SUSHIL KUMAR SINGLA vs UNION BANK OF INDIA on 27 October 2026

**ORDER**

**Appeal No. 273/2026**

1. The brief facts appearing after perusal of the record indicates that the respondents/financial institutions filed Original Application bearing O.A no. 480/2019 (TMA 03/2023) titled as **Union Bank of India and others V M/s SRS Retreat Services Limited and others** which was stated to be pending before DRT-II, Delhi (herein after referred to as '**DRT**'). The appellant was arrayed as defendant no. 5 in the O.A. The appellant being the defendant no. 5 was ordered to be proceeded *ex-parte* vide order dated 05.01.2022. DRT vide final order dated 28.06.2022 allowed O.A against the defendants including the appellant being the defendant no.5.

2. The Appellant filed Miscellaneous Application bearing no. TMA 03/2023 under Order IX Rule 13 of the Code of Civil Procedure, 1908 along with section 22 (2)(g) of the Recovery of Debts due to Bank and Financial Institution Act, 1993 (hereinafter referred to as '**the Act**') in O.A titled as **Sushil Kumar Singhla V Union Bank of India and others** before DRT seeking recall of the final order dated 28.06.2022. The appellant in the application pleaded that he was a whole-time director of defendant no. 8 and several FIRs was lodged against the chairman of SRS Group Companies on account of alleged fraud and misappropriation of

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**Regular Appeal No. 273/2026**

**1**

public funds. The appellant was also arrested on 12.04.2021. The appellant was in judicial custody since 12.04.2021 and due to this reason, he was not having any knowledge about the filing of O.A. The appellant was informed by his son in the first week of April that a notice has been pasted on his house issued by the Recovery Officer to attend the proceedings on 10.04.2023. The appellant contacted the Counsel who entered into an appearance 10.04.2023 before the Recovery Officer and demanded copy of O.A from the counsel of the respondents. The Counsel of the appellant received the copy of O.A on 12.04.2023 from the Counsel of the respondents. The appellant also challenged the impugned final order dated 28.06.2022 on various grounds as stated in the application.

2.1 The respondent no. 1/Union Bank of India contended that the recall application is misconceived, frivolous and filed only to obstruct recovery proceedings. The appellant was whole time director and authorised signatory of the borrower company and was fully aware of the liquidation proceedings and the pendency of the present original application. The official liquidator had also entered in the O.A and represented the Company and as such the appellant cannot plead ignorance of the pleadings. The appellant was duly served through all permissible modes including substituted service by publication. The appellant has deliberately avoided to participate in the proceedings. The miscellaneous application bearing no. TMA 03/2023 is liable to be dismissed.

2.2 The respondent no. 2/ Punjab National Bank also filed reply wherein contended that the summons was duly issued and served upon the defendant no. 5 i.e. the appellant through all permissible modes including publication in the widely circulated newspaper which was accessible to the appellant's family. The service was also effected at appellant's last known address of the appellant by affixation as per Rule 13(4) of the DRT (Procedure) Rules, 1993. The appellant was having the knowledge of proceedings SRS Group and its directors including the appellant. The application is liable to be dismissed.

3. DRT-III Delhi vide impugned order dated 17.07.2026 dismissed the Miscellaneous Application by observing that there exists no ground to recall the final order/judgement dated 28.06.2022. The relevant portion of the impugned order dated 17.07.2026 is reproduced as under:

**14. The Tribunal is also conscious that the *ex-parte* judgment culminated in issuance of a Recovery Certificate after adjudication of the claim on**

--- the basis of documentary evidence. Such adjudication cannot be lightly unsettled unless a clear case of non-service or sufficient cause is established. The applicant has failed to discharge that burden.

15. Accordingly, this Tribunal is of the considered opinion that no ground exists for recalling the *ex-parte* judgment dated 28.06.2022. The application is devoid of merit and appears to have been filed only after commencement of recovery proceedings, thereby causing unnecessary delay in execution of the Recovery Certificate.

16. In view of the foregoing discussion, the application no. TMA/3/2023 filed by Defendant No. 5 under Order IX Rule 13 CPC read with Section 22(2)(g) of the Recovery of Debts and Bankruptcy Act, 1993 seeking recall of the *ex-parte* judgment and final order dated 28.06.2022 is dismissed.

