of

Vembathi, Bhavani. A.11

13.02.2006 True Copy of Field Plan of S.F.No.575 of 38 Vembathi, Bhavani Taluk. A.12

13.02.2006 True Copy of Topo Sketch of No.37 Brahmadesam, No.38, Vembathi, Bhavani Taluk. A.13

13.02.2006 Certificate issued by the VAO, 38, Vembathi Village, Bhavani Taluk, in respect of T.K.Velumani for S.F.No.575/3, & 4. A.14

21.02.2005 Kist Receipt in respect of 1414 Fasli in favour of T.K. Velumani. A.15

01.09.1995 Certified Copy of Encumbrance Certificate of S.F.No.575/3, 575/4 of Vembathi Village, Bhavni Taluk, issued by Sub Registrar, Andhiyur for the period from01.01.1981 to 30.08.1995. A.16

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30.01.2006 Certified Copy of Nil Certificate of Encumbrance on Property of S.F.No.575/3, 4. A.17

-- Statement of Account in respects of Defendants with Certificate issued u/s.2A of the Bankers’ Books Evidence Act. A.18

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