Allowed

State Bank of India v. M S Jewel Salon and Spa

DRT21 May 2025TA/1452/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an original application filed by State Bank of India against M/S Jewel Salon & Spa for recovery of Rs. 16.5 lakhs under the Recovery of Debts and Bankruptcy Act. The tribunal found the respondent in default of a term loan and directed recovery through hypothecated/schedule assets, permitting sale of personal assets if proceeds are insufficient.

What did the court decide?

Bank is allowed to recover Rs. 16,50,115 along with interest and costs. Liberty to recover via sale of hypothecated assets and, if insufficient, personal assets (movable and immovable).

State Bank of India versus M S Jewel Salon and Spa — Contract and Commercial Disputes | DRT (2025)

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T.A. No. 1452 of 2023

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21.05.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 21^st day of May, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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TRANSFERRED APPLICATION No. 1452 of 2023

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(Originally filed before DRT- II, Chennai as OA 857/2019 and thereafter transferred to this Tribunal and renumbered as TA No 1452 of 2023)

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State Bank of India, Stressed Assets Recovery Cell, No.157, 5^th Floor, Anna Salai, Chennai 600 002. Represented by its Manager ….Applicant

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-Vs-

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M/S Jewel Salon & Spa, Rep. by prop. L. Leo Infant, No.8, Plot No.60, IInd Street, Thangaraj Nagar Main Road, New Perungalathur, Chennai 600 063. …Defendant

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Counsels on record / appeared:

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Counsel for Applicant : M/s. M. Suresh

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Defendant was set ex-parte on 20.12.2021

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: - FINAL ORDER - :

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This original application is filed on 25.06.2019 by the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 (formerly Recovery of Debts Due to Banks and Financial Institutions Act, 1993) against the defendant for recovery of a total sum of Rs.16,50,115/- (Rupees Sixteen Lakhs Fifty Thousand One

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Hundred and Fifteen Only) due in respect of Term Loan (Account No.311600035977) repayable together with interest @ 12.50% p.a.

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T.A. No. 1452 of 2023

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21.05.2025

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with monthly rests from the date of filing the OA, till the date of realization in full, for sale of scheduled mentioned hypothecated property more fully detailed in Schedule to the OA, and for costs of this Application.

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Originally, this Application was filed before DRT-II, Chennai, assigned OA No.857 of 2019, and thereafter in pursuance to the notification from Ministry of Finance, DFS dated 04.10.2022, OA No.857 of 2019 stood transferred to this Tribunal and renumbered as TA No.1452 of 2023.

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Brief Facts of the case:

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The Applicant submits that the application is filed within the period of limitation as prescribed under Section 24 of the Recovery of Debts and Bankruptcy Act, 1993, and the subject recovery claim falls within the jurisdiction of this Hon’ble Tribunal.

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It is the case of the applicant bank that the defendant had availed a Term Loan facility of Rs.19.75 Lakhs on 17.10.2016 for improving the business, from Bharathiya Mahila Bank, Anna Salai, and Chennai. The defendant has executed a General Term Loan Agreement dated 17.10.2016 in favour of Bharathiya Mahila Bank.

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It is submitted by the applicant bank that the defendant had executed Hypothecation Agreement and Demand Promissory Note, both dated 17.10.2016 in favour of Bharathiya Mahila Bank. Subsequently

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T.A. No. 1452 of 2023

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21.05.2025

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Bharatiya Mahila Bank has merged with State Bank of India, SMEC, Anna Salai, Chennai 600 002 w.e.f. 1^st April 2017, as per directions of Reserve Bank of India.

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The applicant bank submitted that in evidence of availing the credit facilities and as security thereof, the defendant had executed the following loan documents in favour of applicant bank:

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(a) Sanction Letter dated 17.10.2016 acknowledged by the defendant.

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(b) General Term Loan Agreement dated 17.10.2016 executed by the defendant in favour of Bharathi Mahila Bank.

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It is submitted that subsequent to availing of loan, the defendant was irregular in repayment of installments from the date of sanction towards the loan account of defendant. The defendant failed to repay the balance of the liability in spite of repeated demands and several reminders made. Consequently, the loan account of the defendant has been classified as Non-Performing Assets on 11.02.2019 in terms of the directives of Reserve Bank of India.

