UNION BANK OF INDIA vs M/S RAJ BUILDCON CONSTRUCTION LTD. & ORS on 18 June 2025

FINAL ORDER

This original application has been filed by the applicant banks, on 14.05.2013 through Shri O.P. Sharma, Authorized Officer of the applicant bank, under Section 19 ofthe RDB Act, 1993 against the defendants for recovery of a sum of Rs.20,04,33,106'89 together with cost, charges and pendentellite and future interest @15.75olo from date of filing of this O.A. till the realization in full.

2. The brief facts of the case are that the defendant no. 1 along with the defendant nos.2 to 7, approached the applicant bank and for sanction of Cash Credit, WCTL, FITL, Term Loan-l, Bank Guarantees, Term €J

loan-2, Term Loan-3, Union Mile Loan, against the mortgage of their propefties. Earlier the defendant company was known as R.B. Builders when the defendant first approached the applicant bank in 1994 but the name of the said company was subsequently changed to M/s. Raj Buildcon Construction Limited' The defendant no.1 proposed the applicant bank to repay the said Cash Credit, WCTL, FITL, Term Loans, Bank Guarantees & Union Mib Loan by way of regular payments. It is submitted that the said loans were required by them for the purpose of business requirement. The loans/ limits were increased on request of defendant no.1 and in terms of sanction letters issues from time to time' The last such sanction letters dated 21.09.2012, sanctioning an amount of Rs.2282.72|acs, duly acknowledged by the defendant no.1 company is annexed with the OA' During this period, the applicant had approached the applicant bank for issuance of several different bank guarantees, several of which has been revoked. Several of the bank guarantees has been adjusted, however the dues of two such bank guarantees are yet to be paid by the defendants. Another two bank guarantees have not been revoked till date. Based on the credentials of both the defendants and after completing the verification of the defendants on the basis of the documents so submifted by them the applicant bank sanctioned and disbursed different credit limits in the form of Cash Credit limit, Bank Guarantees, Working Capital term loan (WCTL), Funded Interest Term Loan (FITL), Term Loan-1, Term Loan-2, Term Loan-3, Bank Guarantees Union Mile Loan which were renewed from time to time. On 28.09.2012, all its loan documents were consolidated and common,loar;documents for a sum of 9).

Ps.2282.72 lacs were executed. Pursuant thereto, various documents including Composite Hypothecation Deed, General Term Loan Agreements, Letter of Guarantees, Demand Promissory Note, Letter of extension of mortgages etc. were duly signed & executed by the defendant no.1. The said loan documents were to be governed by the certain terms and conditions as contained. The Composite Hypothecation Deed dated 28.09.2012 for a sum of Rs.2282.72|acs, Hypothecation Agreement of Goods & Debts dated 28.09.20L2 for a sum of Rs.3 crores, General Term Loan Agreement dated 28.09.2012 for a sum of Rs.981.19 lacs, General Term Loan Agreement dated 28.09.2012 for a sum of Rs.29'58 lacs, Agreement on Rate of Interest dated 28.09.2012 for a sum of Rs.2282.72, Letter of Undertaking not to Alienate Hypothecated Goods dated 28.09.2012 for a sum of Rs.300 lacs, Demand Promissory Note dated

28. O1.2OLZ for a sum of Rs'98,11,9000/-, Demand Promissory Note dated 28.09.20L2 for a sum of Rs.31,5,60,000/-, Demand Promissory Note dated 28.09.20t2 for a sum of Rs.3,00,00,000/-, Demand Promissory Note dated 28.09.20L2 for a sum of Rs.1,36,60,000/- & Demand Promissory Note dated

28. Og.21Lzfor a sum of Rs.29,58,000/-. The defendant nos.2 to 7 had executed letter of guarantees dated 28.09.2012 in favour of the applicant bank to secure account maintained by the defendant no.1 to the tune of Rs.2282.72 lacs. The defendant no.1 had approached the applicant bank for issuance of bank guarantee in favour of the beneficiary M/s. Today Homes Infrastructure Private Limited, which was subsequently renewed upto 04.04.20t3 and was subsequently revoked by the said beneficiqry. The copy of application S}

