Allowed

Punjab National Bank v. Al Muskan Traders

DRT23 Sept 2025OA/589/2023

Case brief

AI extract

What is this about?

The DRT allowed the applicant bank's original application ex-parte for recovery of loans amounting to Rs. 31,94,283.50 plus interest and costs. The court directed the ex-parte defendants to pay dues or face sale of securities and issued a Recovery Certificate.

What did the court decide?

Recovery of Rs. 31,94,283.50 plus interest at 11% p.a. from filing date; direction to pay within two months; entitlement to sale of mortgaged and personal assets; injunction against transfer of proper

Punjab National Bank versus Al Muskan Traders — Banking and Recovery | DRT (2025)

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DEBTS RECOVERY TRIB rAL LUCKNOW

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e Office action
taken with
proceeding
date
O.A. No.589/2023
23.09.2025 The Judgment is signed and
pronounced on separate sheets. Separately
attached in 07 sheets.
Order be uploaded on the Tribunal’s
website.
(Dictated
(Pravas Kumar Singh)
,q:==
Presiding Officer
(MK)

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IN THE DEBTS RECOVERY TRIBUNAL LT LUCKNOW

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Present: Pravas Kumar Singh, Presiding Officer

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Case No. Original Application No.589 of 2023

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Dated: 23.09.2025

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Punjab National Bank, having Branch at Circle SASTRA Meerut, PNB Bhawan, C-01, Vedvyas Puri, Delhi Bypass Road, Meerut, Uttar Pradesh. ........Applicant-bank Versus

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M/s Al Muskan Traders, situyated at Moti Colony, Near Slaughter House, Bulandshahar Road, Hapur, U.P. – 245101, Through its Proprietor Mr. Sitab.

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Mr. Sitab, S/o Mr. Abdul Rashid, R/o of 1271, KotalaMevatyan, Near Ek Minar Masjid, B, S. Road, Hapur. U.P., 245101.

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Smt. Shabnam, W/o Mr. Haji Sitab, R/o 1271, KotalaMevatyan, Near Ek Minar Masjid, B. S. Road, Hapur, U.P., 245101. ... ... Defendants

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Ld. Counsel for Applicant-bank: Shri M. H. Abidi, Advocate Ld. Counsel for the Defendants: None.

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JUDGEMENT

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This Original Application has been filed by the ,pplicant-bank under

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Section 19(1) of the Recovery of Debts & Bankruptcy ,ct, 1993, against the defendants for the recovery of Rs.31,94,283.50 (Rupees Thirty One Lacs, Ninety Four Thousand, Two Hundred Eighty Three and Paisa Fifty Only)

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together with pendent-lite and future interest, costs and other reliefs etc.

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-,“

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2 O.A. No.589 of 2023

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The brief facts of case are that the defendants No.1 is a proprietorship firm of which defendant no.2 is the proprietor and the defendant No.3 is the guarantor. The defendant no.2 on behalf of defendant no.1 approached the Applicant-bank for grant of Cash Credit Facility of Rs.5.00 lacs and Term Loan of Rs,21,16 lacs vide its sanction letter dated 30.05.2019 & 31.05.2019 on certain terms and conditions (Exhibit No. A-2) to this Original Application.

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To secure aforesaid credit facility, defendant No.2 on behalf of the defendant No.1 had executed and signed various security documents in favour of the Applicant-bank. The defendant No.3 signed and executed Guarantee Agreement (Exhibit No.A-3 to Exhibit No.A-7) to this Original Application.

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In order to further secure the repayment of the bank dues, the defendant No.2 created equitable mortgage in respect of property i.e. (1) Residential Land & Building situated at House No.11-8/1271/369, Mohalla Kotala Mevatyan, Pargana and Tehsil Hapur, District – Hapur, 245 101 measuring 121.70 square meters (2) Residential Land and Building at House No.1723, Mohalla Ambedkar Nagar, Avas Vikas Colony, (South Ex) Hapur, Pargana and Tehsil Hapur, District Hapur, 245 101 measuring 52.40 square meter in favour of the bank by deposit of title deed (Exhibit No. A-8 Exhibit No. A-9) to this Original Application.

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That the defendants have acknowledged their liability of outstanding dues on 27.09.2019 and 12.03.2021 through cash deposited on several dates

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in their aforesaid loan accounts from time to time

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3 O.A. No.589 of 2023

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To avail the aforesaid credit facility, the Applicant-bank had opened two loan accounts in the name of defendant No. 1 in order to maintain the credit facilities.

