Allowed

State Bank of India v. Ms Vishal Rice Udyog

DRT3 Nov 2025OA/372/2022

Case brief

AI extract

What is this about?

The DRT allowed the applicant bank's recovery application against six borrowers who failed to repay sanctioned term loan and cash credit facilities. The court confirmed the claim based on bank books and security documents, directing payment of dues within two months and authorization to sell mortgaged assets if unpaid.

What did the court decide?

Dues of Rs. 3,11,10,330/- with 8% p.a. interest allowed. Defendants directed to pay within two months or face sale of secured and personal assets. Recovery Certificate to be issued.

State Bank of India versus Ms Vishal Rice Udyog — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL AT LUCKNOW

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Present: Pravas Kumar Singh, Presiding Officer

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Case No. Original Application No.372 of 2022

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Dated: 03 . 11.2025

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1.	State Bank of India, having BranchatMoti Mahal Marg,Hazratganj ,Lucknow. .. Versus M/s. Vishal RiceUdyog(Through itsPartner Ishrat Ali) 242, Village Naglia Aqil, Tehsil Sadar, DistrictRampur-244927.	. . .. ..ApplicantBank
2.	Haji Mohd. Yusuf, S/o Sri Abdullah,Partner M/s. Vishal RiceUdyog,242, VillageNaglia Aqil, TehsilSadar,DistrictRampur-244927.
3.	Sri Amjad Ali, S/o Haji Mohd. Yusuf, Partner, Partner M/s. Vishal RiceUdyog, 242, Village Naglia Aqil, Tehsil Sadar, District Rampur-244927.
4.	Sri Ishrat Ali, S/o Haji Mohd. Yusuf, Partner, Partner M/s. Vishal RiceUdyog, 242, Village Naglia Aqil, Tehsil Sadar, DistrictRampur-244927.
5.	Mohd. Zubair, S/o Mohd. Yusuf, Partner M/s. Vishal Rice Udyog,242,Village Naglia Aqil, TehsilSadar,DistrictRampur-244927.
6.	Smt.Shahida,W/o Asgar Ali,NagliaAqil, District Rampur, UP-244927. . .	.....Defendants

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Ld. Counsel for the applicant-bank: Mr. Anurag Srivastava, Advocate. Ld. Counsel for the defendants: Mr. Madhukar Dixit, Advocate

O.A. No.372 of 2022

JUDGMENT

This Original Application has been filed by the applicant Bank under Section 19 of the Recovery of Debts & Bankruptcy Act, 1993,against the defendants for the recovery of Rs.3,11,10,330/-(Rupees Three Crore, Eleven Lac, Ten Thousand, Three Hundred Thirty Only) together with pendent-lite and future interest, costs and other reliefs etc.

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The brief facts of case:- the defendantnos.Ito 6 are borrowers. The defendant no.1 through defendant nos.2 to 5vide loan application dated 16.6.2009 approached the applicant-bank for grant of Term Loan of Rs.30 lac and Cash Credit Facility of Rs.50 lac, the applicant-bark sanctioned Term Loan of Rs.25 lac and Cash Credit Facility of Rs.45 lac vide letter of Arrangement dated 21.7.2009 on certain terms and conditions (Exhibit No. A-3& Exhibit No.A-5) to this original application.

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In order to secure the aforesaid Credit facilities, the defendants had executed and signed Agreement for Loan Cum Hypothecation9 Promissory Note, Guarantee AWeement, D.P. Note, Consent Clause and Partnership Letter in favour of the applicant-bank on 21.7.2009 (As per this original application.

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Further9 in order tO secure the repayment of bank dues, the defendant no'2 had created mortgage of his immovable property i.e. (D Factory Land & Building situated in Village Naglia Aqil, District Rampur hay,in. Khata No.348, Plot No.99, Area 0.4530 + 0.6080 = 1.061 Hectare (10610 Square Meted & (ii) Residential Double Storey House having area 247.50 Sq. Mtr. situated at Village Nanglia Aqil, as detailed in the petition in favour of the bank (Exhibit No. A-6& Exhibit No. A_7) to this original application. r\

O. A. No.372 of 2022

Again at the request of defendant nos.1 to 6, the applicant-bank sanctioned various credit facilities, for which, the said defendants had nrrther executed and sigDed various security documents in favour of the applicant-bank on 06.01.2011, 28.3.2014 22.10.2014, 02.11.2017, 20.4.2019& 18.6.2020 and also extended creation of mortgage (Exhibit No. A-8 to Exhibit No.A-22, Exhibit No. A-24 to Exhibit No. A-26) to this original application.

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To avail the aforesaid credit facilities, the applicant-bank had opened various loan accounts in the name of defendant no.1/firm in order to maintain the credit facilities.

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After availing the aforesaid credit facilities, the defendants failed to maintain financial discipline and also failed to comply with the terms and conditions of the loan agreement, consequently, the loan accounts of the defendant no.1/firm were classified as NPA on 13.6.2019 by the applicantbank as per RBI guidelines (ExhibitNo. A-23), therefore, the applicant-bank issued Legal Notice dated 06.12.2021 (Exhibit No.A_27)9 but9 the defendants stated no-response and failed to repay the same and the loan accounts of the defendant no.1/firm are still un-liquidated, hence) this Original Application has been instituted.

