PRUDENT ARC LIMITED vs HI TECH GRAIN PROCESSING PVT LTD AND ORS on 24 November 2025

**FINAL ORDER**

1. This original application has been filed by the Applicants No. 1 & 2 (State Bank of India and Andhra Bank Limited), on 06.10.2018, through Mr. Sudhir Kumar Pandeya, Assistant General Manager / Principal Officer of Applicant No. 1 and Ms. Sonalika, Assistant General Manager / Principal Officer of Applicant No. 2, being the authorized officer(s) of the Applicant Banks, under Section 19 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 against the defendants no. 1 to 4 for recovery of following amount(s):- Applicant No. 1 Rs. 171,21,15,254.88 (Rupees One Hundred Seventy One Crore Twenty One Lakh Fifteen Thousand Two Hundred Fifty Four and Paise Eighty Eight only) together with pendentelitte and future interest @11.70% p.a. with monthly rests as regards the Cash Credit Facility from the date of filing of OA till the date of actual and final realization along with all costs and charges.

Applicant No. 2 Rs. 31,27,54,133.78 (Rupees Thirty One Crore Twenty Seven Lakh Fifty Four Thousand One Hundred Thirty Three and Paise Seventy Eight only) together with pendentelite and future interest @11.50% p.a. with monthly rests as regards the Cash Credit Facility from the date of filing of OA till the date of actual and final realization along with all costs and charges.

and other relief(s).

1.2 It is pertinent to note here that this OA bearing no. 18/2019 was originally filed before Ld. DRT-II, Delhi, however, in pursuance to Gazette Notification No. 4718 (E) dated 04.10.2022 issued by Government of India, Department of Financial Services, Ministry of Finance, this case file was transferred by Ld. DRT-II, Delhi to this Tribunal in October 2022 and was numbered at TA-266/2022.

2. The brief facts of the case are that the Applicant No. 1 Bank i.e. State Bank of India is a body corporate constituted under the State Bank of India Act, 1955 carrying on its business of Banking. It is a body corporate with perpetual succession and can sue and be sued in its own name. It is further stated that vide Gazette Notification dated 22.02.2017, erstwhile State Bank of Bikaner & Jaipur (SBBJ) and erstwhile State Bank of Hyderabad (SBH) have merged with State Bank of India (Applicant no. 1 Bank) w.e.f. 01.04.2017. All contracts, deeds, bonds, guarantees, agreements, assurances, power of attorney and other instruments of whatever nature and working arrangements subsisting immediately before the effective date shall be as of full force and effect against or in favour of the Applicant Bank i.e. the Transferee Bank and enforceable as fully and effectually as if, instead of the Transferor Banks. Therefore, the erstwhile State Bank of Bikaner & Jaipur and erstwhile State Bank of Hyderabad are collectively hereinafter are referred as "The Applicant No. 1 Bank". It is further stated that the Applicant No. 1 Bank is filing the present OA through Mr. S.K. Pandeya, Assistant General Manager and Authorized Officer of the Applicant No. 1 Bank's Stressed Assets Management Branch situated at Baba Kharak Singh Marg, Connaught Place, New Delhi who is competent and authorized to institute, sign, verify the plaint and institute the OA and to compete all the legal formalities on behalf of the Applicant No. 1 Bank in terms of General Regulations No. 76 & 77 of State Bank of India General Regulations 1955 made by the Reserve Bank of India in exercise of the powers conferred by Sub-Section (3) of Section 50 of the State Bank of India Act, 1955 with the previous sanctions of the Central Government read with Gazette Notifications published in the Gazette of India dated 26.09.1959, 26.08.1972.

It is further stated that the Applicant No. 2 Bank i.e. Andhra Bank Limited is a public sector bank owned by the Government of India. It is also a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 with perpetual succession and can sue and be sued in its own name. It is also stated that the Applicant No. 2 Bank is filing the present OA through Smt. Sonalika Hazari, Assistant 

General Manager and Authorized Officer of the R.K. Puram Branch of the Applicant No. 2 Bank who is competent and authorized to institute, sign, verify the plaint and institute the OA and to compete all the legal formalities on behalf of the Applicant No. 2 Bank in terms of Power of Attorney executed by Applicant No. 2 in favour of Smt. Sonalika Hazari.

2.1 It is stated in the OA that the Defendant no. 1 is a Company within the meaning of the Companies Act, 1956 which is engaged in and carrying on the manufacturing of grain mill products, starches and starch products, and prepared animal feeds. Defendant no. 2 is a Company incorporated under the Companies Act, 1956 who has stood as Corporate Guarantors and so also mortgaged it property for the credit facilities granted to the Defendant no. 1 from time to time by the consortium Lenders. Defendant no. 3 is the Managing Director & Promoter of the Addressee No. 1 Company and has also stood as Guarantor in his personal capacity in respect of the credit / loan facilities granted to Defendant no. 1 by the Applicant Banks. Defendant no. 4 also stood as guarantors in their personal capacity in respect of the credit / loan facilities granted to the Defendant no. 1 by the Applicant Banks and executed various documents in favour of the Applicant Bank.

So far as, defendants no. 5 & 6 are concerned, they are the Proforma Defendants being other Secured Creditor Consortium Lenders as part of SBI Consortium, who have granted various credit facilities including Working Capital Facility by defendant no. 1 from time to time and have charge over the movable as well as immovable properties of Defendant no. 1. The Applicant No. 1 Bank stood as the Lead Bank and so also as the Security Agent for the SBI Consortium.

It is stated in the OA that Defendant no. 1 availed various Credit Facilities from time to time from the Applicant Banks being the Consortium Lenders consisting of Applicant Banks, Defendants no. 5 & 6 referred as SBI Consortium or Lenders. It is also stated the Lenders have final sanctioned Working Capital Facilities of Rs. 305.00 Crore to the Defendant no. 1 on the terms and conditions as set out in the respective sanction letters issued by the lenders from time to time, wherein Consortium Lenders have pari-passu charge over the assets of the Borrowers & Guarantors. It is also stated that the Defendant no. 1 hypothecated in favour of consortium Lenders its entire goods, movables and other assets [details given in Para 5(5.9) of the OA]. Moreover, the Defendants have equitable mortgaged various properties belonging to defendants no. 3 & 4 in favour of the Consortium Lenders for the Credit Facilities availed by the Defendant no. 1 from the Consortium Lenders from time to time by depositing the title deeds with the Consortium Lenders [details given in Para 5 (5.10) of OA].

**Individual and Consortium Documents regarding Credit Facilities granted by Applicant No. 1 Bank as part of "SBI Consortium"**

2.2 It is stated in the OA that defendant no. 1 being the Borrower furnished the requisite Resolutions 02.01.2010, 03.08.2010, 07.04.2011, 03.03.2012, 25.05.2012, 20.11.2012, 02.012.2013, 09.08.2014, 07.03.2015, 06.11.2015, 29.03.2016, 16.04.2016, 19.11.2016 and 05.06.2017 as Special Resolution under Section 292(1)(c), 293 (1)(d) and Section 372A of the Companies Act, 1956 and/or Section 179, 180 and 186 of the Companies Act 2013 for availing the various loan / credit facilities granted to Defendant no. 1 by the Applicant Banks from time to time.

Further, defendant no. 2 being the Corporate Guarantor furnished the requisite Resolutions 02.01.2010, 03.08.2010, 07.04.2011, 03.03.2012, 20.11.2012, 02.12.2013, 09.08.2014, 06.11.2015, 07.03.2015, 16.04.2016, 19.11.2016 and 05.06.2017 in respect of the various loan / credit facilities granted to Defendant no. 1 by the Applicant Banks from time to time.

2.3 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, vide their Application dated 11.08.2009 approached the erstwhile State Bank of Hyderabad for grant of various credit facilities for business of Defendant no. 1 including a takeover of Credit Facilities. The Applicant No. 1 Bank sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 18.00 Crore vide its Sanction Letter dated 18.12.2009, as detailed below:-

<thead> <tr> <th>Nature of Facility/Limit</th> <th>Amount<br/>(Rs. in<br/>Crores)</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>13.50</td> </tr> <tr> <td>II. NFB Inland / Foreign Letter of Credit</td> <td>04.50</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>18.00</b></td> </tr> <tr> <td><b>Total Limit (A+B)</b></td> <td><b>18.00</b></td> </tr> </tbody> </table>

(Rupees Eighteen Crore Only)

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of Applicant No. 1 Bank on 02.01.2010 :-

- (i) Sanction Letter dated 18.12.2009 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors), in token of having accepted the terms and conditions regulating the aforesaid credit facilities of Rs. 18.00 Crore granted to Defendant no. 1 by the Applicant No. 1 Bank;

- (ii) Agreement of Loan for Overall Limit (Form C-1A) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendant no. 1;

- (iii) Agreement for hypothecation of goods and assets (Form C-2) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendant no. 1;

- (iv) Deeds of Guarantee for Overall Limit (Form C-4A) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendants no. 2, 3 & 4;

- (v) Letter regarding the Grant of Individual Limits within the Overall Limits (Form C-5) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendant no. 1;

- (vi) Agreement to Mortgage dated 04.01.2010;

(vii) Undertaking dated 04.01.2010 by Defendant No. 1 & 2 in favour of the erstwhile State Bank of Hyderabad.

2.4 It is further stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1 in the month of July 2010. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 25.00 Crore vide its Sanction Letter dated 02.08.2010, as detailed below:-

<thead> <tr> <th>Nature of Facility/Limit</th> <th>Amount<br/>(Rs. in Crores)</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>16.50</td> </tr> <tr> <td>II. NFB Inland / Foreign Letter of Credit</td> <td>08.50</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>25.00</b></td> </tr> <tr> <td><b>Total Limit (A+B)</b></td> <td><b>25.00</b></td> </tr> </tbody> </table>

**(Rupees Twenty-Five Crore Only)**

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of Applicant No. 1 Bank on 05.08.2010 :-

- (i) Sanction Letter dated 02.08.2010 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors), in token of having accepted the terms and conditions regulating the aforesaid credit facilities of Rs. 25.00 Crore granted to Defendant no. 1 by the Applicant No. 1 Bank;

- (ii) Supplemental Agreement of Loan for Overall Limit (Form C-1A) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendant no. 1;

- (iii) Supplemental Agreement for hypothecation of goods and assets (Form C-2) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendant no. 1;

- (iv) Supplemental Deeds of Guarantee for Overall Limit (Form C-4A) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendants no. 2, 3 & 4;

- (v) Supplemental Letter regarding the Grant of Individual Limits within the Overall Limits (Form C-5) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendant no. 1;

- (vi) Undertaking dated 05.08.2010 by Defendant No. 1 & 2 in favour of the erstwhile State Bank of Hyderabad.

