STATE BANK OF INDIA vs SVOGL OIL GAS AND ENERGY LTD AND ORS on 5 August 2025

**FINAL ORDER**

1. 1. The present Original Application has been filed by the Applicant Bank on 20.04.2018 through Mr. Narinder Kumar Sharma, son of Mr. B.P. Sharma, who is serving as Assistant General Manager and Principal Officer at the Stressed Asset Management Branch. The application is instituted under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, seeking recovery from Defendants No. 1 to 5 of a total sum of Rs. 153,47,28,522.67/- (Rupees One Hundred Fifty-Three Crores Forty-Seven Lacs Twenty-Eight Thousand Five Hundred Twenty-Two and Sixty Seven Paisa Only). This amount includes Rs. 124,60,30,400/- in the Term Loan Account, Rs. 20,47,83,979/- in the Funded Interest Term Loan Account, and Rs. 8,39,14,142/- in the Priority Loan Account. The Applicant Bank also claims pendentelite and future interest at the rates of 11%, 11%, and 12% per annum respectively, calculated with monthly rests from the date of filing this application until actual realization, along with the costs of this Original Application.

2. 2. It is pertinent to note here that this OA bearing no. 856/2018 was originally filed before Ld. DRT-II, Delhi, however, in pursuance to Gazette Notification No. 4718(E) dated 04.10.2022 issued by Government of India, Department of Financial Services, Ministry 

of Finance, this case file was transferred by Ld. DRT-II, Delhi to this Tribunal in 25.11.2022 and was numbered at TA-355/2022.

1. 3. The brief facts of the case are that Defendant No.1, a company incorporated under the Companies Act, 1956, is engaged in oil and gas exploration. Initially registered as Shiv Vani Drilling Private Limited on 5th December 1989, it became Shiv Vani Oil and Gas Energy Limited, and later, on 18th November 2014, was renamed SVOGL Oil Gas and Energy Limited, its current name. Defendants No. 2 to 5 have acted as guarantors for credit facilities extended to Defendant No.1 by the Applicant Bank. The remaining Defendants form part of a consortium of banks and financial institutions that have granted loans to Defendant No.1. SVUL Projects Ltd has since merged with Defendant No.1.

2. 4. That Mr. Narinder Kumar Sharma is the Assistant General Manager and Principal Officer at the Stressed Assets Management Branch of the Applicant Bank, located at Sixth Floor, Baba Kharak Singh Marg, New Delhi-110001. He is fully conversant with the facts of the case and competent to depose on the matters stated in the application. In accordance with Regulations 76 and 77 of the State Bank of India General Regulations, 1955 framed under Section 50(3) of the State Bank of India Act, 1955, with prior approval of the Central Government and as notified in the Gazette of India on 26.09.1959, 26.08.1972, and 02.05.1987, he is authorized to sign, verify, and undertake all necessary legal actions, including filing applications, plaints, written statements, affidavits, vakalatnamas, and executions on behalf of the Applicant Bank.

1. 5. The Defendant No. 1 is a company duly incorporated under the Companies Act, 1956, and is engaged in the business of oil and gas exploration. To the best knowledge of the Applicant Bank, it was originally incorporated as Shiv Vani Drilling Private Limited on or around 5.12.1989. The company subsequently deleted the word "Private" from its name with effect from 12.01.1990 and later changed its name to Shiv Vani Oil and Gas Energy Limited. On 18.11.2014, it was renamed as SVOGL Oil Gas and Energy Limited, the name under which it presently conducts business. Defendants No. 2 to 5 have stood as guarantors for various credit facilities extended to Defendant No. 1 by the Applicant Bank. The other Defendants form part of a consortium of banks and financial institutions that have also provided financial assistance to Defendant No. 1. It is further pertinent to mention that SVUL Projects Ltd has since merged with Defendant No. 1.

1. 6. **Credit Facilities Granted in 2010**

The Defendants approached the Applicant Bank Around June 2010, the Defendants approached the Applicant Bank for the grant of credit facilities. At that time, Defendant No. 1 was operating under the name and style of Shiv Vani Oil and Gas Exploration Services Ltd. Upon the Defendants' request, the Applicant Bank sanctioned credit facilities amounting to Rs. 75 crores, repayable over a period of 6.5 years, 

vide sanction letter dated 13.08.2010 bearing No. CNW/CBND/2288. The agreed rate of interest was 10.50% per annum (i.e., 2.75% above the SBT base rate), and the Company was responsible for arranging insurance. Defendants No. 2 and 3 stood as guarantors for the said facility. The credit facilities were duly availed by Defendant No. 1, and in furtherance of the same, various loan and guarantee documents were executed, including the sanction letter dated 13.08.2010, a confirmation letter issued by Shri Padam Singhee, the Term Loan Agreement dated 13.08.2010, Deed of Hypothecation and FCNR(B) Term Loan Agreement both dated 03.09.2010, Deed of Guarantee dated 03.09.2010 executed by Shri Padam Singhee and Shri Prem Singhee, and other supporting documents such as the letter regarding individual limits, undertakings, and extracts of board and shareholder meetings evidencing due authorization and approval for availing the said credit facilities.

