UNION BANK OF INDIA (ANDHRA BANK) vs J P ENGINEERS PRIVATE LIMITED on 22 July 2026

**FINAL ORDER**

1. This original application has been filed by the Applicant Bank, on 16.11.2020, through Mr. Neeraj Kumar Jha, Chief Manager, being the authorized officer of the Applicant Bank, under Section 19 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 against the A handwritten signature or mark in blue ink, located at the bottom right of the page. It appears to be a stylized signature, possibly of the judge or official.

Defendants no. 2 to 7 for recovery of a sum of Rs. 150,08,59,459.44 (Rupees One Hundred Fifty Crore Eight Lakh Fifty Nine Thousand Four Hundred Fifty Nine and Paise Forty Four only) due as on 31.10.2020, together with future and pendentelite interest in Secured Overdraft Facility @11.50% p.a. with monthly rests and in ILC/FLC/BG Facility @11.55% p.a. with monthly rests as well as penal interest @2% p.a. with monthly rests till the realization of the amount along with all costs, charges & other relief(s).

1.2 It is pertinent to note here that this OA bearing no. 733/2020 was originally filed before Ld. DRT-I, 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-I, Delhi to this Tribunal in October 2022 and was numbered at TA-220/2022.

2. The brief facts of the case are that the Applicant Bank i.e. Union Bank of India (UBI), is a body corporate constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act, 1970. It is further stated that the Applicant Bank is filing the present OA through Sh. Neeraj Kumar Jha, Chief Manager who is duly empowered and authorized to institute, sign, verify the plaint and institute the OA and to compete all the legal formalities on behalf of the Applicant Bank in terms of GPA executed by the Applicant Bank in his favour.

It is stated in the OA that the Applicant Bank was earlier known as Andhra Bank and vide Gazette Notification dated 04.03.2020, Andhra Bank has been amalgamated with Union Bank of India and all the liabilities and assets of Andhra Bank are now being held by the Union Bank of India, hence, the present OA for recovery is being filed by Union Bank of India.

It is further stated in the OA that the Defendants approached the Applicant Bank at its branch office at A-13, Green Mark Main, New Delhi – 110016 and all the credit facilities were sanctioned and all the document were executed at the Branch Office at Green Park, New Delhi but after declaring the matter as Non-Performing Asset, the account has been transferred, for follow up and recovery purpose to Branch Office at SAMV Branch, M-93, Connaught Place, New Delhi – 110001, hence the SAMV Branch is authorized and empowered to file the present suit.

2.1 It is stated in the OA that the Defendant no. 1 was earlier a partnership firm which was having business of Trading of Ferrous & Non-Ferrous Metals and availing several credit facilities from the Applicant Bank through its partners. Thereafter, in the year 2014 Applicant Bank got itself incorporated as a private limited company with the Registrar of Companies on 20.03.2014 and further continued availing credit facilities from the Applicant Bank after the year 2014, thereafter, Defendant no. 1 as a private limited company continued banking with the Applicant Bank. In this regard Incorporation Certificate along with Master Data of Company as well as KYC documents are relevant.

It is stated in the OA that M/s J.P. Engineers (Partnership Firm) was availing various credit facilities and the facilities were renewed / enhanced from time to time on the request of the borrowers and the borrowers also completed formalities / documents for the said purpose as per requirement of the Bank.

2.2 It is stated in the OA that on the request of the Defendant no. 1, the Applicant sanctioned / renewed / enhanced the credit facility i.e. Secured Overdraft against Real Estate for Rs. 15.0 Crore and ILC/FLC/BG for Rs. 130.0 Crore vide Sanction Letter dated 02.02.2016 on the terms and conditions mentioned in the Sanction Letter which were duly accepted by the Defendants in the capacity of partners, guarantors etc.

On 04.11.2016, a Takeover Agreement was executed between M/s J.P. Engineers Pvt. Ltd. through its Director Sh. Mohinder Jain i.e. Defendant no. 1 and M/s J.P. Engineers, Partnership Firm through its partner Sh. Adish Jain and as per said Agreement, the Defendant no. 1 i.e. company expressed its desire to takeover running business of partnership firm w.e.f. 04.11.2016 on various terms and conditions mentioned in the said Agreement. Thereafter, a supplemental takeover agreement was also executed between the same parties.

In view of the Takeover Agreement dated 04.11.2016, the Defendant no. 1 passed a Board Resolution on 29.11.2016 and accepted the terms and conditions of the Sanction Letter dated 02.02.2016 and also resolved to delegate powers to Mr. Mohinder Jain & Sh. Adish Jain directors of the Defendant no. 1 Company to execute required documents for the security of the credit facilities and for other acts mentioned in the said Resolution.

It is stated in the OA that the Defendants no. 2 & 3 are the Directors of Defendant no. 1 and also stood guarantor for repayment of the credit facilities. The Defendant no. 4 stood as Guarantor and Defendants no. 5 to 7 stood as Corporate Guarantor in the present matter.

It is further stated that the Defendants executed various security documents in favour of the Applicant Bank for securing repayment of the credit facility which are as under:-

- (i) R.F. 210, Demand Promissory Note dated 30.11.2016 for Rs. 130,00,00,000/-;

- (ii) R.F. 210, Demand Promissory Note dated 30.11.2016 for Rs. 15,00,00,000/-;

- (iii) AB-1, Composite Agreement dated 30.11.2016 for Rs. 145.0 Crore executed by Defendant no. 1 company;

- (iv) Consent Letter to be obtained from borrower / guarantor for disclosure of information to 'CIBIL' dated 30.11.2016 executed by the borrower & guarantors;

- (v) Counter Guarantee Form dated 30.11.2016 executed by Defendant no. 1 for Rs. 130.0 Crore;

- (vi) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 1;

- (vii) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendants no. 2, 3 & 4;

- (viii) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 5;

- (ix) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 6;

- (x) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 7.

It is stated in the OA that the Defendants availed various credit facilities on the terms and conditions mentioned in the security documents as per the requirement and also executed necessary documents from time to time apart from mortgaging various immovable properties by its respective owners and by completing / executing necessary documents. It is also pertinent to mention here that the mortgage was extended as per requirement of amount of the credit facilities in favor of the Applicant Bank.

2.3 It is further stated in the OA that on the request of the Defendants, the credit facilities were renewed / sanctioned / enhanced from time to time as per the requirement and demand of the Defendants. The Defendants also completed the obligation on their party by executing various security documents in favor of the Applicant Bank for security of repayment of the loan amount in the year 2017 & 2018.

2.4 It is stated in the OA that the Defendant no. 1 requested the Applicant Bank for sanction / renewal of the credit facilities and after considering and processing the request, sanctioned / renewed the credit facilities i.e. Secured Overdraft (against Real Estate) to the tune of Rs. 15.0 Crore & ILC/FLC/BG for Rs. 150.0 Crore vide Sanction Letter dated 30.04.2019 on interest as per terms and conditions mentioned in the Sanction Letter dated 30.04.2019 which were duly accepted by the Defendants.

The Defendant no. 1 also passed a Board Resolution dated 03.05.2019 and resolved to authorize Mr. Mohinder Jain & Sh. Adish Jain to execute the security documents as required by the Bank.

It is further stated that to secure the repayment of amount of the credit facilities, the Defendants executed the following security documents in favour of the Applicant Bank:-

- (i) R.F. 211, Demand Promissory Note dated 12.06.2019 for Rs. 150,00,00,000/-;

- (ii) AB-1, Composite Agreement dated 12.06.2019;

- (iii) Undertakings dated 12.06.2019 executed by Defendant no. 1;

- (iv) Consent Letter to be obtained from borrower for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 1;

- (v) Counter Guarantee Form dated 12.06.2019 executed by Defendant no. 1;

- (vi) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendant no. 5;

- (vii) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 5;

- (viii) Undertakings dated 12.06.2019 executed by Defendant no. 5;

- (ix) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendant no. 6;

- (x) Undertakings dated 12.06.2019 executed by Defendant no. 6;

- (xi) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 6;

- (xii) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendant no. 7;

- (xiii) Undertakings dated 12.06.2019 executed by Defendant no. 7;

- (xiv) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 7;

- (xv) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendants no. 2 to 4;

- (xvi) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendants no. 2 to 4;

- (xvii) Undertakings dated 12.06.2019 executed by Defendant no. 2 to 4;

- (xviii) International Foreign Exchange Master Agreement dated 12.06.2019;

- (xix) Affidavit dated 03.05.2019 executed by Defendant no. 4;

- (xx) Borrower's Undertaking Letter dated 12.06.2019 executed by Defendant no. 1;

- (xxi) Undertaking executed by Defendant no. 1;

- (xxii) Undertaking executed by Defendants no. 1 to 7;

- (xxiii) R.F. 289A, regarding bills drawn on our customers executed by Defendant no. 1;

(xxiv) Undertaking regarding bank's right to cancel / modify / suspend the credit facilities dated 12.06.2019.