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After the filing of the OA, Summons were sent to Defendant through Registered Post with Acknowledgement Due, which returned with remarks as “left”. Applicant bank had caused paper publication of the notice and filed proof thereof. When OA was taken up on 20.12.2021

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even after giving sufficient time, there was no appearance or representation from the defendants. Hence, Defendant was placed exparte on 20.12.2021.

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Heard the submissions of Applicant Bank and perused the records.

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To prove the case of the Applicant Bank, Mr. T. Anbarasu, Manager representing the Applicant Bank, has filed his Affidavit by way of evidence and same was considered as evidence of AW-1 and list of documents came to be marked as Ex A-1 to A-8 . As the Defendants remained ex-parte, the OA claim remains unchallenged. There is no contra evidence available on record to repudiate the claim of the Applicant Bank.

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With regard to the amount advanced, the interest applied, the conduct and operations in the account and the default committed, this Tribunal comes to the conclusion that the applicant bank is entitled for a final order on the following terms:

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: O R D E R :

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The OA is allowed with costs,

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(a) The applicant bank is allowed to recover from the Defendant

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a sum of Rs.16,50,115/- (Rupees Sixteen Lakhs Fifty Thousand One Hundred and Fifteen Only) due in respect of Term Loan (Account No.311600035977) repayable together with interest @ 12.50% p.a. with monthly rests from the date of filing the OA, till the date of realization in full, along with costs.

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T.A. No. 1452 of 2023

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21.05.2025

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(b) In the event of failure of the Defendant to pay the aforesaid amount, the bank is at liberty to recover the amount by sale of the schedule mentioned hypothecated assets.

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(d) If the sale proceeds of the hypothecated assets are not sufficient to satisfy the dues as ordered above, the applicant bank is at liberty to sell the personal assets of the Defendant (both movable and immovable) to recover the balance dues as required under law.

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(e) The applicant bank shall file the latest memo of calculation of OA amount together with interest, costs etc., to be paid by the Defendants duly considering the amounts, if any, paid by the Defendant and/or amount realized by sale of assets etc., during the intervening period after the filing of the OA, enabling the Registry to prepare Recovery Certificate for the amount to be paid by Defendant to the applicant bank.

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(f) The applicant bank shall file memo of costs within ten days from the date of this final order.

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(g) Recovery Certificate shall be drawn up and issued to the Recovery Officer in terms of the final order.

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A copy of this order be communicated to the parties concerned.

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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(Dictated to Steno (Surya), transcribed by him, corrected, signed and pronounced by me on this the 21^st day of May, 2025)

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ANNEXURES

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WITNESSES EXAMINED FOR THE APPLICANT BANK :

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AW-1: Mr . T. Anbarasu, Manager representing the Applicant Bank

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Exhibits on the part of the Applicant:

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Sl. No.	Description of Documents	Exhibit No.
1.	Reserve Bank of India Circular regarding merger with Bharatiya Mahila Bank Limited with State Bank of India dated 22.03.2017.	A-1
2.	Sanction Letter dated 17.10.2016.	A-2
3.	General Term Loan Agreement dated 17.10.2016.	A-3
4.	Hypothecation Agreement dated 17.10.2016.	A-4
5.	Demand Promissory Note dated 17.10.2016.	A-5
6.	Legal Notice and Returned cover dated 26.04.2019.	A-6
7.	Statement of Account dated 17.10.2016 to 23.04.2019 and Certificate of Banker’s Book Evidence Act 1891 dated 12.06.2019.	A-7
8.	Authorization Circular	A-8

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Witness Examined for the Defendants: -Nil-

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List of Documents Exhibited for the Defendants: -Nil –

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:- SCHEDULE OF PROPERTY-:

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All the tangible movable machinery and plant of the Borrower together with spares, tools and accessories and other movables, both present and future, whether lying loose or in cases which are not lying or

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T.A. No. 1452 of 2023

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stores in or about or shall be brought into or be stores or be in or upon or about the Borrowers’ premises and go downs or wherever else the same may be or be held by any party to the order or disposition of the Borrower relating to or pertaining to the Borrower at No.9, Chitoor Road, Tiruttani 631 209.

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Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

State Bank of India v. M S Jewel Salon and Spa

Case brief

What is this about?

What did the court decide?

State Bank of India v. M S Jewel Salon and Spa

Case brief

What is this about?

What did the court decide?

What the court decided

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