TANOl9t0l2023

dated 28.09.2011executed by the defendant bank requesting for issuance of bank guarantee in favour of the said beneficiary, M/s Today Homes Infrastructure Private Limited, the bank guarantee dated 08.10.2011 issued in favour of said beneficiary M/s. Today Homes Infrastructure Private Limited, the request letter dated 03.10.2012 for extension of bank guarantee, the letter of extension of bank guarantee dated 04.10'2012 executed by applicant ban( the letter dated 05'04.2013 issued by the beneficiary for revocation of bank guarantee & copy of demand draft dated 08.04.2013 for a sum of Rs.1,24,00,000.00 paid to the beneficiary on revocation. The said bank guarantee loan was consolidated into the loan documents executed on 28.09.2012. The defendant no'1 had also approached the applicant bank for issuance of another bank guarantee dated 10.02.2012in favour of the beneficiary M/s. JK Cements Works (Division of J K Cements Limited), which was subsequendy renewed but was subsequently revoked by the said beneficiary. The letter dated 21.01.2013 issued by the beneficiary for revocation of bank guarantee & evidencing issuance of pay order no.16634302, dated 24.01.2013 for a sum of Rs.20,00,000.00 paid to the beneficiary on revocation and. The said bank guarantee loan document was also consolidated into the loan documents executed on 28.09.20t2. The Union Miles Vehicle Loan for a sum of Rs.18.20 lacs were granted for purchase of vehicle, hypothecated to the applicant bank, vide sanction letter dated 04.03.2010 i.e., (a) Vehicle Name: Volkswagen Beetle 2.0. (b) Vehicle Registration No. HR26BB2080. The said loan was also subsequently consolidated into the loan documents executed on 28.09.2012. The defendants, being the moftgagor to the said loans/ g)'

limits had mortgaged their properties in favour of applicant bank and as mentioned below. As per the documents pertaining to mortgage executed in respect of the said loans/ limits, the defendants mortgaged their properties. i.e., (i)House No.Ll44, Ground Floor, Sector-l, Housing Board Colony, Bhiwadi, Rajasthan Housing Board Colony, Rajasthan Measuring 148.50 sq. mtrs., in the name of Sh. Rajendra Bansal. (ii) Residential Propefi at Khata No.834, OPP. UTI Sector- 8, Water Tank, Near Gas Godown, Village Millakpur, Gujjar, Bhiwadi, Rajasthan, measuring 700 SQ. YDS. owned by Mrs. Kaushalya Bansal (iii) 2 Bigha 8 Biswa Vacant Commercial Plot AdmeasuringT260 SQ. YDS. at Pushp Vatika, Mehla Jobnar Road, Village Asalpur, Tehsil Fulera, Distt. Jaipur, owned by M/s. Raj Buildcon Construction Ltd. (iv) Office No.4-A,4h Floor, Welldone Tech Park, Sector-48, Sohna Road, Gurgaon owned by M/s. Raj Buildcon Constructions Ltd' (v) office No.4-B, both on 4h Floor, Welldone Tech Park, Sector-48, Sohna Road, Gurgaon owned By M/s Raj Buildcon Constructions Ltd.(vi) Property No'102.18 Bigha (Area 16404.74 SQ. MTRS.) Industrial Land at Village Khewli, Tehsil Raipur, Distt. Pali Rajasthan owned by an Associate Company M/s Bharat Fab Tech & Corporate Park hrt. Ltd. (vii) LOt.77 Bigha Industrial Land at Village Khewli, Tehsil Raipur, District Pali Rajasthan owned by an Associate Company M/s Bharat Fab Tech & Corporate Park hrt. Ltd. and 80 Bighas Owned By M/s Raj Buildcon Construction Ltd.

3. It is further submitted that the defendants enjoyed and utilized the Loan facility, but failed to maintain the flnancial discipline and failed to repay the due amounts. The applicant- bank requested the ()'

TA NO/9r0/2023 6 defendants to regularize the loan account by visits and letters, but there was no response from the defendants, hence the account was classified as NPA on 31.12.2012. Therefore, the applicant bank serued a recall cum demand notice dated 07.05'2013 to the defendants but failed to recover the same Thus, the present O.AffA is preferred by the applicant bank to recover its dues.

4. On notice by this Tribunal, the defendant no.1,2 & 7 put appearance through counsel and defendant nos.l & 2 filed written statement and evidence. The defendant nos.3 to 6 failed to put appearance' Accordingly, defendant nos. 3 to 6 were proceeded expafte vide order dated 02.12.2014. Thereafter, the defendant nos. 3 to 5 put appearance through counsel but failed to flle WS. The opportunity of filling wriften statement by defendant nos. 3 to 7 was closed vide order dated 03.06.2015 but the defendant nos. 1 to 5 and defendant no. 7 have filed their respective evidence.

