BANK OF INDIA and Others vs MS MOHAN GEMS AND JEWELS PVT LTD AND ORS on 12 February 2026

**FINAL ORDER**

1. 1. This Original Application, instituted on 23.06.2017 under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, has been filed for recovery of a sum of Rs.374,42,89,923.49 (Rupees Three Hundred Seventy-Four Crores Forty-Two Lakhs Eighty-Nine Thousand Nine Hundred Twenty-Three and Paise Forty-Nine only), being the outstanding dues in respect of the aforesaid credit facilities, inclusive of interest calculated up to 30.04.2017 as detailed in the statements of account (as revised from time to time), along with pendentite lite and future interest and charges at the contractual rates from 01.05.2017 till the date of full payment and/or realisation.

**A. Applicant No. 1 – Bank of India**

The Applicant No. 1, Bank of India, is a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Plot No. C-5, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai-400051, and, inter alia, a branch at Parliament Street Marg, New Delhi-110001 (Mid Corporate Branch). The present Application is signed, verified and instituted on behalf of the Applicant Bank by Mr. Ravinder Kumar Sharma, Chief Manager, Jhandewalan Extension Branch, New Delhi, who is the duly constituted attorney, fully conversant with the facts of the case and authorised by virtue of a Power of Attorney dated 21.08.2014 to sign and verify the Application, affidavits, pleadings and other documents and to prosecute the proceedings against the Defendants to their logical conclusion; a copy of the said Power of Attorney, Annexure A-1.

**B. Applicant No. 2 – Corporation Bank**

The Applicant No. 2, Corporation Bank, was a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Mangladevi Temple Road, Pandeshwar, Mangalore-575001, and, inter alia, a branch at M-93, Connaught Circus, New Delhi-110001, and pursuant to Gazette Notification No. 133 dated 04.03.2020 issued under Section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980, stands amalgamated with Union Bank of India with effect from 01.04.2020, whereby its entire undertaking vested in Union Bank of India and all pending or existing proceedings by or against Corporation Bank are to be continued and enforced by or against Union Bank of India as if originally instituted by it. The present Application is signed, verified and instituted by Mr. Debraj Bag, Assistant General Manager, Overseas Branch, New Delhi, who is the duly constituted attorney, fully conversant with the facts of the case and authorised by virtue of a Power of Attorney dated 31.03.1990 to sign and verify the Application, affidavits, pleadings and other documents and to prosecute the proceedings to their ultimate legitimate end; Annexure A-2.

**C. Applicant No. 3 – Bank of Baroda**

The Applicant No. 3, Bank of Baroda, is a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at Mandvi, Baroda, Gujarat, and, inter alia, a branch at the Corporate Financial Services Branch, 1st Floor, Bank of Baroda Building, Sansad Marg, New Delhi-110001. The present Application is signed, verified and instituted on behalf of the Applicant Bank by Ms. Reetu Kaushik, Senior Manager, Corporate Financial Services Branch, New Delhi, who is the duly constituted attorney, fully conversant with the facts of the case and authorised by virtue of a Power of Attorney dated 20.04.2017 to sign and verify the Application, affidavits, pleadings and other documents and to prosecute the proceedings against the Defendants to their ultimate legitimate conclusion; a copy of the said Power of Attorney, Annexure A-3.

1. 2. It is pertinent here that this OA bearing No. 766/2017 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 on 14.10.2022 and was numbered at TA-22/2022.

2. 3. The brief facts of the case are that Defendant No. 1 is the principal borrower, being a company incorporated under the Companies Act, 1956, having its registered office at 3324, Bank Street, Karol Bagh, New Delhi-110005, and is engaged in the business of gems and jewellery, which availed the cash credit facilities of Rs.10 crores sanctioned by the Applicant. Defendants No. 2 and 3 are the Directors of Defendant No. 1 and, in addition to managing its affairs, have, in their personal and individual capacities, executed deeds of guarantee securing due repayment of the financial assistance granted by the Applicant, and are also mortgagors of the secured assets. Defendant No. 4 stands in the dual capacity of a mortgagor as well as a guarantor in respect of the credit facilities extended to Defendant No. 1. Defendants No. 5 to 7 are guarantors who have executed guarantees to secure the due repayment of the credit facilities availed by Defendant No. 1, and are jointly and severally liable along with the principal borrower and other guarantors for the outstanding dues of the Applicant.

1. 4. So far as, Defendants No. 1 to 7, despite due service of summons, failed to appear before this Tribunal and did not file their written statements within the prescribed period; accordingly, vide order dated 15.03.2018, proceedings were initiated against them and their right to file written statements was closed.

2. 5. It is pertinent that Defendants No. 1, 2 and 5 are presently undergoing Corporate Insolvency Resolution Process pursuant to orders passed by the Ld. NCLT, New Delhi under the Insolvency and Bankruptcy Code, 2016. In view thereof, no relief is being granted against Defendants No. 1, 2 and 5 in the present proceedings. However, any amount realized by the Applicant Bank in the insolvency proceedings shall be duly accounted for and adjusted in the present recovery proceedings, in accordance with law.

3. 6. It is further stated that the terms and conditions governing the sanction of the said credit facilities by Applicant No. 1 to Defendant No. 1 were duly accepted and acknowledged by all the Defendants. In this regard, the Applicant No. 1 issued a Sanction Letter dated 18.05.2006, Annexure A-4. In consideration of the sanction and grant of the cash credit facilities aggregating to Rs 10 crores, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors, executed the requisite security and loan documents in favour of Applicant No. 1, thereby setting out and binding themselves to the terms and conditions governing the grant, operation, and repayment of the said credit facilities and submitted the following documents:

2. ii. Demand Promissory Note dated 27.05.2006 - Annexure A-6

3. iii. Agreement of Hypothecation of Plant and Machinery, Stocks and Book Debts dated 27.05.2006 - Annexure A-7

4. iv. Credit Facility Agreement dated 27.05.2006 - Annexure A-8

5. v. Declaration from the Borrower (Form L-515) dated 27.05.2006 - Annexure A-9

6. vi. Letter of Declaration, Undertaking and Authority dated 27.05.2006 - Annexure A-10

7. vii. Form L-516 dated 27.05.2006 - Annexure A-11

8. viii. Agreement of Guarantee dated 27.05.2006 - Annexure A-12

7. At the request of Defendant No. 1, certain modifications were effected in the original Sanction Letter dated 18.05.2006, which were duly communicated by the Applicant No. 1 vide Sanction Letter No. BKS: ADV:87 dated 01.07.2006, Annexure A-13, and the said changes were duly approved by Defendant No. 1 through a Board Resolution dated 01.07.2006, Annexure A-14. In terms of the sanction and the modified conditions, Defendant No. 1 agreed to pay interest at the rate of 0.35% over the Bank's BPLR, then prevailing at 11.60% per annum, or at such other rate as may be fixed by Applicant No. 1 from time to time, calculated on the daily outstanding balance and charged at monthly rests, with the interest so accrued being capitalised and forming part of the principal amount until full repayment of the dues. Defendant No. 1 further agreed that the rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of Applicant No. 1 Bank, at its absolute discretion or pursuant to any directive issued by the Reserve Bank of India, and also undertook to pay penal interest, as prescribed from time to time, over and above the agreed rate, with applicable rests, in the event of irregularity of the account or breach of the agreed terms and conditions.

1. 8. As further security for the aforesaid credit facilities, together with interest and all other monies that may become due and payable by Defendant No. 1 to Applicant No. 1, Defendant No. 1 created a hypothecation in favour of Applicant No. 1 over its stocks of gold and jewellery. Additionally, as further and continuing security for the said credit facilities, along with interest, costs, charges, and other monies payable by the Defendants, Defendants No. 2 to 4 created equitable mortgages in favour of Applicant No. 1 in respect of their immovable properties, thereby securing due repayment of the outstanding dues under the said credit facilities and the detail of the properties are mentioned in para No. 9 of OA.

