Allowed

State Bank of India v. M/S Rehmat Ulla Chirag Din and Others

DRT29 Jul 2025OA/2098/2022

Case brief

AI extract

What is this about?

The DRT allowed the applicant bank's application under Section 19 of the RDB Act for recovery of Rs. 62.42 lakhs from three individual borrowers and one firm. The Tribunal reduced the claimed interest rate to 8% p.a. and authorized recovery from mortgaged properties or personal assets.

What did the court decide?

Recovery certificate issued; defendants liable to pay Rs. 62.42 lakhs with @08%p.a. simple interest; realizable from mortgaged or personal assets.

State Bank of India versus M/S Rehmat Ulla Chirag Din and… — Execution and Attachment | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.2098/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 22.12.2022

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DATE OF DECISION: 29.07.2025

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State Bank of India, a body corporate constituted under the provisions of The State Bank of India Act, 1955 (23 of 1955), having its Corporate Office at Madame Cama Road, Nariman Point Mumbai Maharashtra, 400021, carrying on its business of banking in India and Abroad, having one of its Branch at Moti Bazar, Malerkotla (Punjab), through its specialized management known as Stressed Assets Recovery Branch situated at IInd Floor, S.C.O. 15, Sector 7-C, Madhya Marg, Chandigarh, through its Authorized Officer, Manager Sh. Mahesh Kumar, Manager.

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……..Applicant

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Versus

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M/s Rehmat Ulla Chirag Din, Dhabi Gate, Milkha Road, Loha

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Bazar, Malerkotla, Punjab, through its partners i.e. Defendant

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No. 1 and 2.

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Sh. Shabbir Ahmed S/o Sh. Chirag Din R/o House No. B/III/197, Nishant Colony, Merkotla, Punjab, 148023

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Sh. Mohd Shahid S/o Sh. Shabbir Ahmed R/o House No. B/III/197, Nishant Colony, Merkotla, Punjab, 148023

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Smt. Firoza Begum W/o Sh. Mohd. Shahid R/o House No. B/III/197, Nishant Colony, Merkotla, Punjab, 148023

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………. Defendants

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Advocates:

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Argued by Ms. Komal Tuteja, Advocate proxy for Sh. Ajay Singla, 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,

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2 OA NO.2098/2022 STATE BANK OF INDIA VS M/S REHMAT ULLA CHIRAG DIN AND OTHERS

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against the defendants for recovery of Rs.62,42,313.42p (Rupees Sixty Two Lacs Forty Two Thousand Three Hundred Thirteen and Forty Two Paisa Only). The Original Application has been filed through Sh. Mahesh Kumar, Manager o f the applicant, who is competent to institute the Original Application in terms of Gazette Notifications dated 26.09.1959, 26.08.1972 and 02.05.1987 read with regulation no.76 and 77 of State Bank of India General Regulations, framed in exercise of powers, conferred by the sub section 3 of section 50 of the State Bank of India Act, 1955 with previous sanction of Central Government.

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The brief facts of the OA are that the Defendant No.1 through its partners had approached the applicant for grant of CC Limit of Rs.38.00 Lacs and vide Loan Application dated 09.07.2014, which is Annexure A2 to this OA and thereafter for its Renewal vide Applications dated 23.10.2015, 06.12.2016 and 15.02.2018, which are Annexures A14 A16 and A18 to this OA.

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The applicant sanctioned CC Limit of Rs.38.00 Lacs vide Letter of Arrangement dated 26.08.2014, which is Annexure A3 to this OA and thereafter sanctioned renewal of the same vide Letter of Arrangements dated 26.10.2015, 13.12.2016 and 30.03.2018, which are Annexures A15, A17 and A19, to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant nos. 3 and 4 had mortgaged their immovable properties i.e. i) Shops - Double Storey Building measuring 0K-2.1/2M (75.62 Sq. yards) in the name of defendant no. 3, situated at Chah Dine Wala, Nishant Colony, Malerkotla, Punjab, vide equitable mortgage of sale deed bearing vasika no. 527 dated 03.06.2014 along with its translation, which is Annexure A10 to this OA and letter of confirmation for creation of mortgage by deposit of Title Deed dated 27.08.2014, which is Annexure A11 to this OA.

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3 OA NO.2098/2022 STATE BANK OF INDIA VS M/S REHMAT ULLA CHIRAG DIN AND OTHERS

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ii) Shops - Double Storey Building measuring 0K-2.1/2M (75.62 Sq. yards) in the name of defendant no. 4, situated at Chah Dine Wala, Nishant Colony, Malerkotla, Punjab, vide equitable mortgage of sale deed bearing vasika no. 2355 dated 09.11.200 0, along with its translation, which is Annexure A12 to this OA and letter of confirmation for creation of mortgage by deposit of Title Deed dated 27.08.2014, which is Annexure A13 to this OA.

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Documents executed:- Partnership deed 01.04.2012, which is Annexure A1 to this OA; Agreement of Loan-cum-Hypothecation, Guarantee Form P and letter of Partnership and Dissolution, D.P Note and D.P. note Delivery-cum-Continuity Letter, Free access letter and no lien letter, Content for Disclosure of Information, Guarantee Agreement, all dated 26.08.2014, which are Annexures A4 to A9 to this OA; Letter of Confirmation for creation of mortgage by deposit of title deeds, dated 27.08.2014, which are Annexures A11 and A13 to this OA; Confirmation of outstanding dated 30.03.2018, which is Annexure A20 to this OA; Revival letter dated 10.02.2021, which is Annexure A21 to this OA; Notice u/s 13(2) of SARFAESI Act, dated 04.10.2019, which is Annexure A22 to this OA; Account statement along with certificate, which is Annexure A23 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.62,42,313.42p, 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. 6. 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 21.03.2024 7. In support of the OA, affidavit of Sh. Mahesh Kumar, Manager, State Bank of India h as been filed.

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OA NO.2098/2022 STATE BANK OF INDIA VS M/S REHMAT ULLA CHIRAG DIN AND OTHERS

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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 A23 to this OA, it is proved that the defendants approached applicant for availing of the loan facility 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, 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.62,42,313.42p (Rupees Sixty Two Lacs Forty Two Thousand Three Hundred Thirteen and Forty Two Paisa 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 @13.75%p.a. with monthly rests along with penal interest @2%p.a. from 24.11.2022 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 @08.00%p.a. in 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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5 OA NO.2098/2022 STATE BANK OF INDIA VS M/S REHMAT ULLA CHIRAG DIN AND OTHERS

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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.62,42,313.42p (Rupees Sixty Two Lacs Forty Two Thousand Three Hundred Thirteen and Forty Two Paisa Only) jointly and severally, with costs, current and future simple interest @08.00%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. 12. Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 04.09.2025. 15. 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. Pronounced by me in the open Tribunal . Dated: 29.07.2025

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

State Bank of India v. M/S Rehmat Ulla Chirag Din and Others

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State Bank of India v. M/S Rehmat Ulla Chirag Din and Others

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