5. In their written statement the defendant nos. 1 & 2 have denied the facts mentioned in the OA. It is submitted that the officer of the bank is no more authorised on the date of flling of this O.A because the Directors of the bank were no more on the service of the bank as well as on the post of Directors and they have left the bank services long back and do not remain of the same position when this OA was filed on 13.06.2013 so this OA has not been filed by competent person of the bank and deserves to be dismissed on the very ground. It is submitted that computation of the accounts on all incorrect rate of interest, as well as levy of higher interest so the .gqid_ statement is purely s-\

incorrect and the bank be directed to reproduced the correct statement of account with clear application of interest hence the said OA deserves to be dismissed on the said count alone. The OA being based on documents which certain documents are partially forged and as certain exhibits bear forged signature of the defendant no.2, due to which the said documents cannot be relied upon in this present case. It is further submitted that the that defendant M/s Raj Buildcon Constructions Ltd. was allotted construction of Civil, plumbing and electrical work of four towers (including corresponding non-tower area) at canary greens, sector-73, Gurgaon on 02.09.2011 and the said contract worth Rs.1,24,00,000/- was guaranteed by Union Bank of India and bank guarantee document was executed dated 08.10.2011 between the parties' Accordingly, the work was executed by Raj Buildcon Constructions Ltd. Secondly bank guarantee was also executed for contract work of M/s. Hirise Hospitality h/t' Ltd. Kolkata and Raj Buildcon Constructions Ltd' for civil construction work for Hotel Project located at Adj. ISRO housing society, Bhopal-Ambli Road, Ahmadabad, Gujarat worth Rs.24,73,28,1921- and accordingly the defendant started the execution of the contract on the sites allotted to the defendant and huge amount of raw material, heavy machinery and other fixtures and equipment worth Rs.23,5L,2201- was installed at the site. The bank officers were aware of the contracted sites of the defendant and suddenly without any prior notice/information visited the sites and issued notice to the contracted people of the defendant and informed them regarding the defendant's default to the bank and irregularity in the account, also apprehended the working labour on the site rqgarding the poor financial <"\

position of the defendant company and has ultimately disturbed the working project of the defendant causing huge losses to the defendant company. It is submitted that bank has alleged to lone mortgaged seven valuable properties of the company to secure the loan facility granted to the defendant company and it is submitted that on 25'03.2013 & 26.03.2013 possession of two propefties (1) 3 Bigha 8 Biswa vacant commercial plot measuring7260 Sq' Yds. at Pushp Vatika, Mahla-lobner Road, Village Asalpur, Tehsil Phulera, Distt. Jaipur (2) Property 102.18 Bigha- industrial land at Village Khewil, Tehsil Raipur, Distt. Pali (Raj.) owned by associate company M/s. Bharat Febtek & corporate park limited was published and the possession of the said properties taken by the applicant bank. The properties worth Rs.4.80 Crores & Rs.3.87 Crores Total amount to Rs.8.67 Crores are in the absolute possession of the applicant bank since March 2013 but till date no sale proceedings of the said property was initiated by the applicant bank. When the bank has already taken the possession of the secured assets on March 2013 but till date the said amount was not adjusted in the loan account and thereby charging heavy interest / penal interest and misc' charges in the said loan account whereby causing heavy losses to the defendant company. That even the notice/application filed by the applicant bank stating outstanding dues of Rs.18 Cr. approx but they have till date not adjusted amount of Rs.10.00 Cr. towards the value of properties taken in possession and the balance outstanding which comes to only Rs.08.67 Cr. and it is also wofth mentioning here that on 23.05.2014 bank has also taken the possession of property situated at Bhiwadi House No. U44,G.F. Sector-l, Housing Board, Bhiwadi sl