1. i. Sanction Letter No. CNW/CBND/2288 dated 13.08.2010, duly signed and accepted on behalf of Defendant No. 1

2. ii. Confirmation Letter dated 03.09.2010 issued by Defendant No. 3

3. iii. Term Loan Agreement for High Value Advances dated 13.08.2010, executed by Defendant No. 1 and the Applicant Bank

4. iv. Deed of Hypothecation dated 03.09.2010, creating a charge over the movable assets of Defendant No. 1

- v. FCNR (B) Term Loan Agreement dated 03.09.2010, including the repayment schedule for the foreign currency loan component.

- vi. Deed of Guarantee dated 03.09.2010, executed Defendant No. 2 & 3, jointly and severally guaranteeing repayment of the facilities granted to Defendant No. 1.

- vii. Letter dated 13.08.2010 regarding Grant of Individual Limits within the Overall Sanctioned Limit, issued by the Applicant Bank.

- viii. Undertaking dated 03.09.2010, executed on behalf of Defendant No. 1 in respect of the sanctioned credit facilities.

- ix. Extracts from the Minutes of the Annual General Meeting dated 30.07.2007 of Defendant No. 1, evidencing approval for an increase in borrowing limits.

- x. Extracts from the Minutes of the Board Meeting dated 01.09.2010 of Defendant No. 1, authorizing the borrowing and execution of related documents.

- xi. Extracts from the Minutes of the Board Meeting dated 13.08.2010, recording the decision of the Applicant Bank (then State Bank of Travancore) to grant the credit facilities.

7. **Restructuring of Credit Facilities in 2014**

In 2014, the Defendants again approached the Applicant Bank then known as State Bank of Travancore (now State Bank of India) seeking restructuring of the existing credit facilities, following defaults in repayment. After considering the 

Defendants' request and assessing their financial condition, the Applicant Bank approved the restructuring under the Corporate Debt Restructuring (CDR) mechanism. Pursuant to the approved CDR package, Defendant No. 1, along with its guarantors, executed and submitted various documents reaffirming their liability and accepting the revised terms and conditions. These documents include:

1. i. Letter No. CNW/SOGES/CDR dated 28.03.2014, executed by the Defendants acknowledging and accepting the restructured credit facilities;

2. ii. Sanction Letter dated 25.03.2014, issued by the Applicant Bank, detailing the terms of the restructuring under the CDR package

3. iii. Master Restructuring Agreement dated 18.03.2014, outlining the overall terms and conditions governing the restructured facilities;

4. iv. Deed of Guarantee dated 18.03.2014, executed by Defendant No. 3

5. v. Deed of Guarantee dated 18.03.2014, executed by Defendant No. 2

6. vi. Revival Letter dated 17.12.2016, executed by Defendant No. 1 acknowledging the continuation and enforceability of the credit facilities

7. vii. Balance Confirmation Letter dated 22.06.2015, issued by Defendant No. 1 in favour of State Bank of Travancore

- viii. Trust and Retention Account Agreement, executed to ensure appropriate utilization and monitoring of funds

- ix. Security and Trustee Agreement, executed to secure the interests of the lenders under the restructuring arrangement. These documents collectively reaffirm the Defendants' liability and the terms of the restructured financial assistance.

1. 8. That by order dated 28.03.2006 of the Hon'ble Delhi High Court, SVUL Projects Ltd was merged with Shiv Vani Oil & Gas Exploration Services Ltd.

2. 9. The Defendants duly availed the sanctioned and subsequently restructured credit facilities. However, despite these facilities, Defendant No. 1 repeatedly failed to maintain financial discipline and service the loan obligations. The Defendants have consistently acknowledged their liability to repay the outstanding amounts. The Applicant Bank made multiple attempts, including letters, telephone calls, and personal visits, to urge the Defendants to regularize the account, but Defendant No. 1 failed to comply. Consequently, despite repeated reminders and efforts, the Defendants have failed to clear the outstanding dues.

3. 10. Since the loan accounts of Defendant No. 1 remained irregular and the Defendants failed to maintain financial discipline despite multiple requests and reminders, the account was declared a Non-Performing Asset (NPA) on 28.07.2013. Although interest has not been accounted for post-NPA declaration as per accounting practices, the Defendants remain liable to pay interest at the contractual rates of 11%, 11%, and 12% per annum on the Term Loan, FITL, and Priority Loan respectively, as agreed under the 2014 CDR restructuring package. According to the books of account maintained by the Applicant Bank in the ordinary course of business, significant outstanding amounts are due from the Defendants.

