Dismissed

Ms. S.R. Retail Zone Pvt. Ltd. And Others v. Union Bank of India

DRAT17 Jul 2025REGULAR APPEAL/146/2023

Case brief

AI extract

What is this about?

The Debt Recovery Appellate Tribunal dismissed the appeal by the borrowers challenging a DRT order recovering dues. Upholding the institution of pendente lite and future interest at 10%, the Tribunal ruled that no interest accrued on suspended amounts, thereby confirming the lower court's order and dismissing the appeal.

What did the court decide?

The appeal was dismissed; the judgment and order of the DRT allowing recovery and granting interest at 10% were confirmed.

Ms. S.R. Retail Zone Pvt. Ltd. And Others versus Union… — Execution and Attachment | DRAT (2025)

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Reportable / not reportable

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IN THE DEBT RECOVERY APPELLATE TRIBUNAL - KOLKATA HON'BLE Justice Anil Kumar Srivastava, Chairperson

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APPEAL No. 146 of 2023

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(Arising out of O.A. 237 of 2013 – DRT-Cuttack)

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17.07.2025

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M/S. S.R. Retail Zone Pvt Ltd & Others having registered office at A 51 KHARVELA NAGAR, UNIT 3, KHURDA, Bhubaneswar, Orissa.

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Nihar Ranjan Pattnaik, A- 51 KHARVELA NAGAR, UNIT 3, KHURDA, Bhubaneswar, Orissa.

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Mrs. Basanti Das, resident of 1579, 4^th Lane A, Talabania, Bhaktamandhu Nagar, Bhubaneswar, Khurda, Odisha – 751030/

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Debendranath Das, resident of 1579, 4^th Lane A, Talabania, Bhaktamandhu Nagar, Bhubaneswar, Khurda, Odisha – 751030

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... Appellants

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--Vs--

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UNION BANK OF INDIA having office at PLOT NO 121 &122 GROUND FLOOR, UNIT 3, KHARVELNAGAR, STATION SQUARE BHUBANESWAR, Khurdha, Odisha – 751001.

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Proforma respondents :

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2.Nalinikanta Patnaik residing at S/O. Sri Nilakantha Patnaik Duplex 18, Aryabhumi, Kanak Vihar, Bhubaneswar 751024

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3.Dr Sarbeswar Samal residing at S/o. Kapil Charan Samal 106/1503(P) Acharya Vihar, Bhubaneswar 751002.

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... Respondents

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For Appellant : Mr. Nemani Srinivas, Ld. counsel For Respondent: Ms. Aparajita Rao, ld. adv.

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Ms. Nabanita Dutta, ld. Adv.

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The Appellate Tribunal

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Instant appeal is preferred by the appellant against the

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judgement and order dated 19.02.2021 passed by learned DRT

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Cuttack in O.A. 137 of 2013 (Corporation Bank, merged with

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Union Bank of India Vs. M/s. S.R. Retail Zone Pvt. Ltd. & Others)

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whereby learned DRT allowed the original application filed u/s 19

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of the Recovery of Debts and Bankruptcy Act, 1993 for recovery of Rs.34,09,139.50 against the defendants jointly and severally with pendente lite and future interest @ 10% per annum simple from the date of filing the O.A. till full and final realization of the certified amount. Further direction was issued that the bank can recover dues from the defendants by sale of the properties mortgaged and hypothecated to the bank except the property of defendant no. 2 and 5 namely Nihar Ranjan Pattnaik and Mr. Nalinikanta Pattanaik respectively which have already been sold in auction and property of defendant no.6 namely Dr. Sarbeswar Samal which was released on payment of Rs.30.00 lakh on 28.12.2011.

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As per pleadings of the parties, facts in brief are that appellants herein are the defendants in the O.A., who were borrower, guarantor and mortgager. O.A. was filed by the Corporation Bank which was subsequently merged with the Union Bank of India. Cash credit limit of Rs.90.00 lakh was availed by the appellants which was secured by creation of equitable

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mortgage of the immovable property of appellants. Loan account

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became irregular and classified as NPA. Demand notice dated

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01.08.2011 was issued u/s 13(2) for outstanding dues of Rs.94,10,154/-. Respondent no.6 namely Dr. Sarbeswar Samal entered into a settlement with the bank and immovable property owned by him got released on deposit of Rs.29.00 lakh. The

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deposit of Rs.29.00 lakh was not disclosed in the O.A. proceeding. Possession notice was issued on 13.07.2012 and sale notice was also issued on 21.11.2012. There was no

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mention of depositing Rs.29.00 lakh. Further, Rs.14.70 lakh auction price of immovable property owned by defendant no.2

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was not adjusted.

