PUNJAB AND SIND BANK vs YASH DEEP SHARMA AND ORS on 6 January 2026

FINAL ORDER

1. Initially, this original application was filed by the Applicant Bank, on 14.03.2019, through Mr. Rakesh Kumar Sharma, Assistant General Manager and Mr. Manoj Kumar, Senior Manager, being Authorized Officers of Applicant Bank, under Section 19 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 against the Defendants no. 1 to 3 for recovery of a sum of Rs. 104,71,52,888.14 (Rupees One Hundred One Crore Seventy One Lakh Fifty Two Thousand Eight Hundred Eighty Eight and Paise Fourteen only) along with pendentelite and future interest @13.45% p.a. compounded monthly along with penal interest @2% simple from the date of filing of the present OA till realization and costs of this OA along with other relief(s).

1.2 It is pertinent to note here that this OA bearing no. 350/2019 was originally filed before Ld. DRT-II, Delhi, however, in pursuance to Gazette Notification No. 4718 (E) dated 04.10.2022 issued by Government of India, Department of Financial Services, Ministry of Finance, this case file was transferred by Ld. DRT-II, Delhi to this Tribunal in November 2022 and was numbered at TA-456/2022.

2. The brief facts of the case are that the Applicant Bank is one of the Public Sector Bank and body corporate constituted and functioning under the Banking Companies (Acquisition & Transfer of the Undertaking) Act, 1970, having its Head Office at Rajendra Place New Delhi and the Branch amongst others at Connaught Place, New Delhi. It is further stated that the Applicant Bank is filing the present Original Application for recovery of its dues through Sh. Rakesh Kumar Sharma, Assistant General Manager and Sh. Manoj Kumar, Senior Manager who are the constituted attorneys/ Principal Officers for the applicant bank and are duly entitled, competent & authorized to institute, file, sign and verify the present claim application / pleadings and vakalatnama and to take such steps to recover any of the amount due on behalf of the applicant bank by virtue of respective Power of Attorney executed by the applicant bank in their favour as well as vide Authorization Letter dated 08.03.2019 issued by the applicant bank in their favour.

2.1 It is stated in the OA that the present OA has been instituted against the defendants no. 1 to 3 who are the individual / personal guarantors as well as corporate guarantor respectively to the credit / loan facilities granted / sanctioned by the applicant bank to M/s Maha Associated Hotels Pvt. Ltd. (**Borrower Company**). It is further stated that an application for Corporate Insolvency Resolution Process was filed by operational credit M/s UVA Engineers Pvt. Ltd. against the said Borrower Company under Insolvency and Bankruptcy Code 2016 which got admitted vide Order dated 20.09.2018 by NCLT, Jaipur Bench in CP No. (IB)-03/JPR/2018. As such Interim Resolution Professional has been appointed to carry out Corporate Insolvency Resolution Process in relation to the borrower company i.e. corporate debtor by NCLT, Jaipur Bench vide its letter dated 25.09.2018. Therefore, CIRP has been initiated qua the borrower company in view of the Letter dated 02.10.2018 as well as Letter received on 04.10.2018 of IRP. There has been extension of time by a further period of 90-days of the CIRP period vide order dated 07.03.2019 by NCLT, Jaipur. As such there has been a moratorium by way of prohibition of institution of suits or proceedings against the borrower company in terms of Section 14 of IBC 2016. In view of the moratorium the applicant bank cannot pursue / initiate its recovery proceedings against the said Borrower Company. As such the present OA has been filed against individual / corporate guarantors i.e. defendants no. 1 to 3 herein before this Tribunal by the applicant bank thereby reserving its right to sue or initiate its recovery proceedings against the borrower company before this Tribunal as and when permitted to do so under the law.

2.2 It is stated in the OA that the Borrower Company i.e. M/s Maha Associated Hotels Pvt. Ltd., a Private Limited Company incorporated under Companies Act, is a wholly owned subsidiary company of M/s Maha Hotels Project Pvt. Ltd. i.e. Defendant no. 3 having its registered office at K-47, Janpath, Kishan Nagar, Sham Nagar, Jaipur – 302019, which was set up as a Special Purpose Vehicle (SPV) Project Company to develop "Hampton by Hilton" Hotels at 30 locations within the country. As such, the borrower company had approached the applicant bank for grant of Fund Based and Non-Fund Based facilities for the purpose of carrying out project of proposed development of Hotel Entertainment cum Food Plaza and Hospitality Training Academy on the Land admeasuring 15000 sq. mtrs. situated at HTL-10, New Industrial Area Complex (Majrakth), at Neemrana, Distt. Alwar, Rajasthan – 301705.

As such after considering the said request / loan application of the borrower company, the applicant bank had granted following credit facilities vide its Sanction Letter dated 28.03.2013:- <table border="0"> <tr> <td>(i)</td> <td>Term Loan</td> <td>Rs. 70.0 Crore</td> </tr> <tr> <td>(ii)</td> <td>With sub-limit of Inland /<br/>Foreign Letter of Credit<br/>(Sight / Usuance upto<br/>180days – 365 days)</td> <td>Rs. 25.00 Crore</td> </tr> <tr> <td>(iii)</td> <td>Bank Guarantee</td> <td>Rs. 5.00 Crore</td> </tr> </table>

[details given in Para V(5.4) of the OA]

2.3 As such the said Borrower Company had furnished the certified copy of its Board Resolution dated 05.04.2012 to the applicant bank. In consideration of grant of above said Credit / Loan Facilities by the Applicant Bank, the said Borrower Company had executed following Loan and Security Documents in favour of the Applicant Bank on 23.05.2013:- **For Term Loan :**

- (ii) Bank's Form No. 291 dated 23.05.2013 regarding paying Penal Interest;

- (iii) Bank's Form No. 412 dated 23.05.2013 regarding non-diversion of Funds;

- (iv) Bank's Form No. 216 dated 23.05.2013;

- (v) Bank's Form No. 106 dated 23.05.2013 regarding waiver of presentment of Pronote;

- (vi) Bank's Form No. 103 dated 23.05.2013 regarding monthly installments;

- (vii) Bank's Form No. 126 dated 23.05.2013 regarding request to grant credit facilities;

- (viii) Bank's Form No. 200 dated 23.05.2013 regarding rate of interest;

- (ix) Consent Clause dated 23.05.2013 for disclosure to CIBIL in case of default.