2. 9. At the request of Defendant No. 1, the existing credit facilities were enhanced by Applicant No. 1 Bank from Rs.10 crores to Rs.14 crores vide Sanction Letter dated 31.12.2012, the terms and conditions whereof were duly accepted by all the Defendants, and the requisite documents in relation thereto were executed by the Defendants on 01.02.2008; Annexure A-16. In consideration of the said enhancement of the credit facilities, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors and mortgagors, executed the necessary security and loan documents in favour of Applicant No. 1, setting out the revised terms and conditions governing the grant, operation, and repayment of the enhanced credit facilities and the documents are below:

- ii. Demand Promissory Note for Rs.4 crores dated 02.02.2008 - Annexure A-18

- iii. Form L-435 dated 02.02.2008 - Annexure A-19

- iv. Form L-515 dated 02.02.2008 - Annexure A-20

- v. Form L-516 dated 02.02.2008 - Annexure A-21

- vi. Form L-481 dated 02.02.2008 - Annexure A-22

- vii. Letter of Declaration, Undertaking and Authority dated 02.02.2008 - Annexure A-23

- viii. Charge and Hypothecation of Book Debts (Form CC-531) dated 02.02.2008 - Annexure A-24

- ix. Deed of Guarantee dated 02.02.2008 - Annexure A-25

- x. Acknowledgement of Debt and Securities (Form L-444C) dated 02.02.2008 - Annexure A-26

10. That, as further and additional security for the enhanced credit facilities, together with interest and all other monies that may become due and payable by the Defendants to Applicant No. 1, Defendant No. 4 created a fresh equitable mortgage in favour of Applicant No. 1 over the property described in the para No. 12 of OA. Copies of the Attendance Register dated 02.02.2008, evidencing the creation of the aforesaid equitable mortgages by deposit of title deeds by Defendant No. 4 in the usual and ordinary course of its day-to-day business, Annexure A-27.

11. In terms of the Sanction Letter dated 02.02.2008, Defendant No. 1 agreed to pay interest at the rate of 2% over the BOI BPLR, the minimum being 15.25% per annum, or at such other rate as may be fixed by Applicant No. 1 from time to time, to be calculated on the daily outstanding balance and charged at monthly rests, until the entire dues of the Applicant Bank are fully paid. It was further agreed that the interest so debited would form part of the principal and would carry interest with agreed rests at the aforesaid rates, and that the applicable rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of Applicant No. 1 Bank, at its absolute discretion or pursuant to any directive issued by the Reserve Bank of India. Defendant No. 1 also undertook to pay penal interest, as prescribed from time to time, with agreed rests, over and above the stipulated rate of interest, in the event of the account becoming irregular or for any other reason in terms of the governing agreements.

1. 12. At the request of Defendant No. 1, the existing credit facilities were further enhanced by Applicant No. 1 Bank from Rs.14 crores to Rs.18 crores vide Sanction Letter dated 09.04.2009, the terms and conditions whereof were duly accepted by all the Defendants, and the requisite documents in relation thereto were executed by the Defendants on the same date; Annexure A-28. In consideration of the aforesaid enhancement of the credit facilities, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors and mortgagors, executed the necessary security and loan documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant, operation, and repayment of the enhanced credit facilities and the documents are mentioned as under:

1. i. Board Resolution dated 09.04.2009 passed by Defendant No. 1 in respect of the aforesaid credit facilities, Annexure A-29.


- ii. Demand Promissory Note for Rs.4 crores dated 09.04.2009 executed by the Defendants in favour of Applicant No. 1 Bank, Annexure A-30.

- iii. Form L-481 dated 09.04.2009 executed by Defendant No. 1 in favour of Applicant No. 1 Bank, Annexure A-31.

- iv. Form L-516 dated 09.04.2009 executed by Defendant No. 3 in favour of Applicant No. 1 Bank, Annexure A-32.

- v. Form L-435 dated 09.04.2009 executed by Defendant No. 1 in favour of the Applicant Bank, Annexure A-33.

- vi. Deed of Guarantee dated 09.04.2009 executed by Defendants No. 2 to 4 in favour of Applicant No. 1, Annexure A-34.

- vii. Acknowledgement of Debt and Securities (Form L-444C) dated 09.04.2009 executed by Defendants No. 1 to 4 in favour of Applicant No. 1, Annexure A-35.

13. As further and continuing security for the enhanced credit facilities, together with interest and all other monies that may become due and payable by the Defendants to Applicant No. 1, Defendant No. 4 extended the equitable mortgage in respect of the six properties already mortgaged, by deposit of title deeds, and copies of the Attendance Register dated 09.04.2009 evidencing such extension of equitable mortgages by Defendants No. 2 to 4 in the usual and ordinary course of day-to-day business, Annexure A-36.

14. In terms of the Sanction Letter dated 09.04.2009, Defendant No. 1 further agreed to pay interest at the rate of 12% per annum, or at such other rate as may be fixed by Applicant No. 1 from time to time, to be calculated on the daily outstanding balance and charged at monthly rests until full repayment of the dues, with the interest so debited forming part of the principal and carrying interest with agreed rests; it was also agreed that the applicable rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of Applicant No. 1 Bank, at its absolute discretion or pursuant to any directive issued by the Reserve Bank of India, and that Defendant No. 1 would be liable to pay penal interest, as prescribed from time to time with agreed rests, over and above the stipulated rate of interest in the event of the account becoming irregular or for any other reason in terms of the governing agreements.

1. 15. At the request of Defendant No. 1, the existing credit facilities were reviewed and the limits were enhanced by Applicant No. 1 Bank from Rs.18 crores to Rs.28 crores vide Sanction Letter dated 02.12.2009, the terms and conditions whereof were duly accepted by all the Defendants, and the requisite documents in relation thereto were executed by the Defendants on 03.12.2009; a copy of the said Sanction Letter dated 02.12.2009 Annexure A-37. In consideration of the aforesaid enhancement of the credit facilities, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors and mortgagors, executed the necessary security and loan documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant, operation, and repayment of the enhanced credit facilities, the documents are mentioned as under:

2. ii. Demand Promissory Note for Rs.10 crores dated 03.12.2009 - Annexure A-39

3. iii. Form L-481 dated 03.12.2009 - Annexure A-40

4. iv. Letter of Declaration, Undertaking and Authority dated 03.12.2009 - Annexure A-41

5. v. Form L-516 dated 03.12.2009 - Annexure A-42

- vi. Form L-515 dated 03.12.2009 - Annexure A-43

- vii. Form L-490 dated 03.12.2009 - Annexure A-44

- viii. Letters regarding external credit rating and Interest Service Coverage Ratio - Annexure A-45 (Colly.)

- ix. Deed of Guarantee dated 03.12.2009 - Annexure A-46

- x. Acknowledgement of Debt and Securities (Form L-444C) dated 03.12.2009 - Annexure A-47

16. As further and continuing security for the enhanced credit facilities, together with interest and all other monies that may become due and payable by the Defendants to Applicant No. 1, Defendants No. 2 to 4 extended the equitable mortgage in respect of the six properties already mortgaged, by deposit of title deeds, and copies of the Attendance Register dated 03.12.2009 evidencing such extension of equitable mortgages by Defendants No. 2 to 4 in the usual and ordinary course of day-to-day business, Annexure A-48.

17. In terms of the Sanction Letter dated 02.12.2009, Defendant No. 1 further agreed to pay interest at the rate of 12% per annum, or at such other rate as may be fixed by Applicant No. 1 from time to time, to be calculated on the daily outstanding balance and charged at monthly rests until full repayment of the dues, with the interest so debited forming part of the principal and carrying interest with agreed rests; it was also agreed that the applicable rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of Applicant No. 1 Bank, at its absolute discretion or pursuant to any directive issued by the Reserve Bank of India, and that Defendant No. 1 would be liable to pay penal interest, as prescribed from time to time with agreed rests, over and above the stipulated rate of interest in the event of the account becoming irregular or for any other reason in terms of the governing agreements.

1. 18. That the account of Defendant No. 1, in respect of the aforesaid credit facilities, was transferred from the Bank Street, Karol Bagh Branch to the New Delhi Mid Corporate Branch, Hotel Connaught, Shivaji Stadium, New Delhi, of Applicant No. 1 Bank, and Defendant No. 1, while giving its consent to the said transfer, duly executed the following documents in connection therewith.