2.5 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1 in the month of March 2011. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 40.00 Crore vide its Sanction Letter dated 06.04.2011, as detailed below:-

<thead> <tr> <th><b>Nature of Facility/Limit</b></th> <th><b>Amount<br/>(Rs. in<br/>Crores)</b></th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>27.00</td> </tr> <tr> <td>II. NFB Inland / Foreign Letter of Credit</td> <td>13.00</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>40.00</b></td> </tr> <tr>

<td><b>40.00</b></td> </tr> </tbody> </table>

**(Rupees Forty Crore Only)**

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of Applicant No. 1 Bank on 07.04.2011 :-

- (i) Sanction Letter dated 06.04.2011 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors), in token of having accepted the terms and conditions regulating the aforesaid credit facilities of Rs. 40.00 Crore granted to Defendant no. 1 by the Applicant No. 1 Bank;

- (ii) Agreement of Loan cum Hypothecation for Overall Limit (Form SME 2) dated 07.04.2011 for Rs. 40.00 Crore signed and executed by Defendant no. 1;

- (iii) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 07.04.2011 for Rs.

40.00 Crore signed and executed by Defendants no. 2, 3 & 4;

(iv) Undertaking dated 07.04.2011 by Defendants No. 1 to 4 in favour of the erstwhile State Bank of Hyderabad.

2.6 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1 in the month of January 2012. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 55.00 Crore vide its Sanction Letter dated 12.02.2012, as detailed below:-

<thead> <tr> <th>Nature of Facility/Limit</th> <th>Amount<br/>(Rs. in Crores)</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>37.00</td> </tr> <tr> <td>II. NFB Inland / Foreign Letter of Credit</td> <td>18.00</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>55.00</b></td> </tr> <tr> <td><b>Total Limit (A+B)</b></td> <td><b>55.00</b></td> </tr> </tbody> </table>

**(Rupees Fifty Five Crore Only)**

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of Applicant No. 1 Bank on 10.03.2012 :-

- (i) Sanction Letter dated 10.03.2012 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors), in token of having accepted the terms and conditions regulating the aforesaid credit facilities of Rs. 40.00 Crore granted to Defendant no. 1 by the Applicant No. 1 Bank;

- (ii) Supplemental Agreement of Loan cum Hypothecation for Overall Limit (Form SME 4) dated 10.03.2012 for Rs. 55.00 Crore signed and executed by Defendant no. 1;

- (iii) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 10.03.2012 for Rs. 55.00 Crore signed and executed by Defendants no. 2, 3 & 4;

- (iv) Undertaking dated 10.03.2012 by Defendants No. 1 to 4 in favour of the erstwhile State Bank of Hyderabad.

2.7 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1 in the month of January 2012. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 83.00 Crore vide its Sanction Letter dated 19.11.2012, as detailed below:-

<thead> <tr> <th>Nature of Facility/Limit</th> <th>Amount<br/>(Rs. in Crores)</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>49.00</td> </tr> <tr> <td>II. NFB Inland / Foreign Letter of Credit</td> <td>34.00</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>83.00</b></td> </tr> <tr> <td><b>Total Limit (A+B)</b></td> <td><b>83.00</b></td> </tr> </tbody> </table>

**(Rupees Eighty Three Crore Only)**

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of Applicant No. 1 Bank on 19.11.2012 :-

- (i) Sanction Letter dated 20.11.2012 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors), in token of having accepted the terms and conditions regulating the aforesaid credit facilities of Rs. 83.00 Crore granted to Defendant no. 1 by the Applicant No. 1 Bank;

- (ii) Supplemental Agreement of Loan cum Hypothecation for Overall Limit (Form SME 4) dated 20.11.2012 for Rs. 83.00 Crore signed and executed by Defendant no. 1;

- (iii) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 20.11.2012 for Rs. 83.00 Crore signed and executed by Defendants no. 2, 3 & 4; 

(iv) Undertaking dated 20.11.2012 by Defendants No. 1 to 4 in favour of the erstwhile State Bank of Hyderabad.

(v) Link Letter dated 20.11.2012.

2.8 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1 in the month of September 2013. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 140.00 Crore vide its Sanction Letter dated 08.10.2013. It is pertinent to point out that at the request of Defendants, the erstwhile State Bank of Hyderabad vide its Sanction Letter dated 02.12.2013 had modified the terms and conditions of the Sanction of renewal cum enhancement of the Working Capital Limit. The erstwhile State Bank of Hyderabad sanctioned following credit facilities to the Defendant no. 1 vide its Sanction Letter dated 02.12.2013:-

<thead> <tr> <th>Nature of Facility/Limit</th> <th>Amount<br/>(Rs. in Crores)</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>70.00</td> </tr> <tr> <td>II. EPC/FDP/FDB</td> <td>(15.00)</td> </tr> <tr> <td>III. Letter of Credit</td> <td>70.00</td> </tr> <tr> <td>IV. Bank Guarantee</td> <td>(03.00)</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>140.00</b></td> </tr> <tr>

<td><b>140.00</b></td> </tr> </tbody> </table>

**(Rupees One Hundred and Forty Crore Only)**

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of Applicant No. 1 Bank on 02.12.2013 :-

- (i) Sanction Letter dated 02.12.2013 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors), in token of having accepted the terms and conditions regulating the aforesaid credit facilities of Rs. 140.00 Crore granted to Defendant no. 1 by the Applicant No. 1 Bank;

- (ii) Supplemental Agreement of Loan cum Hypothecation for Overall Limit (Form SME 4) dated 02.12.2013 for Rs. 140.00 Crore signed and executed by Defendant no. 1;

- (iii) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 02.12.2013 for Rs. 140.00 Crore signed and executed by Defendants no. 2, 3 & 4;

- (iv) Link Letter dated 02.12.2013 by Defendants no. 1 to 4 in favour of the erstwhile State Bank of Hyderabad;

- (v) General Indemnity Agreement dated 02.12.2013 in favour of the Applicant No. 1 Bank;

- (vi) Omnibus Counter Guarantee dated 02.12.2013;

- (vii) Undertaking dated 02.12.2013 of Defendants;

- (viii) Undertakings / Declaration dated 02.12.2013;

(ix) Documents for reporting CIBIL disclosure dated 02.12.2013.

2.9 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal of various credit facilities for business of Defendant no. 1. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 111.50 Crore vide its Sanction Letter dated 16.01.2014, as detailed below:-

<thead> <tr> <th>Nature of Facility/Limit</th> <th>Amount<br/>(Rs. in Crores)</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> </tr> <tr> <td>I. Cash Credit (Hypothecation Stocks)</td> <td>59.50</td> </tr> <tr> <td>II. EPC/FDP/FDB</td> <td>(15.00)</td> </tr> <tr> <td>III. Letter of Credit</td> <td>72.00</td> </tr> <tr> <td>IV. Bank Guarantee</td> <td>(03.00)</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>111.50</b></td> </tr> <tr>

<td><b>140.00</b></td> </tr> </tbody> </table>

**(Rupees One Hundred and Eleven Crore and Fifty Lakh Only)**

Consortium Documents

2.10 In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of the Consortium Lenders on 12.03.2015 :-

- (i) Working Capital Consortium Agreement;

- (ii) Inter-se Agreement;

- (iii) Joint Deed of Hypothecation;

- (iv) Agreement cum Indemnity;

- (v) Deed of Omnibus Counter Guarantee;

- (vi) Deed of Personal Guarantee by Defendants no. 3 & 4;

- (vii) Deed of Corporate Guarantee by Defendant no. 2;

- (viii) Letter of Authority to Lead Bank;

- (ix) Declaration cum Undertaking by Defendants;

- (x) Undertaking from the Company and Corporate Guarantor regarding compliance of Section 185 & 186 of the Companies Act, 2013;

- (xi) Memorandum of Entries of the mortgaged properties.

2.11 It is stated in the OA that the Applicant No. 1 Bank that the Applicant No. 1 Bank vide its Letter dated 17.07.2014 informed the Defendant no. 1 that the competent authority of the Applicant No. 1 Bank approved the proposed consortium with the Bank of India, who was supposed to disburse an amount of Rs. 28.50 Crore to Defendant no. 1 as part finance part from the Applicant No. 1 Bank's working Capital Limit of Rs. 111.50 Crore.

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of the Consortium Lenders consisting of the erstwhile State Bank of Hyderabad and Bank of India on 13.06.2014 :-

- (i) Working Capital Consortium Agreement dated 13.06.2014;

- (ii) Inter-se Agreement dated 13.06.2014; 

- (iii) Joint Deed of Hypothecation dated 13.06.2014;

- (iv) Agreement cum Indemnity dated 13.06.2014;

- (v) Deed of Omnibus Counter Guarantee dated 13.06.2014;

- (vi) Deed of Personal Guarantee by Defendants no. 3 & 4 dated 13.06.2014;

- (vii) Deed of Corporate Guarantee by Defendant no. 2 dated 13.06.2014;

- (viii) Letter of Authority to Lead Bank dated 13.06.2014;

- (ix) Declaration cum Undertaking dated 13.06.2014 by Defendants.

2.12 It is stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 121.50 Crore vide its Sanction Letter dated 22.11.2014, as detailed below:-

<thead> <tr> <th rowspan="2">Nature of Facility/Limit</th> <th colspan="2">Amount<br/>(Rs. in Crores)</th> </tr> <tr> <th>Erstwhile<br/>SBH</th> <th>Consortium</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> <td></td> </tr> <tr> <td>I. Cash Credit<br/>(Hypothecation Stocks)</td> <td>64.50</td> <td>85.00</td> </tr> <tr> <td>II. EPC/FDP/FDB</td>

</tr> <tr> <td>III. Letter of Credit</td> <td>57.00</td> <td>95.00</td> </tr> <tr> <td>IV. Bank Guarantee</td> <td>(03.00)</td> <td>(03.00)</td> </tr> <tr> <td><b>Total Fund Based Working<br/>Capital<br/>Limit</b></td> <td><b>121.50</b></td> <td><b>180.00</b></td> </tr> <tr> <td><b>Total Limit (A+B)</b></td> <td><b>121.50</b></td> <td><b>180.00</b></td> </tr> </tbody> </table>

2.13 It is further stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the erstwhile State Bank of Hyderabad for renewal / enhancement of various credit facilities for business of Defendant no. 1. The erstwhile State Bank of Hyderabad sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 151.50 Crore vide its Sanction Letter dated 03.11.2015. The details of Sanction Letters of the Consortium Lenders are as follows:-

<thead> <tr> <th>S. No.</th> <th>Bank</th> <th>Sanction Letter No.</th> <th>Dated</th> </tr> </thead> <tbody> <tr> <td>1.</td> <td>Erstwhile State Bank of Hyderabad</td> <td>F/Adv./Hi Tech Grain/696</td> <td>03.11.2015</td> </tr> <tr> <td>2.</td> <td>Erstwhile State Bank of Bikaner &amp; Jaipur</td> <td>BKR/C&amp;I/Amt.-I/Hi Tech</td> <td>03.02.2016</td> </tr> <tr> <td>3.</td> <td>Bank of India</td> <td>NDMCB/Opr./PM/2016-17/04</td> <td>04.04.2016</td> </tr> <tr> <td>4.</td> <td>Andhra Bank</td> <td>0481/52/15-16/282A</td> <td>22.02.2016</td> </tr> </tbody> </table>

After due and usual verification of the financial status and requirements of Defendant no. 1, the erstwhile State Bank of Hyderabad sanctioned following credit facilities to the Defendant no. 1 vide its Sanction Letter dated 22.11.2014:-

<thead> <tr> <th rowspan="2">Nature of Facility/Limit</th> <th colspan="2">Amount<br/>(Rs. in Crores)</th> </tr> <tr> <th>Erstwhile SBH</th> <th>Consortium</th> </tr> </thead> <tbody> <tr> <td><b>Fund Based Credit Limit</b></td> <td></td> <td></td> </tr> <tr> <td>I. Cash Credit<br/>(Hypothecation Stocks)</td> <td>79.50</td> <td>110.00</td> </tr> <tr> <td>II. EPC/FDP/FDB</td>

</tr> </tbody> </table>

<table border="1"> <tr> <td>III. Letter of Credit</td> <td>72.00</td> <td>125.00</td> </tr> <tr> <td>IV. Bank Guarantee</td> <td>(05.00)</td> <td>(10.00)</td> </tr> <tr> <td><b>Total Fund Based Working Capital Limit</b></td> <td><b>151.50</b></td> <td><b>235.00</b></td> </tr> <tr> <td><b>Total Limit (A+B)</b></td> <td><b>151.50</b></td> <td><b>235.00</b></td> </tr> </table>

In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of the Consortium Lenders on 25.04.2016 :-

- (i) Working Capital Consortium Agreement;

- (ii) Inter-se Agreement;

- (iii) Joint Deed of Hypothecation;

- (iv) Agreement cum Indemnity;

- (v) Deed of Omnibus Counter Guarantee;

- (vi) Deed of Personal Guarantee by Defendants no. 3 & 4;

- (vii) Deed of Corporate Guarantee by Defendant no. 2;

- (viii) Letter of Authority to Lead Bank;

- (ix) Declaration cum Undertaking by Defendants;

- (x) Undertaking from the Company and Corporate Guarantor regarding compliance of Section 185 & 186 of the Companies Act, 2013;

- (xi) Memorandum of Entries of the mortgaged properties.

