Allowed

Bank of India v. M/S Sbs Garments

DRT4 Jul 2025OA/772/2023

Case brief

AI extract

What is this about?

The DRT, Delhi allowed the application filed by Bank of India for recovery of dues from M/s SBS Garments. The Bank obtained a commercial loan, an NPA was declared due to default, and recovery certificates were issued via ex-parte proceedings.

What did the court decide?

Directed defendant to pay Rs.23,17,233 plus pendent lite and future interest @12% p.a. with monthly rests and costs; liability to recover from hypothecated assets and other movable/immovable propertie

Bank of India versus M/S Sbs Garments — Banking and Recovery | DRT (2025)

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O.A. No. 772 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.772 of 2023

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Bank of India

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Gandhi Nagar Branch

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X/918, Chand Mohalla Gandhi Nagar, Delhi-110031

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Applicant

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Versus

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M/s SBS Garments Through its Proprietress Ms.Tanvi Singh Plot no.31, 'Ind floor Patparganj Industrial area Delhi-110092

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Also at: 241, Jagriti Enclave Vikas Marg Extension Delhi-110092

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Also at: H-38, Ist floor, Sector-63 Noida, Uttar Pradesh Defendant

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Present: Shri Shailesh Kumar, Counsel for the applicant bank

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Date of Institution: 14.09.2023 Date of Pronouncement: 04.07.2025

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FINAL ORDER

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This original application has been filed by the applicant bank on 14.09.2023 through Sh.Anuj Kumar Singh, authorized representative of the applicant bank under Section 19 of

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O.A. No. 772 of 2023

Recovery of Debts and Bankruptcy Act, 1993 against the defendants for recovery of a sum of Rs.23,17,233/- (Rupees Twenty Three Lacs Seventeen Thousand Two Hundred Thirty Three only) along with pendentelite and future interest @13.50% per annum along with penal interest @2% per annum with monthly rests from 29.06.2023 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 through its proprietress, the applicant bank sanctioned Cash Credit facility of Rs.20,00,000/- (Rupees Twenty Lacs only) for raw materials and Term Loan of Rs.5,00,000/- for purchase of machineries on 20.12.2012 @12.25% rate of interest per annum with monthly rests under MSME scheme against hypothecation of stocks, book debts etc. for garments business expansion. The defendant also agreed to pay penal interest @2% per annum in case of default in payment of interest.

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In order to avail the loan facilities, the defendant submitted loan applications and executed Hypothecation and Loan Agreement, Guarantee Deed, Demand Promissory Note on 14.01.2013 with the applicant bank.

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The defendant executed Acknowledgement of Debt and Securities thereby acknowledging the debt towards the applicant bank on 16.11.2017 and 07.10.2020.

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It has been submitted by the applicant bank that after availing the aforesaid loan facilities, the defendant failed to comply with the terms and conditions of sanction and failed to regularize the Cash Credit account with the applicant bank. Ultimately, the applicant bank classified the account as NPA on

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O.A. No. 772 of 2023

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31.03.2021 as per RBI guidelines and issued a legal recall notice dated 07.02.2022 but the defendant failed to regularize the account and 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 20.01.2025, the defendants have been proceeded ex-parte as they have 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 Shri Anuj Kumar Singh, authorized representative of the applicant bank who has proved the documents as Authorization Letter Ex.AW1/1(OSR), Application Form for Micro and Small Scale Enterprises Ex.AW-1/2(Colly), Sanction Letter Ex.AW-1/3„ Hypothecation and Loan Agreement Ex.AW-1/4, Guarantee Deed Ex.AW-1/5, Demand Promissory Note Ex.AW-1/6, Acknowledgment of Debt and Securities Ex.AW-1/7(Colly), Recall / Legal Notice Ex.AW-1/8, Statement of Account Ex.AW1/9, Certificate under Banker's Book of Evidence Act Ex.AW1/10, Certificate under Section-65B of Indian Evidence Act Ex.AW-1/11.

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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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O.A. No. 772 of 2023

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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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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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11.^{In the light of the above discussions, the Original} Application deserves to be allowed.

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ORDER

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allow this OA and direct the defendant to pay to the applicant bank, within a period of 30 days, a sum of Rs.23,17,233/- (Rupees Twenty Three Lacs Seventeen Thousand Two Hundred Thirty Three only) together with pendentelite and future interest @12% per annum with monthly rests from the date of filing this application till the date of realization and costs; failing which the aforesaid amount shall be recovered from the sale of hypothecated stocks, book debts and machinery etc. In case of shortfall, the same shall

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O.A. No. 772 of 2023

be recovered from the sale of movable and immovable properties of the defendants.

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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 03.09.2025.

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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 S14 ARMA) PRESIDING OFFICER DRT-I, DELHI

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(Dictated and pronounced in open court) Dated: 04.07.2025

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Bank of India v. M/S Sbs Garments

Case brief

What is this about?

What did the court decide?

Bank of India v. M/S Sbs Garments

Case brief

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What did the court decide?

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