2. ii. Consent Letter dated 02.07.2010 - Annexure A-50

3. iii. Acknowledgement of Debt and Securities executed by the defendants No. 1 to 4 (Form L-444C) dated 02.07.2010 - Annexure A-51 (Colly.)

1. 19. At the request of Defendant No. 1, the existing credit facilities were further enhanced by Applicant No. 1 Bank from Rs.28 crores to Rs.40 crores vide Sanction Letter dated 07.02.2011, the terms and conditions whereof were duly accepted by all the Defendants, and the requisite documents in relation thereto were executed by the Defendants on 21.04.2011; a copy of the said Sanction Letter dated 07.02.2011, Annexure A-52. In consideration of the aforesaid enhancement of the credit facilities, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors and mortgagors, executed the necessary security and loan documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant, operation, and repayment of the enhanced credit facilities.

2. ii. Demand Promissory Note for Rs.12 crores dated 21.04.2011 - Annexure A-54

- iii. Supplemental Deed of Hypothecation dated 21.04.2011 - Annexure A-55

- iv. Credit Facility Agreement dated 21.04.2011 - Annexure A-56

- v. Letter of Declaration dated 21.04.2011 - Annexure A-57

- vi. Form L-516 dated 21.04.2011 - Annexure A-58

- vii. Form L-515 dated 21.04.2011 - Annexure A-59

- viii. Deed of Guarantee dated 21.04.2011 - Annexure A-60

- ix. Acknowledgement of Debt and Securities (Form L-444C) dated 21.04.2011 - Annexure A-61

20. As further and continuing security for the enhanced credit facilities, together with interest and all other monies that may become due and payable by the Defendants to Applicant No. 1, Defendants No. 2 to 4 extended the equitable mortgage in respect of the six properties already mortgaged, by deposit of title deeds, and copies of the Attendance Register dated 25.04.2011 evidencing such extension of equitable mortgages by Defendants No. 2 to 4 in the usual and ordinary course of day-to-day business, Annexure A-62.

21. In terms of the sanction and applicable communications, Defendant No. 1 further agreed to pay interest at the rate of 3.75% over the base rate, then prevailing at 13.25% per annum, or at such other rate as may be fixed by Applicant No. 1 from time to time, to be calculated on the daily outstanding balance and charged at monthly rests until full repayment of the dues, with the interest so debited forming part of the principal and carrying interest with agreed rests; it was also agreed that the applicable rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of Applicant No. 1 Bank, at its absolute discretion or pursuant to any directive issued by the Reserve Bank of India, and that Defendant No. 1 would be liable to pay penal interest, as prescribed from time to time with agreed rests, over and above the stipulated rate of interest in the event of the account becoming irregular or for any other reason in terms of the governing agreements.

22. At the request of Defendant No. 1, the existing credit facilities were substantially enhanced by a consortium of banks headed by Applicant No. 1 Bank along with Corporation Bank, Applicant Bank No. 2, from Rs. 40 crores to Rs. 120 crores, comprising Rs.60 crores sanctioned by each Applicant Bank, vide Sanction Letter dated 18.07.2012 issued by Applicant Bank No. 1 and Sanction Letter dated 08.01.2013 issued by Applicant Bank No. 2; the terms and conditions thereof were duly accepted by all the Defendants, and the requisite consortium and security documents in relation thereto were executed by the Defendants on 10.01.2013, copies whereof are annexed herewith and marked as Annexure A-63 (Colly.).

23. In consideration of the aforesaid enhancement of the credit facilities by the consortium banks, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors and mortgagors, executed the necessary security and loan documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant, operation, and repayment of the enhanced credit facilities and the details of the documents are as under:

- ii. Working Capital Consortium Agreement dated 10.01.2013 - Annexure A-65

- iii. Joint Deed of Hypothecation dated 10.01.2013 - Annexure A-66

- iv. Confirmation of Inter Se Agreement dated 10.01.2013 - Annexure A-67

- v. Various Undertakings dated 10.01.2013 - Annexure A-68

- vi. Undertaking dated 10.01.2013 - Annexure A-69

- vii. Letter of Authority dated 10.01.2013 - Annexure A-70

- viii. Inter Se Agreement dated 10.01.2013 - Annexure A-71

- ix. Form L-490 dated 10.01.2013 - Annexure A-72

- x. Declaration dated 10.01.2013 - Annexure A-73

- xi. Deed of Guarantee dated 10.01.2013 - Annexure A-74

- xii. Acknowledgement of Debt and Securities dated 09.01.2013 - Annexure A-75

24. That, as further and continuing security for the enhanced credit facilities, together with interest and all other monies that may become due and payable by the Defendants to Applicant No. 1, Defendants No. 2 to 4 extended and/or created equitable mortgages in favour of Applicant No. 1 in respect of the properties described in the para No. 29 of OA. Copies of the Attendance Register dated 10.01.2013, evidencing the extension and/or creation of equitable mortgages by deposit of title deeds by Defendant Nos. 2 to 4 in the usual and ordinary course of day-to-day business, are annexed hereto and marked as Annexure A-76 (Colly.).

25. In terms of the respective Sanction Letters issued by the consortium member banks, the Applicants herein, Defendant No. 1 agreed to pay interest at the rates stipulated therein, or at such other rate as may be fixed by the Applicant Banks from time to time, to be calculated on the daily outstanding balance and charged at monthly rests, until the entire dues of the Applicant Banks are fully paid. It was further agreed that the interest so debited would form part of the principal and carry interest with agreed rests at the applicable rates, and that the rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of the Applicant Banks, at their absolute discretion or pursuant to any directive issued by the Reserve Bank of India. Defendant No. 1 also undertook to pay penal interest, as prescribed from time to time with agreed rests, over and above the stipulated rate of interest, in the event of the account becoming irregular or for any other reason in terms of the governing agreements.

1. 26. At the request of Defendant No. 1, the existing credit facilities were further enhanced by the consortium of banks headed by Applicant No. 1 Bank, along with Corporation Bank (Applicant Bank No. 2), State Bank of Patiala (Proforma Defendant No. 8), and Bank of Baroda (Applicant No. 3), from Rs.120 crores to an aggregate limit of Rs.295 crores, comprising Rs.139.00 crores sanctioned by Applicant No. 1 Bank, Rs.60.00 crores by Applicant Bank No. 2, Rs.50.00 crores by Proforma Defendant No. 8, and Rs.46.00 crores by Applicant No. 3. The said enhancement was sanctioned vide Sanction Letters dated 07.11.2013 issued by Applicant No. 1 Bank, dated 24.12.2012 issued by Applicant Bank No. 2, dated 07.12.2013 issued by Proforma Defendant No. 8, and dated 25.02.2014 issued by Applicant No. 3, respectively, the terms and conditions whereof were duly accepted by all the Defendants, and the requisite consortium and security documents in relation thereto were executed by the Defendants on 26.02.2014, Annexure A-77 (Colly.)

2. 27. That, in consideration of the enhancement of the credit facilities from Rs.120 crores to Rs.295 crores sanctioned by the consortium banks, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 4, as guarantors and mortgagors, executed the requisite security and loan documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant, operation, and repayment of the said enhanced credit facilities and the details of the documents are as under:

- ii. Working Capital Consortium Agreement dated 26.02.2014 - Annexure A-79

- iii. Joint Deed of Hypothecation dated 26.02.2014 - Annexure A-80

- iv. Inter Se Agreement dated 26.02.2014 - Annexure A-81

- v. Letter of Authority dated 26.02.2014 - Annexure A-82

- vi. Undertaking - Annexure A-83

- vii. Deeds of Guarantee dated 26.02.2014 - Annexure A-84 (Colly.)

