Allowed

State Bank of India v. M/s Jagdamba Traders

DRT30 Oct 2025OA/886/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an application filed by State Bank of India against M/s. Jagadamba Traders and the proprietor for recovery of a loan of Rs. 35,08,500.34. The defendants were not present. The court modified the future interest rate.

What did the court decide?

Payment of Rs. 35,08,500.34 along with future interest @ 11% per annum and entitlement to sell hypothecated assets to recover dues.

State Bank of India versus M/s Jagdamba Traders — Specific Performance | DRT (2025)

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Presented on: 05.11.2024 Registered on: 25.11.2024 Decided on: 30.10.2025 Duration: Y M D 00 11 25

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IN THE DEBTS RECOVERY TRIBUNAL AT AURANGABAD (Before Dr. J. R. Chauhan Presiding Officer) ORIGINAL APPLICATION No. 886/2024

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TOTAL CLAIM AMOUNT – Rs. 35,08,500.34/-

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State Bank of India, A body corporate constituted under the State Bank of India, Act, 1955 (23 of 1955) having it’s one of Local Head office at Synergy, Bandra-Kurla Complex, Bandra (E), Mumbai & Branches amongst the other places at SMECC, amongst the other places at Chh. Sambhajinagar & having its Stressed Assets Recovery Branch (SARB) at Plot No. 79, N-5, CIDCO Chh. Sambhajinagar431003, Through its Authorized person, Mr. Shivaji s/o Vitthalrao Daud (Dy. Manager & CCO), Age: 54 yrs., Occ.: Service, R/o. CIDCO, Chh. Sambhajinagar.

Versus

… Applicant

(OA No.886/2024)

Page 1 of 8

[AMBADAS]

1.M/s. Jagadamba Traders, Through its Proprietor, Mr. Rupchand Baburao Gawali Age: Major, Occ. Agri., R/o. At 381, Khadaka, Galan (Bk.), Tq. Pachora, Dist. Jalgaon 425001.

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2. Mr. Rupchand Baburao Gawali

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Age: Major, Occ. Agri., R/o. At Post Ambelohal, Tq. Gangapur, Dist. Chh. Sambhajinagar 431133.

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APPEARANCES

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…Defendant

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For the Applicant Mr. K. D. Pande Advocate For Defendant Ex-parte

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JUDGMENT Delivered on 30.10.2025

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The Applicant Bank has filed the present application for the recovery of a sum of Rs. 35,08,500.34/- (Rupees Thirty Five Lacs, Eight Thousand, Five Hundred and Thirty Four Paisa only), along with further interest from the date of filing of the Original Application, i.e., 05.11.2024, until the date of realization of the entire outstanding dues from the Defendants.

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Brief facts of the application are as under:

(OA No.886/2024)

Page 2 of 8

[AMBADAS]

Defendant No. 2, being the proprietor of Defendant No. 1, had approached the Applicant Bank requesting sanction of a Cash Credit Facility. After due consideration, the Bank sanctioned a Cash Credit Facility of ₹22,00,000/- vide Arrangement Letter dated 03.03.2023, subject to certain terms and conditions. The agreed rate of interest for the said facility was @12.40% per annum with monthly rests. Additionally, the Defendant agreed to pay further interest at the rate of 2% per annum by way of liquidated damages in the event of default in repayment.

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Thereafter, Defendant No. 2 again approached the Applicant Bank for renewal of the said Cash Credit Facility. Upon considering the request, the Bank renewed the facility to the extent of Rs. 26,00,000/- vide Arrangement Letter dated 08.02.2024. The rate of interest was revised to @12.65% per annum with monthly rests, and the Defendant continued to remain liable to pay additional interest at 2% per annum in case of default.

(OA No.886/2024)

Page 3 of 8

[AMBADAS]

In order to secure the aforesaid loan facilities, the Defendant executed various loan documents in favour of the Applicant Bank, including the arrangement letters, hypothecation agreement, , letters of undertaking & letter of confirmation dated 20.11.2012

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etc., in favor of the Applicant Bank.

