Allowed

The Federal Bank Ltd. v. Sh. Gurjaypal Singh and Another

DRT25 Nov 2025OA/1291/2025

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an application filed by Federal Bank Ltd. against two loan defaulters for recovery of Rs. 30,09,125.86. The Tribunal granted a uniform simple interest rate of 8% p.a. instead of the claimed higher rates and authorized recovery via sale of mortgaged property.

What did the court decide?

Defendants liable to pay Rs.30,09,125.86 with uniform simple interest @08.00%p.a.; Recovery Certificate issued; Entitlement to recover via sale of mortgaged or personal assets.

The Federal Bank Ltd. versus Sh. Gurjaypal Singh and Another — Banking and Recovery | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1291/25

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 04.09.2025

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DATE OF DECISION: 25.11.2025

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The Federal Bank Ltd., a Banking Company, registered under the Companies Act, 1956 and having its Registered Office at Always, Ernakulam, District and having branches all over India and one of its branch office amongst other places situated at Muktsar City through its Loan Collection and Recovery Division, Chandigarh at SCO no. 867, First Floor, NAC Manimajra, Chandigarh 160101, through its Associate Vice President and Principal Officer and General Power Attorney holder Sh. Santosh Kumar Gupta.

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……..Applicant

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Versus

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Sh. Gurjaypal Singh S/o Sh. Manjit Singh, H.No.550, Kale Wale Raah Di Firni, Village Fattanwala, District Muktsar-152026 (Punjab).

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Smt. Ashneer Kaur W/o Sh. Gujaypal Singh, H.No.550, Kale Wale Raah Di Firni, Village Fattanwala, District Muktsar-152026 (Punjab).

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….……Defendants

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Advocates:

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Argued by Sh. Sunil Salotra, Advocate proxy for Sh. Nitin Grover, Advocate for the applicant

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Defendants already 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 and Bankruptcy Act,1993, against the defendants for recovery of Rs.30,09,125.86p (Rupees Thirty Lacs Nine Thousand One Hundred Twenty Five & Paise Eighty Six Only). The Original Application has been filed through Sh. Santosh Kumar Gupta , Associate Vice President and Principal Officer a nd General Power Attorney holder of the applicant, who is competent to

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2 OA/1291/2025 THE FEDERAL BANK LTD VS SH. GURJAYPAL SINGH AND ANOTHER

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institute the Original Application vide General Power of Attorney dated 16.12.2006, which is Annexure A1 to this OA.

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The brief facts of the OA that the defendants had approached the applicant for the grant of Agri. CC limit facility for a sum of Rs.8.50 Lacs & Agri. Term loan of Rs.9.50 Lacs.

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The applicant sanctioned the Agri. CC limit of Rs.8.50 Lacs vide sanction letter dated 31.01.2019, which is Annexure A2 to this OA & sanctioned Agri. Term loan of Rs.9.50 Lacs vide Sanction letter dated 26.02.2021, which is Annexure A7 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant no. 1 had mortgaged his immovable property i.e. land measuring 61 Kanal 12 Marlas situated at Village Chak Badhai, Hadbast no. 113, Tehsil and District Sri Muktsar Sahib, Punjab. Declaration u/s 4(1) dated 24.01.2019 and dated 26.02.2021, which are Annexures A6 and A12 to this OA.

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Documents executed:- Agreement for agriculture loan, Security delivery letter, Demand Promissory note, all dated 31.01.2019, which are Annexures A3 to A5 to this OA; Agreement for agriculture loan, Take delivery letter to DPN, Demand Promissory Note, Letter of set off, all dated 26.02.2021, which are Annexures A8 to A11 to this OA; Balance Confirmation letter dated 29.01.2022 and 24.04.2025, which are Annexures A13 & A14 to this OA; Cash deposit receipts, dated 14.01.2022, which is Annexure A15 to this OA; Recall notices dated 30.10.2022 and 26.05.2025, which are Annexures A16 to A19 to this OA and statement of accounts, which are Annexures A20 & A21 to this OA.

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The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.30,09,125.86p, 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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3 OA/1291/2025 THE FEDERAL BANK LTD VS SH. GURJAYPAL SINGH AND ANOTHER

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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 20.11.2025.

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In support of the OA, affidavit of Sh. Santosh Kumar Gupta, Associate Vice President and Principal Officer, Federal Bank Limited, has been filed.

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Heard ex-parte arguments and perused record.

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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 A21 to this OA, it is proved that the defendants approached applicant for availing of the loan facilities which were granted to them and for that they had executed all the relevant documents in favour of the bank. The defendants failed to pay back the loans as per terms and conditions of the agreement between the parties. Subsequently, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.30,09,125.86p (Rupees Thirty Lacs Nine Thousand One Hundred Twenty Five & Paise Eighty Six Only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the accounts.

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In so far as pendente lite and future rate of interest is concerned, the applicant in relief clause has claimed [email protected]%p.a. with 4% penal interest with yearly rests in CC & [email protected]%p.a. with 4% penal interest with half yearly rests in term loan from 27.08.2025 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/hypothecated assets, undertaking of the defendants, quantum of loans and prevalent

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4 OA/1291/2025 THE FEDERAL BANK LTD VS SH. GURJAYPAL SINGH AND ANOTHER

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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 @08.00%p.a. in both the loan accounts from the date of filing of the OA till realization of the amount ordered vide this final order. It is ordered accordingly.

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In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.30,09,125.86p (Rupees Thirty Lacs Nine Thousand One Hundred Twenty Five & Paise Eighty Six Only), jointly and severally, with costs, current and future simple interest @08.00%p.a. in both the loan accounts 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 mortgaged property 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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12. 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 05.12.2025.

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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

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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: 25.11.2025.

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

The Federal Bank Ltd. v. Sh. Gurjaypal Singh and Another

Case brief

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The Federal Bank Ltd. v. Sh. Gurjaypal Singh and Another

Case brief

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