BANK OF MAHARASHTRA vs M/s Love Gems And Jewels Pvt Ltd on 10 April 2026

FINAL ORDER

This original application has been filed by the applicant bank on 16.06.2015 before DRT-III, Delhi and 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 a sum of Rs.4,97,25,942/- (Rupees Four Crores Ninety Seven Lacs Twenty Five Thousand Nine Hundred Forty Two only) as on 07.05.2015 along with pendentelite and future interest @14.75% per annum with monthly rests plus @2% penal interest from 08.05.2015 till the date of its realization and costs.

2. The brief facts of the case are that on the request of the defendant no.1 being private limited company through its directors being defendant no.2 and 3, the applicant bank sanctioned Cash Credit limit of Rs.4,50,00,000/- (Rupees Four Crore Fifty Lacs only) on 29.03.2013 @15.50% rate of interest against hypothecation of stock and receivables and mortgage of property owned by defendant no.4 who stood as Corporate Guarantor. In case of default in repayment of loan amount, defendant no.1 also liable to pay @2% penal interest beside other bank charges.

3. That in order to avail the credit facility, the defendant no.1 vide Resolution dated 29.03.2013 of Board of Directors, authorized defendant no.2 to execute necessary documents. The defendant no.4 vide Resolution dated 29.03.2013 of Board of Directors consented for providing corporate guarantee by creating equitable mortgage of two shops for credit facility sanctioned by applicant bank.

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4. The defendant no.2 executed the various documents on behalf of defendant no.1 for availing cash credit facility by the applicant bank viz. Form RF45- Request for making credit facility, Form RF46/47- Demand Promissory Note, Form RF66J- Composite Deed of Hypothecation, Undertakings, Forms RF154A, Guarantees of defendant no.2 to 4 and Affidavit on 29.03.2013 towards the applicant bank.

5. That in order to secure the loan facility, the defendant no.2 on behalf of defendant no.4 created equitable mortgage by executing Memorandum of Record of Deposit of Title Deeds deposited dated 01.04.2013 in respect of Shop No.1 and 10, part of property bearing Municipal No.2728, Khasra No.25, Gali No.23-24, Block P, Beadon Pura, Karol Bagh, New Delhi by depositing original sale deed dated 03.12.2012 with the applicant bank.

6. It has been submitted by the applicant bank that after availing the credit facility, the defendant no.1 failed to adhere to the terms and conditions of loan and not operated the account, not deposited stock statement with the applicant bank despite personal visits as well as notice dated 24.11.2014 issued. The defendant no.1 to 3 disposed of all the hypothecated goods without consent and permission of applicant bank and used the funds for their personal use, thus committed the offences of breach of trust, cheating etc. Ultimately, the applicant bank classified the account as NPA on 27.11.2014 as per RBI guidelines and issued legal notice dated 11.05.2015 but defendants neglected, hence the applicant bank has approached this Tribunal for recovery of their dues.

7. Notice under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Sd- Interest Act 2002 was issued on 06.01.2015 to the defendants by the applicant bank to liquidate the dues but defendants not replied nor made any payment.

8. 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 22.09.2022, all the defendants have been proceeded ex-parte as they have not appeared before the Tribunal nor written statement, evidence and affidavit of assets have been filed.

9. In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Shri S.K.Saha(AW-1), authorized representative of the applicant bank who has proved the documents such as Authorization Circular, Sanction Letter, Resolutions of Defendant no.1 and 4, Form RF45 Request for making credit facility, Form RF 46/47 Demand Promissory Note, Form RF 66J Composite Deed of Hypothecation, Deed of Guarantees Forms RF154A of defendant no.2 to 4, Undertakings, Affidavit, Mortgagor's Declaration for proposed Equitable Mortgage Annexure A, Memorandum of Record of Deposit of Title Deeds Annexure B, Mortgagors Letter for Confirmation of Equitable Mortgage Annexure C, Sale Deed, Notice, Notice u/s 13(2), Legal Notice, Statement of Account under Bankers Book Evidence Act, Uncharged & Penal Interest Statement marked as Ex.AW1/1 to Ex.AW1/24.

10. 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.

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11. 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.

12. 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, jointly or severally, within a period of 30 days, a sum of Rs.4,97,25,942/- (Rupees Four Crores Ninety Seven Lacs Twenty Five Thousand Nine Hundred Forty Two only) as on 07.05.2015 along with pendentelite and future interest @14.75% per annum with monthly rests from 08.05.2015 till its realization with costs, failing which the aforesaid amount shall be recovered from the sale of mortgaged Shop No.1 and 10, part of property bearing Municipal No.2728, Khasra No.25, Gali No.23-24, Block P, Beadon Pura, Karol Bagh, New Delhi owned by defendant no.4. 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 Recovery Officer, DRT I, Delhi on 09.06.2026.

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(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: 10.04.2026