Allowed

State Bank of India v. M/S Teotia Automobile Company

DRT10 Oct 2025OA/151/2023

Case brief

AI extract

What is this about?

The Tribunal allowed an original application filed under Section 19 of the RDB Act by a bank for recovery of dues from defendants who defaulted on an MSME loan. The case was tried ex-parte as respondents did not appear. Recovery was directed from hypothecated assets and properties subject to shortfall recovery.

What did the court decide?

Defendants directed to pay Rs. 36,78,156/- along with interest and costs within 30 days, recoverable from hypothecated assets and properties.

State Bank of India versus M/S Teotia Automobile Company — Banking and Recovery | DRT (2025)

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O.A. No. 151 of 2023

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Debts Recovery Tribunal-I, Delhi 4th floor, Jeevan Tara Building, Parliament Street, New Delhi

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Presiding Officer: Shri Govind Ballabh Sharma

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O.A. No.151 of 2023

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State Bank of India

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Stressed Assets & Recovery Branch

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SBI, IV Floor, Arya Samaj Road,

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Karol Bagh, New Delhi-110005 Applicant

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Versus

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M/s Teotia Automobile Company

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Through its Partners

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New Friends Colony, Gulaothi Road

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Sikandrabad, Distt. Bulandshahar-203205

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Smt. Lata w/o Sh. Harendra R/o 02, Village Khaguawas, Sikandrabad (NPP) Khujra, Bulandshahar, Uttar Pradesh-203205

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Smt. Chanchal w/o Sh. Gyanendra Singh R/o 02, Village Khaguawas, Sikandrabad (NPP) Khujra, Bulandshahar Uttar Pradesh 203205 Defendants

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Present: Shri Anshuman Srivastava, Counsel for the applicant bank

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Date of Reserve: 12.09.2025

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Date of Pronouncement: 10.10.2025

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FINAL ORDER

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This original application has been filed by the applicant bank on 07.01.2023 through Mr. Dheeraj Kumar, authorized representative of the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 against the

O.A. No. 151 of 2023

defendant for recovery of a sum of Rs.36,78,156 /- (Rupees Thirty Six Lacs Seventy Eight Thousand One Hundred Fifty Six only) as on 03.12.2022 along with pendentelite and future interest @11.55% per annum with monthly rests plus 2% penal interest till its realization along with costs.

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The brief facts of the case are that on the request of the defendant no.1 through its partners being defendant no.2 and 3, the applicant bank sanctioned MSME Loan facility for a sum of Rs.32,00,000/- (Rupees Thirty Two Lacs only) on 12.09.2020 @9.65% interest per annum for enhancement of existing business and to purchase machineries against hypothecation of current assets of the firm, stocks and book debts/ receivables, which was renewed on 30.06.2021 as per request of the defendants.

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That in order to avail the credit facility, the defendants submitted loan application dated 21.08.2020 and executed Arrangement Letter, Agreement of Loan cum Hypothecation, on 12.09.2020. The defendant no.2 and 3 executed Letter of Intent, Guarantee Agreement on 26.09.2020 and Affidavits in favour of the applicant bank on 21.08.2020.

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It has been submitted by the applicant bank that after availing the aforesaid loan facility, the defendant failed to comply with the terms and conditions of sanction and not routed their transactions through the account and failed to regularize the account with the applicant bank. The applicant bank classified the account as NPA on 04.05.2022 as per RBI guidelines and issued legal notice dated 19.12.2022 for clearing the dues but no response, hence the applicant bank has approached this tribunal for recovery of their dues.

Scf

O.A. No. 151 of 2023

Notices of this O.A. were issued to the defendant and despite of proper service, the defendant has chosen to absent from the proceedings. As per order dated 02.07.2025, the defendants have been proceeded ex-parte as not appeared before the Tribunal and even written statement, evidence and affidavit of assets have not been filed by the defendant.

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In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Shri Dheeraj Kumar, authorized representative of the applicant bank who has proved the documents as Gazette Notification, Loan Application with Partnership Deed, Arrangement Letter, Agreement of Loan cum Hypothecation, Guarantee Agreement, Letter of Intent and Affidavits by defendant no.2 and 3, Revival Letter SME 11, Legal Notice, Statement of Loan Account with closure reports duly Certified under Bankers' Books Evidence Act and IT Act marked as Ex-AW1/1 to Ex.-AW-1/11 (Colly).

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The applicant bank has fully corroborated the averments made in the O.A. Even otherwise the whole case of the applicant bank is based on the documents and the same have been duly approved.

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The case filed by the applicant bank gone unrebutted and there is no question of disbelieving the case of the applicant bank and the applicant bank has proved its case beyond reasonable doubts.

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In the light of the above discussions, the Original Application deserves to be allowed.

O.A. No. 151 of 2023

ORDER

I, allow this OA and direct the defendants to pay to the applicant bank, jointly or severally, within a period of 30 days, a sum of Rs.36,78,156/- (Rupees Thirty Six Lacs Seventy Eight Thousand One Hundred Fifty Six only) as on 03.12.2022 together with pendentelite and future interest @11.55% per annum with monthly rests from 04.12.0022 till the date of realization and costs; failing which the aforesaid amount shall be recovered from the sale of Hypothecated Assets, Stocks and book debts/ receivables. In case of shortfall, the same shall be recovered from the sale of movable and immovable properties of the defendants.

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(II) The recovery certificate be issued forthwith and be sent to the Recovery Officer, Debt Recovery Tribunal-I, Delhi.

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(III) Parties are directed to appear before the Recovery Officer, DRT I, Delhi on 10.12.2025.

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(IV) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost.

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(GOVIND BALLABH SHARMA) PRESIDING OFFICER DRT-I, DELHI

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(Dictated and pronounced in open court) Dated: 10.10.2025

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State Bank of India v. M/S Teotia Automobile Company

Case brief

What is this about?

What did the court decide?

State Bank of India v. M/S Teotia Automobile Company

Case brief

What is this about?

What did the court decide?

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