**For Sub-Limit of ILLC/FLC of Rs. 25.00 Crore :**

- (i) Agreement relating to ILC / FLC dated 23.05.2013.

- (ii) Bank's Form No. 106 dated 23.05.2013 regarding waiver of presentment of Pronote;

- (iii) Counter Guarantee dated 23.05.2013;

- (iv) General Counter Indemnity dated 23.05.2013.

**For Combined Limites of Term Loan with Sub-Limit of ILC/FLC & Bank Guarantee totaling to Rs. 75.00 Crore :**

- (i) Deed of Hypothecation dated 23.05.2013 with Schedule I & II;

- (ii) Facilities Agreement dated 23.05.2013 with Schedule I to IV;

- (iii) Letter of Undertaking dated 23.05.2013; 2.4 It is stated in the OA that in order to secure the outstanding dues of the applicant bank and to secure the aforesaid Credit / Loan Facilities, the defendants no. 1 & 2 stood as guarantors and executed their personal and continuing guarantees in favour of the applicant bank on 23.05.2013.

2.5 It is stated in the OA that in order to further secure the outstanding dues of the applicant bank, the defendant no. 3 company i.e. M/s Maha Hotels Projects Pvt. Ltd. had executed its corporate guarantee in favour of the applicant bank on 23.05.2013. As such the defendant no. 3 company submitted the certified copy of its Board Resolution dated 08.04.2013 to the applicant bank for the purpose of executing its corporate guarantee in favour of the applicant bank for securing the Loan / Credit Facilities aggregating to Rs. 75.00 crore i.e. Term Loan with sub-limit of ILC/FLC of Rs. 70.00 crore and Bank Guarantee of Rs. 5.00 crore ranted by the applicant bank to the said borrower company. Further, the Defendant no. 3 company had executed a Letter of Undertaking dated 23.05.2013 in favour of the applicant bank regarding non-receipt of any commission or fees etc. for executing its corporate guarantee guaranteeing the due repayment of the loan by the borrower company.

2.6 Further, defendants no. 1 to 3 and the borrower company, had jointly executed Letter of Undertaking (Form 199) dated 23.05.2013 in favour of the applicant bank, recognizing the right of the applicant bank to securitize or sell or assign or transfer the credit facilities either with or without the underlying securities to any other bank or financial institutions etc.

2.7 Moreover, in order to secure the above said credit / loan facilities granted by the applicant bank in its favour, the said borrower company with an intention to create equitable mortgage in respect of its immovable Property i.e. Leasehold rights on the Land situated at HTL-10, New Industrial Area (Majrakath), Neemrana, District Alwar, Rajasthan – 301705 admeasuring 15000 sq. mtrs. together with all building and structures therein, fittings, fixtures attached to the earth or fastened to anything attached to the earth, both present and future had delivered and deposited Original Title Deeds / Documents such as Allotment Letter dated 15.11.2011, Lease

Agreement dated 04.01.2012 by RIICO, Possession Letter dated 04.01.2012, Sanctioned Plan with the applicant bank besides submitting Notarized Affidavit dated 20.05.2013 to the applicant bank by having executed Stamped Declaration cum Undertaking with Schedule-I & II dated 23.05.2013 in favour of the applicant bank. As such the borrower company had executed Bank's Form No. 84A dated 31.10.2013 towards confirmation of equitable mortgage in favour of the applicant bank.

2.8 As such on the request of the borrower company, various loan amounts were disbursed from time to time under the sanctioned Term Loan facility to the borrower company.

2.9 It is also stated in the OA that on the request of the borrower company vide its Letters dated 03.07.2015, a Bank Guarantee bearing no. 0484-BG0072.15 dated 06.07.2015 for sum of Rs. 14,25,000/- was issued in favour of the President of India through the Deputy Commissioner of Customs, EPCG Department, ICD/TKD, New Delhi for a period of 8-years w.e.f. 06.07.2015 valid upto 06.07.2023. In consideration thereof, the borrower company had executed a counter guarantee dated 06.07.2015 in favour of the applicant bank.

2.10 It is further stated that again on the request of the borrower company vide its Letters dated 03.07.2015, a Bank Guarantee bearing no. 0484-BG0073.15 dated 06.07.2015 for sum of Rs. 28,16,000/- was issued in favour of the President of India through the Deputy Commissioner of Customs, EPCG Department, Jawahar Custom House, Nhava Sheva for a period of 8-years w.e.f. 06.07.2015 valid upto 06.07.2023.

In consideration thereof, the borrower company had executed a counter guarantee dated 06.07.2015 in favour of the applicant bank. However, vide letter dated 13.07.2015, on the request of the borrower company. Para No. 7 in the Bank Guarantee dated 06.07.2015 was got amended and same was accordingly intimated to the beneficiary by the applicant bank vide its letter dated 13.07.2015. Accordingly, the Bank Guarantee was treated to have been issued in favour of Assistant / Deputy Commissioner of Customs, Jawahar Custom House, Nhava Sheva, Mumbai and all other terms and conditions had remained unchanged. However, again on the request of the borrower company vide its letter dated 22.07.2015 a revised / amended Bank Guarantee dated 24.07.2015 for Rs. 28,16,000/- was issued in favour of the aforesaid beneficiaries valid upto 24.07.2023. As such a confirmation dated 28.07.2015 was sent to the aforesaid beneficiary by the applicant bank in terms of the Letter dated 28.07.2015 being received from the beneficiary.

2.11 It is stated in the OA that on the request of the borrower company, the applicant bank had renewed the existing loan / credit facilities i.e. Term Loan of Rs. 70.0 Crore and Bank Guarantee of Rs. 5.0 Crore in favour of the borrower company vide its Renewal Sanction dated 11.03.2016. As such, repayment schedule was got revised and the borrower company was required to pay the term loan in 40-quarterly instalments commencing from 3^rd quarter of Financial Year – 2017-18 to 2^nd quarter of Financial Year 2027-28 and interest was payable as and when due.

