Bangalore District Court
Canara Bank vs Mohammed Nusrathulla on 16 April, 2025
1
Com.O.S.23/2025
KABC170000432025
IN THE COURT OF LXXXII ADDL. CITY CIVIL & SESSIONS
JUDGE, AT BENGALURU (CCH.83)
THIS THE 16TH DAY OF APRIL 2025
PRESENT:
SMT. SUMANGALA S BASAVANNOUR.,B.COM,L.L.M.,
LXXXII ADDL.CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
COM.O.S.23/2025
BETWEEN:
Canara Bank,
Hombegowdanagar
Branch, No.211/62, 11th
cross, Wilson Garden,
Hombegowdanagar,
Bangalore - 560 027.
Represented by its
Manager Sri.Rakesh
Jaiswal
: PLAINTIFF
(Represented by
Mohanadasa N.,
Advocate)
18
COM.O.S.23/2025
AND
Sri. Mohammed
Nusrathulla, S/o.
Sri.Mohammed
Azmathullah, Aged about
40 years, No.7/A, 10th
cross, Someshwara
Nagar, Jayanagar,
Bengaluru - 560011.
: DEFENDANT
(Defendant is placed
exparte as per order
dated 20.03.2025.)
Date of Institution of the
06.01.2025
suit
Nature of the suit (suit on
pronote, suit for declaration
Suit for recovery of money
& Possession, Suit for
injunction etc.)
Date of commencement of
08.04.2025
recording of evidence
Date on which judgment
16.04.2025
was pronounced
Total Duration Year/s Month/s Day/s
00 03 10
sd/-
(SUMANGALA S BASAVANNOUR),
LXXXII Addl. City Civil & Sessions Judge,
Bengaluru.
18
COM.O.S.23/2025
JUDGMENT
This suit is filed by the Plaintiff for recovery of money a total sum of Rs.9,17,701/- together with further Interest at 13.65% p.a. compounded monthly, Rs.4,41,355/- 13% per annum compounded monthly on Rs.24,299/- and 11.25% per annum compounded monthly on Rs.4,52,047/- from the date of filing this suit till realization and also pay the costs of this suit to the plaintiff including a sum of Rs.1,500/- being the expenses incurred by the plaintiff for getting the plaint and other papers typed and xeroxed.
2. The Brief facts of the Plaint are as follows:-
The plaintiff is a Banking Company incorporated under the Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head office at J.C. Road, Bengaluru 560002 and a branch among others at the address mentioned in the Cause Title.
The Plaintiff further submits that, The defendant had approached to the Plaintiff Bank seeking a term loan for the purpose of purchase of iron and steel for his manufacturing industry. Considering the request of the Defendant, Plaintiff 18 COM.O.S.23/2025 bank had sanctioned a term loan of Rs.3,35,000/- in terms of its Sanction Memorandum dated 17.12.2018. The proceeds of the said term loan was disbursed crediting his Current Account of the Defendant on 17.12.2018. The defendant had agreed to repay the above said term loan in 60 monthly installments of Rs.7,259/- commencing from 17.01.2019. The defendant had agreed to pay interest separately at 10.85% per annum compounded monthly or at such other rate as fixed by the plaintiff bank as per the guidelines of RBI from time to time and also to pay penal interest at 2% over and above the agreed rate in case of delay or default in payment of the agreed installments. In this connection, the Defendant had executed an Agreement-cum-Deed of Hypothecation, an On Demand Promissory Note, Letter of Undertaking and other loan documents in favour of the plaintiff bank on 17.12.2018.
The Plaintiff further submits that, the Defendant has again approached the Plaintiff Bank seeking a loan for the purpose of purchase of a commercial vehicle for his business considering the request of the Defendant, Plaintiff bank had sanctioned Term Loan of Rs.3,75,000/- in terms of Sanction letter dtd.17.07.2020. The proceeds of the said term loan was disbursed crediting his Current Account of the Defendant. The defendant had agreed to repay the above said term loan in 60 18 COM.O.S.23/2025 monthly installments of Rs.12,685/- commencing from 18.08.2020. The defendant had agreed to pay interest separately at 9.3% per annum compounded monthly or at such other rate as fixed by the plaintiff bank as per the guidelines of RBI from time to time and also to pay penal interest at 2% over and above the agreed rate in case of delay or default in payment of the agreed installments. In this connection, the Defendant had executed an Agreement-cum-Deed of Hypothecation, an On Demand Promissory Note, Letter of Undertaking and other loan documents in favour of the plaintiff bank on 17.07.2020.