It is stated in the OA that other than the documents mentioned above executed by the Defendants, to secure the amount of credit facilities Defendants hypothecated stocks and book debts and also mortgaged several properties in favour of the Applicant for securing the amount of credit facilities.

It is further stated in the OA that the Defendants executed necessary documents from time to time regarding immovable properties with intention to mortgage the said properties, for security of the loan amount being availed by the Defendants, pertaining to deposit of Title Deeds and also deposited original title deeds / documents of the properties with the Applicant Bank.

The details of various mortgaged properties are as under:-

<table border="1"> <tr>

</tr> <tr>

<td>M/s J.P. Engineers through its Partners, Predecessor of the Defendant no. 1.</td> </tr> <tr>

</tr> <tr>

<td>29.07.2002, 11.02.2016 &amp; 12.06.2019.</td> </tr> <tr>

<td>Equitable Mortgage of Industrial Property situated at 262, Block F, Sector-24, Faridabad admeasuring 2444.44 sq. yards with Industrial Building and Shed</td> </tr> <tr> <td>(vi)</td> <td>Details of Sale Deeds</td> <td>Sale Deeds dated</td> </tr> </table>


<table border="1"> <tr> <td></td> <td></td> <td>27.01.1994 and 24.02.1994 executed in favour of M/s J.P. Engineers Pvt. Ltd. in respect of the abovementioned property registered as under : Registered in the office of Sub Registrar, Ballabhgarh, Haryana vide Registration number 3857 and 4275 respectively.</td> </tr> <tr>

<td>Letters dated 29.07.2002, 11.02.2016 &amp; 12.06.2019.</td> </tr> </table>

Property No. 2

<table border="1"> <tr>

</tr> <tr>

<td>Mrs. Anita Jain</td> </tr> <tr>

</tr> <tr>

<td>24.10.2013 &amp; 11.02.2016</td> </tr> <tr>

<td>Equitable Mortgage of Land and Building at K-4/20, Model Town-II, Delhi -110009 admeasuring 482.17 sq. yards.</td> </tr> <tr>

<td>Sale Deeds dated 09.02.1994 executed in favour of Smt. Sonali Rastogi in respect of the abovementioned property registered as under : Registered in the office of Sub Registrar, SD No. I, Delhi.</td> </tr> <tr>

<td>Letters dated 11.02.2016 &amp; 12.06.2019</td> </tr> </table>

**Property No. 3**

<table border="1"> <tr> <td>(i)</td> <td>Name of the Mortgagee</td> <td>UBI (E-Andhra Bank)</td> </tr> <tr>

<td>M/s J.P. Engineers through its Partners, Predecessor of the Defendant no. 1.</td> </tr> <tr>

</tr> <tr>

<td>28.09.2016</td> </tr> <tr>

<td>Equitable Mortgage of Extent of 8221.364 Sq. mtrs. at Khasra No. 419/1 (Part) 420M/1(Part), 421/1, 422/1, 424/1, Village Dharagal, Paragana Jalalabad, Tehsil &amp; District Gaziabad, Uttar Pradesh</td> </tr> <tr> <td>(vi)</td> <td>Details of Gift Deed</td> <td>Gift Deed dated 22.01.2016 executed in favour of M/s J.P. Engineers Pvt. Ltd. in respect of abovementioned property.</td> </tr> <tr>

<td>Letters dated 27.09.2016, 28.09.2016 &amp; 12.06.2019.</td> </tr> </table>

**Property No. 4**

<table border="1"> <tr> <td>(i)</td> <td>Name of the Mortgagee</td> <td>UBI (E-Andhra Bank)</td> </tr> <tr>

<td>Smt. Anita Jain</td> </tr> <tr>

</tr> <tr>

<td>23.02.2008, 27.03.2009 &amp; 12.06.2019</td> </tr> <tr>

<td>Equitable Mortgage of Property at E4/21 D, Block-4, Model Town-II, Delhi -110007 admeasuring an area of 472 sq. yards.</td> </tr> <tr>

<td>Gift Deed dated 24.10.2013 executed in favour of Smt. Anita Jain in respect of the abovementioned property</td> </tr> </table>


<table border="1"> <tr> <td></td> <td></td> <td>registered as under :<br/>Registered in the office of<br/>Sub Registrar-VIA, Model<br/>Town-II, New Delhi vide<br/>Registration No. 10169.</td> </tr> <tr>

<td>Documents executed<br/>for creation of<br/>mortgage</td> <td>Letters dated 27.03.2009 &amp;<br/>12.06.2019</td> </tr> </table>

**Property No. 5**

<table border="1"> <tr>

</tr> <tr> <td>(ii)</td> <td>Name of the<br/>Mortgagors</td> <td>M/s Simla Holdings</td> </tr> <tr>

<td>07.06.2011 &amp; 12.06.2019</td> </tr> <tr> <td>(iv)</td> <td>Details of Property<br/>Mortgaged</td> <td>Equitable Mortgage of Plot<br/>No. A-7, Unit No. 601,<br/>Aggarwal Corporate<br/>Heights, Netaji Subhash<br/>Place, Distt. Centre,<br/>Wazirpur, New Delhi<br/>admeasuring 4517 sq. ft.</td> </tr> <tr>

<td>Sale Deeds dated<br/>26.05.2011 executed in<br/>favour of M/s Simla<br/>Holdings in respect of the<br/>abovementioned property<br/>registered as under :<br/>Registered in the office of<br/>Sub Registrar VIA, New<br/>Delhi, vide Registration<br/>No. 6976, Pages 151 to<br/>262.</td> </tr> <tr> <td>(viii)</td> <td>Documents executed<br/>for creation of<br/>mortgage</td> <td>Letter dated 12.06.2019</td> </tr> </table>

<table border="1"> <tr>

</tr> <tr> <td>(ii)</td> <td>Name of the<br/>Mortgagors</td> <td>Mr. Mohinder Jain</td> </tr> <tr>

</tr> <tr>

<td>25.10.2013, 11.02.2016 &amp;</td> </tr> </table>

<table border="1"> <tr> <td></td> <td></td> <td>12.06.2019</td> </tr> <tr>

<td>Equitable Mortgage of Commercial space at P-3-254, 1^st Floor, Pool Bangash, New Rohtak Road, Central Plaza, Delhi admeasuring 85.24 sq. mts./906.02 SFT.</td> </tr> <tr>

<td>Sale Deed dated 17.04.2013 executed in favour of Mr. Mohinder Jain in respect of the abovementioned property registered as under : Registered in the office of Sub Registrar-I, New Delhi, vide Registration Number 3348, pages 162 to 176.</td> </tr> <tr>

<td>Letters dated 11.02.2016 &amp; 12.06.2019</td> </tr> </table>

Property No. 7

<table border="1"> <tr>

</tr> <tr>

<td>M/s Sidhartha Holdings</td> </tr> <tr>

</tr> <tr>

<td>04.09.2014, 11.02.2016 &amp; 12.06.2019.</td> </tr> <tr>

<td>Equitable Mortgage of 5^th Floor, Vikas Surya Shopping Mall, Plot No. 18, District Centre, Mangalam Place, Sector 3, Rohini, Delhi - 110085 admeasuring 4217.75 sq. ft.</td> </tr> <tr>

<td>Sale Deed dated 25.04.2008 executed in favour of M/s Siddhartha Holdings in respect of the abovementioned property registered as under :</td> </tr> </table>

<table border="1"> <tr> <td></td> <td></td> <td>Registered in the office of Sub Registrar-VI, New Delhi, vide Registration Number 7710, pages 1 to 54.</td> </tr> <tr>