2.14 It is also stated in the OA that Defendant no. 1, as a Borrower and Defendants no. 2 to 4 as Guarantors, approached the Applicant No. 1 Bank for renewal / enhancement of various credit facilities for business of Defendant no. 1. The Applicant No. 1 Bank including the Consortium Lenders sanctioned financial assistance by way of various credit facilities to Defendant no. 1 to the tune of Rs. 305.00 Crore. The details of the Sanction Letters of the Consortium Lenders are as follows:-

<thead> <tr> <th>S. No.</th> <th>Bank</th> <th>Sanction Letter No.</th> <th>Dated</th> </tr> </thead> <tbody> <tr> <td>1.</td> <td>Erstwhile State Bank of Hyderabad</td> <td>F/Adv./Hi Tech Grain/660</td> <td>18.11.2016</td> </tr> <tr> <td>2.</td> <td>Erstwhile State Bank of Bikaner &amp; Jaipur</td> <td>BKR/C&amp;I/Amt.-I/Hi Tech</td> <td>17.03.2017</td> </tr> <tr> <td>3.</td> <td>Bank of India</td> <td>NDMCB/Opr./PM/2017-18/76</td> <td>19.05.2017</td> </tr> <tr> <td>4.</td> <td>Andhra Bank</td> <td>0481/52/17-18/S-04</td> <td>26.04.2017</td> </tr> <tr> <td>5.</td> <td>HDFC Bank Ltd.</td> <td>CAM011403170043</td> <td>05.04.2017</td> </tr> </tbody> </table>

After due and usual verification of the financial status and requirements of Defendant no. 1, following credit facilities to the Defendant no. 1 were granted by the Consortium Lenders:-

<thead> <tr> <th>S. No.</th> <th>Banks</th> <th>Fund Based Limits</th> <th>Non-Fund Based Limits</th> <th>Total</th> </tr> </thead> <tbody> <tr> <td>1.</td> <td>Erstwhile State Bank of Hyderabad</td> <td>87.00</td> <td>97.00</td> <td>184.00</td> </tr> <tr> <td>2.</td> <td>Erstwhile State Bank of Bikaner &amp; Jaipur</td> <td>8.00</td> <td>14.50</td> <td>22.50</td> </tr> <tr> <td>3.</td> <td>Andhra Bank</td> <td>12.00</td> <td>23.00</td> <td>35.00</td> </tr> <tr> <td>4.</td> <td>Bank of India</td> <td>13.00</td> <td>25.50</td> <td>38.50</td> </tr> <tr> <td>5.</td> <td>HDFC Bank Ltd.</td> <td>15.00</td> <td>10.00</td> <td>25.00</td> </tr> <tr> <td>6.</td> <td>Total</td> <td>135.00</td> <td>170.00</td> <td>305.00</td> </tr> </tbody> </table>


In consideration to the grant of the credit facilities to Defendant no. 1, Defendant no. 1, as a borrower, and Defendants no. 2 to 4 as guarantors, signed and executed the following loan and guarantee documents in favour of the Consortium Lenders on 06.06.2017 :-

- (i) Supplemental Working Capital Consortium Agreement;

- (ii) Inter-se Agreement;

- (iii) Amended & Restated Joint Deed of Hypothecation;

- (iv) Agreement cum Indemnity;

- (v) Deed of Omnibus Counter Guarantee for ILC/FLC Limits;

- (vi) Deed of General Indemnity;

- (vii) Deed of Personal Guarantee by Defendants no. 3 & 4;

- (viii) Deed of Corporate Guarantee by Defendant no. 2;

- (ix) Letter of Authority to Lead Bank;

- (x) Declaration cum Undertaking by Defendants;

- (xi) Declaration cum Undertaking for Negative Lien.

2.15 It is stated in the OA that the Defendant no. 3 on 05.06.2014 have created equitable mortgage on pari passu basis among all consortium members by deposit of the Title Deed/Conveyance Deed dated 19.05.2014 of the property being Industrial Unit situated on a plot measuring 400 square yards at Plot No. GI-35, Lawrence Road Industrial Area, New Delhi – 110035. Defendant no. 3 also executed a Memorandum of Entry on 05.06.2014 and subsequently on 19.08.2014, 12.03.2014 and 25.04.2016. Defendant no. 3 also executed a Declaration cum Undertaking dated 06.06.2017 in favour of the Applicant Banks for the credit facilities granted to Defendant no. 1 by the Consortium Lenders. The brief particulars of the mortgaged properties have been given in Para 5(5.44) of the OA.

Further more, Defendant no. 3 on 31.03.2010 have created equitable mortgage on pari passu basis among all consortium members by deposit of the Title Deed/Conveyance Deed dated 14.06.2005 of the property being Industrial Unit situated on a plot measuring 388 square yards at Plot No. GI-36, Lawrence Road Industrial Area, New Delhi – 110035. Defendant no. 3 also executed a Memorandum of Entry on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016. Defendant no. 3 also executed a Declaration cum Undertaking dated 06.06.2017 in favour of the Applicant Banks for the credit facilities granted to Defendant no. 1 by the Consortium Lenders. The brief particulars of the mortgaged properties have been given in Para 5(5.45) of the OA.

Moreover, the Defendant no. 3 on 10.03.2013 have created equitable mortgage on pari passu basis among all consortium members by deposit of the Title Deed/Conveyance Deed dated 17.01.2012 of the property being plot measuring 230.55 square yards at Plot No. GI-5, Lawrence Road Industrial Area, New Delhi – 110035. Defendant no. 3 also executed a Memorandum of Entry on 02.12.2013 and subsequently on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016. Defendant no. 3 also executed a Declaration cum Undertaking dated 06.06.2017 in favour of the Applicant Banks for the credit facilities granted to Defendant no. 1 by the Consortium Lenders. The brief particulars of the mortgaged properties have been given in Para 5(5.46) of the OA.

Further more, the Defendant no. 4 on 31.03.2010 have created equitable mortgage on pari passu basis among all consortium members by deposit of the Title Deed/Conveyance Deed dated 16.02.2014 of the property being Municipal No. 4119 (New) & 1932 (Old), comprising southern half portion of 1^st Floor, northern half portion of 2^nd Floor, and its roof / terrace rights above together with mezzanine, situated at Naya Bazar, Delhi (Admeasuring 128 square yards). Defendant no. 4 also executed a Memorandum of Entry on 02.12.2013 and subsequently on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016. Defendant no. 4 also executed a Declaration cum Undertaking dated 06.06.2017 in favour of the Applicant Banks for the credit facilities granted to Defendant no. 1 by the Consortium Lenders. The brief particulars of the mortgaged properties have been given in Para 5(5.47) of the OA.

It is also stated that the Defendant no. 1 hypothecated its entire current assets by way of 1^st charge on pari passu basis among all consortium member, namely stocks and spares not relating to plant and machinery (consumable stores and spares), Export Bills Receivable and Book Debts both present and future etc. etc. [details given in Para 5(5.48) of the OA].

2.16 It is stated in the OA that Defendant no. 1 signed and executed Balance Confirmations dated 11.07.2014, 31.03.2015, 31.03.2016 and 31.03.2017 in favour of Applicant Banks. Moreover, the Defendant no. 1 time and again acknowledged its liability to pay the outstanding amount to the Applicant Banks especially in its duly audited Balance Sheets for the financial year upto 2016-2017, wherein it has admitted an amount of Rs. 117,10,70,064/- towards the Cash Credit facilities granted by the Applicant Banks.

2.17 It is also stated in the OA that the Defendant no. 1 is incorporated under the Companies Act, 1956 and regularly filing the charge of the Consortium Lenders with the ROC, Delhi & Haryana in compliance of the provisions of the Companies Act, 2013. It is pertinent to point out that the Defendant no. 1 has duly acknowledged and modified the charge of the Consortium Lenders on 06.06.2017 for an amount of Rs. 305.00 Crore.

2.18 It is further stated in the OA that the Defendant no. 1 duly availed the aforesaid credit facility granted to him by the Applicant Banks, however, the Defendant remained irregular in conduct of the aforesaid Credit Facility and neglected to maintain the financial discipline and the Applicant No.1 Bank was left with no other option but to declare the accounts of the Defendant no. 1 Company as NPA on 31.03.2018 as per the Guidelines issued by RBI from time to time. The Applicant Banks vide their several letters called upon Defendant no. 1 to regularize the accounts and maintain its financial discipline but Defendant no. 1 failed to do so.

Since, Defendant no. 1 failed to adhere financial discipline and remained irregular in conduct of the aforesaid loan facilities, despite several request and reminders, the Applicant no. 1 Bank was forced to send a Demand Notice dated 16.08.2018 for an amount of Rs. 168,18,03,950.96 to Defendants (Borrower / Mortgagors / Guarantors) under Section 13(2) of the SARFAESI Act but despite receipt of the said notice the Defendants have failed to liquidate the outstanding amount. It is pertinent to point out that the Applicant no. 1 Bank has already initiated Securitisation proceedings under SARFAESI Act 2002 to enforce its secured assets.

Subsequently, after appropriating the proceeds of Credit available, the Applicant no. 1 Bank issued a Legal Demand Notice dated 03.09.2018 for an amount of Rs. 168,18,03,950.96 to Defendants no. 1 to 4 (Borrower / Mortgagors / Guarantors) calling upon them to repay the outstanding amount but despite receipt of the said notice, the defendants failed to liquidate the outstanding amount to the Applicant No. 1 Bank.

