SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA vs TIKKU ECO PAPER PRODUCTS PVT LTD on 9 June 2026

J U D G M E N T

This is an application under Section 19(1) of the Recovery of the Debts due to Banks and Financial Institutions Act, 1993 renamed as Recovery of the Debt and Bankruptcy Act, 1993 (for short, ‘the 1993 Act’) to recover ₹74,10,250.67/- (Rupees Seventy-Four Lakhs Ten Thousand Two Hundred Fifty and paisa Sixty-Seven Only) under Term Loan Facility with future interest @ 10% per annum with monthly rest and penal interest @ 2% thereon from the date of presentation of the Transferred Original Application i.e. 04.08.2014 till payment/realization and to enforce the hypothecated securities.

The details of the claim amount are as under: - S r N o Na tu re of F a c i li ty O / s . a m ou n t I n te re s t d u e F u rth e r I n te re s t Du e P e n a l I n te re s t Du e T ota l A m ou n t I n s u ra n c e E x p e n s e s Cos t a n d O th e r Ch a rg e s T ota l A m ou n t

T e rm L oa n F a c i li ty ₹ 3 3 , 5 4 , 3 7 9 . 3 4 / - ₹ 1 3 , 1 7 , 1 9 1 . 8 3 / - ₹ 6 , 2 6 , 4 8 3 . 5 0 / - ₹ 8 0 , 87 7 . 0 0 / - ₹ 5 3 ,7 8 ,9 2 8 .6 7 / - ₹ 3 , 6 89 . 0 0 / - ₹ 2 0 , 27 , 6 3 3 . 0 0 / - ₹ 7 4 ,1 0 , 2 5 0 .6 7 / -

It is undisputed fact in the matter that the Defendant nos.1 and 2 were duly served with the transfer notice vide order-sheet dated 14.08.2023. Despite service, the defendants did not enter their appearance and therefore, they were set ex-parte on 06.12.2023.

Defendant no.1, a private limited company are the borrowers who approached the Applicant Bank and sought financial assistance by way of Term Loan Facility wherein defendant no.2 is the managing director and guarantor of the said loan. Pursuant to the loan application made by defendants, the Applicant sanctioned the loan vide Letter of Intent Ref. No.236/DCS-CLCSS/TI dated 08.07.2009 in sum of ₹90,00,000/- (Rupees Ninety Lakhs Only) payable in

EMIs of ₹1,50,000/- (Rupees One Lakhs Fifty Thousand Only) with interest @ 10% per annum. The said loan is covered under CGTMSE Scheme.

The details of the Sanction amount are as under: - Sr No D ate of Sanct ion Amoun t R OI Secu ri ty Colla ter al Secu ri ty

08.07 .20 09 ₹ 90,00 ,000 /- 10% per annum F irst c harge by w ay o f hypot heca tio n i n fav our o f SI DB I o f all the m ov able asset s of th e con cern includi ng plant an d machi nery an d miscella ne ous fixed as set s acquired /to b e acquired un der th e projec t/ sch em e. The s aid loa n is cov ered u nder CGTM S E Sche me .

Tota l Amoun t ₹ 90,00 ,00 0/ - - - -

On the dates given below, defendants signed and executed the loan and security documents as set out in paragraph nos. 5.1 to 5.6 of the Transferred Original Application. Defendants hypothecated First charge by way of hypothecation in favour of SIDBI of all the movable assets of the concern including plant and machinery and miscellaneous fixed assets acquired/to be acquired under the project/scheme and All the movable properties of the borrower pertaining to the project of the borrower as described in the Loan Agreement and situated at Survey No.278/1/2/AMI, Industrial Estate, Demani Road, Dadra, Silvassa-3962302, including but not limiting to its movable, plant, machinery spares, tools and accessories, office equipment, computers, furniture and fixtures and all other movable, both present and further (save and except book-debts). The major items of the equipments are Automatic Feeder of ₹20,00,000/-, Printer 2 Colour of ₹55,00,000/-, Slotter of ₹8,00,000/-, Pnenumatic System of ₹2,50,000/-, Electric System of ₹4,00,000/-, Compressor, 10 CFM of ₹6,50,000/-, Storage Tank of ₹3,00,000/-, Thin Knife, 4 sets of ₹6,50,000/-, Benders, 2 sets of ₹4,00,000/- and Installation and Tax of ₹16,50,000/- aggregating to ₹126,00,000/- to secure the loan.

The details of the documents executed by the Defendants are as under: - (a) Sanction Letter dated 08.07.2009;

(b) Letter of Intent dated 08.07.2009;

(c) Loan Agreement dated 16.07.2009;

(d) Deed of Hypothecation dated 28.07.2009;

(e) Deed of Guarantee dated 16.07.2009;

(f) Undertaking for Non-Disposal of Shareholding, Overrun and non- withdrawal of unsecured loans etc. dated 16.07.2009; (g) Affidavit dated 18.07.2009 executed by defendant nos.2;

(h) Extract of Board Resolution dated 23.04.2012;

(i) Deed of Confirmation dated 27.04.2012.