<td>Letters dated 04.09.2014, 11.02.2016 &amp; 12.06.2019</td> </tr> </table>

Property No. 8

<table border="1"> <tr>

</tr> <tr>

<td>M/s Tantra Solutions</td> </tr> <tr>

</tr> <tr>

<td>23.01.2015, 24.01.2015, 11.02.2016 &amp; 12.06.2019.</td> </tr> <tr>

<td>Equitable Mortgage of Commercial Space No. SH-1, Second Floor, Vardhman Grand Plaza, Plot No. 07, Sector-3, District Centre, Mangalam Place, Outer Ringroad, Rohini, Delhi -110085.</td> </tr> <tr>

<td>Original Agreement dated 23.02.2006 executed between M/s Vardhman Properties Limited and M/s Tantra Solutions executed in respect of the abovementioned property duly registered and certified.</td> </tr> <tr>

<td>Letters dated 23.01.2015, 24.01.2015, 11.02.2016 &amp; 12.06.2019</td> </tr> </table>

Property No. 9

<table border="1"> <tr>

</tr> <tr>

<td>M/s Simla Holdings</td> </tr> </table>


<table border="1"> <tr>

</tr> <tr>

<td>23.01.2015, 11.02.2016 &amp; 12.06.2019.</td> </tr> <tr>

<td>Equitable Mortgage of Property bearing No. 2517/X, Second Floor, Plot No. 8, Block No. 3, Khasra No. 856/195-196, Asaf Ali Road, New Delhi admeasuring 2070 sft.</td> </tr> <tr>

<td>Sale Deed dated 22.02.2010 executed in favour of M/s Simla Holdings in respect of the abovementioned property registered as under : Registered in the office of Sub Registrar-III, New Delhi, vide Registration Number 1436, pages 21 to 38.</td> </tr> <tr>

<td>Letters dated 23.01.2015, 11.02.2016 &amp; 12.06.2019</td> </tr> </table>

The amount of the credit facilities availed by the Defendants from time to time as per their requirement were secured by mortgage of the above said properties along with other security created in favour of the Applicant Bank by the Defendants.

2.5 It is stated in the OA that the Defendants enjoyed the credit facilities and the amount was released / disbursed as per their demand and request from time to time in terms of the terms and conditions of the sanction letters as well as security documents and the Defendants have also executed other relevant documents from time to time and also submitted request for releasing the amount as per requirement.

However, the Defendants miserably failed and neglected to pay the said outstanding amount to the Applicant Bank in accordance with the terms and conditions of the sanction letter and security documents and also failed to maintain financial discipline and further failed and neglected to pay the amount due towards interest and committed various other defaults including breach of terms and conditions of the said loan documents. As such in the compelling circumstances, the Applicant declared the account of Defendants as NPA on 30.09.2019 and an amount of Rs. 150,08,59,459.22 is due and payable as on 31.10.2020.

It is also stated that despite repeated requests and reminders and on various dates to pay the dues and regularize the loan account, the Defendants did not pay any heed towards the request of the Applicant Bank and did not pay required amount to regularize the account. Thus, the Applicant Bank initiated SARFAESI Action against the Defendants and issued Recall Notice dated 01.10.2019 under Section 13(2) of SARFAESI Act to pay the entire outstanding amount in the loan account to the Applicant Bank and also invoked the guarantee of the Guarantors through Recall Notice.

However, despite the assurance, the Defendants failed and/or neglected to make the payment, hence, the Applicant Bank has been compelled to file this OA before this Tribunal.

It is stated in the OA that the Defendants are jointly and severally liable to pay an amount of Rs. 150,08,59,459.44


due as on 31.10.2020 along with future and pendentelite interests, costs and other charges.

2.6 It is stated in the OA that proceedings against the Defendant no. 1 is pending before NCLT, New Delhi, hence, the Applicant Bank is not claiming any relief against Defendant no. 1 presently. However, the Applicant Bank reserves its right to claim relief against the Defendant no. 1. Thus, this OA has been filed against Defendants no. 2 to 7 only.

3. Notices of this O.A. were issued to the Defendants, and Defendants no. 2 to 7 appeared through its Counsel and filed their common WS / Reply.

So far as, Defendant no. 1 is concerned, neither anyone appeared nor filed any WS. It is pertinent to note here that no relief has been claimed by the Applicant Bank qua Defendant no. 1 in this OA since Defendant no. 1 is before Ld. NCLT, Delhi.

3.1 It is stated in the WS that on behalf of Defendant No. 5, 6 & 7 the present WS has been filed by Sh. Mohinder Jain being Authorized Partner of all these firms who is authorized by the Authorization Letters of Defendant No. 5 to 7. It is stated in the WS that all the credit facilities sanctioned by the Bank have been utilized solely for the purpose recorded expressly in the sanction letters. It is also stated that due to its dedicated and honest business policies the Defendant No.1 had gradually achieved a gross turnover of Rs.800 Crore during the financial year 2018-2019. It is further stated that the Defendant No.1 had to recover a huge amount of Rs.21.32 Crore from one of its debtor namely M/s White Metals Pvt. Ltd. It is stated that ARCIL being one of the financial creditor of White Metals Pvt. Ltd filed an application before Hon'ble NCLT which was allowed and CIRP of M/s White Metals Pvt. Ltd was initiated. With a *bona fide* intention to recover its huge outstanding dues from M/s White Metals Pvt. Ltd and in consultation with the officials of erstwhile Andhra Bank the Defendant No.1 submitted its Letter of Intent on 08.03.2019 and also submitted its Resolution Plan after being selected as a successful resolution Applicant of M/s White Metals Pvt. Ltd. Resolution plan submitted by Defendant No.1 has been approved by COC of M/s White Metals Pvt Ltd. It is also stated that the Defendant No.1 on 30.07.2019 discussed and submitted its funding plan to erstwhile Andhra Bank as at the time of submission of funding plan the Defendant No.1 was in the process of acquisition of M/s White Metals Pvt. Ltd. Contents of funding plan dated 30.07.2019 may kindly be read as part and parcel of the present para also. In retaliation to the submission of Resolution Plan by Defendant No.1, the suspended directors of M/s White Metals Pvt. Ltd. hatched up a conspiracy with certain officials of erstwhile Andhra Bank who started creating day to day hindrances in the normal banking operations of Defendant No.1 because of their vested interest who were in hand in gloves with the Ex-Directors of M/s White Metals Pvt. Ltd. It is further stated that the Defendant No.1 had furnished a list of sundry debtors to erstwhile Andhra Bank till the month of June 2019. Apart from sundry debtors the Defendant No.1 had also furnished a margin by way of FDR's to the tune of Rs.31.00 Crore which was also available with the Applicant bank. It is stated that as a part of the conspiracy between the officials of erstwhile Andhra Bank and Ex-Directors of M/s White Metals Pvt. Ltd., the funding plan dated 30.07.2019 submitted by Defendant No.1 was not timely considered, which disturbed the entire financial cycle of the Defendant No.1. As few officials of erstwhile Andhra Bank with their vested interest were working very hard to disrupt the entire line of credit of Defendant No.1, they started leaking confidential financial information of Defendant No.1 to the Ex-Directors of M/s White Metals Pvt. Ltd, which they were under obligation to retain in trust, but they breached. Vide letter dated 22.06.2019, one of the Vendor of Defendant No.1 informed the Defendant No.1 about the critical issue of leaking vital information to the third parties by the officials of erstwhile Andhra Bank. Vide letter dated 26.06.2019, the Defendant No.1 raised its serious objection and concerns to the erstwhile Andhra Bank and advised them to forthwith restrict the unethical practice of sharing vital information to third parties and/or competitors of Defendant No.1 which was causing serious damage to the hard earned goodwill and reputation of Defendant No.1 in the market. It is stated in the WS that no reply was even given by the officials of erstwhile Andhra Bank to the letter dated 26.06.2019 send by Defendant No.1. However, the financial information leaked by the erstwhile officials of Andhra Bank caused havoc for Defendant No.1 as one of the Vendor of Defendant No.1 approached Hon'ble NCLT, Bench-II, New Delhi by filing an Application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (herein after also referred to as '*IBC*') which was registered as Case No. (IB)-1048 (ND)2019 titled "M/s Worldwide Metals Pvt Ltd Vs 