In consideration of renewal of the above said loan / credit facilities, the borrower company had executed following loan 

and security documents by way of renewal in favour of the applicant bank on 15.03.2016:- **For Term Loan :**

- (ii) Bank's Form No. 291 dated 15.03.2016 regarding paying Penal Interest;

- (iii) Bank's Form No. 412 dated 15.03.2016 regarding non-diversion of Funds;

- (iv) Bank's Form No. 216 dated 15.03.2016;

- (v) Bank's Form No. 106 dated 15.03.2016 regarding waiver of presentment of Pronote;

- (vi) Bank's Form No. 122 dated 15.03.2016;

- (vii) Bank's Form No. 103 dated 15.03.2016 regarding monthly installments;

- (viii) Hypothecation of Goods to secure a Demand Cash Credit dated 15.03.2016 (Form No. 192);

- (ix) Letter of Undertaking dated 15.03.2016.

- (ii) Bank's Form No. 106 dated 15.03.2016 regarding waiver of presentment of Pronote;

- (iii) Letter of continuity dated 15.03.2016 (Form No. 159);

- (iv) Bank's Form No. 122 dated 15.03.2016;

- (v) Bank's Form No. 291 dated 15.03.2016 regarding payment of penal interest;

- (vi) Bank's Form No. 412 regarding non-diversion of Funds dated 15.03.2016;

- (vii) Bank's Form No. 216 dated 15.03.2016;

- (viii) Letter of Undertaking dated 15.03.2016;

- (ix) Counter Guarantee dated 15.03.2016.

**For Combined Limits of Term Loan with Sub-Limit of ILC/FLC & Bank Guarantee totaling to Rs. 75.00 Crore :**

- (i) Agreement for Hypothecation of debt and assets dated 15.03.2016 (Form F.EXP 37/96);

- (ii) Bank's Form No. 200 regarding rate of interest dated 15.03.2016.

2.12 It is stated in the OA that in order to secure the renewal of loan/credit facilities, the borrower company had extended the equitable mortgage over its immovable Property i.e. Leasehold rights on the Land situated at HTL-10, New Industrial Area (Majrakath), Neemrana, District Alwar, Rajasthan – 301705 admeasuring 15000 sq. mtrs. together with all building and structures therein, fittings, fixtures attached to the earth or fastened to anything attached to the earth, both present and future in favour of the applicant bank on 15.03.2016 by having executed Banker's Form No. 84A dated 15.03.2016 in favour of the applicant bank. Stamped Declaration cum Undertaking with Schedule-I & II dated 23.05.2013 in favour of the applicant bank. As such the borrower company had executed Bank's Form No. 84A dated 31.10.2013 towards confirmation of equitable mortgage in favour of the applicant bank.

2.13 It is further stated in the OA that the borrower company had acknowledged the outstanding debt of the applicant bank in Term Loan and Bank Guarantee on 15.03.2016 by having executed respective Revival Letters dated 15.03.2016 in favour of the applicant bank.

2.14 It is stated in the OA that the borrower company was required to maintain the financial discipline of the applicant bank but failed to do so. As a result, the loan account was classified as NPA on 31.12.2016 by the applicant bank as per prudential norms of accounting laid by RBI from time to time. Thereafter, the applicant bank had issued Demand Notice under Section 1392) of SARFAESI Act dated 01.02.2017 to the borrower company and its guarantors including defendants no. 1 to 3 herein but they failed to comply with the same. As such further measures were being exercised by the applicant bank under Section 13(4) of SARFAESI Act by taking symbolic possession over the mortgaged property-in-question on 22.06.2017. However, the mortgaged property-in-question is yet to be sold / auctioned by the applicant bank under the SARFAESI Act.

2.15 It is also stated in the OA that it was transpired that an application for Corporate Insolvency Resolution Process was filed by one operational credit M/s UVA Engineers Pvt. Ltd. vide CP No. (IB)-03/JPR/2018 under Insolvency and Bankruptcy Code 2016, against the borrower company before NCLT, Jaipur Bench and same was admitted vide order dated 20.09.2018 by NCLT, Jaipur Bench thereby appointing IRP for carrying out Corporate Insolvency Resolution Process as envisaged under the provisions of IBC 2016 in relation to the corporate debtor i.e. the borrower company vide its Letter dated 25.09.2018. Accordingly, intimation of initiation of CIRP and appointment of IRP was issued to the applicant bank by IRP through his Letter dated 02.10.2018 as well as through Letter received on 04.10.2018 by the applicant bank. Accordingly, the applicant bank had filed its requisite claim in Schedule Form C under Regulation 8 of Insolvency and Bankruptcy Board of India with the IRP / RP. However, vide order dated 07.03.2019, the NCLT, Jaipur Bench had extended further period of 90-days of the CIRP period. Thus, there has been a moratorium by way of prohibition of institutions of suits or proceedings against the borrower company in terms of Section 14 of the IBC 2016.

2.16 It is stated in the OA there has been a contingent liability amounting to Rs. 42,41,000/- under the Bank Guarantee issued by the applicant bank on behalf of the borrower company in favour of the aforesaid beneficiary & the applicant bank reserves its right to claim / recover the outstanding amount on account of the invoked Bank Guarantees in the present OA.

2.17 It is also stated in the OA that the defendants no. 1 & 2 herein stood as guarantors for securing the due repayment of the loan amount granted to the borrower company by the applicant bank. The outstanding debt of the applicant bank was lastly acknowledged by the borrower company on 15.03.2016 besides executing renewal documents dated 15.03.2016 in favour of the applicant bank in terms of the guarantee agreement executed by the defendants no. 1 to 3, any acknowledgment of indebtedness by the Principal Borrower would automatically extend the period of limitation against the guarantors i.e. defendants no. 1 to 3 herein. As such, the applicant bank has become entitled to recover its outstanding debt from the defendants no. 1 to 3 herein jointly and severally and therefore necessity arises to file the present claim application against defendants no. 1 to 3 before this Hon'ble Tribunal which is within the period of limitation.


However, the applicant bank reserves its right to sue or to take appropriate steps / recovery proceedings for recovery of its outstanding loan amount against the borrower company as and when permitted to do so under the la.

