Allowed

Canara Bank v. Rajat Malhotra

DRT29 Dec 2025OA/244/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an application filed by Canara Bank against Mr. Rajat Malhotra for recovery of dues of Rs.23,82,508.22. The Tribunal proceeded ex-parte due to the defendant's absence and fixed the interest rate at 12% p.a., directing recovery from hypothecated assets and properties.

What did the court decide?

Recovery of Rs.23,82,508.22 with interest @12% p.a. and costs from sale of hypothecated assets and defendant's properties within 30 days.

Canara Bank versus Rajat Malhotra — Banking and Recovery | DRT (2025)

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O.A. No. 244 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.244 of 2023

Canara Bank

Karkardooma branch

177, Saini Enclave,

Vikas Marg Extension, Delhi-110092

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Applicant

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Versus

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Mr. Rajat Malhotra s/o Sh.Bharat Bhushan Malhotra Proprietor of M/s Sai Infotech G-40, Vishwa Sadan District Centre Janak Puri, New Delhi

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Also at:

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Mr. Rajat Malhotra s/o Sh.Bharat Bhushan Malhotra 24/31, First Floor, West Patel Nagar New Delhi-110008

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Also at:

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Mr. Rajat Malhotra s/o Sh.Bharat Bhushan Malhotra 172, First Floor, Main Gagan Vihar Delhi-110051 Defendant

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Present: Ms. Seema Gupta, Counsel for the applicant bank

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Date of Reserve: 18.12.2025

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Date of Pronouncement: 29.12.2025

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FINAL ORDER

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This original application has been filed by the applicant bank on 10.02.2023 through Ms. Upasana Gaur, authorized representative of the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 against the defendant for recovery of a sum of Rs.23,82,508.22 (Rupees Twenty Three Lacs Eighty Two Thousand Five Hundred Eight and paisa Twenty Two only) as on 08.02.2023 along with

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O.A. No. 244 of 2023

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pendentelite and future interest @15.95% per annum with monthly rests along with penal interest @2% from the date of filing this application till the date of realization along with costs.

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The brief facts of the case are that on the request of the defendant as proprietor of M/s Sai Infotech vide loan application dated 16.07.2018 along with ITRs, PAN Card, Balance SAheet and CIBL etc., the applicant bank issued Credit Card having limit up to Rs.1,50,000/- inclusive of Cash limit of Rs.50,000/- under Visa Classic Card, which was renewed on 24.04.2022. The defendant submitted loan application dated 01.07.2020 along with KYC and GST provisional registration etc. with the applicant bank and applicant bank sanctioned Open Cash Credit limit/OD limit for Rs.20.00 Lacs on 14.07.2020 @8.30% interest per annum with monthly rests against hypothecation of stock in trade such as Computer peripherals and book debts & existing plant & machineries which was renewed on 16.07.2022 for three months. The Current account linked to Credit Card was closed on 17.07.2021.

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That in order to avail the loan facilities, the defendant submitted loan applications and executed Letter of Proprietorship, Pronote, Letter of Undertaking, Agreement cum Deed of Hypothecation, Cash Credit Agreement, Request for Overdraft Facilities, Specimen Signature Card in favour of the applicant bank on 14.07.2020.

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The defendant hypothecated the stocks in trade such as computer peripherals, book debts, plant & machineries lying at G-40, Vishwa Sadan, District Centre, Janak Puri, New Delhi on 14.07.2020.

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O.A. No. 244 of 2023

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It has been submitted by the applicant bank that after availing the loan facilities, the defendant failed to comply with the terms and conditions of sanction and failed to adhere to the financial discipline. Hence, on visit at the business premises of the defendant on 05.11.2022, it was found that some other unit in the name of Kaushik Infotech was running instead of the defendant. Further, the applicant bank issued notice dated 16.11.2022 to clear overdue amount but defendant neglected the same. Ultimately, the applicant bank classified both the accounts as NPA on 29.11.2022 and 09.12.2022 as per RBI guidelines and issued legal demand notice dated 03.12.2022, but the defendant failed to regularize the account. Hence the applicant bank has approached this Tribunal for recovery of their dues.

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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 30.10.2025, the defendant has 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 Mrs. Upasana Gaur, authorized representative of the applicant bank, who have proved the documents as Account Opening Form, Loan Applications, Credit Card application, Form NF 589, Sanction Letters, Letter of Proprietorship, Pronote, Letter of Undertaking, Agreement cum Deed of Hypothecation, Cash Credit Agreement, Request for Overdraft facility, Specimen Signature Card, Loan and Security Documents, Certificate under Section 65B of Indian Evidence Act, Letters, Visit reports, Notices, Legal Demand Notice,

O.A. No. 244 of 2023

Statement of Accounts, Calculation sheets marked as Ex.AW1/1 to Ex.AW-1/26.

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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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As per the provision of Section 19(20) of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 which is analogous to Section 34 of CPC, on filing of the suit/claim, the contract between the parties comes to an end and the Court/Tribunal has a discretion to award the same depending upon the circumstances of each case. Same principle has been laid down by the Hon'ble Apex Court in the case of Central Bank of India Vs. Ravindra & Others. Taking stock of all the circumstances and keeping in view that there is a drastic fall in rates of interest globally and domestically, I am of the opinion that interest of justice will be served if the interest at the rate of 12% p.a. is awarded.

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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.

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ORDER

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I, allow this OA and direct the defendant to pay to the applicant bank within a period of 30 days, a sum of sci

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O.A. No. 244 of 2023

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Rs.23,82,508.22 (Rupees Twenty Three Lacs Eighty Two Thousand Five Hundred Eight and paisa Twenty Two only) as on 08.02.2023 together with pendentelite and future interest @12% per annum from 08.02.2023 till the date of realization and costs; failing which the aforesaid amount shall be recovered from the sale of hypothecated stocks, plant and machinery etc. In case of shortfall, the same shall be recovered from the sale of movable and immovable properties of the defendant.

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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 27.02.2026.

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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: 29.12.2025

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Canara Bank v. Rajat Malhotra

Case brief

What is this about?

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Canara Bank v. Rajat Malhotra

Case brief

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