The Plaintiff further submits that, meantime during COVID- 19 pandemic period, the Defendant had approached the Plaintiff bank seeking a loan to build up assets and to meet operational liablities and to restart the business. Considering the request of the Defendant, the Plaintiff bank had sanctioned a Guaranteed Emergency Credit Line under its Guarantee Scheme Loan of Rs.54,000/- under its emergency Credit Line Guarantee Scheme. The Plaintiff Bank had disbursed the proceeds of the said limit tot he Defendant on the Defendant executing an Agreement-cum-Deed of Hypothication, letter of undertaking and Pronote for Rs.54,000/- in favour of the Plaintiff bank on 30.06.2020. The Defendant had agreed to repay the said loan 18 COM.O.S.23/2025 in 36 equated monthly installments of Rs.1,680/- commencing after a moratorium period of 12 months. The Defendant has also agreed to pay interest at 7.5% p.a. compounded monthly on such other rates fixed by the Applicant from time to time on the said limit. The Defendant had also agreed to pay penal interest at 2% over and above the agreed rate if any delay or default in payment of installments with interest.
The plaintiff further submits that, the defendant has not repaid the liability under the said Term Loan as per the agreed terms. In spite of several letters and reminders and personal contacts by the officials of the plaintiff Bank demanding repayment of the above said loan, the defendant has failed to repay the same. The plaintiff submits that the rate of interest applicable to the said Term Loan is 13.65% p.a. compounded monthly, 13% p.a. compounded monthly the commercial vehicle loan availed is and in respect of GECL Limit is 11.25% p.a. compounded monthly which is inclusive of penal interest. The defendant is liable to pay to the plaintiff Bank the following sums together with further interest at rates mentioned supra from date of filing this suit till realization.
Liability towards Term Loan as per the account Rs.4,35,090.19 extract including interest upto 11.11.2024 Interest on the above at 13.65% p.a. Rs.6,2643.81 compounded monthly from 12.11.2024 to the 18 COM.O.S.23/2025 date of filing the suit Total Rs.4,41,355/-
Liability towards GECL as per the account Rs.24,157.04 extract including interest upto 30.11.2024 Interest on the above at 11.25% p.a. Rs.141.96 compounded monthly from 01.12.2024 to the date of filing the suit Total Rs.24,299/-
Liability towards the vehicle loan as per the Rs.4,50,531.19 account extract including interest upto 10.12.2024 Interest on the above at 13% p.a. Rs.1,515.81 compounded monthly from 11.12.2024 to the date of filing the suit Total Rs.4,52,047/-
Grand total Rs.9,17,701/-
The plaintiff further submits that, The cause of action for this suit in respect of Term loan for the first time arose on 17.12.2018 and subsequently on 04.02.2021 when the Defendant had executed Letter of Revival. The cause of action in respect of GECL limit arose on 30.06.2020 and subsequently whenever the payments were made which was ultimately on 31.05.2021. The cause of action in respect of Term loan availed second time arose on 18.07.2020 and subsequently 18 COM.O.S.23/2025 whenever the payments were made which had ultimately on 09.03.2021 and at last on 18.11.2022 when the Defendant had executed Letter of Revival in respect of above said credit limit availed by the Defendant within the territorial jurisdiction of this Hon'ble Court. Hence, this suit.
3. In spite of service of paper publication and summons, the Defendant have not appeared before this court and Defendant is placed exparte on 20.03.2025.
4. The Plaintiff has examined PW-1 and got marked Ex.P.1 to Ex.P.19. I have heard the arguments of the Advocate for the Plaintiff.
5. Based on the above pleadings of the Plaintiff, the following points arise for my consideration :-
1. Whether the Plaintiff is entitled for the Suit Claim from the Defendant ?
2. What Order ?
6. My findings on the above Points are as under:
Point No.1 :- In the Partly Affirmative.
Point No.2 :- As per the final Order for the following reasons.18
COM.O.S.23/2025 REASONS
7. POINT NO.1:- The plaintiff bank substantiate of this case examined its Manager as Pw.1. PW.1 in his evidence reiterated averments of the Plaint, and got marked Ex.P.1 to Ex.P.19.