28. In terms of the Sanction Letters issued by the respective consortium member banks, the Applicants herein, Defendant No. 1 agreed to pay interest at the rates stipulated therein, or at such other rate as may be fixed by the Applicant Banks from time to time, to be calculated on the daily outstanding balance and charged at monthly rests until the entire dues of the Applicant Banks are fully paid. It was further agreed that the interest so debited would form part of the principal and would carry interest with agreed rests at the applicable rates, and that the rate of interest would be subject to variation in accordance with changes in the Prime Lending Rate and/or the internal policy of the Applicant Banks, at their absolute discretion or pursuant to any directive issued by the Reserve Bank of India regarding the rate and rests on which interest is to be charged. Defendant No. 1 also undertook to pay penal interest, as prescribed from time to time with agreed rests, over and above the stipulated rate of interest, in the event of the account becoming irregular or for any other reason in terms of the governing agreements.

1. 29. At the request of Defendant No. 1, the existing credit facilities were further enhanced by the consortium of banks headed by Applicant No. 1 Bank, along with Corporation Bank (Applicant Bank No. 2), State Bank of Patiala (assignor of Proforma Defendant No. 8), and Bank of Baroda (Applicant No. 3), from Rs.295 crores to an aggregate limit of Rs.325 crores, comprising Rs.139.00 crores sanctioned by Applicant No. 1 Bank, Rs.90.00 crores by Applicant Bank No. 2, Rs.50.00 crores by State Bank of Patiala, and Rs.46.00 crores by Applicant No. 3. The said enhancement was sanctioned vide Sanction Letters dated 07.11.2013 issued by Applicant No. 1 Bank, dated 07.03.2014 issued by Applicant Bank No. 2, dated 25.02.2014 issued by Applicant No. 3, and dated 07.12.2013 issued by Proforma Defendant No. 8, respectively, the terms and conditions whereof were duly accepted by all the Defendants, and the requisite consortium and security documents in relation thereto were executed by the Defendants on 26.02.2014, Annexure A-85.

2. 30. That, in consideration of the enhancement of the credit facilities from Rs.295 crores to Rs.325 crores sanctioned by the consortium banks, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 5, as guarantors and mortgagors, executed the requisite security and loan documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant, operation, and repayment of the said enhanced credit facilities, the details of the documents are as under:

1. i. Board Resolution dated 24.03.2014 passed by Defendant No. 1, along with covering letter addressed to Applicant Bank No. 1 - Annexure A-86

- ii. Board Resolution dated 24.03.2014 passed by Corporate Guarantor, Defendant No. 5 - Annexure A-87

- iii. Working Capital Consortium Agreement dated 04.04.2014 - Annexure A-88

- iv. Joint Deed of Hypothecation dated 04.04.2014 - Annexure A-89

- v. Inter Se Agreement dated 04.04.2014 - Annexure A-90

- vi. Letter of Authority dated 04.04.2014 - Annexure A-91

- vii. Undertaking dated 04.04.2014 executed by Defendant No. 1 - Annexure A-92

- viii. Undertaking dated 04.04.2014 executed by Defendant No. 4 - Annexure A-93

- ix. Revival Letter dated 04.04.2014 executed by Defendant No. 1 - Annexure A-94

- x. Deeds of Guarantee dated 04.04.2014 executed by Defendants No. 2 to 4 and Defendant No. 5 - Annexure A-95 (Colly.)

31. That, as further security for the said enhanced credit facilities, together with interest and all other monies which may become due and payable by the Defendants to Applicant No. 1, Defendants No. 2 to 4 extended/created an equitable mortgage in respect of the following properties which are mentioned in the para No. 36 of OA, copies of the Attendance Register dated 04.04.2014, evidencing the extension/creation of the said equitable mortgages by deposit of title deeds by Defendants No. 2 to 4 in the usual and ordinary course of their day-to-day business, Annexure A-96.

32. That Defendant No. 1 agreed to pay interest on the credit facilities availed in accordance with the terms and conditions stipulated in the respective Sanction Letters, namely, the Sanction Letter dated 07.11.2013 issued by Applicant Bank No. 1, the Sanction Letter dated 04.12.2012 issued by Applicant Bank No. 2, the Sanction Letter dated 07.12.2013 issued by Applicant Bank No. 3, and the Sanction Letter dated 25.02.2014 issued by Proforma Defendant Bank No. 8, or at such other rates as may be fixed by the Applicant Banks from time to time. The interest payable to Applicant Bank No. 1 was agreed to be calculated on the daily outstanding balance and charged on monthly rests, while the agreed rates of interest applicable to the credit facilities extended by the other consortium member banks are detailed in separate sheets annexed at the end of this Application.

1. 33. It was further agreed that such interest, so long as the entire dues remain unpaid, shall form part of the principal and shall carry interest with agreed rests at the aforesaid rates, which rates shall be subject to revision from time to time in accordance with changes in the Prime Lending Rate and/or the internal policy of the Applicant Banks, at their absolute discretion or pursuant to any directions issued by the Reserve Bank of India regarding the applicable rate and rests. Defendant No. 1 further agreed to pay penal interest, as prescribed from time to time with agreed rests, over and above the contracted rate of interest, in the event the account becomes irregular or for any other reasons as provided under the said agreements.

2. 34. That, upon the request of Defendant No. 1, the existing credit facilities were restructured by a consortium of banks headed by Bank of India, Applicant No. 1, along with Corporation Bank, Applicant Bank No. 2, State Bank of Patiala, Proforma Defendant No. 8, and Bank of Baroda, Applicant Bank No. 3, whereby the total consortium limits were enhanced from Rs. 325 crores to Rs. 390.85 crores, comprising Rs. 167.17 crores by Bank of India, Rs. 108.24 crores by Corporation Bank, Rs. 60.13 crores by State Bank of Patiala, and Rs. 55.31 crores by Bank of Baroda. The said restructuring was sanctioned vide Sanction Letters dated 11.02.2015 issued by Applicant No. 1 Bank, 17.03.2015 issued by Applicant Bank No. 2, 31.12.2014 issued by Applicant Bank No. 3, and 16.03.2015 issued by Proforma Defendant No. 8, respectively. The terms and conditions contained therein were duly accepted by the Defendants, and the consortium documents relating to the said restructuring were duly executed by the Defendants, Annexure A-97.

35. That, prior to the execution of the consortium documents in respect of the aforesaid credit facilities, Defendant No. 1 executed the following documents in favour of Applicant Bank No. 3 for the credit facilities amounting to Rs. 55.31 crores extended by Applicant Bank No. 3. The details of the documents are as under:

1. i. Letter of Instalment with Acceleration Clause (WCTL) dated 31.12.2014 - Annexure A-98.

2. ii. Demand Promissory Note (Cash Credit Facility) dated 31.12.2014 - Annexure A-99.

3. iii. Demand Promissory Note (WCTL Facility) for Rs. 31,84,00,000/- dated 31.12.2014 - Annexure A-100.

4. iv. Demand Promissory Note (FITL-I Facility) for Rs. 1,48,00,000/- dated 31.12.2014 - Annexure A-101.

5. v. Demand Promissory Note (FITL-II Facility) for Rs. 7,84,00,000/- dated 31.12.2014 - Annexure A-102.

6. vi. Board Resolution passed by Defendant No. 5 dated 31.12.2014 - Annexure A-103.

7. vii. Board Resolution passed by Defendant No. 1 dated 31.12.2014 - Annexure A-104.

8. viii. Composite Hypothecation Agreement dated 31.12.2014 - Annexure A-105.


- ix. Letter of Continuing Security (Cash Credit Facility) dated 31.12.2014 - Annexure A-106.

- x. Undertaking-cum-Declaration for Environment Protection dated 31.12.2014 - Annexure A-107.

- xi. General Form of Guarantee dated 31.12.2014 - Annexure A-108.

- xii. Undertaking for Creation of Securities dated 31.12.2014 - Annexure A-109.

- xiii. Declaration to be taken from the Company every year dated 31.12.2014 - Annexure A-110.

- xiv. Power of Attorney in respect of Book Debt Facility dated 31.12.2014 - Annexure A-111.

- xv. Declaration-cum-Undertaking-cum-Authority dated 31.12.2014 - Annexure A-112.

- xvi. Undertaking not to withdraw deposits by Directors till liquidation of advances dated 31.12.2014 - Annexure A-113.

- xvii. Letter of Undertaking (in respect of Book Debts) dated 31.12.2014 - Annexure A-114.

- xviii. Undertaking for Non-Disposal of Shareholdings dated 31.12.2014 - Annexure A-115.