4. The appellant being aggrieved filed the present appeal and challenged the impugned order on the grounds that the impugned order was passed in ignorance of settled principle of law and was erroneous. DRT has failed to appreciate that the summons was duly served upon the appellant who was prevented from appearing in O.A as the appellant was in judicial custody of SFIO from 12.04.2021 to 23.05.2025. The appellant could have been served through the jail authorities. The appellant was not served properly by fixation or publication as per the Rules. The appellant also challenged the impugned order on various other grounds. The appellant prayed that the impugned order be set aside.

5. Sh. Lavam Tyagi, advocate for the appellant advanced argument on admission. The Counsel for the appellant also submitted brief note on argument which is also perused and considered.

6. Sh, Lavam Tyagi, argued that the appellant has satisfied necessary ingredients of Order IX Rule 13 CPC as the appellant was prevented by sufficient cause from appearing before the DRT and no valid service of summons was effected on the appellant. The appellant was incarcerated in SFIO custody from 12.04.2021 and was released on 23.05.2025 in pursuance of order passed by the Supreme Court in Criminal Appeal No. 2816/2023. The appellant was in judicial custody when the appellant was ordered to be proceeded *ex-parte* vide order dated 05.01.2022 and when the final order dated 28.06.2022 was passed. The respondents never brought about the judicial custody of the appellant to the notice of DRT and no attempt was made to serve the appellant through jail authorities.

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6.1 Sh. Lavam Tyagi further argued that there was no valid service of summons effected upon the appellant and to substantiate his argument referred the affidavit of service dated 25.07.2019. The appellant was residing at House no. 143, Sector 9 Ballabgarh, Faridabad, Haryana while the appellant was allegedly served on the address mentioned in the cause title which is situated at Palwal Haryana. Accordingly, the appellant was attempted to be served at wrong address. DRT vide order dated 12.09.2019 directed the respondents to file application for effecting service through publication which was filed on 14.01.2020. It was further argued that the said application was never taken up for hearing and no order was ever passed on the said application. The appellant was ordered to be proceeded *ex-parte* vide order dated 05.01.2022 by wrongly mentioning that the appellant was served through publication but no such service was ever effected as the appellant was in judicial custody. The respondents have not provided any detail regarding the date of publication and concerned newspaper etc. DRT has passed the impugned order by merely relying on false submissions and wrongly imputed knowledge of proceedings on the appellant on the basis of service of summons upon the liquidator of the defendant no. 8/Company. It was argued that no valid service of summons was ever been effected on the appellant. The Counsel for the appellant in light of these submissions argue that the impugned order be set aside.

7. Order IX Rule 13 CPC deals with setting aside decree *ex-parte* against defendant. It provides that where a decree is passed *ex-parte* against a defendant and if the defendant satisfy the court that the summons was not duly served or that he was prevented by any sufficient cause from appearing when the suit was called on for hearing then the *ex-parte* order can be set aside. However, the second proviso provides that no Court shall set aside *ex-parte* decree merely on the ground that there has been irregularity in the service of summons if it is satisfied that the defendant had the notice of hearing and had sufficient time to appear and answer the plaintiff's claim.

8. It is reflecting from the record that respondents filed O.A bearing no. 480/2019 (TMA 03/2023) titled as **Union Bank of India and Others V M/s SRS Retreat Services Limited and others** on 09.04.2019 which was allowed vide final order dated 28.06.2022. The appellant was impleaded as defendant no.5 and was ordered to be proceeded *ex-parte* vide order dated 05.01.2022. The appellant remained in custody of SFIO from 12.04.2021 to 23.05.2025. The appellant being the

--- defendant no. 5 was stated to have been served through substituted service and was proceeded *ex-parte* vide order dated 05.01.2022. It is not on the record that how the appellant was served and when the appellant was served through publication. The affidavit of service dated 25.07.2019 filed by the respondent perused in paragraph 5 reflected that Mukesh Kumar Babbar, Assistant General Manager/ Branch head of Union Bank of India has visited the premises of the appellant but found that the appellant had already left from there and one Sunder Chandra was residing in the premises. It is also on the record that the application on behalf of the respondent was filed for substituted service but there was no order on substituted service. The present appeal requires consideration. Nothing observed herein shall be construed as an expression of opinion on the merits of the case

9. Issue notice to the respondent no. 1 to 3 on taking steps by the appellant through all permissible modes, returnable on 05.02.2027.

----- **(Dr. Justice Sudhir Kumar Jain)** **Chairperson**

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