M/s J.P. Engineers Pvt. Ltd.". The Defendant No.1 contested the above matter, however, the Hon'ble NCLT, Bench-II, Delhi vide order dated 26.02.2020 allowed the above Application and appointed Mr. Sumit Bansal as Interim Resolution Professional and also declared moratorium under Section 14 of IBC. Feeling aggrieved by the order dated 26.02.2020 passed by Hon'ble NCLT, Shareholders of Defendant No.1 filed an Appeal before Hon'ble NCLAT, New Delhi wherein vide order dated 04.03.2020 Hon'ble NCLAT admitted the Company Appeal No. 379 of 2020 however declined to stay the formation of Committee of Creditors. Feeling aggrieved by the order dated 04.03.2020 passed by Hon'ble NCLAT, a Civil Appeal was preferred before Hon'ble Supreme Court wherein vide order dated 04.06.2020 the Hon'ble Supreme Court directed the COC not be precipitate further in the matter and directed the Hon'ble NCLAT to hear the appeal within a period of one month. Thereafter, vide order dated 10.08.2020 Hon'ble NCLAT, New Delhi dismissed the Appeal along with all pending interim applications filed by parties. Feeling aggrieved by the order dated 10.08.2020 passed by Hon'ble NCLAT Delhi the Ex-Directors of Defendant No.1 filed a Civil Appeal No. 2960 of 2020 which was dismissed by Hon'ble Supreme Court vide order dated 04.09.2020. It is stated in the WS that the Defendant No.1 has also lodged an FIR dated 03.06.2019 against the Ex-Directors of M/s White Metals Pvt. Ltd. which is under investigation by Economic Offences Wing (EOW).

It is further stated in the WS that vide letter dated 23.01.2020 and according to Para No.18 of the OA, the

Applicant Bank admitted that the account of Defendant No.1 was classified as NPA on 30.09.2019 whereas in the demand notice dated 01.10.2019 it is alleged that account of Defendant No.1 were classified as NPA on 04.09.2019. Even the account of Defendant No.1 was also wrongly classified as NPA by Applicant Bank as it is the admitted case of bank that last sanction/renewal was given by bank to Defendant No.1 on 30.04.2019 and last documentation was done between bank and Defendant No.1 on 12.06.2019 and ignoring this the bank is alleged to have classified the accounts of Defendant No.1 on 04.09.2019/30.09.2019 which is even prior to expiry of mandatory 90 days period as provided by RBI guidelines. It is also stated that instead of providing any helping hand to the Answering Defendants, the Applicant bank contrary to their promises and assurances and also in violation of Guidelines issued by Reserve Bank of India, classified the account of the Answering Defendant No.1 as NPA on 04.09.2019/30.09.2019. It is also stated that the Applicant Bank has failed to follow the relevant guidelines issued by Reserve Bank of India regarding classification of account as Non Performing Asset and without following those mandatory guidelines the bank is alleged to have classified the account of Answering Defendants as NPA on 30.10.2019 which is in violation of RBI guidelines. In terms of Master circular issued by Reserve Bank of India vide circular No. RBI No. 2007-2008/39 DBOD. No.BP.BC.12/21.04.048/2007-2008 dated July 02, 2007 on "Prudential norms on income recognition, asset classification and Provisioning pertaining to advances" the account could not have been classified as NPA. On perusal of the above A green rectangular stamp with a blue checkmark above it.

mandatory provisions of the Act, read along with Master circular issued by Reserve Bank of India vide circular No. RBI No. 2007-2008/39 DBOD. No.BP.BC.12/21.04.048/2007-2008 dated July 02, 2007 on "Prudential norms on income recognition, asset classification and Provisioning pertaining to advances" and another Guidelines bearing Circular No. DBOD. No.BP.BC.69/21.04.048/2002-2003 dated February 10, 2003 on "Upgradation of loan accounts classified as Non-Performing Assets', the account of Answering Defendants herein can not be even classified as Non-Performing Asset.

It is stated in the WS that the Defendant No.1 vide reply dated 10.10.2019 raised objection against the demand notice dated 01.10.2019 and in an undue haste, the Authorized Officer of Applicant bank, on the very next day, disposed off the objections vide rejoinder dated 11.10.2019.

It is stated in the WS that on 22.03.2020, Ministry of Home Affairs, Government of India, declared nationwide lockdown due to spread of pandemic caused by COVID-19 Virus. In this regard, Government of India, Reserve Bank of India and the State Governments issued various Guidelines/Notifications, from time to time, announcing various benefits/moratoriums/tax relief(s) etc.to all the sectors. It is well known that lockdown had badly affected the financial performance of companies world wide and since there was a high likelihood that financial and operational creditors may declare insolvency proceedings against many such firms, the Ministry of Finance, Government of India even suspended invocation of Sections 7, 9 and 10 of the Insolvency & Bankruptcy Code initially for a period of six months which was extended to one year. The Statement of Development Regulatory Policy dated 27.03.2020 issued by RBI wherein the object of the said policy issued by the RBI stated is to *inter-alia* ease the financial stress caused by COVID-19 disruptions by relaxing repayment pressures and improving access to working capital and further improving the functioning of markets in view of the high volatility experienced with the onset and spread of the pandemic. It is also stated that Clause 5 of the Statement contained in RBI policy dated 27.03.2020 deals with moratorium on loan. The said RBI Policy dated 27.03.2020 further provides for re-scheduling of the payments of term loans and working capital facilities. In the aforesaid RBI Policy dated 27.03.2020, it has also been clarified that any delay in payment leads to default and gets reported to Credit Bureaus. For business loans of Rs. 5 Crores and above, the banks report the overdue position to RBI also through CRILC. As a result of this relief package, the overdue payments post 01.03.2020 will not be reported to Credit Bureaus/CRILC for three months. No penal interest or charges will be payable to the banks. Similarly, SEBI has allowed that Credit Rating Agencies (CRAs) may not consider the delay as default by listed companies if the same is owing to lockdown conditions arising due to COVID-19. Moreover, perusal of Paragraph 5 to 7 of the Regulatory Policy and Package dated 27.03.2020 reveals that the intention of RBI is to maintain *status quo* with regard to the classification of accounts of the borrowers as NPA as they existed as on 01.03.2020.


It is also stated that Reserve Bank of India vide its policy bearing reference number RBI/2019-20/220 DOR.No.BP.BC.63/21.04.048/2019-20 dated 17.04.2020 permitted the lending institutions to grant a moratorium of three months on payment of all terms loan instalments falling due between 01.03.2020 and 31.05.2020 (herein after also referred to as "*the Moratorium Period*"). It is also directed that all accounts classified as Standard as on 29.02.2020, even if overdue, the moratorium period, wherever granted, shall be excluded by the lending institutions from the number of days past-due for the purpose of asset classification under the IRAC Norms. Similar moratorium is also directed to be given in respect of working capital facilities sanctioned in the form of cash credit/overdraft etc. It is further stated that Governor of Reserve Bank of India in his statement dated 22.05.2020 extended the above moratorium period/regulatory measures by another three months from 01.06.2020 till 31.08.2020 taking the total period of applicability of regulatory measures to six months (i.e from 01.03.2020 to 31.08.2020) in view of the extension of lockdown and continuing disruptions on account of Covid-19. It is stated in the WS that thereafter no notice under the provisions of Securitisation Act were issued/served by the Applicant Bank and is proceeding with the alleged secured assets allegedly in the loan account of Defendant No.1. Feeling seriously aggrieved and prejudiced by the mode and manner in which the Applicant bank is misusing the provisions of Securitisation Act, the Defendant No.2 to 6 has filed a SA-125/2021, before DRT-2, Delhi titled SMW Metals Pvt. Ltd.

Vs. Union Bank of India in which the Applicant Bank has not even filed the reply yet.