- xix. Letter of Instalment with Acceleration Clause (FITL-I) dated 31.12.2014 - Annexure A-116.

- xx. Letter of Instalment with Acceleration Clause (FITL-II) dated 31.12.2014 - Annexure A-117.

- xxi. Declaration regarding none of the Directors being in the Defaulters List dated 31.12.2014 - Annexure A-118.

- xxii. Agreement of Corporate Guarantee dated 31.12.2014 - Annexure A-119.


36. That, in consideration of the restructuring and enhancement of the credit facilities from Rs. 325 crores to Rs. 390.85 crores granted by the consortium banks, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 7, as the Directors/Guarantors/Mortgagors, executed the following security documents in favour of Applicant No. 1, setting out the terms and conditions governing the grant of the said credit facilities.

1. i. Board Resolution dated 11.02.2015 - Annexure A-120.

2. ii. Demand Promissory Notes dated 11.02.2015 - Annexure A-121 (Colly.).

3. iii. Agreement of Hypothecation of Plant and Machinery, Stocks and Book Debts dated 11.02.2015 - Annexure A-122.

4. iv. Agreement of Term Loan and Hypothecation of Movable Assets/Goods/Property/Plant and Machinery dated 11.02.2015 - Annexure A-123.

5. v. Credit Facility Agreement dated 11.02.2015 - Annexure A-124.

6. vi. Inter Se Agreement dated 05.06.2015 - Annexure A-125.

7. vii. Letter of Declaration, Undertaking and Authority dated 11.02.2015 - Annexure A-126.

8. viii. Forms L-516, L-516 (FITL) and L-516 (WCTL), all dated 11.02.2015 - Annexure A-127 (Colly.).

9. ix. Undertaking dated 11.02.2015 - Annexure A-128.

10. x. Declaration on Form L-515 dated 11.02.2015 - Annexure A-129.

11. xi. Letters of Pledge of Shares dated 11.02.2015 - Annexure A-130 (Colly.).

12. xii. Letter surrendering share certificates dated 23.04.2015 - Annexure A-131 (Colly.).

xiii. Deed of Guarantee dated 11.02.2015 - Annexure A-132.

37. That vide letter dated 11.02.2015, Applicant No. 1 restructured the credit facilities granted to Defendant No. 1, Annexure A-133. That, as further security for the enhanced credit facilities aggregating to Rs. 390.85 crores, together with interest, costs and all other monies which may become due and payable to Applicant No. 1, Defendants No. 2 to 4 extended the equitable mortgages already created by them, and Defendant No. 5 created a fresh additional equitable mortgage by deposit of title deeds in respect of the immovable property bearing House No. 31, Block-53, Khasra No. 787/10, Ramjas Road, WEA, Karol Bagh, New Delhi, standing in the name of M/s Ganga Business (P) Ltd., Defendant No. 5.

38. The said equitable mortgage was created on 05.06.2015 in favour of Bank of India, Applicant No. 1, securing an amount of Rs. 390.85 crores along with applicable interest and costs at the agreed rates. Copies of the Attendance Register dated 05.06.2015 evidencing the extension/creation of the said equitable mortgages by deposit of title deeds by Defendants No. 2 to 5 in the usual and ordinary course of business, Annexure A-134 (Colly.).

39. That thereafter, once again at the request of Defendant No. 1, the existing credit facilities were further restructured by the consortium of banks headed by Bank of India, Applicant No. 1, along with Corporation Bank, Applicant Bank No. 2, and Bank of Baroda, Applicant Bank No. 3.

40. That, in consideration of the restructuring of the credit facilities granted by the consortium banks, Defendant No. 1, as the principal borrower, and Defendants No. 2 to 7, as the Directors/Guarantors/Mortgagors, executed the following security documents in favour of Applicant No. 1, stipulating the terms and conditions governing the grant of the said credit facilities.

1. i. Board Resolution dated 28.05.2015 - Annexure A-135.

2. ii. Board Resolution dated 28.05.2015 - Annexure A-136.

3. iii. Inter Se Agreement dated 05.06.2015 - Annexure A-137.

4. iv. Letter of Authority to Lead Bank dated 05.06.2015 - Annexure A-138.

5. v. Supplementary Agreement of Hypothecation of Goods and Assets dated 05.06.2015 - Annexure A-139.

6. vi. Working Capital Consortium Agreement dated 05.06.2015 - Annexure A-140.

7. vii. WCTL and FITL Agreement dated 05.06.2015 - Annexure A-141.

8. viii. Restructuring Agreement dated 05.06.2015 - Annexure A-142.

9. ix. Deed of Pledge dated 05.06.2015 - Annexure A-143. Irrevocable Power of Attorney dated 05.06.2015 - Annexure A-144.

10. x. Irrevocable Power of Attorney dated 05.06.2015 - Annexure A-145.

11. xi. Irrevocable Power of Attorney dated 05.06.2015 - Annexure A-146.

12. xii. Undertaking/Indemnity by Guarantors dated 05.06.2015 - Annexure A-147.

13. xiii. Deed of Guarantee dated 05.06.2015 - Annexure A-148.

41. That, in terms of the sanction of the said credit facilities, Defendant No. 1 was obliged to maintain and operate its account strictly in accordance with the terms and conditions of sanction and to observe financial discipline. However, Defendant No. 1, in breach of the said terms and conditions, failed to regularise the account and committed persistent defaults, besides other violations of the sanction conditions, thereby failing to maintain the requisite financial discipline.

1. 42. As a consequence of such defaults and breaches, the account of Defendant No. 1 was classified as a Non-Performing Asset (NPA) by Applicant No. 1 Bank on 30.09.2015, by Applicant Bank No. 2 on 30.06.2015, by Applicant Bank No. 3 on 30.09.2015, and by Proforma Defendant No. 8 on 29.11.2015. Thereafter, upon such classification of the account as NPA, Defendants No. 1 to 7 were duly served with demand notices under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 by Applicant Banks No. 1 to 4 on 21.12.2015, 07.08.2015, 28.12.2015 and 10.12.2015, respectively, Annexure A-149 (Colly.).

2. 43. That, as on 30.04.2017, the Defendants are jointly and severally liable to pay to the Applicant Banks a total sum of Rs. 374,42,89,923.49 (Rupees Three Hundred Seventy Four Crores Forty Two Lakhs Eighty Nine Thousand Nine Hundred Twenty Three and Paise Forty Nine only), comprising Rs. 195,10,54,673.60 due and payable to Bank of India (Lead Bank), Rs. 117,87,77,686.00 due and payable to Corporation Bank, and Rs. 61,44,57,563.89 due and payable to Bank of Baroda. That the transactions entered into between the Applicants and the Defendants are commercial transactions and, accordingly, the Applicant Banks are entitled to pendentite lite and future interest with monthly rests, from the date of filing of the present Application till realisation, at the contractual rates prevailing as on the date of this Application, namely, in respect of Applicant No. 1: Cash Credit at 12.20%, WCTL at 12.20% along with penal interest @ 2%, and FITL at 12.20%; in respect of Applicant No. 2: WCTL

at 12.20%, FITL-I at 12.20% and FITL-II at 12.20%; and in respect of Applicant No. 3: Cash Credit at 12.20%, WCTL at 12.20%, FITL-I at 12.20% and FITL-II at 12.20%.

1. 44. That the Applicant Banks stated that interest and/or compound interest has been charged in the said accounts at such rates and with such periodical rests as are permissible under and in conformity with the directives and guidelines issued by the Reserve Bank of India, and that the penal interest, wherever charged, has not been compounded or capitalised. The Statements of Accounts of Defendant No. 1 maintained with the consortium member banks, duly certified in accordance with the provisions of the Bankers' Books Evidence Act, Annexure A-150 (Colly.) and form an integral part of the present Application.

