HDFC BANK vs M/S ORION AUTOMOBILES PVT LTD AND ORS on 26 February 2026

FINAL ORDER

This original application has been filed by the applicant bank on 12.01.2021 before DRT-III, Delhi and then transferred to DRT-I Delhi under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 against the defendants for recovery of a sum of Rs.23,29,66,325.31 (Rupees Twenty Three Crores Twenty Nine Lacs Sixty Six Thousand Three Hundred Twenty Five and paisa Thirty One only) as on 08.12.2020, out of which Rs.27,71,196.21 in Cash Credit Spares and Rs.23,01,95,129.10 in Inventory Funding (AUIF) along with future interest from the date of filing of this application till actual date of payment along with costs.

2. The brief facts of the case are that on the request of the defendant no.1 being private limited, a dealer of Hyundai Motors India Ltd. vide loan application dated 01.08.2013, the applicant bank sanctioned Cash Credit Spares limit of Rs.150.00 lacs @12.50% interest, Inventory Funding facility of Rs.1500.00 lacs and Adhoc limit of Rs.500.00 lacs @11.50% interest for Working Capital facilities aggregating Rs.2150.00 lacs against hypothecation of all present and future current assets and mortgage of properties as resolved by Board Resolution dated 16.08.2013 of defendant no.1. As per request of defendant no.1 resolved through Board Resolutions, the applicant bank sanctioned additional inventory funding facility for Rs.500.00 lacs on 09.07.2015 and Term Loan of Rs.1600.00 lacs. Further, the applicant bank sanctioned/revised/ modified/enhanced/renewed the credit facilities lastly on

22.06.2018 i.e Cash Credit Spares of Rs.350.00 lacs @10.15% interest and Inventory Funding(AUIF) of Rs.3900.00 lacs @9.50% interest per annum. The defendant no.2 to 5 stood as guarantors for the loan facilities sanctioned in favour of the defendant no.1 by the applicant bank.

3. That in order to avail the credit facilities, defendant no.1 submitted loan application and authorized its officials to jointly or severally execute loan and security documents. The defendant no.1 executed Demand Promissory Notes, Letters of Continuity, Master Facility Agreements for Cash Credit Facility, Undertakings-cum-Indemnity, Letters of Hypothecation, Loan Agreements, Supplemental Letters of Hypothecation of stocks and Book Debts, MCLR Agreement in place of Base Rate, Letters of Continuing Guarantee, Memorandum relating to Charge over Fixed Deposits, Letter of General Lien and Set Off and Power of Attorney for Book Debtswith the applicant bank on 17.08.2013, 10.07.2015, 29.09.2015, 07.10.2016, 28.12.2017 and 22.06.2018.

4. In order to secure the credit facilities, the defendant no.1 hypothecated the present and future current assets on first charge basis, stock in trade, goods in process and book debts of defendant no.1, by filing Form No.CHG-1 dated 03.10.2013 with ROC and Certificate of Registration of Charge duly issued.

5. In addition, the defendant no.2 created equitable mortgage of his property by depositing original title documents and executing Memorandum recording Past Transaction for Creation of Mortgage by Delivery of Title Deeds and Declaration cum Indemnity and re-depositing the same on every enhancement/sanctioned of credit facilities in favour of defendant no.1 as well as defendant no.2 and 5 to secure enhanced credit facilities, deposited title documents of their property with applicant bank as per details: Fiat no.701, 7th floor, Tower-K, Lagoon Residential Apartments Complex, Ambiance Island, NH-8, Village Nathupur, Gurugram, Haryana having super area of 5374 sq. ft. owned by defendant no.2; Property bearing no.C-61, First Floor, South Extension Part-11 Village Mubarakpur Kotla, New Delhi-110048 owned by defendant no.2 and 5.

6. Apart from the above, the defendant no.2 to 5 holding shareholding in various companies viz. Orion Automobiles (Delhi) Pvt.Ltd., G.M.Wines Pvt.Ltd., Sujjan Automobiles Pvt.Ltd., Raj Cars India Pvt.Ltd., Raj Auto Infra Private Ltd., Balsam Automobiles Pvt.Ltd., Balsam Publishing Housing Pvt.Ltd., Arena Cars Pvt.Ltd.

7. It has been submitted by the applicant bank that after availing the credit facilities, the defendants failed to comply with the terms and conditions of sanction, committed default in payment of outstanding including interest and failed to regularize the account with the applicant bank despite request. The defendants offered for One Time Settlement vide email dated 02.12.2019 and applicant bank approved settlement vide letter dated 11.03.2020 but the defendants failed to settle the account and not rectified the default. Ultimately, the applicant bank classified the account as NPA on 01.04.2019 as per RBI guidelines due to non-adherence to financial discipline and issued loan recall notice dated 21.09.2020 but neglected by the defendants. Hence, the applicant bank approached this tribunal for recovery of their dues.

8. The defendants acknowledged their liability of Rs.31,31,80,226.83 as on 30.04.2019 along with interest towards the applicant bank.

9. 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 18.07.2022, 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.

10. In order to prove its case, the applicant bank has filed its evidence by way of Affidavit of Sh.Anirudh Bhargav, authorized representative of the applicant bank, who has submitted the documents such as Board Resolution, Loan Application Forms, Sanction Letters, Demand Promissory Notes, Letters of Continuity, Master Facility Agreements, Undertakings cum Indemnity, Letters of Continuing Guarantee, Declarations cum Indemnity, Memorandums recording Past Transaction for Creation of Mortgage by Delivery of Title Deeds, Letters of Hypothecation, Form no.CHG-1, Board Resolutions, Supplementary Letters of Hypothecation, MCLR Agreement, Supplementary Agreement, Letter of General Lien and Set off, Amendment Agreement, Email, Settlement Letter, Loan Recall Notice, Statement of Account marked as Ex.AW-1/1 to Ex.AW- 1/83.

11. 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.

12. 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.

13. 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 or severally, a sum of Rs.23,29,66,325.31 (Rupees Twenty Three Crores Twenty Nine Lacs Sixty Six Thousand Three Hundred Twenty Five and Paisa Thirty One only) out of which Rs.27,71,196.21/- @10.15% interest per annum with monthly rests and Rs.23,01,95,129.10 @9.50% interest per annum with monthly rests from the date of filing this application till the date of realization along with costs; failing which the amount shall be recovered from the sale of hypothecated stocks, book debts and mortgaged properties as well as shareholdings of defendants in various companies as shown in original application: Flat no.701, 7th floor, Tower-K, Lagoon Residential Apartments Complex, Ambiance Island, NH-8, Village Nathupur, Gurugram, Haryana having super area of 5374 sq. ft. owned by defendant no.2; Property bearing no.C-61, First Floor, South Extension Part-1, Village Mubarakpur Kotla, New Delhi-110048 owned by defendant no.2 and 5 In case of shortfall, the same shall be recovered from the sale of movable and immovable properties 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 27.04.2026. (IV) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost. (GOVIND BALLABH SHARMA) PRESIDING OFFICER DRT-I, DELHI (Dictated and pronounced in open court) Dated: 26.02.2026