(Raj.) the said property was valued Rs.98.83 Lacs was also taken under the possession by the applicant bank and after adjusting the value of the said property the amount comes to Rs.10.68 Cr. Approx. The applicant bank has till date taken no steps for the recovery of outstanding dues against the debtors of the defendant company and after adjusting the recoverable debt amount in the outstanding dues of the bank and only amount of Rs.4.33 Cr. remains balance outstanding in the said loan account. It is further submitted that a settlement agreement has been entered into between the defendant company & applicant bank wherein vide proposal dated 25.0L.2014, 30.01.2014, 04.02.20t4, 05.02.2014 & 28.03.2014 were given to the applicant bank wherein it was clearly stated that permission/NOC by the bank be issued in favour of the company regarding mortgaged properties situated at Pali (Rai.) (Pushap Vatika, Jaipur) being the commercial land whereby the permission sorted from the applicant bank and defendants offered to undertake to make the payment from the sale proceeds of the land and bank will hand over all the original title deeds to the defendants on the depositing of the said amount and also Rs.3 Crores be deposited by the sale of property situated at Jaipur for which the pafi are doing hard work for the settlement or sale of the said properties to repay the bank dues and also huge amount is likely to be received from M/s. Hirise Hospitality P. Ltd. and M/s. Today Homes & Infrastructure Limited. A schedule of a receivable amount was also given to bank worth Rs.6.35 Crore and request for opening an Escrow account was made and after considering all the facts and request of the defendants on 08.05.2014 fo_llowing decisions were e)

TA NO/910/2023 l0 taken in the presence of Chief Manager (Law) and Dy. General Manager of Union Bank of India. The defendants themselves are intending to settle the bank account by way of private sale of mortgage properties with the bank for which the defendant has got the buyers from whom who will catch better prices and also the outstanding dues will be repaid by the sale of the said properties and not extra burdon will be levied on the defendants. The applicant bank has taken the possession of three valuable properties worth Rs. Approx 11 Crore wherein the possession of two properties was taken l1/zyearc above & of one property with more three months & the said propefties have not been sold by the applicant bank. Even the permission for selling those properties by the defendant company was not given resulting into loss of Rs.11 Cr' The defendant company is entitled to get the value of properties adjusted and reversal of interest charged on the recoverable amount to reduce the burden of outstanding dues from May 2013 till the sale of the said properties. It is prayed that this Honble Tribunal may dismissed the OA and action taken by the bank under provisions of Section 13 SARFAESI Act.

6. During the course of proceedings, on 25.05.2017 the Ld. Counsel for defendants submitted that defendant no.2 has expired. But the applicant bank has failed to bring on record the LRs of defendant no'2 despite of availing various opportunities, therefore, the proceedings against defendant no.2 and his LRs were abated by this Tribunal vide order dated 12.10.2018. parties have filed their respective

7. Both the evidence. l.- e)..

TA NOi9l0/2023 l1 B. Heard the Ld. Counsel of both the parties and perused the record.

9. The first contention of the Ld. counsel of the defendant is that the OA is not filed by the competent person duly authorized by the bank and therefore, the OA is liable to be dismissed. From perusal of the record it is clear that the OA has been flled by competent person having full authority to file and sign the OA and therefore, the contention of the defendants has no force.

10. The next contention of defendants is that the applicant bank has filed incorrect statement of account and the interest has been charged at a high rate and therefore, the OA is liable to be dismissed. From perusal of the record it is clear that the statement has been filed and there is no discrepancy in the statement of account. The applicant bank has charged the rate of interest as per agreement entered into between the parties.

11. The next contention of the defendants is that there are no signatures of defendant no.2 on the said documents and the signatures are forged and fabricated. In this regard I have perused the record. From perusal of the record it is clear that the defendants are well educated person and are businessman' Therefore, it cannot be said that the signatures of defendant no.2 are forged and fabricated. There is no evidence filed on behalf of the defendants that the signatures of defendant no.2 are forged and fabricated.

12. The next contention of defendant is that the applicant bank has not filed the documents prior to 2012 and therefore, they have suppressed the material fact and the OA is liable to be dismissed. From perusal c>

of the record it is clear that the applicant bank has filed all the documents which are necessary for the disposal of the present OA. Therefore, the contention of the defendants has no force.

13. The next contention of the defendant is that the statement of account and other documents has not been proved as per Bankers Book Evidence Act. From perusal of the record it is clear that all the document has been proved as per Bankers Book Evidence Act and as per Indian Evidence Act. There is no discrepancy in the same.