As per the books of account maintained by the applicant no. 1 Bank in their regular course of business, a sum of Rs. 171,21,15,254.88 is due and payable by the Defendants no. 1 to 4 (as borrower and guarantors) to Applicant No. 1 Bank besides interest from 12.10.2018 onwards with monthly rests as regards the Credit Facilities which the Defendant no. 1 has failed to pay [details given in Para 5(5.60 & 5.61 of OA)].

**Individual and Consortium Documents regarding Credit Facilities granted by Andhra Bank (Applicant NO. 2) as part of "SBI Consortium"**

2.19 It is stated in the OA that the Defendant no. 1 approached the Applicant No. 2 Bank to avail various credit facilities amounting to Rs. 35.00 Crore. The Applicant no.

2 vide its Sanction Letter dated 26.04.2017 granted the following limits to Defendant no. 1:-

<thead> <tr> <th>Nature</th> <th>Sanctioned Amount<br/>(Rs. in Crore)</th> </tr> </thead> <tbody> <tr> <td>OCC</td> <td>12.00</td> </tr> <tr> <td>EPC (Sub Limit)</td> <td>(02.00)</td> </tr> <tr> <td>Fund Based ceiling</td> <td><b>12.00</b></td> </tr> <tr> <td>ILC/FLC</td> <td>23.00</td> </tr> <tr> <td>BG</td> <td>(03.00)</td> </tr> <tr> <td>Buyers Credit</td> <td>(15.00)</td> </tr> <tr> <td>Non-Fund Based Ceiling</td> <td><b>23.00</b></td> </tr> <tr> <td><b>Total Commitment</b></td> <td><b>35.00</b></td> </tr> </tbody> </table>

2.20 It is further stated in the OA that the Defendant no. 1 duly availed the aforesaid credit facility granted to him by the Applicant No. 2 Bank. However, the Defendant remained irregular in conduct of the aforesaid Credit facility and neglected to maintain the financial discipline and the Applicant No. 2 Bank was left with no other option but to declare the accounts of Defendant no. 1 Company as NPA on 30.06.2018 as per the Guidelines issued by RBI from time to time.

Since, Defendant no. 1 failed to adhere financial discipline and remained irregular in conduct of the aforesaid loan facilities, despite several request and reminders, the Applicant no. 2 Bank was forced to send a Demand Notice dated 03.07.2018 for an amount of Rs. 26,24,64,204.78 to Defendants (Borrower / Mortgagors / Guarantors) under Section 13(2) of the SARFAESI Act calling upon them to repay the outstanding amount but despite receipt of the said notice the Defendants have failed to liquidate the outstanding amount. It is pertinent to point out that the Applicant no. 2 Bank has already initiated Securitisation proceedings under SARFAESI Act 2002 to enforce its secured assets.

As per the books of account maintained by the applicant no. 2 Bank in their regular course of business, a sum of Rs. 31,27,54,133.78 is due and payable by the Defendants to Applicant No. 2 Bank besides interest from 30.06.2018 onwards with monthly rests as regards the Credit Facilities which the Defendant no. 1 has failed to pay [details given in Para 5(5.66 & 5.67 of OA)].

2.21 It is stated in the OA that since the defendants no. 1 to 4 failed to pay the dues of the Applicants No. 1 and 2 Bank, hence, the Applicant Banks have been compelled to file this Application before this Tribunal.

3. Notices of this O.A. were issued to the defendants, and defendants no. 1 to 4 as well as Proforma Defendants no. 5 & 6 appeared through their respective counsels.

3.1 So far as, defendants no. 1 to 4 are concerned, they filed their common WS.

3.2 So far as, defendants no. 5 & 6 (Proforma Defendants) are concerned, though they appeared through their respective counsels but did not chose to file their WS, therefore, right of Defendants no. 5 & 6 stood forfeited vide order dated 28.06.2019 of the Tribunal. It is pertinent to note here that no relief has been claimed by the Applicant Banks qua these defendants.

4. In their common WS filed by defendants no. 1 to 4 they have stated that Defendant no. 1 is engaged in the processing of food grains and it is a "Small Enterprise" as

defined in The Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act 2006) and RBI Circular Reference No. RBI/FIDD/2017-18/56 Master Director FIDD.MSME & NFS.12/06.02.31/2017-18 dated 24.07.2017 (updated as on 25.04.2018) regarding Lending to Micro, Small Enterprises (MSME) Sector as the investment in Plant & Machinery is more than Rs. 25.0 Lakh but does not exceed Rs. 5.0 Crore. Further, the RDB Act 1993 and SARFAESI Act 2002 are not applicable to potentially viable sick MSME accounts and it was the imperative statutory duty of the Applicants & Defendants no. 5 & 6 to rehabilitate the Defendant no. 1 in public interest under the Policy for revival / rehabilitation of sick MSME accounts by all scheduled commercial banks and also under the Guidelines promulgated by RBI by virtue of the powers conferred on it under Section 21 and 35 A of the Banking Regulation act, 1949 vide notified Circular dated 17.03.2016 of RBI regarding eligibility, identification of incipient stress, Corrective Action Plan (CAP), corporate debt restructuring mechanism and joint lenders forum mechanism etc. It is stated in the WS that Defendant no. 1 was sanctioned Working Capital Limits aggregating to Rs. 305.0 crore under the consortium of Banks comprising of Applicants & Defendants no. 5 & 6 for running its business activities. The consortium of banks was constituted in August 2014 and before the formation of consortium, defendant no. 1 was availing credit facilities from erstwhile State Bank of Hyderabad (since amalgamated into Applicant no. 1). Defendants no. 1 to 4 have admitted that the credit facilities of Rs. 305.0 crore were secured by first charge on stock and receivables as also mortgage of Industrial Units 

situated at G-5, G-35 and G-36, Lawrence Road Industrial Area, New Delhi – 110035 (all belonging to defendant no. 3) as also property bearing municipal no. 4110 (new) and 1932(old) comprising of Southern Half Porion of First Floor, Northern Half Portion of Second Floor and Roof/Terrace Rights together with mezzanine floor situated at Naya Bazar, Delhi – 110006 (belonging to defendant no. 4). They have also stated that vide Sanction Letter dated 18.11.2016, the Applicant no. 1, for itself as also on behalf of other members of consortium, sanction Cash Credit (Hyp.) Facility of Rs. 135.0 crore; Letter of Credit Facility of Rs. 155.0 crore and BG Facility of Rs. 15.0 crore to Defendant no. 1. They have also admitted that Defendants no. 2 to 4 stood surety to secure the credit facilities sanctioned by the members of the consortium to Defendant no. 1. But they have raised an objection that at the time of sanctioning of credit facilities, the Defendants no.1 to 4 were induced and compelled to append their signatures on a large number of undated and unfilled printed forms without being afforded any opportunity of understanding the contents, intent and purpose thereon. It is further stated that defendant no. 1 observed and adhered to financial discipline but admitted that defendant no. 1 faced business problems immediately after demonetization which came into effect from 08.11.2016. Thus, defendant no. 1 approached the members of consortium to reduce the cost of funds, to sanction commercial paper facility, WCDL facility and to substantiate Cash Collateral held by them in the form of Fixed Deposits Receipts of Rs. 32.0 crore by mortgage of a commercial property at Noida. The said proposal was given in order to ensure that the banks continue to be secured even if the FDR(s) were to be released to the defendant no. 1. In the consortium meeting dated 23.02.2017, the members of the consortium conveyed to Defendant no. 1 that pre-approval for substitution of security, as aforesaid, had already been granted and final approval shall be granted after conducting the legal audit of the proposed transaction by examining the title deeds of the property proposed to be acquired by defendant no. 1 at Noida. Pursuant to the aforesaid approval, Defendant no. 1 approached Steria India Ltd. having its office at Gautam Budh Nagar, Noida for purchase of commercial property no. B-39, Sector-1, Noida, UP admeasuring 6156 sq. meters for Rs. 37.50 crore. Letter of Intent dated 04.04.2017 was duly submitted by the defendant no. 1 to the members of the consortium under the cover of letter dated 26.04.2017 whereby it requested the members of the consortium to accord final approval for substitution of security, as aforesaid. Yet again, during the consortium meeting dated 06.06.2017, defendant no. 1 requested the members of the consortium for substitution of cash collateral, as aforesaid. Thereafter, vide email dated 19.07.2017 addressed to Applicant no. 1, the Defendant no. 1, *inter alia*, informed the said bank that the other members of the consortium had already granted final approval for substitution of cash collateral with mortgage of the property to be acquired at Noida and reiterated its aforementioned requests for grant of final approval by Applicant No. 1. Defendant no. 1 also informed the Applicants & Defendants 5 & 6 that a sum of Rs. 12.0 crore already stood paid to Steria India Ltd. and if the entire payment of Rs. 37.50 crore is not made on or before 03.08.2017, the aforesaid vendor may proceed to 

forfeit the amount of Rs. 12.0 crore. Under the cover of email dated 19.07.2017, the defendant no. 1 conveyed to Applicant No. 1 the copies of letter dated 19.05.2017 of Defendant no. 6, letter dated 15.07.2017 of Applicant no. 2 and letter dated 18.07.2017 of Defendant no. 5 granting final approval for substitution of cash collateral as aforesaid. Applicant no. 1, vide letter dated 21.07.2017, informed the defendant no. 1 that its proposal for substitution of security stands forwarded to the competent authority for final approval. Thereafter, vide letter dated 20.08.2017, Applicant no. 1 informed that its competent authority had sanctioned and granted approval of substitution of security and recovered charges / fees with respect to substitution of security on 13.08.2017. Even thereafter, Applicants with immediate effect unjustifiably denied the buyer's Credit which was being availed of by the defendant no. 1 since inception. In the meantime, the business of defendant no. 1 faced yet another crisis in the middle of 2017 when the Government policies relating to the import of pulses changed unexpectedly, leading to imposition of import duty and restriction on import which led to escalation of prices of imported pulses, rendering the same unviable. Thus, the defendant no. 1 was constrained to cancel the import orders against which it had already paid huge amounts towards advance and the advance payments made by defendant no. 1 stood forfeited by the exporters.

It is also stated that even though all the members of the consortium had granted final approval for substitution of security, they did not release the FDR(s) of Rs. 32.0 crore. Thus, the members of the consortium acted with malafide and were unreasonable and unfair in dealing with Defendant no. 1. It is also pertinent to note that the Defendant no. 1 had requested the Applicants & Defendants no. 5 & 6 to release the proceeds of Fixed Deposit Receipts directly to the vendor – Steria India Ltd. towards sale consideration, paying way for execution of sale deed by the vendor in favour of Defendant no. 1 and creation of mortgage of the commercial property at Noida in favour of the members of the consortium. In these circumstances, the defendant no. 1, in order to avoid forfeiture of Rs. 12.0 crore that it had already paid to Steria India Ltd., availed of credit accommodation from Defendant no. 5 (outside consortium) in the form of Term Loan for completing the aforesaid transaction of purchase. It is germane that the members of the consortium did not allow the release of interest accruing on the Fixed Deposit Receipts, which could have partly assuaged the liquidity concerns of Defendant no. 1.

