Allowed

Karnataka Bank Limited v. Shalendra Jain and Ors.

DRT7 Oct 2025TA/2728/2022

Case brief

AI extract

What is this about?

The DRT-I Delhi allowed the original application filed by Karnataka Bank Ltd. for recovery of dues from Shalendra Jain, Saroj Jain, and Srajan Jain, who defaulted on overdraft and term loan facilities. The court observed that the defendants' case was unrebutted and affirmed the debt amount, directing recovery from secured assets and properties with an adjusted interest rate of 12%. The defendants

What did the court decide?

Recovery of Rs. 1,81,32,177.65 with interest @12% p.a. from respondents; recovery from hypothecated assets and mortgaged property in case of default.

Karnataka Bank Limited versus Shalendra Jain and Ors. — Banking and Recovery | DRT (2025)

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T.A. No. 2728 of 2022

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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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T.A. No.2728 of 2022

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Karnataka Bank Ltd. Plot no.13, Near Sai Mandir Savitha Vihar Delhi-110092 Applicant

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Versus

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Mr. Shalendra Jain s/o Mr. Girish Chand Jain Proprietor M/s Copper House 1/342-1A, Gali no.1, First floor, Friends Colony Industrial Area Shandara, Delhi-110095

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Also at:

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Mr. Shalendra Jain s/o Mr. Girish Chand Jain House No.30, Gagan Vihar Extn. Krishna Nagar, Delhi-110051

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Mrs. Saroj Jain w/o Mr Girish Chand Jain H.No.30, Gagan Vihar Extn. Krishna Nagar, Delhi-110051

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Mr. Srajan Jain s/o Mr. Girish Chand Jain H No.30, Gagan Vihar Extn. Krishna Nagar, Delhi-110051 Defendant

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Present: Shri Gautam Singhal, Counsel for the applicant bank Date of Reserve: 26.09.2025

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Date of Pronouncement: 07.10.2025

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FINAL ORDER

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This original application has been filed by the applicant bank before DRT-II, Delhi on 12.05.2022 and then transferred

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T.A. No. 2728 of 2022

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to DRT-I Delhi through Shri Sailendra Kumar Saurabh, authorized representative of the applicant bank under Section 19 of Recovery of Debts and Bankruptcy Act, 1993 against the defendants for recovery of Rs.1,81,32,177.65 (Rupees One Crore Eighty One Lacs Thirty Two Thousand One Hundred Seventy Seven and paisa Sixty Five only) as on 02.05.2022 out of which Rs.1,52,25,147/- along with further interest @13.96% in OD a/c and Rs.28,55,704.16 along with further interest @14.30% in respect of Term Loan and Rs.51,362.49 along with further interest @15.40% in respect of Interest Deferment DPN A/c with monthly rests from 02.05.2022 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 no.1 as proprietor of M/s Copper House vide loan application dated 20.01.2016, the applicant bank sanctioned Overdraft facility of Rs.25,00,000/- (Rupees Twenty Five Lacs only) @11.50% interest per annum on 26.02.2016 for business of manufacturing and trading of wires and cables. The applicant bank renewed the limit on 07.06.2017 and enhanced to Rs.90,00,000/- on 30.08.2018 @9.95% interest p.a., and further to Rs.130.00 lacs on 09.01.2020 @10.12% interest p.a. On further request of defendants, the applicant bank sanctioned Working Capital Term Loan under GECL scheme for Rs.25,50,000/- @8.96% interest per annum with monthly rests and Interest Deferment DPN 2020 scheme for Rs.6,58,000/@10.17% interest with monthly rests on 10.07.2020. The defendant no.2 & 3 stood as guarantors for the credit facilities availed by defendant no.1 by the applicant bank. The credit facilities were sanctioned against hypothecation of stock of non-ferrous metal wires, cables, book debts and mortgage of property owned by defendant no.2.

