Allowed

State Bank of India v. M/S Nishtha Trading Co. and Others

DRT21 Aug 2025OA/983/2024

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an application by State Bank of India against a sole proprietorship and guarantors for recovery of outstanding dues. The court reduced the claimed interest to a uniform 8% per annum before granting relief.

What did the court decide?

Recovery Certificate issued; Defendants liable to pay Rs. 25,86,967.01 plus costs and uniform simple interest at 8% p.a. till realization.

State Bank of India versus M/S Nishtha Trading Co. and… — Execution and Attachment | DRT (2025)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.983/2024

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 16.06.2024

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DATE OF DECISION: 21.08.2025

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State Bank of India is a body corporate, constituted under The State Bank of India Act, 1955, and having its Central Office at Madame Cama Road, Nariman Point, Mumbai, Maharashtra, and one of its Local Head office at Sector 17, Chandigarh, having its branch at Stressed Assets Recovery Branch (SARB), 3^rd Floor, Administrative Building, Fountain Chowk, Civil Lines, Ludhiana, Punjab, through its Chief Manager, Sh. Vinod Kumar Lakhanpal.

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……..Applicant Versus

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M/s Nishtha Trading Co., a Sole Proprietorship concern having its place of business at Golu Ke Morh, Guru Har Sahai Road, Near AA BKO, Golu Ke Morh, Guru Har Sahai, District Ferozepur, Punjab through its Sole Proprietor Sh. Pardeep Mehta

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Sh. Pardeep Mehta S/o Sh. Ramesh Chand Mehta, Sole Proprietorship M/s Nishtha Trading Co., R/o Mehta Street, Guru Har Sahai, District Ferozepur, Punjab-152022.

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Smt. Anju Bala W/o Sh. Pardeep Mehta, R/o Mehta Street, Guru Har Sahai, District Ferozepur, Punjab-152022. ………. Defendants

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Advocates:

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Argued by Sh. Yogesh Kumar, Advocate proxy for Sh. Rakesh Gupta, Advocate for the applicant Defendants already ex parte

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OA NO.983/2024

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STATE BANK OF INDIA VS M/S NISHTHA TRADING CO. AND OTHERS

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FINAL ORDER

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Present Original Application was instituted by the applicant under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993, against the defendants for recovery of Rs.25,86,967.01p (Rupees Twenty Five Lacs Eighty Six Thousand Nine Hundred Sixty Seven and One Paisa Only). The Original Application has been filed through Sh. Vinod Kumar Lakhanpal, Chief Manager, of the applicant, who is competent to institute the Original Application vide Gazette Notification dated 27.03.1987 and 17.05.2001, which is Annexure A1 to this OA.

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The brief facts of the OA are that the Defendant No.1 a proprietorship concern, through Defendant No. 2 sole proprietor had approached the applicant for grant of OD Limit of Rs.18.00 Lacs and thereafter, GECL loan of Rs. 3.00 Lacs. Defendants no. 3 stood as Guarantor. Thereafter, the defendants approached the applicant for renewal of OD Limit for Rs. 17,19,552.00, FITL Rs. 85,511.00, new FITL Rs. 2,86,050.00, WCTL-GCL of Rs. 2,75,690.00 and Rs. 95,314.00 and GECL EXT 1.0 of Rs. 2,20,000.00 (Total Facility amount of Rs. 26,82,117.00)

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The applicant sanctioned OD Limit of Rs.18.00 Lacs, vide arrangement letter dated 30.11.2017, which is Annexure A2 to this OA. Thereafter, the applicant sanctioned a loan of Rs. 3.00 Lacs under GECL vide letter of arrangement dated 01.07.2020, which is Annexure A5 to this OA. The OD limit was renewed by the applicant vide letter of arrangement dated 15.10.2020, which is Annexure A8 to this OA. Thereafter, the applicant renewed the OD Limit for Rs. 17,19,552.00, FITL Rs. 85,511.00, new FITL Rs. 2,86,050.00, WCTLGCL of Rs. 2,75,690.00 and Rs. 95,314.00 and GECL EXT 1.0 of Rs. 2,20,000.00 (Total Facility amount of Rs. 26,82,117.00) vide letter of arrangement dated 18.12.2021, which is Annexure A11 to this OA and the terms and conditions were duly accepted by the defendants.

