Allowed

State Bank of India v. M/S Usha Distributors

DRT12 Dec 2025OA/19/2025

Case brief

AI extract

What is this about?

The court allowed the recovery application filed by State Bank of India against M/s. Usha Distributors. The bank recovered a sum of Rs. 23,62,580.27/- along with future interest at 11% per annum. The court also granted a charge over the hypothecated properties and directed the issuance of a recovery certificate.

What did the court decide?

The defendants were ordered to pay Rs. 23,62,580.27/- with future interest at 11% p.a. and the bank was directed to sell hypothecated assets to recover dues. A Recovery Certificate was issued.

State Bank of India versus M/S Usha Distributors — Company and Corporate | DRT (2025)

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Presented on: 10.12.2024 Registered on: 08.01.2025 Decided on: 12.12.2025 Duration: Y M D 01 00 02

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IN THE DEBTS RECOVERY TRIBUNAL AT AURANGABAD (Before Dr. J. R. Chauhan Presiding Officer) ORIGINAL APPLICATION No. 19/2025

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TOTAL CLAIM AMOUNT – Rs. 23,62,580.27/-

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State Bank of India,

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A body corporate constituted under the State Bank of India, Act, 1955 (23 of 1955) having it’s one of Local Head office at Synergy, Bandra-Kurla Complex, Bandra (E), Mumbai & Branches amongst the other places at SMECC, amongst the other places at Chh. Sambhajinagar & having its Stressed Assets Recovery Branch (SARB) at Plot No. 79, N-5, CIDCO Chh. Sambhajinagar-431003, Through its Authorized person, Mr. Shivaji s/o Vitthalrao Daud (Dy. Manager & CCO), Age: 54 yrs., Occ.: Service, R/o. CIDCO, Chh. Sambhajinagar.

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… Applicant

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Versus

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1.M/s. Usha Distributors, Through its Proprietor, Mr. Suraj Mahavir Lohade

(OA No.19/2025)

Page 1 of 7

[AMBADAS]

Age: Major, Occ. Business, R/o. Plot no. 26, Chintamani Sadan, New Balaji Nagar, Saujanya Nagar, Chh. Sambhajinagar 431001.

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2. Mr. Suraj Mahavir Lohade Age: Major, Occ. Business, R/o. Plot no. 26, Chintamani Sadan, New Balaji Nagar, Saujanya Nagar, Chh. Sambhajinagar 431001.

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…Defendant

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APPEARANCES

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Mr. K. D. Pande Advocate Ex-parte

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For the Applicant For Defendant

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JUDGMENT

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Delivered on 12.12.2025

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The Applicant Bank has filed the present application for the recovery of a sum of Rs. 23,62,580.27/- (Rupees Twenty Three Lacs, Sixty Two Thousand, Five Hundred Eighty and Twenty Seven Paisa only), along with further interest from the date of filing of the Original Application, i.e., 10.12.2024, until the date of realization of the entire outstanding dues from the Defendants.

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Brief facts of the application are as under:

(OA No.19/2025)

Page 2 of 7

[AMBADAS]

Defendant No. 2, being the proprietor of Defendant No. 1, had approached the Applicant Bank requesting sanction of Demand Cash Credit Facility & Term Loan Facility. After due consideration, the Bank Sanctioned Demand Cash Credit Facility of 6,00,000/- & Term Loan Facility of Rs. 15,50,000/- vide Arrangement Letter dated 27.01.2023, subject to certain terms and conditions. The agreed rate of interest for the said facilities was @12.75% per annum with monthly rests. Additionally, the Defendants agreed to pay further interest at the rate of 2% per annum by way of liquidated damages in the event of default in repayment.

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In order to secure the aforesaid loan facilities, the Defendants executed various loan documents in favour of the Applicant Bank, including the arrangement letters, hypothecation agreement, , letters of undertaking & letter of confirmation etc., in favor of the Applicant Bank.