2. 45. That upon final accounting, a sum of Rs. 374,42,89,923.49 (Rupees Three Hundred Seventy Four Crores Forty Two Lakhs Eighty Nine Thousand Nine Hundred Twenty Three and Paise Forty Nine only), inclusive of interest as detailed in the separate sheets up to 30.04.2017, has been found due and payable in the account of Defendant No. 1, for which the Defendants are jointly and severally liable, together with pendent lite and future interest and other charges at the rates mentioned in paragraph 40 hereinabove from 01.05.2017 till the date of payment and/or realisation in full. That the Applicant Banks have already taken measures under Section 13(4) of the SARFAESI Act, 2002 in respect of certain mortgaged properties, which were put to e-auction on two occasions but the auctions failed; and without prejudice to their rights to continue proceedings under the SARFAESI Act, the Applicant Banks have filed the present Original Application as a matter of abundant caution, inter alia, to safeguard limitation and to enforce the personal obligations and covenants of the Defendants under the executed documents, as well as to avoid future complications and multiplicity of proceedings.

1. 46. The Applicant Banks have disclosed the creation of securities and have sought appropriate reliefs in paragraph 6 of the O.A. in respect of all immovable properties mortgaged/charged in their favour, while expressly reserving their right, with the leave of this Tribunal, to seek appropriate remedies in respect of the secured assets in the event the same could not be sold under SARFAESI proceedings due to objections or for any other reason. Such pleadings are made in the interest of justice and do not prejudice the Defendants; rather, the Applicant Banks undertake to duly credit any sale proceeds realised under the SARFAESI Act towards the Defendants' liability and to place on record the relevant particulars along with updated statements of account. The notices of e-auction, publications thereof, panchnamas and inventories prepared in respect of the mortgaged properties put to auction, Annexure A-151.

2. 47. That the cause of action for filing the present Original Application first arose on 18.05.2006 when Applicant Bank No. 1 initially sanctioned the credit facilities in favour of Defendant No. 1, and thereafter arose on 01.02.2008, 09.04.2009 and 02.12.2009 when the said credit facilities were enhanced at the request of Defendant No. 1. The cause of action further arose on 02.07.2010 upon acknowledgment of debt by the Defendants, and again on 07.02.2011, 18.07.2012, 07.11.2013, 04.04.2014, 31.12.2014, 11.02.2015, 17.03.2015 and 16.03.2015 when the credit facilities were enhanced, reviewed and/or restricted by the Applicant Banks at the request of Defendant No. 1. The cause of action also arose from time to time when Defendant No. 1 availed the credit facilities, and further when the Defendants were repeatedly called upon to regularise the account and liquidate the outstanding dues of the Applicant Banks. The cause of action is continuous and recurring in nature so long as the Defendants fail to discharge their liability and clear the outstanding dues. That the present Original Application is filed without prejudice to the rights of the Applicant Banks in respect of any action already initiated or to be initiated under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, and the Applicant Banks undertake to duly inform this Tribunal of any amount, if any, realised in proceedings under the said Act.

48. To substantiate its case, that the Applicant Bank No. 1 has filed the affidavit of Mr. Pawan Kumar, Chief Manager, Bank of India, New Delhi Large Corporate Branch, Janpath, New Delhi, who is duly authorised and fully conversant with the facts and records of the present case. The Applicant No. 1, Bank of India, having its Head Office at Plot No. C-5, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai-400051, and having, inter alia, a branch at Parliament Street Marg, New Delhi-110001, known as the Mid Corporate Branch. The deponent is authorised to swear the said affidavit and depose in the present proceedings by virtue of the Power of Attorney, Exhibit AW-1/1.

1. i. Power of Attorney of the Deponent – Exhibit AW-1/1

2. ii. Sanction Letter dated 18.05.2006 – Exhibit AW-1/2

3. iii. Board Resolution dated 22.05.2006 – Exhibit AW-1/3

4. iv. Demand Promissory Note for Rs. 10 Crores dated 27.05.2006 – Exhibit AW-1/4

5. v. Agreement of Hypothecation of Plant & Machinery, Stocks and Book Debts dated 27.05.2006 – Exhibit AW-1/5

- vi. Credit Facility Agreement dated 27.05.2006 – Exhibit AW-1/6

- vii. Declaration on Form L-515 dated 27.05.2006 – Exhibit AW-1/7

- viii. Letter of Declaration, Undertaking & Authority dated 27.05.2006 – Exhibit AW-1/8

- ix. Form L-516 dated 27.05.2006 – Exhibit AW-1/9

- x. Agreement of Guarantee dated 27.05.2006 – Exhibit AW-1/10

- xi. Revised Sanction Letter dated 01.07.2006 – Exhibit AW-1/11

- xii. Board Resolution dated 01.07.2006 – Exhibit AW-1/12

- xiii. Attendance Register for creation of Equitable Mortgage dated 27.05.2006 (Colly.) – Exhibit AW-1/13

- xiv. Sanction Letter dated 31.12.2007 (effective from 01.02.2008) – Exhibit AW-1/14

- xv. Board Resolution dated 01.02.2008 – Exhibit AW-1/15

- xvi. Demand Promissory Note for Rs. 4 Crores dated 02.02.2008 – Exhibit AW-1/16

- xvii. Form L-435 dated 02.02.2008 – Exhibit AW-1/17

- xviii. Form L-515 dated 02.02.2008 – Exhibit AW-1/18

- xix. Form L-516 dated 02.02.2008 – Exhibit AW-1/19

- xx. Form L-481 dated 02.02.2008 – Exhibit AW-1/20

- xxi. Letter of Declaration, Undertaking & Authority dated 02.02.2008 – Exhibit AW-1/21

- xxii. Charge and Hypothecation of Book Debts (Form CC-531) dated 02.02.2008 – Exhibit AW-1/22

- xxiii. Deed of Guarantee dated 02.02.2008 – Exhibit AW-1/23

- xxiv. Acknowledgement of Debt & Securities (Form L-444C) dated 02.02.2008 – Exhibit AW-1/24

- xxv. Attendance Register for Additional Equitable Mortgage dated 02.02.2008 – Exhibit AW-1/25

- xxvi. Sanction Letter dated 09.04.2009 – Exhibit AW-1/26

- xxvii. Board Resolution dated 09.04.2009 – Exhibit AW-1/27

- xxviii. Demand Promissory Note dated 09.04.2009 – Exhibit AW-1/28

- xxix. Form L-481 dated 09.04.2009 – Exhibit AW-1/29

- xxx. Form L-516 dated 09.04.2009 – Exhibit AW-1/30

- xxxi. Form L-435 dated 09.04.2009 – Exhibit AW-1/31

- xxxii. Deed of Guarantee dated 09.04.2009 – Exhibit AW-1/32

- xxxiii. Acknowledgement of Debt & Securities dated 09.04.2009 – Exhibit AW-1/33

- xxxiv. Attendance Register for Extension of Equitable Mortgage dated 09.04.2009 – Exhibit AW-1/34

- xxxv. Sanction Letter dated 02.12.2009 – Exhibit AW-1/35

- xxxvi. Board Resolution dated 02.12.2009 – Exhibit AW-1/36

- xxxvii. Demand Promissory Note dated 03.12.2009 – Exhibit AW-1/37

- xxxviii. Form L-481 dated 03.12.2009 – Exhibit AW-1/38

- xxxix. Letter of Declaration, Undertaking & Authority dated 03.12.2009 – Exhibit AW-1/39

- xl. Form L-516 dated 03.12.2009 – Exhibit AW-1/40

- xli. Form L-515 dated 03.12.2009 – Exhibit AW-1/41

- xlii. Form L-490 dated 03.12.2009 – Exhibit AW-1/42

- xliii. Letters relating to Credit Rating and ISCR dated 03.12.2009 (Colly.) – Exhibit AW-1/43

- xliv. Deed of Guarantee dated 03.12.2009 – Exhibit AW-1/44

- xlv. Acknowledgement of Debt & Securities dated 03.12.2009 – Exhibit AW-1/45

- xlvi. Attendance Register for Extension of Equitable Mortgage dated 03.12.2009 – Exhibit AW-1/46

- xlvii. Board Resolution dated 01.07.2010 – Exhibit AW-1/47

- xlviii. Consent Letter dated 02.07.2010 – Exhibit AW-1/48

- xlix. Acknowledgement of Debt & Securities dated 02.07.2010 (Colly.) – Exhibit AW-1/49