2.18 It is stated in the OA that as on date of present OA, an amount of Rs. 104,71,52,888.14 (for Term Loan Account) is due and payable by the defendants no. 1 to 3, jointly or severally, to the applicant bank [details given in Para V(5.21) of the OA]. It is also stated in the OA that since defendants no. 1 to 3 failed to pay the dues of the applicant bank, hence, the Applicant Bank is constrained to approach this Hon'ble Tribunal for recovery of its dues from the Defendants.

3. Notices of this O.A. were issued to the defendants and the defendants no. 1 to 3 appeared through their counsel and filed a common WS. In their WS, the defendants have taken following main objections in their WS:-

- (i) That the present OA filed by the applicant bank is neither maintainable in law nor in facts as the applicant bank is guilty of "Suppresio Veri" and "Suggestio Falsi" as the bank has concealed various important and material facts from this Tribunal at the time of admission of OA;

- (ii) That the applicant bank has sought plural remedies by way of bringing several independent cause of actions in one application with mala-fide intentions to harass the defendants;

- (iii) That the applicant's officials had got from the defendants certain unfilled / blank performas signed in blank by exercising misrepresentation, commercial duress and coercion and without even given an opportunity to read or understand the nature and contents of the said papers got signed in blank. Hence, all the documents filed and relied upon by the applicant bank cannot be allowed to be received in evidence are vitiated. It is also apparent that the applicant bank has filed un-dated documents subsequently and apparently at the time of the institution of the OA to suit its own convenience;

- (iv) That the Statement of Accounts submitted by the Applicant Bank as a part of the documents is not legible and clear, thus, the answering defendants cannot comment upon the genuineness of the entries. Moreover, the Statement of Account submitted cannot be read as evidence as the same have not been filed along with 65B of the Indian Evidence Act as provided in the law and also not certified in the prescribed format. It is also stated that Statement of Account filed by the applicant bank is prima-facie wrong, contains wrong, incorrect and unauthorized entries, wrong calculation of interest, as the wrong application of interest rates has been done by the bank. Moreover, the applicant bank has illegally debited penal interest, incidental charges and liquidated damages in the account of answering defendants which are in contravention of the rules, law and the RBI guidelines and in clear violation of the judgment passed by Hon'ble Supreme Court of India in the matter of *CBI Vs. Ravindra & Ors. SLP(C) 2424 of 1993* wherein it 

is categorically stated that the interest cannot be capitalized;

- (v) That admittedly the principal borrower company has moved before NCLT and CIRP had been initiated vide order dated 25.09.2018 and the same has been extended with consent of all the creditors for a further period. It is pertinent to note here that the applicant bank is the main and sole financial creditor of the company and also the complete voting board of the committee of creditors. As the applicant bank has already moved its claim before the IRP and the borrower company has enough assets to repay the entire outstanding, it is clear that the applicant bank now sails in both boats i.e. filing their claim before the IRP against the Borrower Company and now also has filed the present OA against the alleged guarantors to put undue pressure and recover the double amount;

- (vi) That the guarantees are alleged stated to have executed by the defendants herein at the time of execution of the OA and the agreement in question is alleged to have been renewed on 15.03.2016 whereas no consent was ever obtained from the guarantors for renewal of the same, thus, the answering defendants are not liable to honour any such commitment as the guarantee which is without their consent;

- (vii) That the borrower company had given proposal for one time settlement of the outstanding dues and the applicant bank has not even considered the same and has opted to file the present OA; 

- (viii) That the applicant bank has already taken symbolic possession of the mortgaged property under SARFAESI Act vide notice dated 01.02.2017 and the value of the said property is more than the outstanding as claimed by them thus, the present OA is not maintainable before this Hon'ble Tribunal as the applicant bank is in possession of the assets of the borrower company which are worth more than the outstanding;

- (ix) That the entire record of the borrower company are in possession of IRP and they do not have the access to the same;

- (x) That the present OA is barred by limitation. It is stated in the WS that the deed of guarantee has expired on 14.03.2016 and the present OA has been filed after the expiry of limitation;

- (xi) That the applicant bank has itself admitted the different alleged loans that were granted at different points of time and as such the different causes of action on different alleged loans have arisen. Hence, the application is barred by Rule 10 and may be dismissed on this ground alone;

- (xii) That that OA has not been signed, verified and instituted by a duly authorized and competent person;

- (xiii) That as an effect to the CIRP, the defendants who are also the directors of the Company, are suspended and the entire control of the management rests with CoC and RP. Despite being well aware of the facts, this OA has been filed before this Tribunal with an intention to place the defendants under undue pressure. On 

one hand, the applicants have chosen their forum for the present subject matter i.e. NCLT and on the other hand, it is now seeking the same relief against the defendants through this Tribunal. Further more, under Section 238 of the IBC, the proceedings under IBC supersedes all other proceedings before any other court or Tribunal. Therefore, the present OA is liable to be dismissed pending the outcome of the NCLT proceedings.

In the light of above, it has been prayed to dismiss the OA filed by the Applicant Bank with exemplary costs.

4. Rejoinder to the WS has also been filed by the applicant bank denying the allegations levelled against it and reiterating the averments made in the OA.

5. To prove its case, the Applicant Bank leads its evidence by filling the affidavit of Sh. Bimlesh Prasad, Chief Manager, of applicant bank.

5.1 Sh. Bimlesh Prasad, officer of the Applicant Bank has placed reliance upon the documents filed by the Applicant Banks which includes :-

- (i) Power of Attorney executed by the applicant bank as well as vide Authorization Letter dated 08.03.2019 issued by the applicant bank in favour of Sh. Rakesh Kumar Sharma, the then AGM of applicant bank (Ex. AW-1/1-colly);

- (ii) Sanction Letter dated 28.03.2013 of applicant bank (Ex. AW-1/2);

- (iii) Certified copy of Board Resolution dated 05.04.2012 passed by the Borrower Company (Ex. AW-1/3); **For Term Loan – Rs. 70.0 crore**

- (iv) Demand Promissory Note dated 23.05.2013 (Form No. 14) (Ex. AW-1/4);

- (v) Bank's Form No. 291 dated 23.05.2013 regarding paying Penal Interest (Ex. AW-1/5);

- (vi) Bank's Form No. 412 dated 23.05.2013 regarding non-diversion of Funds (Ex. AW-1/6);