It is also stated in the WS that Defendant No. 2 to 6 entered into OTS dated 30.06.2023 and as per the terms and conditions two properties i.e (i) Land and Building at K-4/20 Model Town-II, Delhi-110009 and (ii) Plot No.A-7, Unit No.601, Aggarwal Corporate Heights, Netaji Subhash Place, Dist Centre, Wazirpur, New Delhi were released by Bank on deposit of amount of Rs.15.34 crores for (i) Land and Building at K-4/20 Model Town-II, Delhi-110009 and Rs. 9,50,66,769.00/- for (ii) Plot No.A-7, Unit No.601, Aggarwal Corporate Heights, Netaji Subhash Place, Dist Centre, Wazirpur, New Delhi. It is submitted that both these properties were sold by Answering Defendants on conditional NOC provided by the Bank. It is stated that the amount of Rs. 540.00 Lakhs as upfront amount was duly paid by the Answering Defendants herein. The said modification/Sanction dated 27.06.2023, the Answering Defendants had deposited Rs: 23.00 Cr towards the total settlement of Rs 54.50 Cr. But due to some sever outside constraints Answering Defendants were not able to settle the accounts. It is stated in the WS that recent election code of conduct has also been affected which made the things a bit difficult to sell the properties. Answering Defendants even requested for more time to settle the Accounts.

In their WS, the Defendants no. 2 to 7 have raised following main objections :-

- (i) Defendants no. 2 to 7 have raised an objection that the present OA under reply is further liable to be dismissed on the ground that the Applicant bank has failed to place on record of this Hon'ble Tribunal, all those documents on which the Applicant bank relied upon. It is a well settled principal of law laid down by Hon'ble Supreme Court and various Hon'ble High Courts from time to time that any party to the *lis* who is guilty of concealment of facts/documents is liable to be thrown out of the court at the very outset.

- (ii) Next objection raised by the Defendants no. 2 to 7 is that the purported statement of accounts which is placed on record by the Applicant bank is not in accordance with the Bankers' Book of Evidence Act and is thus liable to be taken off the record. Even otherwise, each and every debit entry as appearing in all pages of the purported statements of accounts are specifically and vehemently denied and disputed by the answering defendants individually and specifically. The bank must necessarily prove each and every alleged entry by filing and proving all corroborative vouchers, files, registers, ledgers etc. as there exists no presumption of the purported statement of accounts as filed and in any event any alleged presumption having been specifically rebutted by the answering Defendants.

- (iii) Next plea of Defendants no. 2 to 7 is that the Applicant bank in the present OA has failed to make out any actionable cause of action for impleading the answering defendants in the present proceedings hence also the present OA is liable to be dismissed qua the answering defendants with heavy costs.

- (iv) Next plea of Defendants no. 2 to 7 is that the instant application is not maintainable in as much as the same has not been signed, verified nor filed by a duly authorized or competent person and on this short ground alone the application deserves to be dismissed.

- (v) Defendants no. 2 to 7 have also raised an objection that the present original application has not been valued properly for the purposes of court fee / Application fees on original application.

- (vi) Defendants no. 2 to 7 have taken a plea that the Applicant bank has wrongly invoked the territorial jurisdiction of this Hon'ble Tribunal and hence the present O.A deserves to be dismissed and be dismissed with heavy costs on this short ground alone.

- (vii) Next objection raised by Defendants no. 2 to 7 is that the Applicant has grossly undervalued the securities as mentioned in Clause 3A. Applicant bank be put to strict proof thereof. It is also stated that Property no.2 and Property No. 5 are released by the Applicant bank themselves on receiving of OTS amount.

- (viii) Defendants no. 2 to 7 have also raised an objection that the OA filed by the Applicant bank is not within the period of limitation.

- (ix) Next plea of Defendants no. 2 to 7 is that the SAMV Branch is not authorized and empowered to file the present suit.

- (x) Defendants no. 2 to 7 have raised an objection that that Property No.2 and Property No.5 have been released by the Applicant Bank on payment of the OTS letter dated 20.06.2023. It is also stated that for the sale of these property the Bank duly issued NOCs. It is further stated that Property no.1 and Property No. 2 are under the Authority of the RP as the Defendant No.1 is before NCLT and Applicant Bank is at liberty to file their claim before NCLT regarding the same.

- (xi) Defendants no. 2 to 7 have stated in the WS that the Defendant no. 1 had to recover a huge amount of Rs. 21.32 Crore from one of its debtor namely M/s White Metals Pvt. Ltd. These Defendants have mentioned about the correspondence exchanged with the said debtor as well as erstwhile Andhra Bank and they are alleging that erstwhile Andhra Bank was guilty for causing havoc for Defendant no. 1.

- (xii) Defendants no. 2 to 7 have also raised an objection that vide Letter dated 23.01.2020 and according to Para 18 of the OA, the account of Defendant no. 1 was classified as NPA on 30.09.2019 whereas in Demand Notice dated 01.10.2019, it is stated that the account of Defendant no. 1 was classified as NPA on 04.09.2019. Moreover, Applicant Bank has wrongly classified the account as NPA contrary to the guidelines of RBI.

- (xiii) Further more, Defendants no. 2 to 7 have also stated that during COVID-19 pandemic, various notifications were issued by RBI for granting moratorium but no benefit was granted by the Applicant Bank to the answering Defendants.

In the light of above, it has been prayed to dismiss the OA with heavy and exemplary costs.

In support of its WS, Defendant no. 2 to 7 have also filed following documents:-

- a) True copy of Authorization Letters of Defendants no. 4 to 6 (D-1);

- b) True copy of funding Plan dated 30.07.2019 submitted by Defendant no. 1 to erstwhile Andhra Bank (D-2-colly);

- c) True copy of letter dated 22.08.2019 sent by BALCO (D-3);

- d) True copy of letter dated 26.05.2019 sent by Defendant no. 1 (D-4);

- e) True copy of order dated 26.02.2020 passed by Hon'ble NCLT Bench-II, Delhi (D-5);

- f) True copy of order dated 04.03.2020 passed by Hon'ble NCLAT, Delhi (D-6);

- g) True copy of order dated 04.06.2020 passed by Hon'ble Supreme Court (D-7);

- h) True copy of order dated 10.08.2020 passed by Hon'ble NCLAT (D-8);

- i) True copy of order dated 04.09.2020 passed by Hon'ble Supreme Court (D-9);

- j) True copy of FIR dated 03.06.2019 (D-10);

- k) True copy of Letter dated 23.01.2020 (D-11);

- l) True copy of Demand Notice dated 01.10.2019 (D-12);

- m) True copy of Master Circular dated 02.07.2007 issued by Reserve Bank of India (D-13);

- n) True copy of Reply dated 10.10.2019 and rejoinder dated 11.10.2019 (D-14);

- o) True copy of Statement of Development Regulatory Policy dated 27.03.2020 (D-15);

- p) True copy of RBI guidelines dated 17.04.2020 (D-16);

- q) True copy of RBI Statement dated 22.05.2020 (D-17);

- r) True copy of the property release letter dated 26.12.2023 (D-18);

- s) True copy of the No Dues Certificate dated 15.09.2023.

4. To prove its case, the Applicant Bank leads its evidence by filling the affidavit of Mr. Neeraj Kumar Jha, Chief Manager of the Applicant bank.

4.1 Mr. Neeraj Kumar Jha, officer of applicant bank has placed reliance upon the documents filed by the Applicant Bank which includes:-

- (i) Power of Attorney duly executed by the Applicant Bank in favour of the deponent (Ex. AW-1/1);

- (ii) Gazette Notification dated 04.03.2020 whereby Andhra Bank has been amalgamated with Union Bank of India (Ex. AW-1/2);

- (iii) Copy of the Order dated 26.02.2020 of Hon'ble NCLT with regard to admission of Defendant no.1 Company to CIRP (Ex. AW-1/3);

- (iv) Incorporation Certificate along with Master Data of Defendant no. 1 Company as well as KYC documents (Ex. AW-1/4);

- (v) Sanction Letter dated 02.02.2016 issued by the Applicant Bank (Ex. AW-1/5);

- (vi) Takeover Agreement dated 04.11.2016 executed between M/s J.P. Engineers Pvt. Ltd. through its Director Sh. Mohinder Jain i.e. Defendant no. 1 and M/s J.P. Engineers, Partnership Firm through its partner Sh. Adish Jain as well as supplemental takeover agreement dated 24.01.2017 executed between the same parties (Ex. AW-1/6-colly);

- (vii) Board Resolution on 29.11.2016 passed by Defendant no. 1 (Ex. AW-1/7);

- (viii) R.F. 210, Demand Promissory Note dated 30.11.2016 for Rs. 130,00,00,000/- (Ex. AW-1/8);