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As per books of the bank maintained in the usual and ordinary course of banking business, an outstanding of Rs.39119109330/_ (Rupees Thee Crore, Eleven Lac, Ten Thousand9 Three Hundred Thirty Only) including interest UPto 23.12.2021 were lying due for payment) which they did not paY despite repeated requests and demands. The applicant Bank has filed the coPY of Statement of Account (Exhibit No. A-28) to this original application.

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O.A. No.372 of 2022

The cause of action for filing the present application arose firstly on 21.7.2009 when the abovementioned credit facility was sanctioned by the applicant-bank and necessary documents were executed by the defendants. The cause of action further arose on 06.12.2021 when the applicant-bank had issued legal notice recalling the defendants to repay the dues of the applicant-bank, but, the defendants failed to pay the same.

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The summons was served upon the defendants through registered post. The defendants appeared before this Tribunal throug1 their counsel to contest the case, but, failed to file any WS, hence, the matter proceeded against the defendants.

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From perusal of the record, it is evident that the defendants were provided fair opportunities to contest the claim of the bank. As the defendants appeared, but, any WS was not filed9 so only point of consideration before this Tribunal in as to whether the bank is legally entitled to the amount as claimed in Original Application on the basis of documents and pleading submitted by it.

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12' in support of the case Shri Anupam Saxena, Chief Manager of the applicant Bank has supported its case on affidavit.

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13 . On a careful scrutiny of the evidence on affidavit and Exhibit marked as (ExhibitNo. A-1 tO ExhibitNo. A-28 tO this original application)9it stands proved that the defendants had availed the credit facilities from the applicant bank by executing loan and security documents detailed as above in favour of the applicant Bank. A perusal of the application, evidence and documents relied upon clearly establishes that defendants had utilized the above loan facilities as granted to them. The applicant bank has maintained the Books of account in the ordinary course of banking business showing

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O.A. No.372 of 2022

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disbursal of the loan amount. It further shows that bank had regularly credited the amount paid by the defendants in the books of account. The Bank had also charged interest from time to time and the entries is relevant u/s 4 of the Bankers Book Evidence Act. It is also proved that the applicant bank’s claim is within limitation against the defendants, therefore, the defendants are liable to pay the dues.

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Accordingly, the defendants are directed to pay the balance dues to the applicant bank within a period of two months from the date of judgment failing which the applicant bank will be entitled to sell the mortgage property/hypothecated assets as well as personal properties of the defendants.

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The applicant-bank has claimed different rate of interest in the above loan accounts as mentioned in para 6.1 of the OA together with pendent lite and future interest till the actual date of its realization and costs. On the basis of the foregoing discussion, interest of justice will be served if pen(lent-lite and future interest is granted @8.00%per annum in all the above loan accounts with monthly rest on reducing balance from the date of filing of the O. A. till the date of realization with costs.

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1 find that the bank has proved the execution of loan documents and creation of mortgage in its favour. In the result, the Original Application succeeds against the defendants with costs. The defendants are jointly and severally liable to pay the dues of the applicant-bank and the mortgage property/hypothecated assets as well as the personal properties are liable to be sold

O.A. No.372 of 2022

17.It is, therefore, ordered:-

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(1) That the Original Application No.372 of 2022 of the applicant bank for issuance of Recovery Certificate to the tune of Rs.3,11,10,330/- (Rupees Three Crore, Eleven Lac, Ten Thousand, Three Hundred Thirty Only) together with the interest @8.00% per annum in the loan accounts together with pendentelite and future interest from the date of filing of the Original Application i.e. 28.12.2021 till the loan is fully liquidated and costs succeeds and is hereby allowed against the defendants.

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(ii) It is pertinent to mention here that this Tribunal vide order dated 19.5.2022 appointed Advocate Commissioner to prepare inventory of the movable goods and hypothecated assets lying over the mortgage properties as the defendants were siphoning money and alienating hypothecated assets. The Advocate Commissioners visited the premises and prepared inventory of plant, machinerY and other equipment and submitted their report before this Tribunal.

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(II1) The defendants are directed to pay the dues within a period of two months from the date of judgment, failing which the applicant bank will be entitled to recover the same from the secured assets, personal movables and immovable assets of the defendants.

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(iv) The applicant-bank is entitled to recover aforesaid amount by sale of mortgage property/hypothecated assets (if not sold earlier under the provisions of the S.A.R.F.A.E.S.I. Act 2002). The amount, if any, already recovered by sale of any mortgage

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O.A. No.372 of 2022

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property/hypothecated assets or otherwise shall be adjusted towards the debt and only the balance amount shall be recoverable. If the dues of the applicant-bank still remain unsatisfied, the same shall be recovered by attachment and sale of the personal movable and immovable assets of the defendants.

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(v) The defendants are hereby restrained by means of injunction from depleting, transferring, encumbering, alienating or in any way dealing with their properties/estates without first paying the claim of the applicant bank.

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(vi) Let Recovery Certificate be issued immediately u/s 19(22) of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 by fixing 22.12.2025 before R.O., DRT, Lucknow.

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Judgment is pronounced in the open court.

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Dated: 03 . 11.2025

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hPIi*

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(Pravas K .,dr Singh) Presiding Officer

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(Veeresh)

State Bank of India v. Ms Vishal Rice Udyog

Case brief

What is this about?

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State Bank of India v. Ms Vishal Rice Udyog

Case brief

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