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The Applicant Bank further contends that, in order to secure the aforesaid loan facilities sanctioned to him, the Defendant executed hypothecation agreement dated 08.02.2024 thereby hypothecating all kind of stock & book-debts, raw material, receivables and other current assets of the firm, plant & machinery purchased out of bank’s finance.

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The applicant bank contended that the defendants have failed to keep their promise and commitments agreed by them with regard to due repayment of the loan amount. The defendants failed to operate the loan account properly and failed to pay the agreed rate of interest as per terms and conditions of the sanction letter. Thereafter, the applicant bank repeatedly made demand of loan

(OA No.886/2024)

Page 4 of 8

[AMBADAS]

amount and called upon the defendants to pay with the agreed rate of interest thereon, but the defendants failed and neglected to pay the same. The loan account of the defendants became irregular and classified as NPA on 26.08.2024. Therefore on 19.10.2024 the applicant bank issued legal notice to the defendants through his advocate. Despite service of Notices, the defendants failed and neglected to repay the outstanding dues of the applicant Bank. Hence, this application is filed.

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The defendant failed to appear in matter though they were served through RPAD. Hence, the defendants were proceeded ex-parte as per Order dated 10.03.2025.

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The applicant Bank has filed Claim Affidavit of evidence at Exhibit-4 of Mr. Shivaji s/o Vitthalrao Daud, (City Case Officer & Dy. Manager) of the applicant Bank, and has produced on record the original loan transaction documents as Exh. A-1 to A-11 as per list of documents Exh. 5 which corroborates the case of the applicant Bank.

(OA No.886/2024)

Page 5 of 8

[AMBADAS]

I have heard arguments of the learned Advocate for the applicant Bank.

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Since the defendants failed to appear and contest the application, I find no reason to disbelieve the unrebutted evidence of the applicant Bank. Therefore, the applicant Bank is entitled for the reliefs as claimed.

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The applicant Bank has claimed charge over hypothecated property of the borrowers.

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The applicant Bank has claimed future interest @12.65% with monthly rests from the date of filing i.e. 05.11.2024 of this application till realization of the claim amount. However, considering the facts of the case, I am of the opinion that if future interest is granted @ 11% per annum (simple) on outstanding amount, it would be just and reasonable rate of interest.

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ORDER

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(A) Original Application No. 886/2024 is allowed with costs.

(OA No.886/2024)

Page 6 of 8

[AMBADAS]

(B) The defendants shall pay to the applicant Bank a sum of Rs. 35,08,500.34/- (Rupees Thirty Five Lacs, Eight Thousand, Five Hundred and Thirty Four Paisa only), along with future interest @ 11% per annum (simple), from the date of filing of the O.A. i.e. 05.11.2024 till full payment/realization of the amount mentioned in this operative order.

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(C) The aforesaid adjudicated amount is secured by the hypothecation of all kind of stock & book-debts, raw material, receivables and other current assets of the firm, plant & machinery purchased out of bank’s finance. Vide hypothecation agreement dated 03.03.2023 at Exh. A-4 and hypothecated agreement dated 08.02.2024 at Exh. A-7 in list of documents Exh. 5.

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(D)

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(D) The applicant Bank is entitled to sell the hypothecated stocks / plant & Machinery / articles/goods etc., to recover its dues.

(OA No.886/2024)

Page 7 of 8

[AMBADAS]

(E) Issue Recovery Certificate accordingly.

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(F) The Registrar is directed to send the copy of the Judgment and Recovery Certificate to the applicant and defendant.

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(G) File be consigned to the record room.

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Sd/-

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Pronounced in open court. (Dr. J. R. Chauhan) Place: Aurangabad Presiding Officer Date:.30.10.2025 Debts Recovery Tribunal, Aurangabad

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(OA No.886/2024)

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Page 8 of 8

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[AMBADAS]

State Bank of India v. M/s Jagdamba Traders

Case brief

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State Bank of India v. M/s Jagdamba Traders

Case brief

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