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3 OA NO.983/2024

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STATE BANK OF INDIA VS M/S NISHTHA TRADING CO. AND OTHERS

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Defendant no. 2 and 3 had mortgaged immovable property detail as under: -

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i) land measuring 18.81 Marla, situated at opposite Bharat Petrol Pump, Village Sadiq, Hadbast 47, Tehsil Sadiq, District Faridkot, Punjab, in the name of defendant no. 2, vide equitable mortgage of sale deed bearing vasika no. 286 dated 11.07.2016, along with its translations, which is Annexure A14 to this OA.

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ii) land measuring 6 Kanal 4.5 Sarsai, situated at Village Mohan Ke Uttar, Tehsil Guru Har Sahai, District Ferozepur, Punjab, in the name of defendant no.3, vide equitable mortgage of sale deed bearing vasika no. 1452 dated 26.10.2017, along with its translations, which is Annexure A16 to this OA.

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Documents executed:- Agreement of loan cum Hypothecation and Guarantee Agreement, both dated 30.11.2017, which are Annexures A3 and A4 to this OA; Supplemental Agreement of Loan cum Hypothecation, Guarantee Agreement, both dated 01.07.2020, which are Annexures A6 and A7 to this OA; Supplemental Agreement of Loan cum Hypothecation, Guarantee Agreement, both dated 15.10.2020, which are Annexures A9 and A10 to this OA; Supplemental Agreement of Loan cum Hypothecation, Guarantee Agreement, both dated 18.12.2021, which are Annexures A12 and A13 to this OA; Letter of Confirmation for creation of mortgage by deposite of title deed dated 30.11.2017, which are Annexures A15 and A17 to this OA; CERSAI, which is Annexure A18 to this OA; Notice dated 19.07.2023 U/s 13(2) of SARFAESI Act, 2002, which is Annexure A19 to this OA; Possession notice dated 21.10.2023, which is Annexure A20 to this OA; Statement of Accounts, which are Annexures A21 to A25 to this OA, Valuation Report, dated 15.01.2024, which is Annexure A26 to this OA.

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4 OA NO.983/2024

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STATE BANK OF INDIA VS M/S NISHTHA TRADING CO. AND OTHERS

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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.25,86,967.01p, 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. Since no one appeared in the matter on behalf of defendants, they were proceeded ex-parte on 16.01.2025. Thereafter, arguments were heard on 12.08.2025 and case was posted for final order.

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Later, Sh. Balbir Kumar, Advocate filed an IA no. 1325/2025 vide diary no. 13029 dated 18.08.2025, on behalf of defendants for setting aside ex-parte order dated 16.01.2025. IA no. 1326/2025 was also filed along with the same which is an application for condonation of delay in filling the IA no. 1325/2025. Sh. Balbir Kumar, Advocate

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appeared on behalf of defendants today through Video

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Conferencing . Both the IAs were heard today and vide separate order of even date, both the IAs are dismissed today.

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In support of the OA, affidavit of Sh. Vinod Kumar Lakhanpal, Chief Manager, State Bank of India h as been filed.

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Heard arguments and perused record.

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It was argued by learned proxy counsel for applicant 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 A26 to this OA, it is proved that the defendants approached applicant for availing of the loan facilities which were granted to him 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

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5 OA NO.983/2024

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STATE BANK OF INDIA VS M/S NISHTHA TRADING CO. AND OTHERS

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NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.25,86,967.01p (Rupees Twenty Five Lacs Eighty Six Thousand Nine Hundred Sixty Seven and One Paisa 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 @11.45%p.a.in OD, @09.25% p.a. in GECL, @10.30%p.a. in FITL, @17.45%p.a. in WCTL, @09.25%p.a. in GECL (3.0) along with monthly rests and penal interest @2%p.a. from 01.06.2024 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 mortgaged property, undertaking of the defendants, quantum of loan 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 all the 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.25,86,967.01p (Rupees Twenty Five Lacs Eighty Six Thousand Nine Hundred Sixty Seven and One Paisa Only) jointly and severally, with costs, current and future simple interest @08.00%p.a. in all 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/mortgaged properties

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6 OA NO.983/2024

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STATE BANK OF INDIA VS M/S NISHTHA TRADING CO. AND OTHERS

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of the defendants in execution proceedings if not sold earlier under the provisions of the SARFAESI Act, 2002. If the dues of the applicant 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.

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Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 18.09.2025.

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Copy of this order be given dasti to the applicant and be sent to

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defendants through registered/speed post and this order be also uploaded on the official website of this Tribunal and record be consigned.

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Pronounced by me in the open Tribunal .

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Dated: 21.08.2025

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

State Bank of India v. M/S Nishtha Trading Co. and Others

Case brief

What is this about?

What did the court decide?

State Bank of India v. M/S Nishtha Trading Co. and Others

Case brief

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