<table border="1"> <thead> <tr> <th>Sr. No.</th> <th>Head</th> <th>Amount in Rupees</th> </tr> </thead> <tbody> <tr> <td>1</td> <td>Term Loan</td> <td>124,60,30,400.62</td> </tr> <tr> <td>2</td> <td>FITL</td> <td>20,47,83,979.73</td> </tr> <tr> <td>3</td> <td>Priority Loan</td> <td>8,39,14,142.32</td> </tr> </tbody> </table>

As of 05.04.2018, the Defendants are jointly and severally liable to pay a total amount of Rs. 153,47,28,522.67 inclusive of interest accrued up to that date at the contractually agreed rates. Additionally, the Defendants remain liable to pay interest at the contractual rates of 11%, 11%, and 12% per annum on the Term Loan, FITL, and Priority Loan respectively, from 06.04.2018 onwards as pendentite lite and on the outstanding amounts until the date of actual realization.

1. 11. The cause of action in the present case is a continuing one and arose on multiple occasions, including each time the Defendants approached the Applicant Bank seeking credit facilities; when the said credit facilities were sanctioned and disbursed by the Bank; when the Defendants failed to adhere to the agreed terms and conditions and did not maintain financial discipline; and when the Bank officials made repeated requests and follow-ups with the Defendants for clearing the outstanding dues. Furthermore, the cause of action also arose on the specific dates detailed in the Original Application, thereby giving rise to the present proceedings.

1. 12. It is further stated that the Applicant Bank also initiated actions under SARFAESI Act and took actual physical possession of the secured assets under Section 13(4) of the said Act.

2. 13. It is further stated that the instant OA is without prejudice to the right of the applicant bank to proceed further under the Act, in accordance with law.

3. 14. It is further stated that since, the Defendants did not pay the amount due to Applicant Bank, hence, the Applicant Bank was left with no alternative but to file the present OA and the Applicant Bank is entitled to recover the entire amount due from the defendants, who are jointly and severally liable to pay the same to the Applicant Bank along with interest.

4. 15. Notices of this O.A. were issued to the Defendants, but Defendants did not chose to file their WS except contesting Defendant No. 2 to 5, hence, their right to file the WS was closed vide order dated 22.11.2019.

5. 16. So far as, Defendant No. 1 to 4 are before Ld. NCLT, and Defendant No. 4 & 5 are, initially they were proceeded ex parte vide order dated 18.03.2024.

6. 17. To prove its case, the Applicant Bank leads its evidence by filling the affidavit of Ms. VARRDA

Mittal, Chief Manager, The Stressed Assets Management Branch at 12th Floor, Jawahar Vyapar Bhavan, New Delhi, who has relied upon the documents filed by the applicant bank which includes the applicant no. 1/ The State Bank of India would act as a Facility Agent and may exercise on its own discretion to take action in the case of default/enforcement.

18. It is stated that, pursuant to the request of Defendant No. 1, the Applicant Bank, then State Bank of Travancore (now merged with State Bank of India), sanctioned credit facilities of Rs. 75 crores.

- i. Sanction Letter dated 13.08.2010 bearing No. CNW/CBND/2288 (Exhibit PW1/1)

- ii. Letter dated 03.09.2010 from Defendant No. 3 acknowledging acceptance of the sanctioned Term Loan (Exhibit PW1/2).

- iii. Term Loan Agreement dated 03.09.2010 (Exhibit PW1/3)

- iv. Deed of Hypothecation (Exhibit PW1/4)

- v. FCNR(B) Term Loan Agreement (Exhibit PW1/5)

- vi. Deed of Guarantee by Defendant No. 2 & 3 dated 03.09.2010 (Exhibit PW1/6)

- vii. Letter regarding Grant of Individual Limits dated 13.08.2010 (Exhibit PW1/7)

- viii. Undertaking by the borrower company dated 03.09.2010 (Exhibit PW1/8)

**Restructuring of Credit Facilities in 2014**

- ix. Master Restructuring Agreement between Shiv-Vani Oil and Gas Exploration Services Ltd., ICICI Bank Ltd., and other CDR Lenders, (Exhibit PW1/9)

- x. Deeds of Guarantee by Defendant No. 2 & 3 both dated 18.03.2014 (Exhibits PW1/10 and PW1/11)

- xi. Extracts of the Board Meeting Minutes dated 18.03.2014 (Exhibit PW1/12)

- xii. Security Trustee Agreement dated 20.03.2014 (Exhibit PW1/13)

- xiii. Letters issued by State Bank of Travancore regarding restructuring dated 25.03.2014 and 28.03.2014 (Exhibit PW1/14 and PW1/15)

- xiv. Unattested Deed of Hypothecation dated 28.03.2014 (Exhibit PW1/16)

