Allowed

State Bank of India v. Smt. Harbans Kaur through Her Legal Heirs

DRT3 Mar 2026OA/1016/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the debtor recovery application filed by State Bank of India against the legal heirs of a deceased borrower. The court found the loan account irregular and classified as NPA. The Tribunal declared the defendants liable to pay the outstanding principal along with a uniform simple interest rate.

What did the court decide?

Directing the defendants to pay Rs. 27,82,127.00 including costs and simple interest at 8% per annum from the date of filing till realization.

State Bank of India versus Smt. Harbans Kaur through Her… — Company and Corporate | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1016/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION:27.06.2016

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DATE OF DECISION: 03.03.2026

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State Bank of India, a body corporate, constituted under the State Bank of India Act, 1955, and having Central Office at Madam Cama Road, Nariman Point, Mumbai and one of its Local Head office at sector 17-A, Chandigarh and one its Branch at ADB Muktsar, District Muktsar through its Chief Manager Sh. Vishal Ahuja.

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……..Applicant

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Versus

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Smt. Harbans Kaur W/o Sh. Gurmail Singh since deceased survived by following Legal Heirs:

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(i) Sh. Pargat Singh, Son (ii) Ms. Manpreet Kaur, Daughter Both Residents of Village Lakhewali, Tehsil and District Sh. Muktsar Sahib.

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….……Defendants

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Advocates:

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Argued by Ms. Seerat, Advocate proxy for Sh. Pankaj Beri, Advocate for the applicant

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Defendants already ex-parte vide order dated 07.11.2023

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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 & Bankruptcy Act, 1993, against the defendants for recovery of Rs.27,82,127.00 (Rupees Twenty Seven Lacs Eighty Two Thousand One Hundred Twenty Seven Only). The Original Application has been filed through Sh. Vishal Ahuja, Chief Manager of the applicant, who is competent to institute the Original Application in terms of Gazette Notification published in the Gazette of India dated 26.09.1959, 26.08.1972 and 02.05.1987 issued under Regulation No. 76 & 77 of State Bank of India Regulations framed in exercise of the powers conferred by Sub section

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OA NO.1016/2022 STATE BANK OF INDIA VS. HARBANS KAUR THROUGH HER LEGAL HEIRS

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3 of Section 50 of the State Bank of India Act, 1955, with the previous sanction of the Central Government.

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The brief facts of the OA are that the defendant i.e. Smt. Harbans Kaur (since deceased) approached the applicant for grant KCC Limit of RS. 16.00 lacs and Term Loan of Rs.1.00 Lac for Debt Swap, vide Loan Applications dated 14.10.2015, which are Annexures A1 & A2 to this OA.

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The applicant sanctioned the KCC Limit of RS. 16.00 lacs and Term Loan of Rs.1.00 Lac for Debt Swap vide Letters of Arrangement dated 10.11.2015, which are Annexures A3 & A4 to this OA and terms and conditions were duly accepted by the defendant i.e. Smt. Harbans Kaur (since deceased). 4. Defendant i.e. Smt. Harbans Kaur (since deceased) mortgaged her immovable property i.e. Land Measuring 48Kanal-00Marla situated at Village Lakhewali, Tehsil and District Sri Muktsar Sahib, Punjab vide Declaration dated 10.11.2015 u/s 4(1) of Punjab Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act, 1978, which is Annexure A8 to this OA.

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Documents executed: Hypothecation Agreements, undertaking, all dated 10.11.2015, which are Annexures A5 to A7 to this OA; Notice dated 24.05.2022, which is Annexure A9 to this OA; Statement of Accounts, which are Annexures 10 & A11 to this OA.

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The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in the loan accounts there were a Rs.27,82,127.00 debit of which is recoverable and the defendants i.e. legal heirs of Late Smt. Harbans Kaur, 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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OA NO.1016/2022 STATE BANK OF INDIA VS. HARBANS KAUR THROUGH HER LEGAL HEIRS

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The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 07.11.2023.

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In support of the OA, affidavit of Sh. Vishal Ahuja, Chief Manager, State Bank of India, has been filed.

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Heard ex-parte arguments and perused record.

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It was argued by learned proxy counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant bank had proved its case. From the perusal of all the Annexures A1 to A11 to this OA, it is proved that Late Smt. Harbans Kaur approached applicant for availing of the loan facilities which were granted to her and for that she had executed all the relevant documents in favour of the bank. The defendants failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, accounts were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.27,82,127.00 (Rupees Twenty Seven Lacs Eighty Two Thousand One Hundred Twenty Seven 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 pendente lite and future rate of interest is concerned, the applicant in relief clause has claimed interest @10.60%p.a. with 2% penal interest and half yearly rests in KCC and interest @7.55%p.a. with 2% penal interest and half yearly rests in Term Loan from 01.06.2022 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/hypothecated assets, undertaking of the defendants, quantum of loans and prevalent

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OA NO.1016/2022 STATE BANK OF INDIA VS. HARBANS KAUR THROUGH HER LEGAL HEIRS

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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 @8.00%p.a. in both 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.27,82,127.00 (Rupees Twenty Seven Lacs Eighty Two Thousand One Hundred Twenty Seven Only), jointly and severally, with costs, current and future simple interest @8.00%p.a. in both 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 mortgaged properties/ hypothecated assets of defendants in execution proceedings if not sold earlier under

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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 20.03.2026.

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Copy of this order be given dasti to the applicant and be sent to 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: 03.03.2026.

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

State Bank of India v. Smt. Harbans Kaur through Her Legal Heirs

Case brief

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State Bank of India v. Smt. Harbans Kaur through Her Legal Heirs

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