- (ix) R.F. 210, Demand Promissory Note dated 30.11.2016 for Rs. 15,00,00,000/- (Ex. AW-1/9);

- (x) AB-1, Composite Agreement dated 30.11.2016 for Rs. 145.0 Crore executed by Defendant no. 1 company (Ex. AW-1/10);

- (xi) Consent Letter to be obtained from borrower / guarantor for disclosure of information to 'CIBIL' dated 30.11.2016 executed by the borrower & guarantors (Ex. AW-1/11);

- (xii) Counter Guarantee Form dated 30.11.2016 executed by Defendant no. 1 for Rs. 130.0 Crore (Ex. AW-1/12);

- (xiii) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 1 (Ex. AW-1/13);

- (xiv) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendants no. 2, 3 & 4 (Ex. AW-1/14);

- (xv) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 5 (Ex. AW-1/15);

- (xvi) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 6 (Ex. AW-1/16);

- (xvii) R.F. 291, General Form of Guarantee dated 30.11.2016 executed by Defendant no. 7 (Ex. AW-1/17);

- (xviii) Sanction Letter dated 30.04.2019 issued by Applicant Bank (Ex. AW-1/18);

- (xix) Board Resolution dated 03.05.2019 passed by Defendant no. 1 (Ex. AW-1/19);

- (xx) R.F. 211, Demand Promissory Note dated 12.06.2019 for Rs. 150,00,00,000/- (Ex. AW-1/20);

- (xxi) AB-1, Composite Agreement dated 12.06.2019 (Ex. AW-1/21);

- (xxii) Undertakings dated 12.06.2019 executed by Defendant no. 1 (Ex. AW-1/22-colly);

- (xxiii) Consent Letter to be obtained from borrower for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 1 (Ex. AW-1/23);

- (xxiv) Counter Guarantee Form dated 12.06.2019 executed by Defendant no. 1 (Ex. AW-1/24); 

- (xxv) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendant no. 5 (Ex. AW-1/25);

- (xxvi) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 5 (Ex. AW-1/26);

- (xxvii) Undertakings dated 12.06.2019 executed by Defendant no. 5 (Ex. AW-1/27-colly);

- (xxviii) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendant no. 6 (Ex. AW-1/28);

- (xxix) Undertakings dated 12.06.2019 executed by Defendant no. 6 (Ex. AW-1/29-colly);

- (xxx) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 6 (Ex. AW-1/30);

- (xxxi) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendant no. 7 (Ex. AW-1/31);

- (xxxii) Undertakings dated 12.06.2019 executed by Defendant no. 7 (Ex. AW-1/32-colly);

- (xxxiii) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendant no. 7 (Ex. AW-1/33);

- (xxxiv) R.F. 291, General Form of Guarantee dated 12.06.2019 executed by Defendants no. 2 to 4 (Ex. AW-1/34);

- (xxxv) Consent Letter to be obtained from guarantor/s for disclosure of information to 'CIBIL' dated 12.06.2019 executed by Defendants no. 2 to 4 (Ex. AW-1/35);

- (xxxvi) Undertakings dated 12.06.2019 executed by Defendant no. 2 to 4 (Ex. AW-1/36-colly);

- (xxxvii) International Foreign Exchange Master Agreement dated 12.06.2019 (Ex. AW-1/37);

- (xxxviii) Affidavit dated 03.05.2019 executed by Defendant no. 4 (Ex. AW-1/38);

- (xxxix) Borrower's Undertaking Letter dated 12.06.2019 executed by Defendant no. 1 (Ex. AW-1/39);

- (xl) Undertaking executed by Defendant no. 1 (Ex. AW-1/40);

- (xli) Undertaking executed by Defendants no. 1 to 7 (Ex. AW-1/41);

- (xlii) R.F. 289A, regarding bills drawn on our customers executed by Defendant no. 1 (Ex. AW-1/42);

- (xliii) Undertaking regarding bank's right to cancel / modify / suspend the credit facilities dated 12.06.2019 (Ex. AW-1/43);

- (xliv) Documents with regard to creation of mortgage in respect of Property No. 1 mortgaged by M/s J.P. Engineers through its Partners (Predecessor of Defendant no. 1) viz. Title Deeds (Ex. AW-1/44-colly) and Letters dated 29.07.2002, 11.02.2016 & 12.06.2019 (Ex. AW-1/45-colly);

- (xlv) Documents with regard to creation of mortgage in respect of Property No. 2 mortgaged by Mrs. Anita Jain viz. Title Deeds (Ex. AW-1/46) and Letters dated 11.02.2016 & 12.06.2019 (Ex. AW-1/47-colly);

(xlvi) Documents with regard to creation of mortgage in respect of Property No. 3 mortgaged by M/s J.P. Engineers through its Partners (Predecessor of Defendant no. 1) viz. Title Deeds (Ex. AW-1/48) and Letters dated 27.09.2016, 28.09.2016 & 12.06.2019 (Ex. AW-1/49-colly);

(xlvii) Documents with regard to creation of mortgage in respect of Property No. 4 mortgaged by Mrs. Anita Jain viz. Title Deeds (Ex. AW-1/50) and Letters dated 27.03.2009 & 12.06.2019 (Ex. AW-1/51-colly);

(xlviii) Documents with regard to creation of mortgage in respect of Property No. 5 mortgaged by M/s Simla Holdings viz. Title Deeds (Ex. AW-1/52) and Letter dated 12.06.2019 (Ex. AW-1/53);

(xlix) Documents with regard to creation of mortgage in respect of Property No. 6 mortgaged by Mr. Mohinder Jain viz. Title Deeds (Ex. AW-1/54) and Letters dated 11.02.2016 & 12.06.2019 (Ex. AW-1/55-colly);

(l) Documents with regard to creation of mortgage in respect of Property No. 7 mortgaged by M/s Siddhartha Holdings viz. Title Deeds (Ex. AW-1/56) and Letters dated 04.09.2014, 11.02.2016 & 12.06.2019 (Ex. AW-1/57-colly);

(li) Documents with regard to creation of mortgage in respect of Property No. 8 mortgaged by M/s Tantra Solutions viz. Title Deeds (Ex. AW-1/58)

and Letters dated 23.01.2015, 24.01.2015, 11.02.2016 & 12.06.2019 (Ex. AW-1/59-colly);

- (lii) Documents with regard to creation of mortgage in respect of Property No. 9 mortgaged by M/s Simla Holdings viz. Title Deeds (Ex. AW-1/60) and Letters dated 23.01.2015, 11.02.2016 & 12.06.2019 (Ex. AW-1/61-colly);

- (liii) Recall Notice dated 01.10.2019 u/s 13(2) of SARFAESI Act, 2002 issued by the Applicant Bank to the Defendants along with postal receipts (Ex. AW-1/62);

- (liv) Statement of Account along with Certificate(s) under Section 65-B (2) of Indian Evidence Act and u/s 2A (b) of Bankers Books Evidence Act (Ex. AW-1/63, AW-1/64 and AW-1/65 respectively).

5. So far as, Defendants no. 2 to 7 are concerned, they have filed their Evidence by way of affidavit of Sh. Mohinder Jain, Defendant no. 2 who has relied upon the following documents:-

- (i) True copy of Authorization Letters of Defendants no. 4 to 6 (DW-2/1);

- (ii) True copy of funding Plan dated 30.07.2019 submitted by Defendant no. 1 to erstwhile Andhra Bank (DW-2/2-colly);

- (iii) True copy of letter dated 22.08.2019 sent by BALCO (DW-2/3);

- (iv) True copy of letter dated 26.05.2019 sent by Defendant no. 1 (DW-2/4);

- (v) True copy of order dated 26.02.2020 passed by Hon'ble NCLT Bench-II, Delhi (DW-2/5);

- (vi) True copy of order dated 04.03.2020 passed by Hon'ble NCLAT, Delhi (DW-2/6);

- (vii) True copy of order dated 04.06.2020 passed by Hon'ble Supreme Court (DW-2/7);

- (viii) True copy of order dated 10.08.2020 passed by Hon'ble NCLAT (DW-2/8);

- (ix) True copy of order dated 04.09.2020 passed by Hon'ble Supreme Court (DW-2/9);

- (x) True copy of FIR dated 03.06.2019 (DW-2/10);

- (xi) True copy of Letter dated 23.01.2020 (DW-2/11);

- (xii) True copy of Demand Notice dated 01.10.2019 (DW-2/12);

- (xiii) True copy of Master Circular dated 02.07.2007 issued by Reserve Bank of India (DW-2/13);

- (xiv) True copy of Reply dated 10.10.2019 and rejoinder dated 11.10.2019 (DW-2/14);

- (xv) True copy of Statement of Development Regulatory Policy dated 27.03.2020 (DW-2/15);

- (xvi) True copy of RBI guidelines dated 17.04.2020 (DW-2/16);

- (xvii) True copy of RBI Statement dated 22.05.2020 (DW-2/17);

- (xviii) True copy of the property release letter dated 26.12.2023 (DW-2/18);

- (xix) True copy of the No Dues Certificate dated 15.09.2023 (DW-2/19).