8. In the decision reported in A.I.R. - 2000 - Karnataka - 234 (Syed Ismail vs. Smt. Shamshia Begum), the Hon'ble High Court of Karnataka has held as follows :-
"3. The impugned order does not disclose the nature of pleading placed by the plaintiff and whether there is prima facie material to grant a decree in his favour. A judgment in favour of the plaintiff is not automatic. The Court has to consider the case of the plaintiff and grant a decree in his favour. The learned trial Judge has not referred to the pleadings of the plaintiff and the documents produced by him to substantiate even a prima facie case for grant of a decree in his favour. Therefore, the judgment and decree in favour of the plaintiff is not automatic on failure of the opposite party to put his defense. The Court can grant a judgment in favour of the party only upon consideration of the case of the plaintiff including appreciation of pleadings and evidence."
9. The averments of the Plaint, evidence of PW.1 discloses that, The defendant had approached to the Plaintiff Bank 18 COM.O.S.23/2025 seeking a term loan for the purpose of purchase of iron and steel for his manufacturing industry. Considering the request of the Defendant, Plaintiff bank had sanctioned a term loan of Rs.3,35,000/- in terms of its Sanction Memorandum dated 17.12.2018 as per Ex.P.2. The said amount was disbursed by crediting his current account on 17.12.2018. The defendant had agreed to repay the above said term loan in 60 monthly installments of Rs.7,259/- commencing from 17.01.2019. The defendant had agreed to pay interest separately at 10.85% per annum compounded monthly or at such other rate as fixed by the plaintiff bank as per the guidelines of RBI from time to time and also to pay penal interest at 2% over and above the agreed rate in case of delay or default in payment of the agreed installments.
10. In this connection, the Defendant had executed an Agreement-cum-Deed of Hypothecation at Ex.P.3, Letter of undertaking at Ex.P.4 on 17.12.2018.
11. the Defendant has again approached the Plaintiff Bank seeking a loan for the purpose of purchase of a commercial vehicle for his business considering the request of the Defendant, Plaintiff bank had sanctioned Term Loan of Rs.3,75,000/- in terms of Sanction letter dtd.17.07.2020 as per 18 COM.O.S.23/2025 Ex.P.6. The above said loan was disbursed by crediting his current account.
12. The defendant had agreed to repay the above said term loan in 60 monthly installments of Rs.12,685/- commencing from 18.08.2020. The defendant had agreed to pay interest separately at 9.3% per annum compounded monthly or at such other rate as fixed by the plaintiff bank as per the guidelines of RBI from time to time and also to pay penal interest at 2% over and above the agreed rate in case of delay or default in payment of the agreed installments.
13. In this connection, the Defendant had executed an Agreement-cum-Deed of Hypothecation at Ex.P.7, Letter of Undertaking at Ex.P.8 dtd.18.07.2020.
14. During COVID-19, the Defendant had approached the Plaintiff bank seeking a loan to build up assets and to meet operational liabilities and to restart the business by filing application as per Ex.P.9. Considering the request of the Defendant, the Plaintiff bank had sanctioned a Guaranteed Emergency Credit Line under its Guarantee Scheme Loan of Rs.54,000/- under its emergency Credit Line Guarantee Scheme at Ex.P.10. The Plaintiff Bank had disbursed the 18 COM.O.S.23/2025 proceeds of the said limit to the Defendant. In this connection, Defendant executed an Agreement-cum-Deed of Hypothication at Ex.P.11, Pronote at Ex.P.12, letter of undertaking at Ex.P.13 on 30.06.2020 in favour of the Plaintiff bank.
15. The Defendant had agreed to repay the said loan in 36 equated monthly installments of Rs.1,680/- commencing after a moratorium period of 12 months. The Defendant has also agreed to pay interest at 7.5% p.a. compounded monthly on such other rates fixed by the Applicant from time to time on the said limit. The Defendant had also agreed to pay penal interest at 2% over and above the agreed rate if any delay or default in payment of installments with interest.
16. In spite of several letters and reminders and personal contacts by the officials of the plaintiff Bank demanding repayment of the above said loan, the defendant has failed to repay the same.
17. From Ex.P.16 - Statement of account speaks to the effect that total amount payable towards principle amount of Rs.4,50,531.19 as on 10.12.2024. The Plaintiff also claimed the Interest on the above amount @ 13% p.a. compounded monthly from 11.12.2024 to the date of filing the suit an 18 COM.O.S.23/2025 amount of Rs.1,515.81. The total due amount is Rs.4,52,047/-.