In October 2017, the renewal of the credit facilities sanctioned by the members of the consortium fell due as they refused to issue a formal letter of renewal of the facilities. The Defendant no. 1 had tendered proposal dated 03.10.2017 for enhancement of credit limits from Rs. 305.0 crore to Rs. 355.0 crore but the Applicant no. 1, during the meeting of the members of the consortium convened on 27.11.2017, refused to enhance its exposure. Hence, the CFO of Defendant no. 1 informed that Indian Bank has agreed to grant credit accommodation to Defendant no. 1 and, therefore, Defendant no. 1 be permitted to proceed to avail financial assistance from the said Bank. The members of the consortium accorded the said permission to defendant 

no. 1 to avail financial assistance from Indian Bank. It is also stated that the members of the consortium after having kept the proposal dated 03.10.2017 pending for more than five months, rejected the same vide letter dated 23.03.2018 and the said letter intriguingly mentioned that the existing limits had been renewed only upto 09.06.2018. It is also pertinent that Applicant no. 1, on 27.02.2018, debited the account of defendant no. 1 to recover / charge processing fee for enhancement of credit limits. Thus, the members of the consortium clearly acted with malafide and were unfair in having rejected the proposal for enhancement. It is germane that the Applicant no. 1 vide letter dated 16.01.2018 informed the Defendant no. 1 that its proposal for enhancement of credit limits stood approved and accepted at the branch level and the matter had been referred to the competent authority for final approval. The aforesaid precarious circumstances were copiously conveyed to members of the consortium vide letter dated 26.03.2018.

It is stated in the WS that the members of the consortium proceeded to declare and classify the credit facilities as NPA in violation of prudential guidelines and rules relating to income recognition. It is pertinent that there was no financial defaults at all which could result into the loan facilities becoming NPA. It is stated that till 28.02.2018, Defendant no. 1 paid interest due in the loan accounts to the members of the consortium and all the loan facilities were prudential standard and regular on 15.03.2014. However, Applicant no. 1 and Defendant no. 5 illegally and arbitrarily declared and classified the loan facilities as NPA on 31.03.2018. Even otherwise, under the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006) and the relevant RBI Circular pleaded supra, the Applicants and Defendants no. 5 & 6 were under an absolute obligation to nurse and rehabilitate Defendant no. 1 but instead of discharging their statutory and fiduciary obligations, the Applicants & Defendants no. 5 & 6 proceeded to initiate proceedings under SARFAESI Act 2002.

It is stated in the WS that in April 2018, the members of the consortium liquidated the Fixed Deposit Receipts and adjusted the proceeds thereof towards their alleged dues but the consent of Defendant no. 1 was not obtained and the members of consortium, did not even both to inform defendant no. 1 about the liquidation of the FDRs.

It is further stated that the Defendant no. 1 submitted a resolution / revival plan dated 14.08.2018 which merited consideration and deserved to be accepted was deliberated upon during the consortium meeting dated 06.09.2018. The defendant no. 1, keeping in view the concerns expressed by the members of the consortium, submitted a revised resolution / revival plan dated 08.10.2018. Even though the Defendant no. 1 had tendered / submitted resolution plans dated 14.08.2018 and 08.10.2018, the Applicants & Defendants 5 & 6 continued to illegally pursue proceedings under SARFAESI Act 2002 while keeping the same pending. The members of the consortium, vide email dated 31.01.2019, rejected the resolution / revival plans submitted by Defendant no. 1 (without conveying the reasons) which was violative of the provisions of the MSMED Act 2006

and the relevant RBI Circulars relating to Small Scale Enterprises. Thus, Defendant no. 1 vide letters dated 05.02.2019 & 18.02.2019, called upon the members of the consortium to furnish reasons for rejection of the revival plants submitted by it but to no avail.

Further, it is stated in the WS that the alleged claim(s) of the Applicants are patently barred by limitation; that the security documents relied upon by the Applicants are insufficiently stamped and/or unstamped; that the Statement of Accounts contain false fictitious and ambiguous debit entries and are incomplete; that certificates purportedly issued under the provisions of Bankers' Books Evidence Act, 1891 and Section 65B of Indian Evidence Act, 1872 are defective and do not conform to the mandatory prerequisites; that the applicants are also guilty of charging penal interest and capitalizing / compounding the same which is expressly barred by virtue of the dictum of *Central Bank of India Vs. Ravindra – (2002) 1 SCC 367*; that the OA has not been instituted, signed and verified by persons duly authorized to do so etc.

In view of the defence raised by defendants no. 1 to 4, it is vividly clear that the applicants are not entitled to recover any amount from them. Defendant no. 1, on account of the culpable acts and omissions of the members of the consortium, suffered insurmountable commercial and business losses including loss of goodwill and reputation, which losses, conservatively estimated, would be more than Rs. 1000 crore. The details of the losses incurred by defendants no. 1 to 4 are as follows:-

- (i) Business and Commercial Losses : Rs. 500.00 Crore;

- (ii) Loss of Goodwill : Rs. 250.00 Crore; and

- (iii) Loss of reputation : Rs. 250.00 Crore.

It is stated in the WS that the Defendants no. 1 to 4, without prejudice to the defence raised by them, seek set off / equitable set off for a sum of Rs. 171,21,15,254.88 along with interest @11.70% p.a. with monthly rests against applicant no. 1 and for a sum of Rs. 31,27,54,133.78 along with interest thereof @11.50% p.a. with monthly rests against applicant no. 2.

On merits, Defendants no. 1 to 4 have raised following main objections in their WS:-

- (i) That the alleged claim of the Applicants does not qualify to be "Debt" under Section 1(1)(g) of the RDB Act, therefore, this Tribunal does not have inherent jurisdiction to adjudicate upon the OA;

- (ii) That this Tribunal does not have territorial jurisdiction to adjudicate upon this OA;

- (iii) That the alleged claim of Applicants is patently barred by limitation;

- (iv) That this OA has not been filed by duly authorize offices of Applicant Banks;

- (v) that at the time of sanctioning of credit facilities, the Defendants no.1 to 4 were induced and compelled to append their signatures on a large number of undated and unfilled printed forms without being afforded any opportunity of understanding the contents, intent and purpose thereon.

- (vi) That none of the alleged Memoranda of Entry bears the signatures of Defendants no. 3 & 4;

- (vii) That the security documents relied upon by the Applicants are insufficiently stamped and/or unstamped;

- (viii) That the Statement of Accounts contain false fictitious and ambiguous debit entries and are incomplete. Moreover, the certificates purportedly issued under the provisions of Bankers' Books Evidence Act, 1891 and Section 65B of Indian Evidence Act, 1872 are defective and do not conform to the mandatory prerequisites. It is also stated in the WS that the applicants are also guilty of charging penal interest and capitalizing / compounding the same which is expressly barred by virtue of the dictum of *Central Bank of India Vs. Ravindra* – (2002) 1 SCC 367.

In the light of above, it has been prayed to dismiss and reject the OA in toto with special, punitive, exemplary and compensatory costs and alternatively, allow the plea of Defendants no. 1 to 4 for an equitable set off / equitable set off for a sum of for a sum of Rs. 171,21,15,254.88 along with interest @11.70% p.a. with monthly rests against applicant no. 1 and for a sum of Rs. 31,27,54,133.78 along with interest thereof @11.50% p.a. with monthly rests against applicant no. 2.

**Documents relied by defendants no. 1 to 4 in their WS**

- (i) Copy of RBI Circular dated 24.07.21017 (updated as on 25.04.2018) (Annexure - D1);

- (ii) Copy of Circular Reference No. RBI/2015-16/338FIDD.MSME & NFS.BC.No. 21/06.02.31/201516 dated 17.03.2016 (Annexure – D2);

- (iii) Copy of Minutes of consortium meetings dated 23.02.2017 (Annexure – D3);

- (iv) Copy of Letter of Intent dated 04.04.2017 signed with Steria (India) Ltd. (Annexure – D4);

- (v) Copy of Letter dated 26.04.2017 (Annexure – D5);

- (vi) Copy of the minutes of consortium meetings dated 06.06.2017 (Annexure – D6);

- (vii) Copy of the email dated 19.06.2017 (Annexure – D7);

- (viii) Copies of letters dated 19.05.2017, 15.07.2017 and 18.07.2017 (Annexure – D8-colly);

- (ix) Copy of the letter dated 21.07.2017 (Annexure – D9);

- (x) Copy of letter dated 20.08.2017 (Annexure - D10);

- (xi) Copy of the statement of account dated 13.09.2017 (Annexure – D11);

- (xii) Copy of proposal dated 03.10.2017 (Annexure - D12);

- (xiii) Copy of minutes of meeting dated 27.11.2017 (Annexure - D13);

- (xiv) Copy of letter dated 23.03.2018 (Annexure - D14);

- (xv) Copy of the statement of account dated 27.02.2018 (Annexure - D15); 

- (xvi) Copy of letter for enhancement of credit limits approved and accepted dated 16.01.2018 (Annexure - D16);

- (xvii) Copy of letter dated 26.03.2018 (Annexure - D17);

- (xviii) Copy of resolution / revival plan submitted to consortium members dated 14.08.2018 (Annexure - D18);

- (xix) Copy of revised resolution / revival plan submitted to consortium members dated 08.10.2018 (Annexure - D19);

- (xx) Copy of email rejecting the resolution / revival plan dated 31.01.2018 (Annexure – D20);

- (xxi) Copy of each of letters dated 05.02.2019 & 18.02.2019 (Annexure – D21-colly);

- (xxii) Copy of each of letters dated 11.10.2018, 28.12.2018 & 18.09.2018, 12.10.2018 (Annexure – D22-colly).

5. During the pendency of this OA, Ld. counsel for Applicant Banks informed that Defendants no. 1, 3 & 4 are before Ld. NCLT, Delhi. In these circumstances, vide order dated 31.03.2022 of the Tribunal, it was directed that the proceedings qua Defendants no. 1, 3 and 4 shall not continue.

6. Since, Defendants no. 1, 3 & 4 were before Ld. NCLT, Delhi, hence, the Applicant banks filed the Rejoinder to the WS filed by defendant no. 2 only denying the allegations levelled against it and retreating the averments made in the OA.

7. To prove their case, the Applicant No. 1 Bank i.e. State Bank of India, leads its evidence by filing the affidavit of Sh. Prashant Singh, Chief Manager (AW1) of the Applicant No. 1 Bank. Further more, Applicant No.2 Bank i.e. Union Bank of India also leads evidence by filing the Affidavit of Smt. Mineendra, Chief Manager (A2W1) of Applicant No. 2 Bank.