- (vii) Bank's Form No. 216 dated 23.05.2013 (Ex. AW-1/7);

- (viii) Bank's Form No. 106 dated 23.05.2013 regarding waiver of presentment of Pronote (Ex. AW-1/8);

- (ix) Bank's Form No. 103 dated 23.05.2013 regarding monthly installments (Ex. AW-1/9);

- (x) Bank's Form No. 126 dated 23.05.2013 regarding request to grant credit facilities (Ex. AW-1/10);

- (xi) Bank's Form No. 200 dated 23.05.2013 regarding rate of interest (Ex. AW-1/11);

- (xii) Consent Clause dated 23.05.2013 for disclosure to CIBIL in case of default (Ex. AW-1/12); **For sub-limit of ILC/FLC of Rs. 25.0 crore**

- (xiii) Agreement relating to ILC / FLC dated 23.05.2013 (Ex. AW-1/13); **For BG of Rs. 5.00 crore**

- (xiv) Demand Promissory Note dated 23.05.2013 (Form No. 14) ) (Ex. AW-1/14);

- (xv) Bank's Form No. 106 dated 23.05.2013 regarding waiver of presentment of Pronote (Ex. AW-1/15);

- (xvi) Counter Guarantee dated 23.05.2013 (Ex. AW-1/16);

- (xvii) General Counter Indemnity dated 23.05.2013 (Ex. AW-1/17).


**For Combined Limites of Term Loan with Sub-Limit of ILC/FLC & Bank Guarantee totaling to Rs. 75.00 Crore :**

- (xviii) Deed of Hypothecation dated 23.05.2013 with Schedule I & II (Ex. AW-1/18);

- (xix) Facilities Agreement dated 23.05.2013 with Schedule I to IV (Ex. AW-1/19);

- (xx) Letter of Undertaking dated 23.05.2013 (Ex. AW-1/20);

- (xxi) Deed of Guarantee dated 23.05.2013 executed by defendants no. 1 & 2 (Ex. AW-1/21);

- (xxii) Deed of Corporate Guarantee dated 23.05.2013 executed by defendant no. 3 (Ex. AW-1/22);

- (xxiii) certified copy of its Board Resolution dated 08.04.2013 passed by Defendant no. 3 (Ex. AW-1/23);

- (xxiv) Letter of Undertaking dated 23.05.2013 executed by defendant no. 3 (Ex. AW-1/24);

- (xxv) Letter of Undertaking (Form 199) dated 23.05.2013 executed by defendants no. 1 to 3 and the borrower company, jointly (Ex. AW-1/25);

- (xxvi) Stamped Declaration cum Undertaking with Schedule-I & II dated 23.05.2013 executed by defendants no. 1 & 2 being authorized signatories of borrower company (Ex. AW-1/26 & AW-1/27);

- (xxvii) Bank's Form No. 84A dated 31.10.2013 executed by Borrower Company towards confirmation of equitable mortgage (Ex. AW-1/28);

- (xxviii) Copies of original title documents / title deeds of the mortgaged property (Ex. AW-1/29-colly);

- (xxix) Copy of No Objection dated 08.11.2013 of RIICO regarding mortgage in favour of applicant bank (Ex. AW-1/30);

- (xxx) Letters dated 03.07.2015 of the Borrower Company to the applicant bank requesting for issuance of Bank Guarantee(s) (Ex. AW-1/31 & AW-1/32);

- (xxxi) Office copy of Bank Guarantee No. 0484-BG0072-15 for Rs. 14,25,000/- dated 06.07.2015 issued by applicant bank (Ex. AW-1/33);

- (xxxii) Counter guarantee dated 06.07.2015 issued by the borrower company in favour of the applicant bank (Ex. AW-1/34);

- (xxxiii) Letters dated 03.07.2015 of Borrower company to the applicant bank requesting for issuance of Bank Guarantee(s) (Ex. AW-1/35 to AW-1/37);

- (xxxiv) Office copy of Bank Guarantee bearing no. 0484-BG0073.15 dated 06.07.2015 for sum of Rs. 28,16,000/- issued by the applicant bank (Ex. AW-1/35 to AW-1/37);

- (xxxv) Counter guarantee dated 06.07.2015 executed by Borrower Company in favour of the applicant bank (Ex. AW-1/38);

- (xxxvi) Letter dated 13.07.2015 of applicant bank with regard to amendment of Para No. 7 in the Bank Guarantee dated 06.07.2015 intimating to the beneficiary by the applicant bank (Ex. AW-1/39);

- (xxxvii) Request letter dated 22.07.2015 of Borrower Company as well as revised / amended Bank Guarantee dated 24.07.2015 for Rs. 28,16,000/- issued in favour of the beneficiaries (Ex. AW-1/40 & AW-1/41);

- (xxxviii) Confirmation dated 28.07.2015 sent by the applicant Bank to the beneficiary (Ex. AW-1/42);

- (xxxix) Renewal Sanction dated 11.03.2016 issued by the applicant bank (Ex. AW-1/43); **For Term Loan**

- (xli) Demand Promissory Note dated 15.03.2016 (Form No. 14) (Ex. AW-1/44);

- (xlii) Bank's Form No. 291 dated 15.03.2016 regarding paying Penal Interest (Ex. AW-1/45);

- (xliii) Bank's Form No. 412 dated 15.03.2016 regarding non-diversion of Funds (Ex. AW-1/46);

- (xliv) Bank's Form No. 216 dated 15.03.2016 (Ex. AW-1/47);

- (xlv) Bank's Form No. 106 dated 15.03.2016 regarding waiver of presentment of Pronote (Ex. AW-1/48);

- (xlvii) Bank's Form No. 122 dated 15.03.2016 (Ex. AW-1/49);

- (xlviii) Bank's Form No. 103 dated 15.03.2016 regarding monthly installments (Ex. AW-1/50);

- (xlviii) Hypothecation of Goods to secure a Demand Cash Credit dated 15.03.2016 (Form No. 192) (Ex. AW-1/51);

- (xlviii) Letter of Undertaking dated 15.03.2016 (Ex. AW-1/52);

- (xlix) Demand Promissory Note dated 15.03.2016 (Form No. 14) (Ex. AW-1/53);

