Allowed

Bank of Baroda v. Messrs Taunk Industries and Another

DRT28 Aug 2025OA/577/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an application by Bank of Baroda for recovery of Rs. 49.90 Lakhs owed by M/s Taunk Industries. After striking off the defense due to lack of proper representation, the Tribunal upheld the liability and granted uniform simple interest at 8% p.a. instead of claimed rates.

What did the court decide?

Debt of Rs. 49,90,954.20p is declared recoverable; interest fixed at 8% p.a.; Recovery Certificate issued.

Bank of Baroda versus Messrs Taunk Industries and… — Contract and Commercial Disputes | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.577/2024

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 27.05.2024

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DATE OF DECISION: 28.08.2025

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Bank of Baroda, a Body Corporate, constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act of 1970, having its Registered Head Office at Baroda Bhawan, R.C. Dutt Road, Alkapuri Baroda - 390007, Gujarat, and its Branch Offices throughout India along with a Regional office Stressed Asset Recovery branch (ROSARB) at 3^rd Floor, SCO 62-63, Sector 17-B, Chandigarh represented through Sh. Hitesh Sehgal, Chief Manager being Principal Officer and duly constituted attorneys of the applicant.

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……..Applicant

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Versus

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M/s Taunk Industries through its proprietor Sh. Manpreet Singh Taunk S/o Sh. Dara Singh R/o C-56, Focal point Channalon, Kurali, Mohali PIN – 140103

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2^nd Address: R/o Village Behrampur Beat Post Office Bela District Roopnagar Punjab

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Sh. Manpreet Singh Taunk S/o Sh. Dara Singh Proprietor M/s Taunk Industries R/o Flat No. D-303, Gillco Towers, Sector 127, Kharar, District SAS Nagar Mohali.

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2^nd Address: R/o Rampura Bus Stop Khasra No. 13-11-4 unnamed Road Behrampur Beat Roopnagar Punjab.

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………. Defendants

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Advocates:

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Argued by Ms. Kanchan Sehgal, Advocate for the applicant None for Defendants

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FINAL ORDER

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Present Original Application was instituted by the applicant under

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Section 19 of the Recovery of Debts & Bankruptcy Act 1993, against the

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OA NO.577/2024 BANK OF BARODA VS. MESSRS TAUNK INDUSTRIES AND ANOTHER

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defendants for recovery of Rs.49,90,954.20p (Rupees Forty Nine Lacs Ninety Thousand Nine Hundred Fifty Four and Paise Twenty Only). The Original Application has been filed through Sh. Hitesh Sehgal, Chief Manager of the applicant, who is competent to institute the Original Application vide Resolution dated 15.11.2017, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant no. 2 through its proprietor defendant no. 1 had approached the applicant for grant of Term Loan of Rs.10.00 Lacs vide Loan Application dated 09.03.2021, which is Annexure A2 to this OA and further approached the applicant for grant of another Term Loan of Rs.50.00 Lacs vide Loan Application dated 18.10.2021, which is Annexure A11 to this OA.

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The applicant sanctioned Term Loan of Rs.10.00 Lacs, vide Sanction Letter dated 09.03.2021, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendants. Further, the applicant sanctioned another Term Loan of Rs.50.00 Lacs, vide Sanction Letter dated 22.10.2021, which is Annexure A12 to this OA.

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Defendant no. 1 through defendant no. 2 had hypothecated their movable properties i.e. Hypothecation of Plant and Machinery i.e. Fence Machine, Wire Fence Machine, CNC fibre cutting machine complete with foundation bolts and base plate and pipe frame structure and 1.5 KW duel pullet electric penal water chiller and other accessories, CNC Press Brake (4 axis Y1.Y2x and automatic single directional crowning) complete with foundation bolt and base plate, UPS, Automatic voltage regulator, Exide make battery (30 pcs) vide Composite Hypothecation Agreement dated 10.03.2021 and 22.10.2021, which are Annexure A6 and A15 to this OA.

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OA NO.577/2024 BANK OF BARODA VS. MESSRS TAUNK INDUSTRIES AND ANOTHER

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Documents executed :- D.P Note and Letter of Sole Proprietorship both dated 10.03.2021, which is Annexure A4 & A5 to this OA; Letter of Authority to make payment directly to dealer, Declaration-cumUndertaking-cum-Authority, General Undertaking and Letter of Installment, all dated 10.03.2021, which are Annexures A7 to A10 to this OA; Letter of Sole Proprietorship and D.P Note both dated 22.10.2021, which is Annexures A13 & A14 to this OA; Declarationcum-Undertaking-cum-Authority and Letter of Installment, both dated 22.10.2021, which is Annexures A16 & A17 to this OA; AOD for 10 Lacs and AOD for 50 Lacs both dated 10.03.02023, which are Annexures A18 & A19 to this OA; SARFAESI Notice under section 13(2) dated 05.01.2024, along with Postal Receipt, which is Annexures A20 & A21 to this OA; Statement of Accounts, which are Annexures A22 & A23 to this OA.

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The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.49,90,954.20p, 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.

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The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants. Ms. Nivedita Malik Sharma, Advocate appeared on behalf of defendants on 29.11.2024 and filed her Power of Attorney on behalf of defendants. However, no WS was filed by the defendants, therefore their opportunity to file the WS was closed and defense was struck off on 04.08.2025.

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In support of the OA, affidavit of Sh. Hitesh Sehgal, Chief Manager, Bank of Baroda h as been filed.

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Heard arguments and perused record.

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OA NO.577/2024 BANK OF BARODA VS. MESSRS TAUNK INDUSTRIES AND ANOTHER

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It was argued by learned counsel that the opportunity to file WS by defendants was closed and defense was struck off on 04.08.2025. It was further argued 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 loans facilities 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, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.49,90,954.20p (Rupees Forty Nine Lacs Ninety Thousand Nine Hundred Fifty Four and Paise Twenty Only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the accounts.

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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 @11.70% p.a.in Term Loan-I and @13.25% p.a. in Term Loan-II with monthly rests and penal interest @2%p.a. from 12.05.2024 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 hypothecated assets, undertaking of the defendants, quantum of loans 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 both the

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OA NO.577/2024 BANK OF BARODA VS. MESSRS TAUNK INDUSTRIES AND ANOTHER

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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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In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.49,90,954.20p (Rupees Forty Nine Lacs Ninety Thousand Nine Hundred Fifty Four and Paise Twenty Only) jointly and severally, with costs, current and future simple interest @08.00%p.a. in both the loan accounts 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 assets of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the 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.

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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 24.09.2025. 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: 28.08.2025

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

Bank of Baroda v. Messrs Taunk Industries and Another

Case brief

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Bank of Baroda v. Messrs Taunk Industries and Another

Case brief

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