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Writ Petition no. 22945 of 2012 filed by the defendant no.4

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namely Mr. Debendranath Das before the Hon’ble High Court of Orissa wherein under the direction of the Hon’ble High Court amount of Rs.9.00 lakh was deposited on 28.01.2013.

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Thereafter O.A. no. 237 of 2013 was filed u/s 19 of the

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Recovery of Debts and Bankruptcy Act, 1993 for recovery certificate of Rs.57,79,139.50 wherein an amount of Rs.14.70 lakh and Rs.9.00 lakh, total Rs.23.70 lakh was not adjusted.

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Objection was filed by the appellants herein before the DRT.

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Thereafter, learned DRT decided the O.A. claim by formulating

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three issues :

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(1) Whether the claim of the applicant bank is within time? (2) whether the defendant no.1 firm had utilized the loan facilities granted by the bank? (3) whether all the defendants are liable to pay the amount due to the applicant bank or not?

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Learned DRT recorded finding that the claim of the bank is

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within time and bank is entitled for a recovery certificate of

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Rs.34,09,139.50 against the defendants who are jointly and severally liable. Interest at the rate of 10% simple also granted by the DRT. Learned DRT took into consideration the total

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payment of Rs.23.70 lakh and granted the certificate amount of Rs.34,09,139.50.

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Feeling aggrieved by the impugned judgement and order, appellants preferred the appeal.

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I have heard learned counsel for the appellants as well as

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learned counsel for the respondent bank and perused the records. 8. At the very outset it is to be observed that the impugned

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judgement and order passed by learned DRT is challenged by the borrower/mortgagers, appellants herein, only. Findings recorded

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by learned DRT are not challenged by the bank. Accordingly,

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bank has accepted the findings of the learned DRT.

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As far as challenge of the appellants is concerned, it is mainly on the ground of award of interest and secondly, it is submitted that appellants have made deposit of Rs.14.70 lakh and Rs.9.00 lakh on 29.01.2013 and 28.01.2013 respectively, but

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learned DRT has given concession for the same without giving any benefit for calculating interest to be accrued in favour of the appellants. Accordingly, judgement and order passed by learned DRT to this extent is against the law.

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Per contra, learned counsel for the respondent bank

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submits that learned DRT has given concession for the deposit received by the bank to the extent of Rs.23.70 lakh. Accordingly,

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there is no illegality in the impugned judgement and order passed by learned DRT.

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As far as impugned judgement and order is concerned, on factual aspect it is only on the two counts only. As far as interest accrued on the amount of Rs.14.70 lakh and Rs.9.00 lakh is

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concerned those amounts were deposited with the bank. On depositing the same the bank enjoyed interest accrued on those

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amounts. Learned counsel for the respondent bank submits that

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no interest accrued in favour of the bank as those amounts were

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kept in suspense account. Since no interest accrued in favour of the bank, question of allowing interest on those amounts to the appellants does not arise.

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As far as rate of interest awarded by learned DRT is concerned, learned DRT is well within its competence to award pendente lite and future interest from the date of filing O.A. in view of the law laid down by the Hon’ble Apex Court in Central Bank of India Vs. Ravinder & Ors. [2002 (1) SCC 367] . Learned DRT considered the contractual rate of interest @ 13.50% and after considering the contractual rate on its inherent discretion awarded 10% simple rate of interest for pendente lite

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and future from the date of filing the O.A. I do not find any illegality or impropriety in the impugned judgement and order, which is liable to be confirmed. Appeal lacks merit and is liable to be dismissed.

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O R D E R

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Appeal is dismissed. Judgement and order dated

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19.02.2021 passed by DRT, Cuttack in O.A. 137 of 2013 is confirmed. Costs easy.

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File be consigned to record room.

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Copy of the judgement/Final Order be uploaded in the Tribunal’s website.

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Order dictated, signed and pronounced by me in the open Court on this the 17^th day of July, 2025.

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(Anil Kumar Srivastava, J) Chairperson

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Dated : 17.07.2025 /pkb

Ms. S.R. Retail Zone Pvt. Ltd. And Others v. Union Bank of India

Case brief

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Ms. S.R. Retail Zone Pvt. Ltd. And Others v. Union Bank of India

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