- (l) Bank's Form No. 106 dated 15.03.2016 regarding waiver of presentment of Pronote (Ex. AW-1/54);

- (li) Letter of continuity dated 15.03.2016 (Form No. 159) (Ex. AW-1/55);

- (liii) Bank's Form No. 122 dated 15.03.2016 (Ex. AW-1/56);

- (liiii) Bank's Form No. 291 dated 15.03.2016 regarding payment of penal interest (Ex. AW-1/57);

- (liv) Bank's Form No. 412 regarding non-diversion of Funds dated 15.03.2016 (Ex. AW-1/58);

- (lv) Bank's Form No. 216 dated 15.03.2016 (Ex. AW-1/59);

- (lvi) Letter of Undertaking dated 15.03.2016 (Ex. AW-1/60);

- (lvii) Counter Guarantee dated 15.03.2016 (Ex. AW-1/61); **For Combined Limits of Term Loan with Sub-Limit of ILC/FLC & Bank Guarantee totaling to Rs. 75.00 Crore :**

- (lviii) Agreement for Hypothecation of debt and assets dated 15.03.2016 (Form F.EXP 37/96) (Ex. AW-1/62);

- (lix) Bank's Form No. 200 regarding rate of interest dated 15.03.2016 (Ex. AW-1/63);

- (lx) Bank's Form No. 84A dated 15.03.2016 executed by the Borrower Company in favour of the applicant bank for extending the equitable mortgage over its immovable property (Ex. AW-1/64);

- (lxi) Revival Letters dated 15.03.2016 in r/o Term Loan and Bank Guarantee executed by the Borrower Company in favour of the applicant bank (Ex. AW-1/65 & AW-1/66);

- (lxii) Copy of Demand Notice under Section 13(2) of SARFAESI Act dated 01.02.2017 issued by the applicant bank to the borrower company and its guarantors including defendants no. 1 to 3 herein (Ex. AW-1/67);

- (lxiii) Copy of Possession Notice 22.06.2017 issued by applicant bank with photographs (Ex. AW-1/68-colly);

- (lxiv) Order dated 20.09.2018 of Ld. NCLT, Jaipur Bench sent by it to IRP vide its Covering Letter dated 25.09.2018 (Ex. AW-1/69 & AW-1/70);

- (lxv) Intimation of initiation of CIRP and appointment of IRP issued to the applicant bank by IRP through his Letters dated 20.06.2018 & 02.10.2018 which were received on 04.10.2018 by the applicant bank (Ex. AW-1/71 & AW-1/72);

- (lxvi) Requisite claim filed by the applicant bank in Schedule Form C under Regulation 8 of Insolvency and Bankruptcy Board of India with the IRP / RP (Ex. AW-1/73);

- (lxvii) Order dated 07.03.2019 of the NCLT, Jaipur Bench whereby it had extended further period of 90-days of the CIRP period (Ex. AW-1/74);

- (lxviii) Statement of Account with regard to Term Loan Account maintained by the applicant bank duly certified under Bankers Books Evidence Act bearing the signatures of Sh. Rakesh Sharma, the then AGM of the applicant bank as well as Calculation Sheet with Memorandum of Interest (in the Term Loan Account) (Ex. AW-1/75-colly & AW-1/76);

6. So far as, defendants no. 1 to 3 are concerned, none of the defendants chose to file any evidence in support of their common WS, hence, the defence taken by all the defendants remained unsubstantiated / uncorroborated.

7. In the present matter, written submissions have also been filed by the defendant no. 3.

8. It is pertinent to note here that Ld. counsel for applicant bank informed this Tribunal that personal insolvency proceedings have been commenced qua defendants no. 1 & 2

are before Ld. NCLT, Jaipur bench and filed the relevant orders passed by Ld. NCLT.

In the light of above, since personal insolvency proceedings qua defendants no. 1 & 2 are pending before Ld. NCLT, hence, no order qua defendants no. 1 & 2 can be passed against said defendants at this stage.

However, it is directed that applicant bank shall be at liberty to revive the OA qua defendants no. 1 & 2 in case NCLT proceedings are quashed / withdrawn in future, in accordance with law.

It is also matter of record that CIRP proceedings qua Borrower Company are also pending before Ld. NCLT, Jaipur Bench. In these circumstances, it is directed that in case Applicant Bank receive any amount from the CIRP proceedings qua Borrower Company as well as personal insolvency proceedings qua defendants no. 1 & 2 herein (which are pending before Ld. NCLT, Jaipur Bench), it shall give due adjustment of the same in the recovery proceedings.

9. Since, defendants no. 1 & 2 are before Ld. NCLT, Jaipur Bench, hence, there is no need to deal with the objections of defendants no. 1 & 2 taken in their common WS filed by defendants no. 1 to 3.

10. Now I would like to deal with the defence taken by defendant no. 3 in subsequent paras. :-

- (i) Defendant no. 3 has raised an objection that the present OA filed by the applicant bank is neither maintainable in law nor in facts as the applicant bank is guilty of "Suppresio Veri" and "Suggestio Falsi" as the bank has concealed various important and material facts from this Tribunal at the time of admission of OA.

It is matter of record that the applicant bank has filed all the requisite documents in support of its OA which have already been exhibited. On the other hand, defendants have not filed any evidence in support of their WS. Hence, this Tribunal is of the view that mere making allegations by the defendants does not suffice their purpose. In these circumstances, this objection of the Defendant no. 3 does not hold any water and same stands rejected.

- (ii) Next objection of defendant no. 3 is that the applicant bank has sought plural remedies by way of bringing several independent cause of actions in one application with mala-fide intentions to harass the defendants.

Record reveals that this OA has been filed qua defendants no. 1 to 3, being guarantors to the Borrower Company, with regard to various facilities granted by the applicant bank to the borrower company. This Tribunal does not find any merit in the contention of the defendant no. 3, hence, this objection of the Defendant no. 3 is liable to be rejected and same stands rejected accordingly.


(iii) Defendant no. 3 has also taken a plea that the applicant's officials had got from the defendants certain unfilled / blank performas signed in blank by exercising misrepresentation, commercial duress and coercion and without even given an opportunity to read or understand the nature and contents of the said papers got signed in blank. Hence, all the documents filed and relied upon by the applicant bank cannot be allowed to be received in evidence are vitiated. It is also apparent that the applicant bank has filed undated documents subsequently and apparently at the time of the institution of the OA to suit its own convenience.