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T.A. No. 2728 of 2022

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That in order to avail the credit facilities, the defendants submitted Loan Applications and executed Request Letters, Acceptance Letters, Account Opening Form for Proprietorship concern, Take Delivery Letters, Demand Promissory Notes, Hypothecation Agreements, General Power of Attorney for Book Debts, Declaration Letters, Consent Letters, Letters of Authority, Guarantee Letters, Term Loan Agreement, in favour of the applicant bank on various dates at the time of renewal / enhancement and sanction of new limits.

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That in order to secure the loan facilities availed by defendant no.1, the defendant no.2 created equitable mortgage of Freehold Residential/mixed use property bearing no.30A, measuring 100 sq. yards out of Khasra no.29/25, 3/10, 33/1, 33/2, 34/5, 34/6, 30/22 and 30/21, situated in the abadi of Gagan Vihar Extension, in the area of Village Khureji Khas Illaqa Shandara, Delhi-110051 in favour of the applicant bank on 25.04.2016 by executing Letter of Authority and Memorandum of Deposit of Title Deeds dated 17.09.2002 which was also mortgaged in the account of M/s Arihant Trading and Metal Industries for the credit facilities availed by proprietorship concern of defendant no.3.

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It has been submitted by the applicant bank that after availing the aforesaid loan facilities, the defendants failed to comply with the terms and conditions of sanction and failed to route their transactions through the account with the applicant bank. Ultimately, the applicant bank classified the account as NPA on 07.06.2021 as per RBI guidelines and issued legal demand notice dated 11.06.2021 but the defendants failed to regularize the account. Hence the applicant bank has approached this Tribunal for recovery of their dues.

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T.A. No. 2728 of 2022

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Notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 dated 18.10.2021 was issued by the applicants to the defendants for repayment of entire dues. The applicant bank took symbolic possession of the secured assets and published the possession notice in newspapers u/s 13(4) dated 29.12.2021.

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Notices of this O.A. were issued to the defendants and despite of proper service, the defendants have chosen to absent from the proceedings. As per order dated 16.05.2024, 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 Sh. Sailendra Kumar Saurabh, authorized representative of the applicant bank, who have proved the documents as Power of Attorney, Credit Sanction Intimation letter, Request letter, Acceptance letter, Account Opening form, Take delivery letter, Demand Promissory note, Hypothecation agreement, General Power of Attorney for book debts, Declaration letters, Consent letters, Memorandum of Deposit of Title deeds, Sale deeds, Guarantee letters, Credit Sanction Intimation, Key fact statement of Overdraft facilities, Acceptance cum Declaration letter, Certificate issued by M/s Ashok Pranshu & Co, Chartered Accounts, Demand notice Notice under section 13(2) and 13(4) of SARFAESI Act along with postal receipts, Statement of accounts, Certificate under section 2A of the Banker's Books of Evidence Act, Certificate

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T.A. No. 2728 of 2022

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under Section 65B OF Indian Evidence Act as Ex.AW-1/1 to Ex.AW-1/111.

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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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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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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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In the light of the above discussions, the Original Application deserves to be allowed.

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ORDER

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I, allow this OA and direct the defendants to pay to the applicant bank, jointly or severally, within a period of 30 days,

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T.A. No. 2728 of 2022

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a sum of Rs.1,81,32,177.65 (Rupees One Crore Eight One Lacs Thirty Two Thousand One Hundred Seventy Seven and Paisa Sixty Five only) as on 02.05.2022 along with further interest @12% per annum with monthly rests from 02.05.2022 till the date of realization and costs; failing which the aforesaid amount shall be recovered from the sale of hypothecated stocks and book debts and mortgaged property i.e. Freehold Residential/mixed use property bearing no.30A, measuring 100 sq. yards out of Khasra no.29/25, 3/10, 33/1, 33/2, 34/5, 34/6, 30/22 and 30/21, situated in the abadi of Gagan Vihar Extension, village Khureji Khas Illaqa Shandara, Delhi-110051. In case of shortfall, the same shall 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 04.12.2025.

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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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DA),i (GOVIND BALLABH SHARMA) PRESIDING OFFICER DRT-I, DELHI

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(Dictated and pronounced in open court) Dated: 07.10.2025