Allowed

Bank of Baroda v. M/s M.H. Industries

DRT17 Jun 2025OA/1206/2024

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an applicant's application for recovery of a debt of Rs.21,06,977.93p. The court reduced the claimed interest rate from 11.05%p.a. to 8.00%p.a. and ordered the recovery of the principal and reduced interest with costs.

What did the court decide?

Recovery of Rs.21,06,977.93p plus costs and simple interest at 8.00%p.a. from date of filing till realization via execution sale or attachment.

Bank of Baroda versus M/s M.H. Industries — Contract and Commercial Disputes | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1206/2024 PRESIDED OVER BYMRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 04.07.2024

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DATE OF DECISION: 17.06.2025.

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Bank of Baroda, a public sector banking and financial services Company having its head office at Suraj Plaza 1, Sayajigunj, Baroda, 390005 and a Branch Office among others at through its authorized officer and duly constituted Power of Attorney Holder Sh. Narendra Mehra, presently posted as Branch Head at Sunder Nagar, Branch, Ludhiana.

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……..Applicant

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Versus

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1. M/s M.H. Industries through its proprietor Mr. Manjot Singh Registered Office at 11326, Street No.5, Partap Nagar, Vishlarma Colony, Ludhiana, Punjab-141003.

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2. Mr. Manjot Singh S/o Sh. Harjit Singh R/o 190/1, Street no.2, Surjit Colony Bahamian Kalan Road, Mundian Kalan, Ludhiana -141015.

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….……Defendants Advocates: Argued by, Ms. Seerat Sharma, Advocate proxy for Sh. S.K. Dhir, Advocate for Applicant Defendants are ex parte

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FINAL ORDER

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Present Original Application was instituted by the applicant under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, against the defendants for recovery of Rs.21,06,977.93p (Rupees Twenty One Lacs Six Thousand Nine Hundred Seventy Seven & Ninety Three Paise only). The Original Application has been filed through Sh. Narendra Mehra, Branch Head of the applicant, who is competent to institute the Original Application vide Copy of Attorney dated 18.08.2015 and Power of Attorney dated 18.08.2015, which are Annexures A1 to this OA.

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2 OA NO.1206-2024 BANK OF BARODA VS M/S M H INDUSTRIES AND ANOTHER

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The brief facts of the OA are that the defendant no.1 through defendant no.2 had approached the applicant for the grant of CC Limit of Rs.20.00 Lacs vide Copy of the Application Form dated 20.10.2022, which is Annexure A2 to this OA.

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The applicant sanctioned the CC Limit of Rs.20.00 Lacs vide Copy of the credit sanction dated 20.10.2022, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant no.1 had hypothecated its properties/assets i.e. Stocks, Finished Goods and Book Debts etc. vide Hypothecation Agreement dated 20.10.2022, which is Annexure A6 to this OA

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Documents executed: - Letter of sole proprietorship, Promissory Note, Letter of Undertaking all dated 20.10.2022, which are Annexures A4, A5, A7 and A8 to this OA; Power of Attorney dated 20.10.2022, which is Annexure A9 to this OA; CERSAI, which is Annexure A9/A to this OA; Letter dated 05.04.2024, which is Annexure A10 to this OA; Recall Notice dated 26.04.2024, which is Annexure A11 to this OA and Statements of Accounts along with interest certificate & Banker Certificate, which are Annexures A12 to A14 to this OA.

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The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in loan account there was a debit of Rs.21,06,977.93p, which is recoverable and the defendants were served recall notices but they did not repay the outstanding amount, therefore, the applicant requested to accept the application and to issue Recovery Certificate accordingly.

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The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte on 13.06.2025.

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In support of the OA, affidavit of Sh. Dharam Pal Malik, Manager, Bank of Baroda, h as been filed. 8. Heard arguments and perused record.

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3 OA NO.1206-2024 BANK OF BARODA VS M/S M H INDUSTRIES AND ANOTHER

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It was argued by learned proxy counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant had proved its case. From the perusal of all the Annexures A1 to A14 to this OA, it is proved that the defendants approached applicant for availing of the loan facility which was granted to them and for that they had executed all the relevant documents in favour of the applicant. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.21,06,977.93p (Rupees Twenty One Lacs Six Thousand Nine Hundred Seventy Seven & Ninety Three Paise only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the account.

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In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @11.05%p.a. in from 07.05.2024 till the realization.

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The Tribunal is of the considered opinion that sometimes in appropriate cases the prerogative of mercy is the brightest jewel in the crown of the Judge. Keeping in view the facts and circumstances of the instant case including nature of the mortgaged property, undertaking of the defendants, quantum of loan and prevalent market rates of interest which have gone drastically downhill in yester years, while exercising the discretion vested in this Tribunal, this Tribunal deems it just and appropriate to grant uniform simple interest @8.00%p.a. in the loan account from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.21,06,977.93p (Rupees Twenty One Lacs Six Thousand Nine

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4 OA NO.1206-2024 BANK OF BARODA VS M/S M H INDUSTRIES AND ANOTHER

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Hundred Seventy Seven & Ninety Three Paise only) jointly and severally, with costs, current and future simple interest @8.00%p.a. in the loan account from the date of filing of OA till the date of realization of the amount. Accordingly, the applicant shall be entitled to recover aforesaid amount from the sale of hypothecated/mortgaged properties of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the applicant still remain unsatisfied, it shall be entitled to recover the same by attachment and sale of personal assets of the defendants. The applicant is at liberty to enforce the claim through due process of law.

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Any other application pending stands disposed of.

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Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 11.07.2025.

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Copy of this order be given dasti to the applicant and be sent to defendants through registered/speed post and this order be also uploaded on the official website of this Tribunal and record be consigned.

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Pronounced by me in the open Tribunal .

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Dated: 17.06.2025.

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Bank of Baroda v. M/s M.H. Industries

Case brief

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Bank of Baroda v. M/s M.H. Industries

Case brief

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