This Tribunal is of the view that plea of blank documents is no plea in the eyes of law as has been held by the Hon'ble Delhi High Court in the matter of "Indian Bank Vs. Cheese Wafers (India) Pvt. Ltd It was held if the defendants have not filed any complaint before higher authorities of the bank or filed any complaint before police authorities.....". Thus, the plea of blank / unfilled documents, alleged to be misused by the applicant bank for creating false claims, is not maintainable after filing of the suit and the same is rejected.

(iv) Next objection of defendant no. 3 is that the Statement of Accounts submitted by the Applicant Bank as a part of the documents is not legible and clear, thus, the answering defendants cannot comment upon the genuineness of the 

entries. Moreover, the Statement of Account submitted cannot be read as evidence as the same have not been filed along with 65B of the Indian Evidence Act as provided in the law and also not certified in the prescribed format. It is also stated that Statement of Account filed by the applicant bank is prima-facie wrong, contains wrong, incorrect and unauthorized entries, wrong calculation of interest, as the wrong application of interest rates has been done by the bank. Moreover, the applicant bank has illegally debited penal interest, incidental charges and liquidated damages in the account of answering defendants which are in contravention of the rules, lex and the RBI guidelines and in clear violation of the judgment passed by Hon'ble Supreme Court of India in the matter of *CBI Vs. Ravindra & Ors. SLP(C) 2424 of 1993* wherein it is categorically stated that the interest cannot be capitalized.

I have gone through the statement of account(s) filed by the applicant bank along with Calculation Sheet with Memorandum of Interest and Certificate under Bankers Book Evidence Act (Ex. AW-1/75-colly & AW-1/76) and there is no infirmity in the said documents. Even otherwise, defendant no. 3 has not filed their own statement of accounts. Hence, this plea of Defendant no. 3 also does not hold any water and same stands rejected accordingly.


(v) Defendant no. 3 has stated in the WS that admittedly the principal borrower company has moved before NCLT and CIRP had been initiated vide order dated 25.09.2018 and the same has been extended with consent of all the creditors for a further period. It is further stated that it is pertinent to note here that the applicant bank is the main and sole financial creditor of the company and also the complete voting board of the committee of creditors. As the applicant bank has already moved its claim before the IRP and the borrower company has enough assets to repay the entire outstanding, it is clear that the applicant bank now sails in both boats i.e. filing their claim before the IRP against the Borrower Company and now also has filed the present OA against the alleged guarantors to put undue pressure and recover the double amount.

It is matter of record that this OA has been filed qua guarantors since the borrower company is before Ld. NCLT. This Tribunal is of the view that there is no bar to file an OA qua guarantors when the main borrower company is before Ld. NCLT as the liability of the guarantors is coextensive with the borrower company. With these observations, this plea of defendant no. 3 is not tenable in the eyes of law and same stands rejected.

(vi) Next objection raised by defendant no. 3 is that the guarantees are alleged stated to have executed by the defendants herein at the time of execution A solid green rectangular box is positioned at the bottom right of the page, below the page number.

of the OA and the agreement in question is alleged to have been renewed on 15.03.2016 whereas no consent was ever obtained from the guarantors for renewal of the same, thus, the answering defendants are not liable to honour any such commitment as the guarantee which is without their consent.

It is matter of record that defendant no. 3 has not denied the execution of guarantee deed at the time of availing loan facilities by the Borrower Company in May 2013. Applicant Bank has already proved the Deed of Corporate Guarantee dated 23.05.2013 executed by defendant no. 3 (Ex. AW-1/22). Perusal of the said Deed of Guarantee reveal that the said Guarantee is a continuing one, hence, same shall be binding on defendant no. 3 at the time of renewal of facilities in March 2016. With these observations, this plea of defendant no. 3 stands rejected accordingly.

- (vii) Defendant no. 3 has also raised an objection that the borrower company had given proposal for one time settlement of the outstanding dues and the applicant bank has not even considered the same and has opted to file the present OA.

So far as, question of settlement between the parties is concerned, this Tribunal is of the view that it is the prerogative of the parties to settle the matter and this Tribunal is not going to interfere for the same. Admittedly, defendants along with Borrower have failed to maintain financial discipline, hence, this OA has been filed for recovery of its dues. Hence, this objection of defendant no. 3 stands rejected accordingly.

(viii) Defendant no. 3 has also taken a plea in the WS that the applicant bank has already taken symbolic possession of the mortgaged property under SARFAESI Act vide notice dated 01.02.2017 and the value of the said property is more than the outstanding as claimed by them thus, the present OA is not maintainable before this Hon'ble Tribunal as the applicant bank is in possession of the assets of the borrower company which are worth more than the outstanding.

Since there is no bar on the applicant bank to proceed under SARFAESI Act and RDB Act simultaneously, hence, this objection of defendant no. 3 does not hold any water and same stands rejected.

(ix) Next objection of defendant no. 3 is that the entire record of the borrower company are in possession of IRP and they do not have the access to the same.

This Tribunal is of the view that for want of documents from IRP, defendant no. 3 cannot take advantage for paying the dues to applicant bank as the guarantee given by the defendant no. 3 is continuing one and the liability of defendant no. 3 is coextensive with the borrower company. The applicant bank has duly filed the requisite documents in support of its OA whereas defendant no. 3 did not even chose to file its evidence. Hence, mere allegations by defendant no. 3 will not suffice its purpose. Accordingly, this plea of defendant no. 3 is hereby rejected.

- (x) Defendant no. 3 has also raised an objection that the present OA is barred by limitation. It is stated in the WS that the deed of guarantee has expired on 14.03.2016 and the present OA has been filed after the expiry of limitation.

As already discussed above, that the guarantee deed executed by defendant no. 3 is continuing one, hence, it cannot be said that the deed of guarantee of defendant no. 3 was expired on 14.03.2016. It is also matter of record that this OA was filed on 14.03.2019 whereas facilities obtained by the borrower company were renewed on 15.03.2019. Hence, this objection of the view that this OA has been filed well within the period of limitation and same stands rejected accordingly.