6. Heard Ld. counsels for the parties and perused the entire record.

6.1 It is matter of record that CIRP proceedings were initiated qua Defendant no. 1 / borrower company before Ld. NCLT, Delhi and Applicant Bank has not sought any relief qua Defendant no. 1 in this TA. Even otherwise, no final order can also be passed qua Defendant no. 1, at this stage due to pendency of CIRP proceedings initiated qua Defendant no. 1 before Ld. NCLT, Delhi.

However, it is directed that Applicant Bank shall be at liberty to revive the OA qua Defendant no. 1 in case CIRP proceedings are quashed / withdrawn in future, in accordance with law.

It is also directed that in case Applicant Bank receives any amount from CIRP proceedings, it shall give due adjustment of the same in the recovery proceedings.

6.2 Now I would like to deal with the objections raised by Defendants no. 2 to 7 herein in following paras:-

(i) Defendants no. 2 to 7 have raised an objection that the present OA under reply is further liable to be dismissed on the ground that the Applicant bank has failed to place on record of this Hon'ble Tribunal, all those documents on which the Applicant bank relied upon. It is a well settled principal of law laid down by Hon'ble Supreme Court and various Hon'ble High Courts from time to time that any party to the *lis* who is guilty of concealment of facts/documents is liable to be thrown out of the court at the very outset.

It is matter of record that the Applicant Bank has filed all the relevant documents in support of its OA

which have been duly proved / exhibited as Ex AW-1/1 to AW-1/65. Hence, this plea of Defendants no. 2 to 7 does not hold any water and same stands rejected.

- (ii) Next objection raised by the Defendants no. 2 to 7 is that the purported statement of accounts which is placed on record by the Applicant bank is not in accordance with the Bankers' Book of Evidence Act and is thus liable to be taken off the record. Even otherwise, each and every debit entry as appearing in all pages of the purported statements of accounts are specifically and vehemently denied and disputed by the answering defendants individually and specifically. The bank must necessarily prove each and every alleged entry by filing and proving all corroborative vouchers, files, registers, ledgers etc. as there exists no presumption of the purported statement of accounts as filed and in any event any alleged presumption having been specifically rebutted by the answering Defendants.

I have gone through the entire record which reveals that the Applicant Bank has duly filed Statement of Account along with Certificate(s) under Section 65-B (2) of Indian Evidence Act and u/s 2A(b) of Bankers Books Evidence Act (Ex. AW-1/63 to AW-1/65). On the other hand, though Defendants no. 2 to 7 were always at liberty to file their own statement of account but they did not chose to do so.

So far as, denial of each and every entry of statement of accounts by the answering Defendants is concerned, this Tribunal is of the view that mere denial is not going to give any benefit to the Defendants.

I have also gone through the Statement of Account and do not find any infirmity in the same. Hence, this plea of Defendants no. 2 to 7 is hereby rejected.

- (iii) Next plea of Defendants no. 2 to 7 is that the Applicant bank in the present OA has failed to make out any actionable cause of action for impleading the answering defendants in the present proceedings hence also the present OA is liable to be dismissed qua the answering defendants with heavy costs.

As already discussed above, the Applicant Bank has already filed relevant documents executed by the Defendants. Even otherwise, Defendants no. 2 to 7 have not denied execution of relevant security documents i.e. guarantee deeds or creation of mortgage etc. Hence, this Tribunal is of the view that this objection of Defendants no. 2 to 7 does not hold any water, hence, same stands rejected.

- (iv) Next plea of Defendants no. 2 to 7 is that the instant application is not maintainable in as much as the same has not been signed, verified nor filed by a duly authorized or competent person and on this short ground alone the application deserves to be dismissed.

Record reveals that the Applicant Bank has already filed Power of Attorney duly executed by the Applicant Bank in favour of its Officer (Ex. AW-1/1). On the other hand, Defendants no. 2 to 7 have failed to prove any infirmity in the said document i.e. Power of Attorney. Hence, this plea of Defendants no. 2 to 7, being devoid of any merit, stands rejected.

- (v) Defendants no. 2 to 7 have also raised an objection that the present original application has not been valued properly for the purposes of court fee / Application fees on original application.

I have gone through the record of this case file. Admittedly, this OA has been filed by the Applicant Bank for recovery of more than Rs. 150.0 Crore (approx.) As per RDB Act, amount of fees payable by Applicant Bank is calculated on the amount of debt due and when this OA is filed by the Applicant Bank, this Tribunal is of the view that appropriate court fees of Rs. 1,50,000/- (maximum) has already been paid by the Applicant Bank. Thus, this plea of Defendants no. 2 to 7 is liable to be rejected and same stands rejected.

- (vi) Defendants no. 2 to 7 have taken a plea that the Applicant bank has wrongly invoked the territorial jurisdiction of this Hon'ble Tribunal and hence the present O.A deserves to be dismissed and be dismissed with heavy costs on this short ground alone.

It is matter of record that all the addresses of Defendants no. 1 to 7 are of Delhi and Section 19(1) of RDB Act, which governs the territorial jurisdiction of Debt Recovery Tribunals (DRTs), states that *an application may be made to the Tribunal within the local limits of whose jurisdiction: (a) The bank or financial institution maintains the account in which the debt is outstanding. (b) The defendant resides, carries on business, or personally works for gain. (c) The cause of action, wholly or in part, arises.*

In these circumstances, the Tribunal is of the considered view that in pursuance to Section 19(1) (b) of the RDB Act, this Tribunal has territorial jurisdiction to entertain this Original Application (OA). Hence, this objection of Defendants no. 2 to 7 stands rejected.

(vii) Next objection raised by Defendants no. 2 to 7 is that the Applicant has grossly undervalued the securities as mentioned in Clause 3A. Applicant bank be put to strict proof thereof. It is also stated that Property no.2 and Property No. 5 are released by the Applicant bank themselves on receiving of OTS amount.

Though, Defendants no. 2 to 7 have stated in the WS that the Applicant Bank has undervalued the securities as mentioned in Clause 3A but they have not filed any documentary proof in support of this contention. This Tribunal is of the view by taking 

such bald allegations, no benefit can be given to the Defendants.

So far as, question of release of Property Nos. 2 and 5 on receiving of OTS amount is concerned, Defendant have themselves stated in the WS that they entered into OTS dated 30.06.2023 and both the properties were sold by Answering Defendants on conditional NOC provided by the Bank. It is also stated in the WS that the amount of Rs. 540.00 Lakhs as upfront amount was duly paid by the Answering Defendants herein. They also deposited Rs: 23.00 Crore towards the total settlement of Rs 54.50 Crore but due to some sever outside constraints, they were not able to settle the accounts. Thus, it is clear that the Defendants failed to settle the account.

This Tribunal is of the view that settlement of the account is the sole prerogative of the Applicant Bank and it does not require interference of this Tribunal.

In the light of above discussion, this plea of Defendants no. 2 to 7 stands rejected.

(viii) Defendants no. 2 to 7 have also raised an objection that the OA filed by the Applicant bank is not within the period of limitation.

In the present case, Defendants have executed various security documents from time to time i.e. w.e.f. November 2016 till 12.06.2019, hence, it is clear that the Defendants executed the documents lastly on 12.06.2019 whereas this OA was filed on A handwritten signature or mark in blue ink, located at the bottom right of the page. It consists of a stylized, somewhat illegible scribble that appears to be a signature.

