UNION BANK OF INDIA vs M/S SHIVAY INDUSTRIES AND ORS on 25 September 2026

**FINAL ORDER**

This original application has been filed by the applicant bank on 17.09.2022 before DRT-III Delhi & then transferred to Sd- DRT-I Delhi under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 against the defendants for recovery of a sum of Rs.41,49,246.03 (Rupees Forty One lacs Forty Nine thousand Two hundred Forty Six & paisa Three only) as on 31.08.2022 along with pendent elite and future interest @9.70% in OCC account and @7.50% in GECL respectively from 01.09.2022 with monthly rest plus @2% penal interest from the date of institution of this application till the date of realization and costs.

2. The brief facts of the case are that on the request of the defendant no.1 through its partners being defendant no.2 and 3 vide their loan application dated 01.10.2018 along with relevant documents, the applicant bank sanctioned the OCC credit facility of Rs.35,00,000/- (Rupees Thirty-Five lacs only) on 04.10.2018 against hypothecation of stocks covered under CGTMSE scheme which was renewed on 02.12.2019 and again on 27.05.2021. In addition, on the request vide letter dated 01.04.2020, the applicant bank sanction UGECL term loan facility of Rs.6.00 lacs on 04.07.2020.

3. In order to avail both the Credit facilities, the defendants submitted loan applications and executed Composite Agreements (Form 40150), General Form of Guarantees, Consent for Disclosure of Information to CIBIL (Format 40161), Demand Promissory Notes SD-21, Letters of Continuity (AD-09), Simple Agreements AD-2A, Interest Agreements SD-24, Term Loan Agreements SD-19, Letters of Undertaking AD-11, Declaration of Partnership AD-07, Letters of Guarantee SD-01, and Acknowledgement of Debt (Comp. no. 40121) on various dates in favour of applicant bank.

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4. It has been submitted by the applicant bank that after availment of both the credit facilities, the defendants failed to comply with the terms and conditions despite several reminders to pay the outstanding dues. The applicant bank classified the account as NPA on 30.06.2022 and issued recall notice on 14.07.2022 & 19.08.2022 to the defendants to clear the outstanding but defendants neither care to reply nor made any efforts to repay. Hence, the applicant bank has approached this Tribunal for recovery of their dues.

5. Notices of this O.A. were issued to the defendants and despite proper service, the defendants have chosen to absent from the proceedings. As per order dated 09.02.2026, the defendants have been proceeded ex-parte as they have failed to file written statement, evidence and affidavit of assets.

6. In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Mr. Naveen Kumar, authorized officer of bank, who has proved the documents such as Power of Attorney Ex.AW1/1, Loan Application for OCC Credit Facility Ex-AW1/2(Colly), Sanction Letter Ex.AW1/3, Composite Agreement (Form 40150) Ex.AW1/4 & Ex.AW1/12, General Form of Guarantees Ex.AW1/5 & Ex.AW1/6, Ex.AW1/13 & Ex.AW1/14, Consents for disclosure of information to CIBIL (Format 40161) Ex.AW1/7, Ex.AW1/8, Ex.AW1/15 & Ex.AW16, Acknowledgement of Debt (Comp.40121) Ex.AW1/9, Renewal Application Ex.AW1/10, Renewal Sanction Letter Ex.AW1/11, Ex.AW1/14, Letter for change of address Ex.AW1/17, Application for UGECL Loan Ex.AW1/18, Sanctioned of UGECL Loan Ex.AW1/19, Declaration about merger of banks Ex.AW1/20, Demand Promissory Note SD-21 Ex.AW1/21, Letter of Continuity (AD-09) Ex.AW1/22, Simple Agreement (AD-21) Ex.AW1/23, Interest Agreement SD-24 Ex.AW1/24, sd- Term Loan Agreement (SD-19) Ex.AW1/25, Letter of Undertaking (AD-11) Ex.AW1/26, Declaration of Partnership (AD-07) Ex.AW1/27, Letter of Guarantee (SD-01) Ex.AW1/28, Renewed of OCC limit Ex.AW1/29, Demand Promissory Note (EBLR Linked) Ex.AW1/30 , Letter of Undertaking from Partners (AD-11) Ex.AW1/31, Declaration of Partnership (AD-07) Ex.AW1/32, Letter of Continuity AD-09 (M) Ex.AW1/33, Letter of Undertaking (AD-12) Ex.AW1/34, Hypothecation Agreement (SD-03) Ex.AW1/35, Letter of Undertaking from Borrower(s) Ex.AW1/36, Simple Agreement (AD-02A) Ex.AW1/37, Letter of Undertaking from Guarantor(s) Ex.AW1/38 & Ex.AW1/39, Letter of Undertaking Ex.AW1/40, Letter of Guarantee (SD-01) Ex.AW1/41, Declaration Ex.AW1/42, Letter of adjustment of overdue Ex.AW1/43, Recall Notice Ex.AW1/44(Colly), Certified Statement of account Ex.AW1/45 (Colly).

7. The applicant bank has fully corroborated the averments made in the O.A. Even otherwise the whole case of the applicant bank is based on the documents and the same have been duly proved.

8. The case filed by the applicant bank gone unrebuted and there is no question of disbelieving the case of the applicant bank and the applicant bank has proved its case beyond reasonable doubts.

9. In the light of the above discussions and documents on record, the Original Application deserves to be allowed.

**ORDER**

I, allow this OA and direct the defendants to pay to the applicant bank, jointly or severally, within a period of 30 days, a sum of Rs.41,49,246.03 (Rupees Forty One lacs Forty Nine *sd-*

thousand Two hundred Forty Six and paisa Three only) as on 31.08.2022 along with pendentelite interest @11.70% with monthly rest from 01.09.2022 from the date of institution of the application till the date of realization and costs, failing which the aforesaid amount shall be recovered from sale of hypothecated stocks and book debts. In case of shortfall, the same shall be recovered from the sale of movable and immovable assets of the defendants.

(II) The recovery certificate be issued forthwith and be sent to the Recovery Officer, Debt Recovery Tribunal-I, Delhi.

(III) Parties are directed to appear before the Recovery Officer, DRT I, Delhi on 25.11.2026.

(IV) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost.

sd- **(GOVIND BALLABH SHARMA)** **PRESIDING OFFICER** **DRT-I, DELHI**

(Dictated and pronounced in open court) Dated: 25.09.2026