- (xi) It is stated in the WS that the applicant bank has itself admitted the different alleged loans that were granted at different points of time and as such the different causes of action on different alleged loans have arisen. Hence, the application is barred by Rule 10 and may be dismissed on this ground alone.

This OA has been filed qua the defendants for the different loan facilities obtained by the Borrower Company from the same bank wherein answering defendant no. 3 stood as corporate guarantor. The availment of loan facilities and execution of guarantee deed is not denied by defendant no. 3. In these circumstances, this plea of defendant no. 3 also stands rejected accordingly.

(xii) Next objection of defendant no. 3 is that this OA has not been signed, verified and instituted by a duly authorized and competent person.

Record reveals that applicant bank has duly filed Power of Attorney executed by the applicant bank as well as Authorization Letter dated 08.03.2019 issued by the applicant bank in favour of Sh. Rakesh Kumar Sharma, the then AGM of applicant Bank (Ex. AW-1/1-colly) who filed this OA. I do not find any infirmity in the same, hence, this plea of defendant no. 3 also stands rejected.

(xiii) Defendant no. 3 has also raised an objection that as an effect to the CIRP, the defendants who are also the directors of the Company, are suspended and the entire control of the management rests with CoC and RP. Despite being well aware of the facts, this OA has been filed before this Tribunal with an intention to place the defendants under undue pressure. It is further stated by defendant no. 3 that on one hand, the applicants have chosen their forum for the present subject matter i.e. NCLT and on the other hand, it is now seeking the same relief against the defendants through this Tribunal. Further more, under Section 238 of the IBC, the proceedings 

under IBC supersedes all other proceedings before any other court or Tribunal. Therefore, the present OA is liable to be dismissed pending the outcome of the NCLT proceedings.

This Tribunal is of the view that the liability of the defendants is continuing and coextensive with the borrower company. Even otherwise, applicant bank is duty bound to give adjustment of the amount recovered from the NCLT proceedings pending qua Borrower Company and defendants no. 1 & 2 herein, as discussed above, hence, defendant no. 3 cannot be benefitted by taking such plea. Accordingly, this plea of defendant no. 3 is hereby rejected.

11. On the other hand, the witness of Applicant Bank has fully corroborated the averments made in the OA. Even otherwise the whole case of the applicant is based on the documents and the witness has duly proved all these documents. The evidence filed by the applicant gone unrebuted and there is no question of disbelieving the evidence lead by the applicant bank and applicant bank has proved its case beyond reasonable doubts. Accordingly, the Applicant Bank is entitled to recover the entire amount, as claimed in the OA from the defendants, along with pendentelite interest @ 13% p.a. and costs of this OA.

12. In this OA, applicant has prayed to issue recovery certificate against defendants no. 1 to 3 wherein defendants no. 1 & 2 are personal guarantors whereas defendant no. 3 is the corporate guarantor to the Borrower Company.

Since personal insolvency proceedings qua defendants no. 1 & 2 are pending before Ld. NCLT, Jaipur Bench, hence, no order qua defendants no. 1 & 2 can be passed against said defendants at this stage.

However, it is directed that applicant bank shall be at liberty to revive the OA qua defendants no. 1 & 2 in case NCLT proceedings are quashed / withdrawn in future, in accordance with law.

It is also matter of record that CIRP proceedings qua Borrower Company are also pending before Ld. NCLT, Jaipur Bench. In these circumstances, it is directed that in case Applicant Bank receive any amount from the CIRP proceedings qua Borrower Company as well as personal insolvency proceedings qua defendants no. 1 & 2 herein (which are pending before Ld. NCLT, Jaipur Bench), it shall give due adjustment of the same in the recovery proceedings.

13. Consequently, TA No. 456/2022 is liable to be allowed in favour of the Applicant Bank and against defendant 3 only (being Corporate Guarantor to the Borrower Company), as it is liable to pay the dues of the Applicant Bank along with costs and pendentelite & future interest @ 13% p.a. from the date of filing of the OA till its actual realization in full.

ORDER

(i) TA No. 456/2022 stands allowed in favour of applicant bank against defendant no. 3 for a sum of Rs. 104,71,52,888.14 (Rupees One Hundred One Crore Seventy One Lakh Fifty Two

36

Thousand Eight Hundred Eighty Eight and Paise Fourteen only), along with pendentelite and future interest @13% p.a. from the date of filing of the OA till its actual realization in full; along with costs of this OA. Now Defendant no. 3 is directed to pay the aforesaid amount to the Applicant Bank within 30-days, failing which, the aforesaid amount(s) shall be recovered from the sale of secured assets belonging to defendant no. 3 only.

In case of shortfall, same shall be recovered from the sale movable and immovable assets of the defendant no. 3.

- (ii) Since, defendants no. 1 & 2 are before Ld. NCLT, Jaipur Bench, as discussed above, hence, no order qua defendants no. 1 & 2 can be passed against said defendants at this stage.

- (iii) Since personal insolvency proceedings qua defendants no. 1 & 2 are pending before Ld. NCLT, Jaipur Bench, hence, no order qua defendants no. 1 & 2 can be passed against said defendants at this stage.

However, it is directed that applicant bank shall be at liberty to revive the OA qua defendants no. 1 & 2 in case NCLT proceedings are quashed / withdrawn in future, in accordance with law.

It is also matter of record that CIRP proceedings qua Borrower Company are also pending before Ld. NCLT, Jaipur Bench. In these circumstances, it is directed that in case Applicant Bank receive any amount from the CIRP proceedings qua Borrower Company as well as personal insolvency proceedings qua defendants no. 1 & 2 herein (which are pending before Ld. NCLT, Jaipur Bench), it shall give due adjustment of the same in the recovery proceedings.

- (iv) It is also directed that the Applicant shall adjust the amount(s), if any, received from the defendants during the pendency of this case.

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

- (vi) Parties are directed to appear before the Recovery Officer-II, DRT-III, Delhi on 20.03.2026.

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

File be closed and consigned to records.

06.01.2026

(SHIV KUMAR - I) PRESIDING OFFICER, DRT-III, DELHI

(Pronounced in open court) Dated: 06.01.2026