31.10.2020. Thus, it is clear that this OA has been filed well within the period of limitation.

Even otherwise, present matter pertains to recovery of amount advanced to the Borrower Company against the mortgage of immovable properties. In this case, equitable mortgage was created at the time of disbursal of loan facilities from time to time till June 2019 wherein the mortgage of immovable properties of Defendants is involved and recovery suit is filed which is covered under Article 62 of Limitation Act under which the Suit / OA is filed to enforce payments secured by the mortgage / otherwise charged upon the immovable property wherein the period of limitation is 12-years.

Thus, it is clear that this OA has been filed well within the period of limitation. Accordingly, this plea of Defendants no. 2 to 7 is not tenable and same is hereby rejected.

- (ix) Next plea of Defendants no. 2 to 7 is that the SAMV Branch is not authorized and empowered to file the present suit.

It is matter of record that it is stated in the OA that the Defendants approached the Applicant Bank (e-Andhra Bank) at its branch office at A-13, Green Mark Main, New Delhi – 110016 and all the credit facilities were sanctioned and all the document were executed at the Branch Office at Green Park, New Delhi but after declaring the matter as Non-Performing Asset, the account has been transferred, for follow up and recovery purpose to Branch Office at SAMV Branch, M-93, Connaught Place, New Delhi – 110001, hence, the SAMV Branch is authorized and empowered to file the present suit.

In the light of above, this Tribunal is also of the view that SAMV Branch of the Applicant Bank is duly authorized and empowered to file the present case.

- (x) Defendants no. 2 to 7 have raised an objection that that Property No.2 and Property No.5 have been released by the Applicant Bank on payment of the OTS letter dated 20.06.2023. It is also stated that for the sale of these property the Bank duly issued NOCs. It is further stated that Property no.1 and Property No. 2 are under the Authority of the RP as the Defendant No.1 is before NCLT and Applicant Bank is at liberty to file their claim before NCLT regarding the same.

This plea of Defendants has already been discussed in above paras. So far as, question of one property which is stated to be under the Authority of the RP is concerned, Defendants cannot get benefit and get absolved from their liabilities, being guarantors. Even otherwise, the Applicant Bank is always at liberty to file their claim before Ld. NCLT. Hence, this objection also stands rejected accordingly.

- (xi) Defendants no. 2 to 7 have stated in the WS that the Defendant no. 1 had to recover a huge amount of Rs. 21.32 Crore from one of its debtor namely M/s White Metals Pvt. Ltd. These Defendants have mentioned about the correspondence exchanged with the said debtor as well as erstwhile Andhra Bank and they are alleging that erstwhile Andhra Bank was guilty for causing havoc for Defendant no. 1.

Admittedly, this OA has been filed by the Applicant Bank for recovery of its dues qua Defendants. Applicant Bank has already filed documentary evidence in proof of their case and Defendants have also neither denied availment of credit facilities nor execution of security documents. Therefore, at the time of paying the dues of the Applicant Bank, Defendants cannot get absolved from their liability towards the Applicant Bank, being guarantors of Borrower Company. With these observations, this objection of Defendants no. 2 to 7 stands rejected.

- (xii) Defendants no. 2 to 7 have also raised an objection that vide Letter dated 23.01.2020 and according to Para 18 of the OA, the account of Defendant no. 1 was classified as NPA on 30.09.2019 whereas in Demand Notice dated 01.10.2019, it is stated that the account of Defendant no. 1 was classified as NPA on 04.09.2019. Moreover, Applicant Bank has wrongly classified the account as NPA contrary to the guidelines of RBI.

Admittedly, this OA has been filed by the Applicant Bank for recovery of its dues qua Defendants. Applicant Bank has already filed documentary evidence in proof of their case and Defendants have also neither denied availment of credit facilities nor execution of security documents.

So far as, question of mentioning two different date(s) of NPA in Letter dated 23.01.2020 and Demand Notice dated 01.10.2019, is concerned, I have gone through both the documents.

So far as Letter dated 23.01.2020 of Applicant Bank (relied by Defendants in their WS) is concerned, same is addressed to M/s SMW Metal Private Limited which is not a party to this OA. On the other hand, Applicant Bank has not filed any such Letter with the OA as the said Letter is not related to the Defendants in this case.

So far as, question of wrongly declaring the Account of Borrower Company as NPA is concerned, this Tribunal does not find any infirmity in the same.

In the light of above, this objection of Defendants no. 2 to 7 is hereby rejected.

(xiii) Further more, Defendants no. 2 to 7 have also stated that during COVID-19 pandemic, various notifications were issued by RBI for granting moratorium but no benefit was granted by the Applicant Bank to the answering Defendants.

It is apparent from the record of this OA that the account of Borrower Company was already declared as NPA in 2019 itself i.e. way before the commencing COVID-19 period. Moreover, Demand Notice dated 01.10.2019 was also issued before the COVID-19 period. In these circumstances, Defendants no. 2 to 7 cannot get absolve from their liability on such frivolous ground, hence, same stands rejected.

6.3 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 bank is based on the documents and the witness has duly proved all these documents. The evidence filed by the applicant bank gone unrebutted and there is no question of disbelieving the evidence lead by the applicant bank and applicant 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 no. 2 to 7 along with pendentelite and future interest @11% p.a. and cost of this OA.

6.4 In this OA, Applicant Bank has prayed to issue recovery certificate against Defendants no. 2 to 7 wherein the Defendants 2 to 4 are personal guarantors & Defendants no. 5 to 7 are corporate guarantors.

6.5 So far as, Defendant no. 1 / principal borrower is concerned, no relief has been claimed by Applicant Bank qua Defendant no. 1 since defendant no. 1 / principal borrower was already before Ld. NCLT, Delhi. Even otherwise, no final order can also be passed qua Defendant no. 1, at this stage due to pendency of CIRP proceedings initiated qua Defendant no. 1 before Ld. NCLT, Delhi.

However, it is directed that Applicant Bank shall be at liberty to revive the OA qua Defendant no. 1 in case CIRP

proceedings are quashed / withdrawn in future, in accordance with law.

It is also directed that in case Applicant Bank receives any amount from CIRP proceedings, it shall give due adjustment of the same in the recovery proceedings.

6.6 Consequently, TA No. 220/2022 is liable to be allowed in favour of Applicant Bank against Defendants no. 2 to 7 (being personal and corporate guarantors and/or mortgagors), who are liable to pay the dues of the Applicant Bank along with costs and pendentelite & future interest @11% p.a. from the date of filing of present OA, till the date of payment in full.

ORDER

1. (i) TA No. 220/2022 stands allowed in favour of Applicant Bank against the Defendants no. 2 to 7 for a sum of Rs. 150,08,59,459.44 (Rupees One Hundred Fifty Crore Eight Lakh Fifty Nine Thousand Four Hundred Fifty Nine and Paise Forty Four only) along with pendentelite and future interest @11% p.a. from the date of filing of this OA till realization of the entire dues of the Applicant Bank along with costs of this OA. Now Defendants no. 2 to 7 are directed to pay the aforesaid amount(s) to the Applicant Bank within 30-days, failing which, the aforesaid amount(s) shall be recovered from the sale of secured assets / mortgaged properties / hypothecated assets / stocks etc. belonging to Defendants no. 2 to 7.

In case of shortfall, same shall be recovered from the movable and immovable assets of Defendants no. 2 to 7 only.

- (ii) So far as, Defendant no. 1 / principal borrower is concerned, no relief has been claimed by Applicant Bank qua Defendant no. 1 since defendant no. 1 / principal borrower was already before Ld. NCLT, Delhi. Even otherwise, no final order can be passed qua Defendant no. 1, at this stage due to pendency of CIRP proceedings initiated qua Defendant no. 1 before Ld. NCLT, Delhi.

However, it is directed that Applicant Bank shall be at liberty to revive the OA qua Defendant no. 1 in case CIRP proceedings are quashed / withdrawn in future, in accordance with law.

It is also directed that in case Applicant Bank receives any amount from CIRP proceedings, it shall give due adjustment of the same in the recovery proceedings.

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

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

- (v) Parties are directed to appear before the Recovery Officer-I, DRT-III, Delhi on 23.09.2026.

TA-220/2022

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

File be closed and consigned to records.

22.07.2026

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

(Pronounced in open court) Dated 22.07.2026