STATE BANK OF INDIA vs M/S SHRI SAI TRADERS AND ORS on 22 January 2026

FINAL ORDER

This original application has been filed by the applicant bank before DRT-III, Delhi on 18.12.2021 & then transferred to DRT-I Delhi under Section 19 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 against the defendants for recovery of Rs.25,37,247.35 (Rupees Twenty Five Lacs Thirty Seven Thousand Two Hundred Forty Seven and paisa Thirty Five only) as on 14.12.2021 @14.75% interest per annum with monthly rests from the date of filing of this application till the date of realization with costs. Further, the name of Mr. Dhirendra Kumar has been substituted as authorized representative in place of Sh. Mahendra Roopchandani, erstwhile AR of the applicant bank.

2. The brief facts of the case are that on the request of defendant no.1 through its proprietor being defendant no.2 vide loan application along with necessary KYC documents, the applicant bank sanctioned Cash Credit facility for a sum of Rs.21.00 lacs (Rupees Twenty One Lacs only) @3.60% above MCLR i.e. 12.10% rate of interest on 22.11.2018 against hypothecation of stocks and book debts and STDR of Rs.6.30 Lacs. The defendant no.3 stood as guarantor for the loan facilities sanctioned in favour of the defendant no.1. The defendants also agreed to pay penal interest @2% in case of default or delay.

3. In order to avail the credit facility, the defendant no.1 through its proprietor being defendant no.2 submitted loan application and executed Letter of Arrangement, Agreement of

Loan cum Hypothecation, Undertaking with the applicant bank on 22.11.2018 and the defendant no.3 executed Guarantee Agreement (SME-3) on 22.11.2018 in favour of applicant bank.

4. That in order to secure the loan facility the defendant no.2 hypothecated the stock of garments and book debts of defendant no.1 in favour of applicant and deposited SDTR LIC of Rs.6.30 lacs with the applicant bank.

5. It has been submitted by the applicant bank that after availing the aforesaid loan facility, the defendants failed to comply with the terms and conditions of sanction and failed to deposit overdue interest, not submitted stock statement on regular basis and failed to route sale proceeds through the account. Ultimately, the applicant bank classified the account as NPA on 30.04.2021 as per RBI guidelines and issued legal notice dated 14.10.2021 calling upon them to pay the outstanding amount but defendants neglected the same, hence the applicant bank has approached this tribunal for recovery of its dues.

6. Notices of this O.A. were issued to the defendants and despite of proper service, the defendants have chosen to absent from the proceedings. As per order dated 26.08.2025, the defendants have been proceeded ex-parte as they have not appeared before the Tribunal and even written statement, evidence and affidavit of assets have not been filed by the defendants.

7. In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Shri Mahendra Roopchandani, authorized representative of the applicant bank who has proved the documents such as Gazette Notification, Details of Immovable Properties, Letter of Arrangement, Agreement of Sd

Loan cum Hypothecation, Guarantee Agreement, Undertaking, Self-attested copies of PAN card, Aadhar card, Udyog Aadhar Memorandum, Registration Certificate, Rent agreement, Notice & Postal receipts, Certificate under Section 2A(b) of Banker's Book of Evidence Act and Section 65B of Evidence Act, Statement of Account marked as Ex.AW-1/1 to Ex.AW-1/8.

8. 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 approved.

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

10. As per the provision of Section 19(20) of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 which is analogous to Section 34 of CPC, on filing of the suit/claim, the contract between the parties comes to an end and the Court/Tribunal has a discretion to award the same depending upon the circumstances of each case. Same principle has been laid down by the Hon'ble Apex Court in the case of Central Bank of India Vs. Ravindra & Others. Taking stock of all the circumstances and keeping in view that there is a drastic fall in rates of interest globally and domestically, I am of the opinion that interest of justice will be served if the interest at the rate of 12% p.a. is awarded.

11. In the light of the above discussions, the Original Application deserves to be allowed.

ORDER

I, allow this OA and direct the defendants to pay to the applicant bank within a period of 30 days, jointly and severally, a sum of Rs.25,37,247.35 (Rupees Twenty Five Lacs Thirty Seven Thousand Two Hundred Forty Seven and paisa Thirty Five only) as on 14.12.2021 alongwith pendentelite and future interest @12.00% per annum from date of filing of this application till the date of realization and costs; failing which the aforesaid amount shall be recovered from the sale of hypothecated stock, book debts and appropriation of SDTR LIC etc. In case of shortfall, the same shall be recovered from the sale of movable and immovable properties of the defendant. (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 23.03.2026. (IV) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost. sd- 2e)-2-6 (GOVIND BALLABH SHARMA) PRESIDING OFFICER DRT-I, DELHI (Dictated and pronounced in open court) Dated: 22.01.2026