18. Ex.P.17 - Statement of account speaks to the effect that total amount payable towards principle amount of Rs.24,157.04 as on 30.11.2024. The Plaintiff also claimed the Interest on the above amount @11.25% p.a. compounded monthly from 01.12.2024 to the date of filing the suit an amount of Rs.141.96. The total due amount is Rs.24,299/-.
19. Ex.P.18 - Statement of account speaks to the effect that total amount payable towards principle amount of Rs.4,35,090.19 as on 11.11.2024. The Plaintiff also claimed the Interest on the above amount @13.65% p.a. compounded monthly from 12.11.2024 to the date of filing the suit an amount of Rs.6,264.81. The total due amount is Rs.4,41,355/-.
20. The Plaintiff claimed the Interest @13.65% p.a. compounded monthly from the date of filing the suit till the realization. By considering the prevailing rate of Interest, it is just and proper to award the Interest @ 10% p.a. from the date of filing the suit till the realization.
21. The above mentioned transactions commenced from 17.12.2018 and subsequently Defendant had executed the 18 COM.O.S.23/2025 Revival letter dtd.04.02.2021 at Ex.P.14 and Letter of Revival dtd.18.11.2022 at Ex.P.15 and this suit filed on 06.01.2025 is within the limitation period.
22. In this case in spite of service of summons through Paper publication, the Defendant is not appeared and denied the claim of the Plaintiff. Hence, it shows the Defendants admitted the case of the Plaintiff. The evidence of PW.1 and Ex.P.1 to Ex.P.19 are remained unchallenged. Therefore, the Plaintiff is entitle for recovery of the suit claim of amount of Rs.9,17,701/- with interest at 10% per annum from the date of suit till realization. Hence, I answer this Point in "Partly Affirmative".
23. POINT NO.2:- Therefore, I proceed to pass the following order.
ORDER The Suit of the Plaintiff is decreed in part with cost.
The Defendant is hereby directed to pay total aggregate sum of Rs.9,17,701/- together with interest 10% per annum from the date of suit till the realization.
Draw Decree accordingly.
18COM.O.S.23/2025 The Office is directed to send copy of this Judgment to Plaintiff and Defendant to their email ID as required under Order XX Rule 1 of the Civil Procedure Code as amended under Section 16 of the Commercial Courts Act.
(Dictated to the Stenographer, typed by her directly on computer, verified and then pronounced by me in open Court on this the 16th day of April, 2025).
sd/-
(SUMANGALA S BASAVANNOUR), LXXXII Addl.City Civil & Sessions Judge, Bengaluru.
ANNEXURE LIST OF WITNESSES EXAMINED ON BEHALF OF THE PLAINTIFF PW-1 Rakesh Jaiswal LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE PLAINTIFF Ex.P.1 Loan Application (pg no.13 to 17) Ex.P.2 Sanction Memorandum dtd.17.12.2018 (pg no.18 &
19) Ex.P.3 Agreement cum deed of Hypothication dtd.17.12.2018 (pg no.20 to 28) 18 COM.O.S.23/2025 Ex.P.4 Letter of undertaking dtd.17.12.2018 (pg no.29 to
33) Ex.P.5 Loan application dtd.10.07.2020 (pg no.34 to 38) Ex.P.6 Loan sanction memorandum dtd.17.07.2020 (pg no.39 & 40) Ex.P.7 Hypothication Agreement dtd.18.07.2020 (pg no.41 to 54) Ex.P.8 Letter of undertaking dtd.18.07.2020 Ex.P.9 GECL Loan application dtd.30.06.2020 Ex.P.10 Loan sanction memorandum dtd.30.06.2020 Ex.P.11 Agreement cum deed of Hypothication dtd.30.06.2020 (pg no.70 to 82) Ex.P.12 Pronote dtd.30.06.2020 Ex.P.13 Letter of undertaking dtd.30.06.2020 (pg no.84 to 88 Ex.P.14 Letter of revival dtd.04.02.2021 Ex.P.15 Letter of revival dtd.18.11.2022 Ex.P.16 Statement of account along with certificate (pg no.91 to 96) Ex.P.17 Statement of account along with certificate (pg no.97 to 101) Ex.P.18 Statement of account along with certificate (pg no.102 to 106) Ex.P.19 PIM report dtd.22.09.2023 LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENDANT NIL 18 COM.O.S.23/2025 LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE DEFENDANT NIL sd/-
(SUMANGALA S BASAVANNOUR), LXXXII Addl.City Civil & Sessions Judge, Bengaluru.