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After availing the aforesaid credit facility, the defendants failed to maintain financial discipline and also failed to comply with the terms and conditions of the loan agreement, consequently, the loan account of the EH defendant no.1/firm was classified as NPA on 30.09.2019 by the bank as per ilt! : RBI guidelines (Exhibit No. A-10), thereafter the Applicant-bank issued Demand Notice dated 03.10.2019 under Section 13(2) of the SARFAESI Act, 2002 to the defendants (Exhibit No. A-11). Finally, the applicant bank issued legal notice dated 05.01.2023 to the defendants (Exhibit No. A-12) but, the defendants stated no-response and they failed to repay the same and the loan 11f accounts of the defendants 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.31,94,283.50 (Rupees Thirty One Lacs, Ninety Four Thousand, Two Hundred Eighty Three and Paisa Fifty Only) including interest upto 31.03.2023, were lying due for payment, for which the defendants are jointly and severally liable to repay the same, which they did not pay despite repeated requests and demand. The Applicant-bank filed the Statement of loan Accounts. (Exhibit No.A-13 & Exhibit No.A-14) to this Original Application.

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The cause of action for filing the present application arose firstly on 30.05.2019 & 31.05.2019 when the aforesaid credit facility were sanctioned by the Applicant-bank and the same were availed by the defendants and

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rv.+F

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O.A. No.589 of 2023

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necessary documents were executed by the defendants. The cause of action further arose on when Legal Notice dated 05.01.2023 was sent to the defendants, recalling the entire outstanding dues and they failed to pay the same.

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The summons were served upon the defendants through registered post, the defendants through counsel have appeared before this Tribunal, but no written statement has been filed so far, hence opportunity to file the written statement is closed vide order dated 11.06.2025. The case is

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proceeded ex-parte against the defendants.

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From the perusal of the record, it is evident that the defendants were provided with fair opportunities to contest the claim of the bank. As the defendants opted not to contest the case, so only point of consideration before this Tribunal is as to whether 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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In support of the case Shri Vivek Kumar, Manager of the Applicantbank has filed an affidavit.

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On a careful scrutiny of the evidence on affidavit and Exhibits marked as Exhibit No.A-1 to Exhibit No.A-14, it is proved that 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 show that defendant had utilized the above loan facilities as granted to

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them. The Applicant-bank had maintained the Books of account in the

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O.A. No.589 of 2023

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ordinary course of banking business showing disbursal of the loan amount. The Bank had also charged interest from time to time and the entries are relevant u/s 4 of the Banker Books of Evidence Act. It is also proved that the Applicant-bank’s claim is within limitation against defendants, therefore, the defendants are jointly and severally 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 2 months from the date of judgement failing which the Applicant-bank will be entitled to sell the mortgaged property, hypothecated assets and personal assets/ properties of the defendants.

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The Applicant-bank has claimed [email protected]% in Cash Credit and Term Loan Accountper annum with monthly rest w.e.f. 01.04.2023 till the date of realization and costs. On the basis of foregoing discussion, interest of justice will be served if pendent- lite and future interest is granted per annum with monthly rest reducing balance from the date of filing of the

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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 as ex-parte against the defendants with costs. The bank has proved the loan execution of loan documents in favour of the bank and availment of credit facility. The liability of the defendant Nos.1 to 3 are joint and several and mortgaged property, hypothecated asset as well as the

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personal properties are to be sold.

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It is, therefore , ordered

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O.A. No.589 of 2023

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(i) That the Original Application No.589 of 2023 of the Applicant bank for issuance of Recovery Certificate to the tune of Rs.31,94,283.50 (Rupees Thirty One Lacs, Ninety Four Thousand, Two Hundred Eighty Three and Paisa Fifty Only) along with the interest @11% per annum with monthly rest from the date of filing of the Original Application i.e. 12.06.2023 till the loan is fully liquidated and costs succeeds exparte against the defendants.

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(ii) The defendants are directed to pay the dues within a period of two months from the date of judgement, 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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(iii) The Applicant–bank is entitled to recover aforesaid amount by sale of mortgage property & hypothecated assets (if not sold earlier under the provision of the S.A.R.F.A.E.S.I. Act 2002). The amount, if any already recovered by sale of any hypothecated assets or otherwise 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 assets of the defendant jointly and severally.

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(iV) 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.

O.A. No.589 of 2023

(V) 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 23.12.2025 before R.O., DRT, Lucknow.

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(vi) The Applicant-bank is directed to file a memo of cost for preparing Recovery Certificate u/s 19(22) of the Recovery of Debts Bankruptcy Act, 1993 .

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Judgment is pronounced in the open court.

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Dated: 23.09.2025

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(Pravas Kumaha: Presiding Officer

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(MK)

Punjab National Bank v. Al Muskan Traders

Case brief

What is this about?

What did the court decide?

Punjab National Bank v. Al Muskan Traders

Case brief

What is this about?

What did the court decide?

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