Allowed

Bank of India v. Ms K C Foods Trading Co.

DRT10 Sept 2025OA/754/2023

Case brief

AI extract

What is this about?

DRT allowed an ex-parte application by State Bank of India for recovery of dues totaling approximately Rs. 22.41 lakhs along with interest and costs from defaulting defendants, directing issuance of a recovery certificate and attaching movable and immovable assets.

What did the court decide?

Recovery certificate issued for Rs. 22,41,118.08 with 7% pendent lite and future interest; direction to pay within two months; attachment and sale of hypothecated and personal assets permitted.

Bank of India versus Ms K C Foods Trading Co. — Banking and Recovery | DRT (2025)

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IN TEn DEBTS RECOVERY TRIBUNAL AT LUCKNOW

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Present: Pravas Kumar Singh, Presiding Officer

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Case No. Original Application No.754 of 2023

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Dated: 10.9.2025

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State Bank of India, having Branch at Bulandshahr Road Industrial Area, Ghaziabad, UP-201009.

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. . . . . . ..Applicant Bank

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Versus 1. M/s. KC Foods Trading Co. Registered office at Shyam Park, Gali No.4, Ho. No.81, Main Shyam Park, Ghaziabad District Ghaziabad, UP-201001 . Office at House No.430-B, Opposite Shiv Mandir Sewa Nagar, Meerut Road Ghaziabad, UP-20100 1 . 2. Mr. Lokesh Kumar, S/o Jagjeevan Ram, R/o House No.38, Bhatta Road, Subhash Nagar, Ghookna Near Ekta Public School, Ghaziabad, UP-201001 . Also At: House No.825, Subhash Nagar, near Ekta Public School, Ghookna Mod, Ghaziabad, UP-201001 .

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Defendants

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Ld. Counsel for the applicant-bank: Mr. Supriy Mishra, Advocate Ld. Counsel for the defendants: None

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JUDGMENT

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This Original Application has been filed by the applicant Bank under Section 19 of the Recovery of Debts & Bankrupt( Act, 1993,againstthe defendants for the recovery of Rs.22,41,118.08/-(Rupees Twenty-Two Lac, Forty-One Thousand, One Hundred Eighteen and Paisa Eight Only)

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O.A. No.754 of 2023

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(Ib.17,39,150/- in Loan Account No.0086/-), (Rs.1,70,742.20/- in Loan Account No.0152), (Rs.38,371.88/- in Loan Account No.0013), (Rs.1977,975/- Loan Account No.0087) & (Rs.1,14,879/- Loan Account No.0004) together with pendent-lite and future interest, costs and other reliefs etc.

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The brief facts: The defendant no.1 is proprietorship firm, of which, the defendant no.2 is proprietor. The defendant nos.1& 2 vide loan application dated 18.5.2020 approached the applicant-bank for grant of housing loan of Rs.0.95 lac, for purchase of stocks of FMCG, which was duly considered and sanctioned by the applicant-bank on 20.5.2020 on certain terms and conditions (Exhibit No. A-2 & Exhibit No. A-3) to this original application.

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In order to secure the aforesaid credit facility, the defendant no.2 on behalf of the defendant no.1/firm had executed and signed various security documents in favour of the applicant-bank on 20.5.2020 like Demand Promissory Note, Authorization Letter, Multipurpose Documents, Declaration Letter, Hypothecation Cum Loan Agreement, Letter of Demand, Repo Based Lending Rate Agreement, Letter of Authority Declaration and Undertaking and Unconditional and irrevocable undertaking for Covid (ExhibitNo. A-4 to Exhibit No. A-12)to this original application.

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Again, at the request of defendants, the applicant-bank sanctioned STAR GECL Loan of Rs.1.9 lac, Cash Credit Loan of Rs.15 lac and Term Loan of Rs.1.5 lac, which were duly considered and sanctioned by the applicant-bank, for which, the said defendants had further executed and signed various security documents in favour of the applicant-bank on

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O.A. No.754 of 2023

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18.6.20209 28.10.2020, 20.7.2021 & 25.11.2021 (Exhibit No.A-13 to

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Exhibit No. A-35) to this original application.