- 1. Sanction Letter dated 07.02.2011 – Exhibit AW-1/50

- li. Board Resolution dated 20.04.2011 – Exhibit AW-1/51

- lii. Demand Promissory Note dated 21.04.2011 – Exhibit AW-1/52

- liii. Supplemental Deed of Hypothecation dated 21.04.2011 – Exhibit AW-1/53

- liv. Credit Facility Agreement dated 21.04.2011 – Exhibit AW-1/54

- lv. Letter of Declaration dated 21.04.2011 – Exhibit AW-1/55

- lvi. Form L-516 dated 21.04.2011 – Exhibit AW-1/56

- lvii. Form L-515 dated 21.04.2011 – Exhibit AW-1/57

- lviii. Deed of Guarantee dated 21.04.2011 – Exhibit AW-1/58

- lix. Acknowledgement of Debt and Securities (Form L-444C) dated 21.04.2011 – Exhibit AW-1/59

- lx. Attendance Register for Extension of Equitable Mortgage dated 25.04.2011 – Exhibit AW-1/60

- lxi. Sanction Letters dated 18.07.2012 and 08.01.2013 (Colly.) – Exhibit AW-1/61

- lxii. Board Resolution dated 09.01.2013 – Exhibit AW-1/62

- lxiii. Working Capital Consortium Agreement dated 10.01.2013 – Exhibit AW-1/63

- lxiv. Joint Deed of Hypothecation dated 10.01.2013 – Exhibit AW-1/64

- lxv. Confirmation of Inter-Se Agreement dated 10.01.2013 – Exhibit AW-1/65

- lxvi. Various Undertakings dated 10.01.2013 – Exhibit AW-1/66

- lxvii. Undertaking dated 10.01.2013 – Exhibit AW-1/67

- lxxviii. Letter of Authority dated 10.01.2013 – Exhibit AW-1/68

- lxxix. Inter-Se Agreement dated 10.01.2013 – Exhibit AW-1/69

- lxx. Form L-490 dated 10.01.2013 – Exhibit AW-1/70

- lxxi. Declaration dated 10.01.2013 – Exhibit PW-1/71

- lxxi. Deed of Guarantee dated 10.01.2013 – Exhibit AW-1/72

- lxxii. Acknowledgement of Debt and Securities dated 09.01.2013 – Exhibit AW-1/73

- lxxiii. Attendance Register for Creation/Extension of Equitable Mortgage dated 10.01.2013 (Colly.) – Exhibit AW-1/74

- lxxiv. Sanction Letters dated 07.11.2013, 04.12.2012, 07.12.2013 and 25.02.2014 (Colly.) – Exhibit AW-1/75

- lxxv. Board Resolution dated 25.02.2014 – Exhibit AW-1/76

- lxxvi. Working Capital Consortium Agreement dated 26.02.2014 – Exhibit AW-1/77

- lxxvii. Joint Deed of Hypothecation dated 26.02.2014 – Exhibit AW-1/78

- lxxviii. Inter-Se Agreement dated 26.02.2014 – Exhibit AW-1/79

- lxxix. Letter of Authority dated 26.02.2014 – Exhibit AW-1/80

- lxxx. Undertaking dated 26.02.2014 – Exhibit AW-1/81

- lxxxi. Deeds of Guarantee dated 26.02.2014 (Colly.) – Exhibit AW-1/82

- lxxxii. Board Resolution dated 24.03.2014 – Exhibit AW-1/83

- lxxxiii. Board Resolution of Corporate Guarantor dated 24.03.2014 – Exhibit AW-1/84

- lxxxiv. Working Capital Consortium Agreement dated 04.04.2014 – Exhibit AW-1/85

- lxxxv. Joint Deed of Hypothecation dated 04.04.2014 – Exhibit AW-1/86

- lxxxvi. Inter-Se Agreement dated 04.04.2014 – Exhibit AW-1/87

- lxxxvii. Letter of Authority dated 04.04.2014 – Exhibit AW-1/88

- lxxxviii. Undertaking dated 04.04.2014 – Exhibit AW-1/89

- lxxxix. Undertaking dated 04.04.2014 – Exhibit AW-1/90

- xc. Revival Letter dated 04.04.2014 – Exhibit AW-1/91

- xc. Deeds of Guarantee dated 04.04.2014 – Exhibit AW-1/92

- xcii. Attendance Register for Extension/Creation of Mortgage dated 04.04.2014 (Colly.) – Exhibit AW-1/93

- xciii. Sanction Letters dated 11.02.2015, 17.03.2015, 31.12.2014 and 16.03.2015 (Colly.) – Exhibit AW-1/94

- xciv. Board Resolution dated 11.02.2015 – Exhibit AW-1/95

- xcv. Demand Promissory Notes dated 11.02.2015 (Colly.) – Exhibit AW-1/96

- xcvi. Agreement of Hypothecation dated 11.02.2015 – Exhibit AW-1/97

- xcvii. Agreement of Term Loan and Hypothecation dated 11.02.2015 – Exhibit AW-1/98

- xcviii. Credit Facility Agreement dated 11.02.2015 – Exhibit AW-1/99

- xcix. Inter-Se Agreement dated 05.06.2015 – Exhibit AW-1/100

- c. Letter of Declaration, Undertaking and Authority dated 11.02.2015 – Exhibit AW-1/101

- ci. Forms L-516 / FITL / WCTL dated 11.02.2015 (Colly.) – Exhibit AW-1/102

- cii. Undertaking dated 11.02.2015 – Exhibit AW-1/103

- ciii. Declaration on Form L-515 dated 11.02.2015 – Exhibit AW-1/104

- civ. Letters of Pledge of Shares dated 11.02.2015 (Colly.) – Exhibit AW-1/105

- cv. Letter surrendering Share Certificates dated 23.04.2015 (Colly.) – Exhibit AW-1/106

- cvi. Deed of Guarantee dated 11.02.2015 – Exhibit AW-1/110

- cvii. Restructuring Letter dated 11.02.2015 – Exhibit AW-1/111

- cviii. Attendance Register for Mortgage dated 05.06.2015 (Colly.)

– Exhibit AW-1/112

- cix. Board Resolution dated 28.05.2015 – Exhibit AW-1/113

- cxiv. Board Resolution dated 28.05.2015 – Exhibit AW-1/114

- cx. Inter-Se Agreement dated 05.06.2015 – Exhibit AW-1/115

- cxvi. Letter of Authority dated 05.06.2015 – Exhibit AW-1/116

- cxii. Supplementary Hypothecation Agreement dated 05.06.2015

– Exhibit AW-1/117

- cxii. Working Capital Consortium Agreement dated 05.06.2015

– Exhibit AW-1/118

- cxiii. WCTL and FITL Agreement dated 05.06.2015 – Exhibit AW-1/119

- cxiv. Restructuring Agreement dated 05.06.2015 – Exhibit AW-1/120

- cxv. Deed of Pledge dated 05.06.2015 – Exhibit AW-1/121

- cxvi. Irrevocable Power of Attorney dated 05.06.2015 – Exhibit AW-1/122

- cxvii. Irrevocable Power of Attorney dated 05.06.2015 – Exhibit AW-1/123

- cxviii. Irrevocable Power of Attorney dated 05.06.2015 – Exhibit AW-1/124

- cxix. Undertaking / Indemnity dated 05.06.2015 – Exhibit AW-1/125

- cxx. Deed of Guarantee dated 05.06.2015 – Exhibit AW-1/126

- cxxi. Demand Notices under Section 13(2) of the SARFAESI Act dated 07.08.2015, 10.12.2015, 21.12.2015 and 28.12.2015 (Colly.) – Exhibit AW-1/127

- cxxii. Certified Statements of Account under the Bankers' Books Evidence Act (Colly.) – Exhibit AW-1/128


14. To substantiate its case, the Applicant Bank No. 2 has filed the affidavit of Ms. Uma Sharma, Chief Manager, Corporation Bank, M-93, Connaught Circus, New Delhi, who is duly authorised and fully conversant with the facts and records of the present case. The deponent has sworn the said affidavit in her capacity as Chief Manager of Applicant Bank No. 2 pursuant to the Power of Attorney executed in her favour by Applicant Bank No. 2, Exhibit AW-2/1

- i. Power of Attorney executed in her favour by Applicant Bank No. 2, Exhibit AW-2/1

- ii. Sanction Letter dated 07.03.2014 issued by Applicant Bank No. 2 (Corporation Bank) for enhancement of consortium credit facilities from Rs. 290 crores to Rs. 325 crores – Exhibit AW-2/2.