7.1 Sh. Prashant Singh, Officer of Applicant No. 1 Bank (AW1) has placed reliance upon the documents filed by the Applicant No. 1 Bank which includes:-

- (i) General Regulations No. 76 & 77 of State Bank of India General Regulations 1955 made by the Reserve Bank of India in exercise of the powers conferred by Sub-Section (3) of Section 50 of the State Bank of India Act, 1955 with the previous sanctions of the Central Government read with Gazette Notifications published in the Gazette of India dated 26.09.1959, 26.08.1972 and 02.05.1987 (Ex. AW1/1 to Ex. AW1/4);

- (ii) Gazette Notification dated 22.02.2017 (whereby SBBJ and SBH were merged with SBI w.e.f. 01.04.2017) (Ex. AW1/5);

- (iii) Resolutions dated 02.01.2010, 03.08.2010, 07.04.2011, 03.03.2012, 25.05.2012, 20.11.2012, 02.01.2013, 09.08.2014, 07.03.2015, 06.11.2015, 29.03.2016, 16.04.2016, 19.11.2016 and 05.06.2017 of Defendant no. 1 being Borrower (Ex. AW1/6 to Ex. AW1/19);

- (iv) Resolutions 02.01.2010, 03.08.2010, 07.04.2011, 03.03.2012, 20.11.2012, 02.12.2013, 09.08.2014, 06.11.2015, 07.03.2015, 16.04.2016, 19.11.2016 and 05.06.2017 of Defendant no. 2 (Ex. AW1/20 to AWW1/31); 

- (v) Sanction Letter dated 18.12.2009 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors) (Ex. AW1/33);

- (vi) Agreement of Loan for Overall Limit (Form C-1A) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/34);

- (vii) Agreement for hypothecation of goods and assets (Form C-2) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/35);

- (viii) Deeds of Guarantee for Overall Limit (Form C-4A) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendants no. 2, 3 & 4 (Ex. AW1/36);

- (ix) Letter regarding the Grant of Individual Limits within the Overall Limits (Form C-5) dated 02.01.2010 for Rs. 18.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/37);

- (x) Agreement to Mortgage dated 04.01.2010 (Ex. AW1/38);

- (xi) Undertaking dated 04.01.2010 by Defendant No. 1 & 2 in favour of the erstwhile State Bank of Hyderabad (Ex. AW1/39);

- (xii) Sanction Letter dated 02.08.2010 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors) (Ex. AW1/40);

- (xiii) Supplemental Agreement of Loan for Overall Limit (Form C-1A) dated 05.08.2010 for Rs.

25.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/41);

- (xiv) Supplemental Agreement for hypothecation of goods and assets (Form C-2) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/42);

- (xv) Supplemental Deeds of Guarantee for Overall Limit (Form C-4A) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendants no. 2, 3 & 4 (Ex. AW1/43);

- (xvi) Supplemental Letter regarding the Grant of Individual Limits within the Overall Limits (Form C-5) dated 05.08.2010 for Rs. 25.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/44);

- (xvii) Undertaking dated 05.08.2010 by Defendant No. 1 & 2 in favour of the erstwhile State Bank of Hyderabad (Ex. AW1/45);

- (xviii) Sanction Letter dated 06.04.2011 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors) (Ex. AW1/46);

- (xix) Agreement of Loan cum Hypothecation for Overall Limit (Form SME 2) dated 07.04.2011 for Rs. 40.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/47);

- (xx) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 07.04.2011 for Rs. 40.00 Crore signed and executed by Defendants no. 2, 3 & 4 (Ex. AW1/48);

- (xxi) Undertaking dated 07.04.2011 by Defendants No. 1 to 4 in favour of the erstwhile State Bank of Hyderabad (Ex. AW1/49);

- (xxii) Sanction Letter dated 10.03.2012 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors) (Ex. AW1/50);

- (xxiii) Supplemental Agreement of Loan cum Hypothecation for Overall Limit (Form SME 4) dated 10.03.2012 for Rs. 55.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/51);

- (xxiv) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 10.03.2012 for Rs. 55.00 Crore signed and executed by Defendants no. 2, 3 & 4 (Ex. AW1/52);

- (xxv) Undertaking dated 10.03.2012 by Defendants No. 1 to 4 in favour of the erstwhile State Bank of Hyderabad (Ex. AW1/53);

- (xxvi) Sanction Letter dated 20.11.2012 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors) (Ex. AW1/54);

- (xxvii) Supplemental Agreement of Loan cum Hypothecation for Overall Limit (Form SME 4) dated 20.11.2012 for Rs. 83.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/55);

- (xxviii) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 20.11.2012 for Rs. 83.00 Crore signed and executed by Defendants no. 2, 3 & 4 (Ex. AW1/56);

- (xxix) Undertaking dated 20.11.2012 by Defendants No. 1 to 4 in favour of the erstwhile State Bank of Hyderabad (Ex. AW1/57);

- (xxx) Link Letter dated 20.11.2012 (Ex. AW1/58);

- (xxxi) Sanction Letter dated 02.12.2013 signed by Defendants no. 1 to 4 (as borrower, Corporate Guarantor and Guarantors) (Ex. AW1/59);

- (xxxii) Supplemental Agreement of Loan cum Hypothecation for Overall Limit (Form SME 4) dated 02.12.2013 for Rs. 140.00 Crore signed and executed by Defendant no. 1 (Ex. AW1/60);

- (xxxiii) Supplemental Deeds of Guarantee for Overall Limit (Form SME 3) dated 02.12.2013 for Rs. 140.00 Crore signed and executed by Defendants no. 2, 3 & 4 (Ex. AW1/61);

- (xxxiv) Link Letter dated 02.12.2013 by Defendants no. 1 to 4 in favour of the erstwhile State Bank of Hyderabad (Ex. AW1/62);

- (xxxv) General Indemnity Agreement dated 02.12.2013 in favour of the Applicant No. 1 Bank (Ex. AW1/63);

- (xxxvi) Omnibus Counter Guarantee dated 02.12.2013 (Ex. AW1/64);

- (xxxvii) Undertaking dated 02.12.2013 of Defendants (Ex. AW1/65);

- (xxxviii) Undertakings / Declaration dated 02.12.2013 (Ex. AW1/66); 

- (xxxix) Documents for reporting CIBIL disclosure dated 02.12.2013 (Ex. AW1/67); **Consortium documents executed on 12.03.2015**

- (xl) Working Capital Consortium Agreement (Ex. AW1/68);

- (xli) Inter-se Agreement (Ex. AW1/69);

- (xlii) Joint Deed of Hypothecation (Ex. AW1/70);

- (xliii) Agreement cum Indemnity (Ex. AW1/71);

- (xliv) Deed of Omnibus Counter Guarantee (Ex. AW1/72);

- (xlv) Deed of Personal Guarantee by Defendants no. 3 & 4 (Ex. AW1/73);

- (xlvi) Deed of Corporate Guarantee by Defendant no. 2 (Ex. AW1/74);

- (xlvii) Letter of Authority to Lead Bank (Ex. AW1/75);

- (xlviii) Declaration cum Undertaking by Defendants (Ex. AW1/76);

- (xlix) Undertaking from the Company and Corporate Guarantor regarding compliance of Section 185 & 186 of the Companies Act, 2013 (Ex. AW1/77);

- (l) Memorandum of Entries of the mortgaged properties (Ex. AW1/78);

- (li) Applicant No. 1 Bank's Letter dated 17.07.2014 to Defendant no. 1 (Ex. AW1/79);

- (lii) Working Capital Consortium Agreement dated 13.06.2014 (Ex. AW1/80);

- (liiii) Inter-se Agreement dated 13.06.2014 (Ex. AW1/81);

- (liv) Joint Deed of Hypothecation dated 13.06.2014 (Ex. AW1/82);

- (lv) Agreement cum Indemnity dated 13.06.2014 (Ex. AW1/83);

- (lvi) Deed of Omnibus Counter Guarantee dated 13.06.2014 (Ex. AW1/84);

- (lvii) Deed of Personal Guarantee by Defendants no. 3 & 4 dated 13.06.2014 (Ex. AW1/85);

- (lviii) Deed of Corporate Guarantee by Defendant no. 2 dated 13.06.2014 (Ex. AW1/86);

- (lix) Letter of Authority to Lead Bank dated 13.06.2014 (Ex. AW1/87);

- (lx) Declaration cum Undertaking dated 13.06.2014 by Defendants (Ex. AW1/88);

- (lxi) Sanction Letter dated 22.11.2014 of SBH (Ex. AW1/89); **Documents executed on 25.04.2016**

- (lxii) Working Capital Consortium Agreement (Ex. AW1/90);

- (lxiii) Inter-se Agreement (Ex. AW1/91);

- (lxiv) Joint Deed of Hypothecation (Ex. AW1/92); A small green rectangular stamp or mark with a blue line above it, located at the bottom right of the page.

- (lxv) Agreement cum Indemnity (Ex. AW1/93);

- (lxvi) Deed of Omnibus Counter Guarantee (Ex. AW1/94);

- (lxvii) Deed of Personal Guarantee by Defendants no. 3 & 4 (Ex. AW1/95);

- (lxviii) Deed of Corporate Guarantee by Defendant no. 2 (Ex. AW1/96);

- (lxix) Letter of Authority to Lead Bank (Ex. AW1/97);

- (lxx) Declaration cum Undertaking by Defendants (Ex. AW1/98);

- (lxxi) Undertaking from the Company and Corporate Guarantor regarding compliance of Section 185 & 186 of the Companies Act, 2013 (Ex. AW1/99);

- (lxxii) Memorandum of Entries of the mortgaged properties (Ex. AW1/100); **Documents executed by Defendants no. 1 to 4 on 06.06.2017**

- (lxxiii) Supplemental Working Capital Consortium Agreement (Ex. AW1/101);

- (lxxiv) Inter-se Agreement (Ex. AW1/102);

- (lxxv) Amended & Restated Joint Deed of Hypothecation (Ex. AW1/103);

- (lxxvi) Agreement cum Indemnity (Ex. AW1/104);

- (lxxvii) Deed of Omnibus Counter Guarantee for ILC/FLC Limits (Ex. AW1/105);

- (lxxviii) Deed of General Indemnity (Ex. AW1/106);

- (lxxix) Deed of Personal Guarantee by Defendants no. 3 & 4 (Ex. AW1/107);

- (lxxx) Deed of Corporate Guarantee by Defendant no. 2 (Ex. AW1/108);

- (lxxxi) Letter of Authority to Lead Bank (Ex. AW1/109);

- (lxxxii) Declaration cum Undertaking by Defendants (Ex. AW1/110);

- (lxxxiii) Declaration cum Undertaking for Negative Lien (Ex. AW1/111);

- (lxxxiv) Title Deed/Conveyance Deed dated 19.05.2014 (Ex. AW1/112) of the property being Industrial Unit situated on a plot measuring 400 square yards at Plot No. GI-35, Lawrence Road Industrial Area, New Delhi – 110035 belonging to Defendant no. 3;

- (lxxxv) Memorandum of Entry executed by Defendant no. 3 on 05.06.2014 and subsequently on 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. AW1/113 to AW1/116);

- (lxxxvi) Declaration cum Undertaking dated 06.06.2017 executed by Defendant no. 3 in favour of the Applicant Banks (Ex. AW1/118);

- (lxxxvii) Title Deed/Conveyance Deed dated 14.06.2005 of the property being Industrial Unit situated on a plot measuring 388 square yards at Plot No. GI-36, Lawrence Road Industrial Area, New Delhi – 110035 belonging to Defendant no. 3 (Ex. AW1/119);

- (lxxxviii) Memorandum of Entry executed by Defendant no. 3 on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. AW1/120 to AW1/124);

- (lxxxix) Declaration cum Undertaking dated 06.06.2017 executed by Defendant no. 3 in favour of the Applicant Banks (Ex. AW1/125);

- (xc) Title Deed/Conveyance Deed dated 17.01.2012 of the property being plot measuring 230.55 square yards at Plot No. GI-5, Lawrence Road Industrial Area, New Delhi – 110035 belonging to Defendant no. 3 (Ex. AW1/126);

- (xci) Memorandum of Entry executed by Defendant no. 3 on 02.12.2013 and subsequently on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. AW1/127 to AW1/132);