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5 . The defendants had also executed and signed Acknowledgement of Debts dated 25.11.2021 confirming the balance in the loan account (Exhibit

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No. A-36) to this original application.

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To avail the aforesaid credit facility, the applicant-bank had opened five 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, all the loan accounts of the defendants were classified as NPA on 29.3.2022 by the bank as per RBI guidelines, therefore, the applicant-bank issued Legal Notices dated 04.01.2023 & 25.4.2023 through its Advocate (Exhibit No. A-37 & Exhibit No. A-38), but, the defendants stated no-response and they failed to repay the same and the loan 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.22,41,118.08/-(Rupees TwentyTwo Lac, Forty-One Thousand, One Hundred Eighteen and Paisa Eight Only) (Rs.17,39,150/- in Loan Account No.0086/-), (Rs.1,70,742.20/- in Loan Account No.0152), (Rs.38,371.88/- in Loan Account No.0013), (Rs.1,77,975/- Loan Account No.0087) & (Rs.1,14,879/- Loan Account No.0004) including interest upto 30.3.2022 were lying due for payment, which they did not pay despite repeated requests and demands. The

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O.A. No.754 of 2023

applicant Bank has filed the copy of Statement of Account (ExhibitNo. A- 39) to this original application.

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The cause of action for filing the present application arose firstly on 20.5.2020 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 25.4.2023 when the applicant-bank had issued legal notice through its counsel 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 paper publication, but, the defendants did not appear before this Tribunal to contest the case and the matter was heard ex-parte against them.

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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 opted not to contest the case, 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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In support of the case Shri Ram Naresh Niranjan, Chief Manager of the applicant Bank has supported its case on affidavit.

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On a careful scrutiny of the evidence on affidavit and EMlibit marked as (Exhibit No. A-1 to Exhibit No. A-39 to this original application), it 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 applicationp evidence and documents relied upon clearly establishes that defendants had utilized the above loan facilities as granted to them. The applicant bank has maintained

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O.A. No.754 of 2023

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the Books of accounts in the ordinary course of banking business showing 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 III I 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 hypothecated assets/mortgage property and personal properties of the defendants.

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The applicant-bank has claimed interest @7.25% in Term Loan Account, interest @7.85% in STAR GECL Loan Account, interest @9.35% in Cash Credit Loan Account & interest @7.50% in another Term Loan Account 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 pendent-lite and future interest is granted @7.00% in all the above Loan Accounts per arulum 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 in its favour. In the result, the Original Application succeeds u-parte against the defendants with costs. The defendants are jointly and severally liable to pay the dues of the applicant-bank and the hypothecated assets are liable to be sold

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O.A. No.754 of 2023

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17.It is, therefore, ordered: -

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(i) That the Original Application No.754 of 2023 of the applicant IffIFII

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bank for issuance of Recovery Certificate to the tune of Rs.22,41 , 1 18.08/-(Rupees Twenty-Two Lac, Forty-One Thousand, One Hundred Eighteen and Paisa Eight Only) (Rs.17,39,150/- in Loan Account No.0086/-), (Rs.1,70,742.20/in Loan Account No.0152), (Rs.38,371.88/- in Loan Account No.0013), (Rs.1,77,975/- Loan Account No.0087) & (Rs.1,14,879/- Loan Account No.0004) together with the interest @7.00% from pendent-lite and future interest in the loan accounts from the date of filing of the Original Application i.e. 15.7.2023 till the loan is fully liquidated and costs succeeds and IH I

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is hereby allowed ex-parte 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 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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(iii) The applicant-bank is entitled to recover aforesaid amount by sale of hypothecated assets (in accordance with law). The amount, if any, already recovered by sale of hypothecated assets or otherwise shall be adjusted towards the debt and only the balance amount shall be recoverable. If the dues of the applicantbank 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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O.A. No.754 of 2023

(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.

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(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 10.12.2025 before R.O., DRT, Lucknow.

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Judgment is pronounced in the open court.

Dated: 10.9.2025

\N-

R*O

(Pratas Kumar Singh) 'residing Officer

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(Veeresh)

Bank of India v. Ms K C Foods Trading Co.

Case brief

What is this about?

What did the court decide?

Bank of India v. Ms K C Foods Trading Co.

Case brief

What is this about?

What did the court decide?

What the court decided

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