- xv. Deeds of Guarantee by T.R.S. Pvt. Ltd. (PW1/17)

- xvi. Deeds of Guarantee by Defendant No. 5 dated 28.03.2014 (Exhibit PW1/18)

- xvii. Sponsor Support Agreement (PW1/19)

- xviii. Trust and Retention Account Agreement (Exhibit PW1/20)

- xix. Unattested Pledge Agreements dated 28.03.2014 and 09.04.2014 (Exhibit PW1/21 and PW1/22)

- xx. Balance Confirmation Letter dated 22.06.2015 (Exhibit PW1/23)

- xxi. Revival Letter dated 17.12.2016 (Exhibit PW1/24)

- xxii. *Interest Calculation Sheets* for Account No. 67270979214 for the period 29.03.2014 to 21.06.2017 (Exhibit PW1/25)


- xxiii. Interest Calculation Sheets for Account No. 67277770840 from 28.05.2014 to 21.06.2017 (Exhibit PW1/26)

- xxiv. Interest Calculation Sheets for Account No. 67270960791 from 28.03.2014 to 21.06.2017 (Exhibit PW1/27)

- xxv. Statements of Account for Account No. 67270960791 for the period 28.03.2014 to 20.06.2017 (Exhibit PW1/28),

- xxvi. Statements of Account for Account No. 67270960791 for the period 28.03.2014 to 20.06.2017 (Exhibit PW1/28)

- xxvii. Statements of Account for Account No. 67270979214 for the same period (Exhibit PW1/29)

- xxviii. Statements of Account for Account No. 67277770840 for the period 28.05.2014 to 20.06.2017 (Exhibit PW1/30).

- xxix. Statement of Account annexed with the Original Application as Annexure A, which details the transactions and outstanding amounts up to 05.04.2018 (Exhibit PW1/31)

- xxx. Interest Calculation Sheet annexed as Annexure B, illustrating the interest charged at various points in time on the Term Loan, FITL, and Priority Loan as per the restructuring package dated 2014 (Exhibit PW1/32)

19. 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 bank has proved its case beyond reasonable doubts. Accordingly, the bank is entitled to recover the entire amount along with pendentelite interest and future costs as agreed between the parties. I hereby allow this OA as the applicant bank has proved its claim beyond any doubt.

1. 20. In this TA, Applicant Bank has prayed to issue recovery certificate against Defendant No. 5. In the present matter, the Defendant No. 1 is principal borrower and defendants no. 2 to 5 stood as guarantor / mortgagors.

2. 21. Further, it is an admitted fact that Defendant No. 1 company has gone into liquidation pursuant to the directions passed by the Hon'ble High Court of Delhi, and during the course of such liquidation proceedings, the Applicant Bank has received certain amounts from the Official Liquidator in partial discharge of the outstanding liabilities of the said Defendant.

3. 22. Moreover, applicant bank has already stated in the OA as well as written submissions that the mortgaged properties have been sold under SARFAESI Act and/or in liquidation proceedings by the OL.

4. 23. Consequently, TA No. 355/2022 stands allowed in favour of Applicant Bank and against Defendant No. 5, who is liable to pay the dues of the Applicant Bank along with costs and pendentelite & future interest, as claimed in the OA, from the date of filing of present OA, till the date of payment in full.

**ORDER**

TA No. 355/2022 stands allowed and the Defendant No. 5 is directed to pay to the Applicant Bank, within 30 days, a sum of Rs. 153,47,28,522.67/- (Rupees One Hundred Fifty-Three Crores Forty-Seven Lacs Twenty-Eight Thousand Five Hundred Twenty-Two and Sixty Seven Paisa Only) less the amount received from the sale / release of mortgaged properties and the amount received from OL, along with cost and pendentelite and future interest, as claimed in OA i.e. @ 11% per annum with monthly rests from the date of filing of this OA till the date of realization failing which, the aforesaid amount shall be recovered from the sale of hypothecated / charged stocks / tangible movables and available mortgaged properties (which have not been sold / released as yet by the bank or OL).

Further, in case of shortfall, the same shall be recovered from the sale of movable and immovable assets of the defendants no. 2 to 4 (since defendant no. 1 has already gone into liquidation).

- (i) It is also directed that the applicant shall adjust the amount(s), if any, received from the defendants / OL during the pendency of this case. Since, Defendant No. 1, company has gone into liquidation and is under power and possession of OL appointed by Hon'ble High Court of Delhi, OL shall deposit decretal amount received from the sale of the assets of Defendant No. 1.

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

- (iii). Parties are directed to appear before the Recovery Officer-II, DRT-III, Delhi on 07.10.2025

- (iv). 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: 05.08.2025

05.08.2025 (SHIV KUMAR - I) PRESIDING OFFICER, DRT-III, DELHI

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