After availing the loan, defendants did not adhere to the financial discipline and committed default in payment of instalments and repayment of the loan and accordingly the accounts of the borrowers were declared as Non-Performing Assets (N.P.A.) on 08.08.2011 as per RBI Guidelines. Therefore, on 17.09.2012, the applicant, under Section 13(2) of SARFAESI Act, 2002 called upon defendants to liquidate the outstanding in the sum of ₹72,24,018/- (Rupees Seventy-Two Lakhs Twenty-Four Thousand Eighteen Only) as on 17.09.2012 together with contractual rate of interest @ 15.50% per annum with monthly/quarterly rests within 60 days from receipt of this notice. Despite notice, defendant nos. 1 and 2 failed and neglected to pay.

As on 01.08.2014, there was owing, due and payable by defendants to the applicant the aggregate sum of ₹74,10,250.67/- (Rupees Seventy-Four Lakhs Ten Thousand Two Hundred Fifty and paisa Sixty-Seven Only) under Term Loan Facility with future interest @ 10% per annum with monthly rest and penal interest @ 2% thereon. The applicant has maintained the loan ledger extract and the entries posted therein are made in the usual and ordinary course of the banking business.

Since, defendants failed and neglected to make the payment, the applicant was left with no other alternate but to file the Transferred Original Application which was presented on 04.08.2014.

The applicant has filed affidavit (exhibit-8) in lieu of examination in chief of Mr Ashish Wadke, Assistant General Manager and list of documents (exhibit-9) thereby adducing in evidence the documents at AW-1 to AW-15, which are admitted in evidence, read, recorded and exhibited.

Accordingly, in the Transferred Original Application was filed for the recovery of ₹74,10,250.67/- (Rupees Seventy-Four Lakhs Ten Thousand Two Hundred Fifty and paisa Sixty- Seven Only) under Term Loan Facility with future interest @ 10% per annum with monthly rest and penal interest @ 2% thereon from the date of presentation of the Transferred Original Application i.e. 04.08.2014 till payment/realisation.

The Tribunal has scrutinised and examined the allegations contained in the Transferred Original Application and analysed the evidence adduced by the applicant which has gone unchallenged, uncontroverted and unrebutted.

Upon careful scrutiny and the examination of the Transferred Original Application, analysing the evidence and giving due weightage to the documentary evidence adduced by the applicant, the Tribunal views that there is no reason to disbelieve the claim made by the applicant bank.

In view of the observations made hereinabove, Transferred Original Application filed by the applicant deserves to be allowed.

Hence, the following order:

ORDER

(A) The Transferred Original Application No.1636 of 2016 in Original Application No.471 of 2015 is allowed with costs. (B) Defendant nos.1 and 2 are ordered and directed to pay to the applicant, either jointly or severally, the aggregate sum of ₹74,10,250.67/- (Rupees Seventy-Four Lakhs Ten Thousand Two Hundred Fifty and paisa Sixty-Seven Only) under Term

Loan Facility with future simple interest @ 10% per annum thereon from the date of presentation of the Transferred Original Application i.e. 04.08.2014 till payment/realization after adjusting the recoveries made by the Applicant under SARFAESI Act, 2002 or any other amount paid by the borrowers after filing of this T.O.A. No.1636 of 2016. (C) The aforesaid adjudicated amount is secured by the valid and subsisting hypothecated properties, that is, First charge by way of hypothecation in favour of SIDBI of all the movable assets of the concern including plant and machinery and miscellaneous fixed assets acquired/to be acquired under the project/scheme and All the movable properties of the borrower pertaining to the project of the borrower as described in the Loan Agreement and situated at Survey No.278/1/2/AMI, Industrial Estate, Demani Road, Dadra, Silvassa-3962302, including but not limiting to its movable, plant, machinery spares, tools and accessories, office equipment, computers, furniture and fixtures and all other movable, both present and further (save and except book-debts). The major items of the equipments are Automatic Feeder of ₹20,00,000/-, Printer

Colour of ₹55,00,000/-, Slotter of ₹8,00,000/-, Pnenumatic System of ₹2,50,000/-,

Electric System of ₹4,00,000/-, Compressor, 10 CFM of ₹6,50,000/-, Storage Tank of ₹3,00,000/-, Thin Knife, 4 sets of ₹6,50,000/-, Benders, 2 sets of ₹4,00,000/- and Installation and Tax of ₹16,50,000/- aggregating to ₹126,00,000/-. (D) Defendant nos.1 and 2 are entitled to redeem the hypothecated properties as per law failing which the applicant has right to proceed to sell the hypothecated properties and recover dues as per law. (E) The Applicant is also hereby directed to submit the details of claim amount received from the Central Government since the facility is granted under CGTMSE Scheme. (F) Issue Recovery Certificate. (G) The learned Registrar is directed to send a copy of the judgment and recovery certificate to (i) the applicant, (ii) defendant and (iii) the Recovery Officer by post and email.

(Harish Kumar Kaushik) Presiding Officer, DRT-2, Mumbai