- (xcii) Declaration cum Undertaking dated 06.06.2017 executed by Defendant no. 1 in favour of the Applicant Banks (Ex. AW1/133);

- (xciii) Title Deed/Conveyance Deed dated 16.02.2014 of the property being Municipal No. 4119 (New) & 1932 (Old), comprising southern half portion of 1^st Floor, northern half portion of 2^nd Floor, and its roof / terrace rights above together with mezzanine, situated at Naya Bazar, Delhi (Admeasuring 128 square yards) belonging to Defendant no. 4 (Ex. AW1/134);

- (xciv) Memorandum of Entry executed by Defendant no. 4 on 02.12.2013 and subsequently on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. AW1/135 to AW1/140);

(xcv) Balance Confirmations dated 11.07.2014, 31.03.2015, 31.03.2016 and 31.03.2017 executed by Defendant no. 1 in favour of Applicant Banks (Ex. AW1/141 to AW1/144);

(xcvi) Audited Balance Sheets of Defendant no. 1 for the financial year upto 2016-2017 wherein it has admitted an amount of Rs. 117,10,70,064/- towards the Cash Credit facilities granted by the Applicant Banks (Ex. AW1/145);

(xcvii) Duly acknowledged and modified charge of the Consortium Lenders on 06.06.2017 for an amount of Rs. 305.00 Crore by the Defendant no. 1 with ROC (Ex. AW1/146);

(xcviii) Demand Notice dated 16.08.2018 for an amount of Rs. 168,18,03,950.96 to Defendants (Borrower / Mortgagors / Guarantors) issued by Applicant No. 1 Bank under Section 13(2) of the SARFAESI Act to the Defendants (Ex. AW1/147);

(xcix) Legal Demand Notice dated 03.09.2018 for an amount of Rs. 168,18,03,950.96 issued by Applicant no. 1 Bank to Defendants no. 1 to 4 (Ex. AW1/148);

(c) Statements of Account duly certified under the Bankers Books Evidence Act in respect of all the Loan Accounts, the calculation sheet of the accrued interest of the Loan Accounts and the Statement showing the total outstanding amount (Ex. AW1/149 to AW1/156).

7.2 Moreover, Smt. Mineendra, Officer of Applicant No. 2 Bank (A2W1) has also placed reliance upon certain documents which includes:-

- (i) Copy of the Gazette Notification dated 04.03.2020 with regard to amalgamation of Andhra Bank and Corporation Bank with Union Bank of India (Ex. A2W1/1);

- (ii) Order dated 31.01.2024 passed by the Tribunal allowing IA no. 58/2024 filed by Applicant no. 2 Bank for substitution of erstwhile Andhra Bank with Union Bank of India (Ex. A2W1/2);

- (iii) Power of Attorney dated 12.12.2019 issued by erstwhile Andhra Bank in favour of the officer of the bank (Ex. A2W1/3);

- (iv) Sanction Letter dated 22.02.2016 issued by Applicant No. 2 Bank to Defendant no. 1 (Ex. A2W1/4); **Documents executed by Defendant no. 1 to 4 in favour of the Consortium Lenders on 25.04.2016**

- (v) Working Capital Consortium Agreement (Ex. A2W1/5);

- (vi) Inter-se Agreement (Ex. A2W1/6);

- (vii) Joint Deed of Hypothecation (Ex. A2W1/7);

- (viii) Agreement cum Indemnity (Ex. A2W1/8); 

- (ix) Deed of Omnibus Counter Guarantee(Ex. A2W1/9);

- (x) Deed of Personal Guarantee by Defendants no. 3 & 4 (Ex. A2W1/10);

- (xi) Deed of Corporate Guarantee by Defendant no. 2 (Ex. A2W1/11);

- (xii) Letter of Authority to Lead Bank (Ex. A2W1/12);

- (xiii) Declaration cum Undertaking by Defendants (Ex. A2W1/13);

- (xiv) Undertaking from the Company and Corporate Guarantor regarding compliance of Section 185 & 186 of the Companies Act, 2013 (Ex. A2W1/14);

- (xv) Memorandum of Entries of the mortgaged properties (Ex. A2W1/15);

- (xvi) Sanction Letter dated 26.04.2017 of Applicant No. 2 (A2W1/16); **Documents executed by Defendants no. 1 to 4 on 06.06.2017**

- (xvii) Supplemental Working Capital Consortium Agreement (Ex. A2W1/17);

- (xviii) Inter-se Agreement (Ex. A2W1/18);

- (xix) Amended & Restated Joint Deed of Hypothecation (Ex. A2W1/19);

- (xx) Agreement cum Indemnity (Ex. A2W1/20);

- (xxi) Deed of Omnibus Counter Guarantee for ILC/FLC Limits (Ex. A2W1/21);

- (xxii) Deed of General Indemnity(Ex. A2W1/22);

- (xxiii) Deed of Personal Guarantee by Defendants no. 3 & 4 (Ex. A2W1/23);

- (xxiv) Deed of Corporate Guarantee by Defendant no. 2 (Ex. A2W1/24);

- (xxv) Letter of Authority to Lead Bank (Ex. A2W1/25);

- (xxvi) Declaration cum Undertaking by Defendants (Ex. A2W1/26);

- (xxvii) Declaration cum Undertaking for Negative Lien (Ex. A2W1/27);

- (xxviii) Title Deed/Conveyance Deed dated 19.05.2014 of the property being Industrial Unit situated on a plot measuring 400 square yards at Plot No. GI-35, Lawrence Road Industrial Area, New Delhi – 110035 belonging to Defendant no. 3 (Ex. A2W1/28);

- (xxix) Memorandum of Entry executed by Defendant no. 3 on 05.06.2014 and subsequently on 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. A2W1/29 to A2W1/31));

- (xxx) Declaration cum Undertaking dated 06.06.2017 executed by Defendant no. 3 in favour of the Applicant Banks(Ex. A2W1/32);

- (xxxii) Title Deed/Conveyance Deed dated 14.06.2005 of the property being Industrial Unit situated on a plot measuring 388 square yards at Plot No. GI-36, Lawrence Road Industrial Area, New Delhi –

110035 belonging to Defendant no. 3(Ex. A2W1/33);

(xxxii) Memorandum of Entry executed by Defendant no. 3 on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. A2W1/34 to A2W1/38);

(xxxiii) Declaration cum Undertaking dated 06.06.2017 executed by Defendant no. 3 in favour of the Applicant Banks (Ex. A2W1/39);

(xxxiv) Title Deed/Conveyance Deed dated 17.01.2012 of the property being plot measuring 230.55 square yards at Plot No. GI-5, Lawrence Road Industrial Area, New Delhi – 110035 belonging to Defendant no. 3 (Ex. A2W1/40);

(xxxv) Memorandum of Entry executed by Defendant no. 3 on 02.12.2013 and subsequently on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016 (Ex. A2W1/41 to A2W1/45);

(xxxvi) Declaration cum Undertaking dated 06.06.2017 executed by Defendant no. 1 in favour of the Applicant Banks (Ex. A2W1/46);

(xxxvii) Title Deed/Conveyance Deed dated 16.02.2014 of the property being Municipal No. 4119 (New) & 1932 (Old), comprising southern half portion of 1^st Floor, northern half portion of 2^nd Floor, and its roof / terrace rights above together with mezzanine, situated at Naya Bazar, Delhi (Admeasuring 128 square yards) belonging to Defendant no. 4 (Ex. A2W1/47);

- (xxxviii) Memorandum of Entry executed by Defendant no. 4 on 02.12.2013 and subsequently on 05.06.2014, 19.08.2014, 12.03.2014 and 25.04.2016. (Ex. A2W1/48 to A2W1/53);

- (xxxix) Declaration cum Undertaking dated 06.06.2017 of Defendant (Ex. A2W1/54);

- (xl) Copy of ROC search Report showing the registration (Ex. A2W1/55);

- (ci) Balance Confirmations dated 11.07.2014, 31.03.2015, 31.03.2016 and 31.03.2017 executed by Defendant no. 1 in favour of Applicant Banks (Ex. AW21/56 to A2W1/59);

- (cii) Audited Balance Sheets of Defendant no. 1 for the financial year upto 2016-2017 wherein it has admitted an amount of Rs. 117,10,70,064/- towards the Cash Credit facilities granted by the Applicant Banks (Ex. A2W1/60)

- (ciii) Duly acknowledged and modified charge of the Consortium Lenders on 06.06.2017 for an amount of Rs. 305.00 Crore by the Defendant no. 1 with ROC(Ex. A2W1/61);

- (civ) Demand Notice dated 03.07.2018 for an amount of Rs. 26,24,64,204.78 issued by Applicant no. 2 Bank to Defendants (Borrower / Mortgagors / Guarantors) under Section 13(2) of the SARFAESI Act (Ex. A2W1/62);

- (cv) Statement of Account duly certified under the Bankers Books Evidence Act in respect of the Loan Accounts, the calculation sheet of the accrued interest of the Loan Accounts, and the Statement showing the total outstanding amount (Ex. A2W1/63).

It is pertinent to note here that the documents executed by the Defendants on 25.04.2016 and 06.06.2017 as well as documents with regard to creation of mortgage by defendants no. 3 & 4, Balance Confirmation Letters executed by Defendant no. 1, duly audited balance sheets for the financial year 2016-2017 of Defendant no. 1 and registration / modification of charge with ROC have also been relied and exhibited by Applicant No. 1 Bank as well.

8. So far as, evidence of Defendant no. 2 is concerned, it has filed evidence by way of affidavit of Sh. Kapil Mittal, Director of defendant no. 2 who has relied upon the documents filed along with the WS as Ex. D2D1/1 to D2W1/21 which are as follows:-

- (i) Copy of RBI Circular dated 24.07.21017 (updated as on 25.04.2018) (Ex. D2W1/1);

- (ii) Copy of Circular Reference No. RBI/2015-16/338FIDD.MSME & NFS.BC.No. 21/06.02.31/201516 dated 17.03.2016 ((Ex. D2W1/2);

- (iii) Copy of Minutes of consortium meetings dated 23.02.2017 (Ex. D2W1/3);

- (iv) Copy of Letter of Intent dated 04.04.2017 signed with Steria (India) Ltd. (Ex. D2W1/4);

- (v) Copy of Letter dated 26.04.2017 (Ex. D2W1/5);

- (vi) Copy of the minutes of consortium meetings dated 06.06.2017 (Ex. D2W1/6);

- (vii) Copy of the email dated 19.06.2017 (Ex. D2W1/7);

- (viii) Copies of letters dated 19.05.2017, 15.07.2017 and 18.07.2017 (Ex. D2W1/8-colly);

- (ix) Copy of the letter dated 21.07.2017 (Ex. D2W1/9);

- (x) Copy of letter dated 20.08.2017 (Ex. D2W1/10);

- (xi) Copy of the statement of account dated 13.09.2017 (Ex. D2W1/11);

- (xii) Copy of proposal dated 03.10.2017 (Ex. D2W1/12);

- (xiii) Copy of minutes of meeting dated 27.11.2017 (Ex. D2W1/13);

- (xiv) Copy of letter dated 23.03.2018 (Ex. D2W1/14);

- (xv) Copy of the statement of account dated 27.02.2018 (Ex. D2W1/15);

- (xvi) Copy of letter for enhancement of credit limits approved and accepted dated 16.01.2018 (Ex. D2W1/16);

- (xvii) Copy of letter dated 26.03.2018 (Ex. D2W1/17);

- (xviii) Copy of resolution / revival plan submitted to consortium members dated 14.08.2018 (Ex. D2W1/18);

- (xix) Copy of revised resolution / revival plan submitted to consortium members dated 08.10.2018 (Ex. D2W1/19);

- (xx) Copy of email rejecting the resolution / revival plan dated 31.01.2018 (Ex. D2W1/20);

- (xxi) Copy of each of letters dated 05.02.2019 & 18.02.2019 (Ex. D2W1/21-colly).