(OA No.19/2025)

Page 3 of 7

[AMBADAS]

The Applicant Bank further contends that, in order to secure the

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aforesaid loan facilities sanctioned to them, the Defendants executed hypothecation agreement dated 27.01.2023 thereby hypothecating all kind of stock & book-debts, raw material, receivables and other current assets of the firm, plant & machinery purchased out of bank’s finance.

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The applicant bank contended that the defendants have failed to keep their promise and commitments agreed by them with regard to due repayment of the loan amount. The defendants failed to operate the loan account properly and failed to pay the agreed rate of interest as per terms and conditions of the sanction letter. Thereafter, the applicant bank repeatedly made demand of loan amount and called upon the defendants to pay with the agreed rate of interest thereon, but the defendants failed and neglected to pay the same. The loan account of the defendants became irregular and classified as NPA on 27.07.2024. Therefore on 30.11.2024 the applicant bank issued legal notice to the defendants through his advocate. Despite service of Notices, the

(OA No.19/2025)

Page 4 of 7

[AMBADAS]

defendants failed and neglected to repay the outstanding dues of the applicant Bank. Hence, this application is filed.

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The defendant failed to appear in matter though they were served through RPAD. Hence, the defendants were proceeded ex-parte as per Order dated 20.05.2025.

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The applicant Bank has filed Claim Affidavit of evidence at Exhibit-4 of Mr. Shivaji s/o Vitthalrao Daud, (City Case Officer & Dy. Manager) of the applicant Bank, and has produced on record the original loan transaction documents as Exh. A-1 to A-9 as per list of documents Exh. 5 which corroborates the case of the applicant Bank.

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I have heard arguments of the learned Advocate for the applicant Bank.

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Since the defendants failed to appear and contest the application, I find no reason to disbelieve the unrebutted evidence of the applicant Bank. Therefore, the applicant Bank is entitled for the reliefs as claimed.

(OA No.19/2025)

Page 5 of 7

[AMBADAS]

The applicant Bank has claimed charge over hypothecated properties of the borrowers.

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The applicant Bank has claimed future interest @12.40% with monthly rests from the date of filing i.e. 10.12.2024 of this application till realization of the claim amount. However, considering the facts of the case, I am of the opinion that if future interest is granted @ 11% per annum (simple) on outstanding amount, it would be just and reasonable rate of interest.

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ORDER

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(A) Original Application No. 19/2025 is allowed with costs.

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(B) The defendants shall pay jointly and severally to the applicant Bank a sum of Rs. 23,62,580.27/- (Rupees Twenty Three Lacs, Sixty Two Thousand, Five Hundred Eighty and Twenty Seven Paisa only), along with future interest @ 11% per annum (simple), from the date of filing of the O.A. i.e. 10.12.2024 till full payment/realization of the amount mentioned in this operative order.

(OA No.19/2025)

Page 6 of 7

[AMBADAS]

(C) The aforesaid adjudicated amount is secured by the hypothecation of all kind of stock & book-debts, raw material, receivables and other current assets of the firm, plant & machinery purchased out of bank’s finance. Vide hypothecation agreement dated 27.01.2023 at Exh. A-4 in list of documents Exh. 5.

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(D) The applicant Bank is entitled to sell the hypothecated stocks / plant & Machinery / articles/goods etc., to recover its dues.

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(E) Issue Recovery Certificate accordingly.

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(F) The Registrar is directed to send the copy of the Judgment and Recovery Certificate to the applicant and defendants.

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(G) File be consigned to the record room.

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Sd/-

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Pronounced in open court. Place: Aurangabad Date:.12.12.2025

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(Dr. J. R. Chauhan) Presiding Officer Debts Recovery Tribunal, Aurangabad

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(OA No.19/2025)

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Page 7 of 7

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[AMBADAS]

State Bank of India v. M/S Usha Distributors

Case brief

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State Bank of India v. M/S Usha Distributors

Case brief

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