- iii. Statements of Account of Defendant No. 1 maintained with consortium member banks, duly certified under the Bankers' Books Evidence Act, 1891 - Exhibit AW-2/3.

15. To substantiate its case, the Applicant Bank No. 3 has filed the affidavit of Ms. Reetu Kaushik, Senior Manager, Bank of Baroda, CFS Branch, 16, Parliament Street, New Delhi, who is duly authorised and fully conversant with the facts and records of the present case based on the records maintained at the branch. The deponent has sworn the said affidavit in her capacity as Senior Manager of Applicant Bank No. 3 pursuant to the Power of Attorney executed in her favour, which is annexed herewith and marked as Exhibit A-3/1.

- i. Power of Attorney executed in her favour - Exhibit A-3/1

- ii. Sanction Letter dated 25.02.2014 issued by Applicant No. 3 (Bank of Baroda), conveying enhancement/restructuring of consortium credit facilities from Rs. 120 crores to Rs. 295 crores – Exhibit AW-3/2.

- iii. Sanction Letter dated 31.12.2014 issued by Applicant No. 3 – Exhibit AW-3/3.

- iv. Letter of Installment with Acceleration Clause (WCTL) dated 31.12.2014 – Exhibit AW-3/4.

- v. Demand Promissory Note (CC Facility) dated 31.12.2014 – Exhibit AW-3/5.

- vi. Demand Promissory Note (WCTL Facility) dated 31.12.2014 – Exhibit AW-3/6.

- vii. Demand Promissory Note (FITL-I Facility) dated 31.12.2014 – Exhibit AW-3/7.

- viii. Demand Promissory Note (FITL-II Facility) dated 31.12.2014 – Exhibit AW-3/8.

- ix. Board Resolution of Defendant No. 5 dated 31.12.2014 – Exhibit AW-3/9.

- x. Board Resolution of Defendant No. 1 dated 31.12.2014 – Exhibit AW-3/10.

- xi. Composite Hypothecation Agreement dated 31.12.2014 executed by Defendant No. 1 – Exhibit AW-3/11.

- xii. Letter of Continuing Security (Cash Credit Facility) dated 31.12.2014 – Exhibit AW-3/12.

- xiii. Undertaking-cum-Declaration for Environment Protection dated 31.12.2014 – Exhibit AW-3/13.

- xiv. General Form of Guarantee dated 31.12.2014 executed by Defendants No. 2 to 4 – Exhibit AW-3/14.

- xv. Undertaking for Creation of Securities dated 31.12.2014 – Exhibit AW-3/15.

- xvi. Declaration to be taken from the Companies Every Year dated 31.12.2014 – Exhibit AW-3/16.

- xvii. Power of Attorney in respect of Book Debt Facility dated 31.12.2014 – Exhibit AW-3/17.

- xviii. Declaration-cum-Undertaking-cum-Authority dated 31.12.2014 – Exhibit AW-3/18.

- xix. Undertaking not to withdraw deposits by directors till liquidation of advances dated 31.12.2014 – Exhibit AW-3/19.

- xx. Letter of Undertaking (in respect of Book Debts) dated 31.12.2014 – Exhibit AW-3/20.

- xxi. Undertaking for Non-Disposal of Shareholdings dated 31.12.2014 – Exhibit AW-3/21.

- xxii. Letter of Installment with Acceleration Clause (FITL-I) dated 31.12.2014 – Exhibit AW-3/22.

- xxiii. Letter of Installment with Acceleration Clause (FITL-II) dated 31.12.2014 – Exhibit AW-3/23.

- xxiv. Declaration regarding none of the Directors being in Defaulters List dated 31.12.2014 – Exhibit AW-3/24.

- xxv. Agreement of Corporate Guarantee dated 31.12.2014 executed by Defendant No. 5 – Exhibit AW-3/25.

- xxvi. Notice under Section 13(2) of the SARFAESI Act, 2002 dated 21.12.2015 issued by Applicant No. 3 – Exhibit AW-3/26.

- xxvii. Statements of Account of Applicant No. 3, duly certified under the Bankers' Books Evidence Act, 1891 (as on 30.04.2017) – Exhibit AW-3/27.

- xxviii. The notice of e-auction, publication of e-auction, panchanamas and inventories prepared in respect of the mortgaged properties put to auction - Exhibit AW-3/28.

16. The witness produced by the Applicant Banks has fully corroborated the averments made in the present TA. In any event, the Applicant Banks' case is primarily document-based, and the witness has duly authenticated all such documents. The evidence presented by the Applicant Banks remains unrebuted, leaving no ground to disbelieve the same. The Applicant Banks have, therefore, established their claim beyond reasonable doubt. In view of the foregoing, the Applicant Banks are entitled to recover the entire outstanding amount along with pendentelite interest and future costs as agreed between the parties. Accordingly, this TA is allowed, as the Applicant Banks have successfully proven their claim beyond any doubt.

1. 17. In this TA, the Applicant Banks have prayed for issuance of a Recovery Certificate against Defendants No. 1 to 7. In the present matter, Defendant No. 1 is the principal borrower to whom the financial facilities were sanctioned and Defendants No. 1, 2 and 5 are presently undergoing insolvency proceedings before the Ld. NCLT under the Insolvency and Bankruptcy Code; accordingly, no relief is being granted against the said Defendants in the present TA. Defendant No. 1 is the principal borrower; Defendants No. 2 to 4 are guarantors (Defendants No. 2 and 3 being Directors who also created mortgage security); Defendant No. 5 is a corporate guarantor; and Defendants No. 6 and 7 are guarantors, are jointly and severally liable for repayment of the dues. Defendant No. 8 is a proforma defendant.

2. 18. Consequently, TA No. 22/2022 is hereby allowed in favour of the Applicant Banks and against the Defendants No. 3, 4, 6 & 7, who are held jointly and severally liable to pay the dues of the Applicant Banks, along with costs and pendentelite and future interest @ 12% per annum, as claimed in the TA, from the date of filing of the present TA until full and final payment.

ORDER

TA No. 22/2022 stands allowed in favour of the Applicant Banks and against the Defendants No. 3, 4, 6 & 7, who are held jointly and severally liable to pay a sum of Rs.374,42,89,923.49 (Rupees Three Hundred Seventy-Four Crores Forty-Two Lakhs Eighty-Nine Thousand Nine Hundred Twenty-Three and Paise Forty-Nine only) of the Applicant Banks. The Defendants No. 3, 4, 6 & 7 are directed to pay aforesaid outstanding dues, within 30 days, along with costs and pendent lite and future interest at the rate of 12% per annum, as claimed in the TA, from the date of filing till realization. In case of default, the aforesaid amount shall be recovered by sale of the hypothecated/charged stocks, tangible movables, and the available mortgaged properties.

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

Further, in case of shortfall, the same shall be recovered from the sale of movable and immovable assets of the Defendants No. 3, 4, 6 & 7.

So far as, Defendant No. 1, 2 & 5 are concerned, since Defendant No. 1, 2 & 5 are before Ld. NCLT, hence, no order qua Defendant No. 1, 2 & 5 can be passed against said Defendants at this stage.

However, it is directed that Applicant Banks shall be at liberty to revive the OA qua Defendant No. 1, 2 & 5 in case NCLT are quashed / withdrawn in future, in accordance with law.

It is further directed that in case Applicant Banks receive any amount from the proceedings pending before Ld. NCLT, they shall give due adjustment of the same in the recovery proceedings.

It is also directed that the applicant shall adjust the amount(s), if any, received during the pendency of this case.

TA-22/2022

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

- (ii). Parties are directed to appear before the Recovery Officer-II, DRT-III, Delhi on 01.04.2026.

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

File be closed and consigned to records.

(Pronounced in open court)

Dated: 12.02.2026 K. Singh

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