14. The next contention of defendants is that the information of the declaration of the account as NPA has not been given to the defendants and an amount of Rs.4,35,736l- has been credited after declaration of account as NPA and therefore, the account has wrongly been declared as NPA. But the contention of the defendant has no force. There is no need to issue any notice before declaration of the account as NPA. Merely because credit entry has been made in the account the account has not become standard.

15. The next contention of the defendant is that the documents annexed with the OA as Annexure 3 to 18 has not been properly stamped and cannot be read into evidence. But the contention of the defendant has no force. There is no necessity of any stamp on the paper alleged by the defendant.

16. The next contention of the defendant is that the instrument of hypothecation does not bear the signature of the officials of the bank and therefore, the documents cannot be read into evidence. But the contention of the defendant has no force. All the S.\

documents have been properly executed by the defendants and the same can be relied upon. Therefore, the contention of the defendans has no force. t7. From perusal of the entire evidence, it is clear that the defendants have failed to prove their c:lse as claimed in the written statement. On the other hand, the applicant bank has proved his case against the defendants and therefore, the defendants are liable to pay jointly and severally the amount claimed by the applicant bank and ,6" 94fl-A of the applicant bank is liable to be allowed. In the light of the above discussions, the present TA deserves to be allowed.

ORDER

1) I hereby allow this T.A. of the Applicant Bank and direct the defendant nos. 1 and 3 to 7 to pay jointly and severally to the applicant bank within 30 days from today, a sum of Rs.20,04,33,106.89 along with cost, expenses and interest @15.75olo from the date of filing of this O.A which has become TA till the date of realization. fhe OAfl-A has already been abated against defendant no.2, therefore, the LRs of defendant no.2 are not liable to pay any amount.

2) In case of failure to deposit the above amount within the stipulated period, the same shall be recovered from the sale of the hypothecated assets and sale of the mortgaged properties i.e., (i)House No.U44, Ground Floor, Sector-1, Housjn_g Board Colony, Bhiwadi,

Rajasthan Housing Board Colony, Rajasthan Measuring 148.50 sq. mtrs., in the name of Sh. Rajendra Bansal. (ii) Residential Property at Khata No.834, OPP. UTI Sector-8, Water Tank, Near Gas Godown, Village Millakpur, Gujjar, Bhiwadi, Rajasthan, measuring 700 SQ. YDS. owned by Mrs. Kaushalya Bansal (iii) 2 Bigha 8 Biswa Vacant Commercial Plot Admeasuring 7260 SQ. YDS. at Pushp Vatika, Mehla Jobnar Road, Village Asalpur, Tehsil Fulera, Distt. Jaipur, owned by M/s. Raj Buildcon Construction Ltd.

(iv) Office No.4-Ar 4b Floor, Welldone Tech Park, Sector-48, Sohna Road, Gurgaon owned by M/s. Raj Buildcon Constructions Ltd. (v) office No'4-B, both on 4s Floor, Welldone Tech Park, Sector-48, Sohna Road, Gurgaon owned By M/s Raj Buildcon Constructions Ltd.(vi) Propefi No.102.18 Bigha (Area 16404.74 SQ. MTRS.) Industrial Land at Village Khewli, Tehsil Raipur, Distt. Pali Rajasthan owned by an Associate Company M/s Bharat Fab Tech & Corporate Park tut. Ltd. (vii) l}l.77 Bigha Industrial Land at Village Khewli, Tehsil Raipur, District Pali Rajasthan owned by an Associate Company M/s Bharat Fab Tech & Corporate Park tut. Ltd. and 80 Bighas Owned By M/s Raj Buildcon Construction Ltd. In case of short fall, the same shall be recovered from the sale of personal movable and immovable assets of the defendant nos. 1 and 3 to 7.

3) Recovery Certificate be issued forthwith and be sent to Recovery Officer, Debts Recovery Tribunal-Il, Delhi.

4) The registry of this Tribunal is hereby directed to issue free copy of the order and send the same to both the parties. q).\

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5) Parties are direct to appear before the Ld. Recovery Officer, DRT-II, Delhi on 18.08.2025. Pending IAs, if any, stand disposed of. File be consigned to records. sa Date: 18.06.2025 ' t--t _l (SUSHIL KUMAR RASTOGI) PRESIDING OFFICER DRT-II, Delhi This judgement has been signed, dated and pronounced in open court. Date:18.06.2025 S.\ (susHrl KUMA( RASTOGI) PRESIDING OFFICER DRT-II, Delhi T