9. Subsequently, Defendant no. 2 stopped entering before the Tribunal and the case was directed to proceed ex parte vide order dated 30.07.2025 qua Defendant no. 2.

10. During the pendency of this OA, it was informed by the Ld. counsel for the Applicant Bank that CIRP proceedings have been commenced qua Defendant no. 1

before Ld. NCLT, Delhi. It was also informed that the personal insolvency proceedings have been initiated qua defendants no. 3 & 4 as well before Ld. NCLT, Delhi.

11. It is also pertinent to note here during the pendency of the OA, the name of Applicant No. 1 Bank / SBI was substituted with Prudent ARC Limited vide order dated 30.07.2025 passed in IA No. 615/2025 by the Tribunal.

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

12.1 It is matter of record that defendants no. 1 to 4 had filed the common WS whereas evidence was filed by Defendant no. 2 which was subsequently proceeded ex parte vide order dated 30.07.2025 due to non-appearance.

12.2 It is also matter of record that CIRP proceedings have been commenced qua Defendant no. 1 Company before Ld. NCLT, Delhi. Moreover, personal insolvency proceedings have also been initiated qua defendants no. 3 & 4 before Ld. NCLT, Delhi, hence, no final order can be passed qua defendants no. 1, 3 & 4, at this stage.

In these circumstances, there is no need to deal with the defence taken by defendants no. 1, 3 & 4 in this case.

12.3 So far as, defendant no. 2 is concerned, now I would like to deal with the objections raised by it in its common WS (filed with Defendants no. 1, 3 & 4) in following paras:-

- (i) Defendant no. 2 has raised an objection that the alleged claim of the Applicants does not qualify to be "Debt" under Section 1(1)(g) of the RDB Act, therefore, this Tribunal does not have inherent jurisdiction to adjudicate upon the OA.

It is matter of record that defendant no. 2 has not denied the availment of loan facilities from the Applicants and the Applicants have duly proved their case on the basis of documents executed by Defendants no. 1 to 4 including defendant no. 2. Hence, this plea of Defendant no. 2 does not hold any water and same stands rejected.

- (ii) Next objection raised by defendant no. 2 is that this Tribunal does not have territorial jurisdiction to adjudicate upon this OA.

Record reveals that Defendants no. 1 to 4 are having address of Delhi and they are running their business from their Delhi office. Moreover, loan facilities were granted from the Delhi offices of Applicants. Hence, in the light of Section 19(i)(c) of RDB Act, this Tribunal is having territorial jurisdiction to adjudicate upon this OA. Accordingly, this objection of defendant no. 2 is liable to be rejected and same stands rejected.

- (iii) Defendant no. 2 has also raised an objection that the alleged claim of Applicants is patently barred by limitation.

Record reveals that this OA was filed on 06.10.2018 whereas defendants executed various security documents on 25.04.2016 as well as 06.06.2017. Moreover, Defendant no. 1 also executed last Balance Confirmation Letter on 31.03.2017. Hence, this Tribunal is of the view that this OA was filed well within the period of Limitation. Accordingly, this plea of Defendant no. 2 is hereby rejected.

- (iv) Defendant no. 2 has further taken a plea that this OA has not been filed by duly authorized offices of Applicant Banks.

Record reveals that Applicant No. 1 has filed various documents with regard to authorization of officers of Applicant No. 1 being General Regulations of SBI as well as Gazette Notification dated 22.02.2017 (Ex. AW1/1 to AW1/4, AW1/5). Similarly, Applicant No. 2 has also filed the Power of Attorney dated 12.12.2019 of erstwhile Andhra Bank in favour of the officer of the Bank (Ex. A2W1/3). Hence, this Tribunal is of the view that this plea of Defendant no. 2 does not hold any water and same stands rejected.

- (v) Defendant no. 2 has also stated in the WS that at the time of sanctioning of credit facilities, the Defendants no.1 to 4 were induced and compelled to append their signatures on a large number of undated and unfilled printed forms without being afforded any opportunity of understanding the contents, intent and purpose thereon.

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

- (vi) Next objection of Defendant no. 2 is that none of the alleged Memoranda of Entry bears the signatures of Defendants no. 3 & 4.

Record reveals that the title documents of the mortgaged properties were deposited with the Applicants by Defendants no. 3 & 4 and they also executed Declaration cum Undertakings as well as other Letters for this purpose which have been duly filed on the record of this case file. Even otherwise, Defendants no. 3 & 4 are before Ld. NCLT, Delhi, hence, no effective order is going to passed qua Defendants no. 3 & 4 as well as properties mortgaged by them in their favour. Accordingly, this plea of Defendant no. 2 is not going to give any benefit and same stands rejected.

- (vii) Defendant no. 2 has also taken a plea that the security documents relied upon by the Applicants are insufficiently stamped and/or unstamped.

This Tribunal is of the view that once defendants have not denied the availment of loan facilities or execution of security documents, now at the time of paying the dues of the Applicants, they cannot be benefited by taking such pleas. Accordingly this plea of Defendant no. 2 is also hereby rejected.

(viii) Next objection of Defendant no. 2 is that the Statement of Accounts contain false fictitious and ambiguous debit entries and are incomplete. Moreover, the certificates purportedly issued under the provisions of Bankers' Books Evidence Act, 1891 and Section 65B of Indian Evidence Act, 1872 are defective and do not conform to the mandatory prerequisites. It is also stated in the WS that the applicants are also guilty of charging penal interest and capitalizing / compounding the same which is expressly barred by virtue of the dictum of *Central Bank of India Vs. Ravindra – (2002) 1 SCC 367*.

It is matter of record that both the Applicants have filed their respective Statement of Account(s) duly certified under Bankers Books of Evidence Act as well as calculation sheets of the accrued interest and the Statement showing the total outstanding amount (Ex.AW1/149 to AW1/156 & A2W1/63). Even otherwise, 

defendant no. 2 was always at liberty to file its own statement(s) of accounts with correct figures but it has failed to do so. In these circumstances, this plea of answering defendant no. 2 is also hereby rejected.

12.4 Though, Defendant no. 2 also prayed for an equitable set off / Counter Claim for a sum of for a sum of Rs. 171,21,15,254.88 along with interest @11.70% p.a. with monthly rests against applicant no. 1 and for a sum of Rs. 31,27,54,133.78 along with interest thereof @11.50% p.a. with monthly rests against applicant no. 2, however, it is matter of record that vide order dated 18.10.2019 passed by the then Ld. Presiding Officer, it was directed that same shall not be taken on record as the court fees was not deposited by the Defendants. In these circumstances, there is no need to deal with the Set Off / Counter Claim and same stands dismissed for want of court of fees.

12.5 So far as, defendants no. 5 & 6 are concerned, they are proforma defendants and no relief has been claimed against these defendants by the applicant banks.

12.6 On the other hand, the witness(es) of applicant banks have corroborated the averments made in the OA. Even otherwise the whole case of the applicant banks is based on the documents and the witness(es) have duly proved all these documents. The evidence filed by the applicant banks gone unrebutted and there is no question of disbelieving the evidence lead by the applicant banks and applicants have proved its case beyond reasonable doubts. Accordingly, the Applicants are entitled to recover the entire amount(s), as claimed in the OA from the defendant no. 2 along with pendentelitte and future interest @11% p.a. and cost of this OA.

12.7 In this OA, applicant banks have prayed to issue recovery certificate against defendants no. 1 to 4 wherein the defendant 1 is principal borrower and defendants no. 2 to 4 are corporate and/or personal guarantors.

12.8 So far as, defendants no. 5 & 6 are concerned, no relief has been claimed by applicant banks qua these defendants being proforma defendants.

12.9 It is pertinent to note here that during the pendency of this case, it was informed by the Applicants that CIRP proceedings have been commenced qua Defendant no. 1 Company before Ld. NCLT, Delhi. Moreover, personal insolvency proceedings have also been initiated qua defendants no. 3 & 4 before Ld. NCLT, Delhi, hence, no final order can be passed qua defendants no. 1, 3 & 4, at this stage, till the relevant order(s) of Ld. NCLT are withdrawn / quashed.

However, it is directed that applicant banks shall be at liberty to revive the OA qua defendants no. 1, 3 & 4 in case CIRP and personal insolvency proceedings pending before Ld. NCLT, Delhi are quashed / withdrawn in future, in accordance with law.

It is also directed that in case applicant Banks receives any amount from the proceedings pending before Ld. NCLT, Delhi, it shall give due adjustment of the same in the recovery proceedings.

12.10 Consequently, TA No. 266/2022 is liable to be allowed in favour of applicant bank against defendant no. 2 (being Corporate Guarantor), which is liable to pay the dues of the applicants, 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**

(i) TA No. 266/2022 stands allowed and the defendant no. 2 is directed to pay to the Applicants No. 1 & 2 the amounts, as detailed below:- Applicant No. 1 Rs. 171,21,15,254.88 Prudent ARC Ltd. (Rupees One Hundred Seventy One (assignee of SBI) Crore Twenty One Lakh Fifteen Thousand Two Hundred Fifty Four and Paise Eighty Eight only)

Applicant No. 2 Rs. 31,27,54,133.78 UBI (Rupees Thirty One Crore Twenty (e-Andhra Bank) Seven Lakh Fifty Four Thousand One Hundred Thirty Three and Paise Seventy Eight 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 Banks, failing which, the aforesaid amount shall be recovered from the sale of secured assets / mortgaged properties / hypothecated assets / stocks etc. belonging to defendant no. 2.

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

- (ii) So far as, defendants no. 1, 3 & 4 are concerned, since CIRP and personal insolvency proceedings have been commenced qua defendants no. 1, 3 & 4 before Ld. NCLT, Delhi (as discussed above), no final order can be passed against defendants no. 1, 3 & 4, at this stage. till the relevant order(s) of Ld. NCLT are withdrawn / quashed.

However, it is directed that Applicant Banks shall be at liberty to revive the OA qua defendants no. 1, 3 & 4 in case CIRP and personal insolvency proceedings pending before Ld. NCLT, Delhi are quashed / withdrawn in future, in accordance with law.

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

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

- (iv) It is also directed that the sale proceeds of the secured assets shall be distributed between the consortium members, as per inter-se agreements executed amongst them.

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

- (vi) Parties are directed to appear before the Recovery Officer-II, DRT-III, Delhi on 22.01.2026.

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

File be closed and consigned to records.

2025 (SHIV KUMAR - I) PRESIDING OFFICER, DRT-III, DELHI

(Pronounced in open court) Dated: 24.11.2025

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