Allowed

State Bank of India v. M/S Virasat E Punjab and Anr.

DRT10 Apr 2026OA/1075/2023

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an application for recovery of a distressed loan. The court confirmed the defendants' liability to pay the principal amount plus costs, reduced the claimed interest rate to 8% p.a., and directed the issuance of a recovery certificate.

What did the court decide?

Recovery certificate issued; defendants liable to pay Rs. 72,38,727.00 with costs and simple interest @8.00% p.a.

State Bank of India versus M/S Virasat E Punjab and Anr. — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1075/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 18.08.2023

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DATE OF DECISION: 10.04.2026

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State Bank of lndia, a body corporate, constituted under the State Bank of lndia Act, 1955 and having Central Office at Madam cama Road, Nariman Point, Mumbai and one of its Local Head offices, at sector 17A, Chandigarh and one of its Specialized Branches, known as Stressed Assets Recovery Branch (SARB) at SCO 15, 1^st Floor, Madhya Marg, Sector 7-C, Chandigarh, through its Chief Manager, Sh. Sanjeev Parkash Verma.

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……..Applicant

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Versus

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M/s Virasat E Punjab, a Sole Proprietorship concern, situated at Mohalla Kurali Wala, VIP Road, Behind Dawat Palace, Anandpur Sahib, District Rupnagar, through its Proprietor Sh. Hartegbir Singh S/o Sh. Amritpal Singh Gyani.

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Sh. Hartegbir Singh S/o Sh. Amritpal Singh Gyani R/o Mohalla Kurali Wala, VIP Road, Behind Dawat Palace, Anandpur Sahib, District Rupnagar.

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….……Defendants

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Advocates:

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Argued by Sh. Rishab Gupta, Advocate proxy for Sh. Gaurav Singla, Advocate for the applicant

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None for Defendants (already ex-parte vide order dated 01.04.2026).

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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.72,38,727.00 (Rupees Seventy Two Lacs Thirty Eight Thousand Seven Hundred Twenty Seven Only). The Original

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OA NO.1075/2023 STATE BANK OF INDIA VS M/S VIRASAT E PUNJAB AND ANOTHER Application has been filed through Sh. Sanjeev Parkash, Chief Manager of the applicant, who is competent to institute the Original Application vide terms of Gazette Notification published in the Gazette of lndia dated 26.09.1959 & 26.08.1972 and dated 02.05.1987 issued under Regulation No. 76 & 77 of State Bank of lndia Regulations framed in Exercise of the powers conferred by Sub section (3) of Section 50 of the State Bank of lndia Act, 1955, with the previous sanction of the Central Government.

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The brief facts of the OA are that the Defendant no. 1, through its proprietor defendant no. 2, approached the applicant for grant of Term Loan of Rs. 60.00 Lacs vide Loan Application dated 22.07.2020, which is Annexure A1 to this OA. 3. The applicant sanctioned the Term Loan of Rs.60.00 Lacs vide Letter of Arrangement dated 28.09.2020, which is Annexure A2 to this OA and terms and conditions were duly accepted by the defendants. 4. Defendant no. 2 mortgaged his commercial land measuring 1K-3M6S situate at behind Dawat Palace, Mohalla Kurali wala, VIP Road, Anandpur Sahib, District Rupnagar, vide Letter of Confirmation for Creation of Mortgaged by Deposit of Title Deeds dated 30.09.2020, which is Annexure A9 to this OA; Registered Sale Deed No. 233 dated 26.05.2009 registered with Office of Sub Registrar Anandpur Sahib, which is Annexure A4 to this OA; Registered Gift Deed No. 252 dated 08.10.2018, which is Annexure A5 to this OA; Registered Sale deed No. 63 dated 19.04.1990, which is Annexure A6 to this OA; Registered Gift Deed No.175 dated 15.05.2009, which is Annexure A7 to this OA; Registered Gift Deed No.416, dated 22.07.2019, which is Annexure A8 to this OA. Documents executed: - Agreement of Loan Cum Hypothecation dated 28.09.2020, which is Annexure A3 to this OA; Memorandum for recording creation of mortgage by deposit of title deeds dated

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OA NO.1075/2023 STATE BANK OF INDIA VS M/S VIRASAT E PUNJAB AND ANOTHER

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28.09.2020, which is Annexure A10 to this OA; Valuation Report dated 17.09.2022, which is Annexure A11 to this OA; Legal Notice dated 25.07.2022 with Postal Receipts, which is Annexure A12 to this OA; Statement of Account with certificate, which is Annexure A13 to this OA. 5. The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in the loan account, there was a debit of Rs.72,38,727.00 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. 6. The defendants were served summons to appear before this Tribunal and after service upon defendants, Sh. Hartegbir Singh, Defendant no. 2, appeared on behalf of defendants on 04.06.2024 and sought time to engage Advocate. Sh. Harsh Chopra, Advocate, filed his Power of Attorney on behalf of defendants on 25.11.2024 and Paper book was supplied to him. WS was filed on 01.08.2025. No one appeared on behalf of defendants after 05.01.2026. Hence, opportunity to participate in admission or denial of documents stood closed and they were proceeded ex-parte vide order dated 01.04.2026. 7. In support of the OA, affidavit of Sh. Sanjeev Parkash, Chief Manager, State Bank of India, has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned proxy that in view of the documentary evidence brought on record, the applicant bank had proved its case. From the perusal of all the Annexures A1 to A13 to this OA, it is proved that the defendants approached applicant for availing of the loan facility which was granted to them and for that they 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

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OA NO.1075/2023 STATE BANK OF INDIA VS M/S VIRASAT E PUNJAB AND ANOTHER the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.72,38,727.00 (Rupees Seventy Two Lacs Thirty Eight Thousand Seven 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 account.

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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 @12.40% p.a. plus 2% penal interest with monthly rests from 19.07.2023 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 simple interest @8.00% p.a. in the loan account 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.72,38,727.00 (Rupees Seventy Two Lacs Thirty Eight Thousand Seven Hundred Twenty Seven Only), jointly and severally, with costs, current and future simple interest @8.00% p.a. in the loan account 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 property of 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

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OA NO.1075/2023 STATE BANK OF INDIA VS M/S VIRASAT E PUNJAB AND ANOTHER

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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. 12. Any other application pending stands disposed of . 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 30.04.2026 15. 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. Pronounced by me in the open Tribunal . Dated: 10.04.2026

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

State Bank of India v. M/S Virasat E Punjab and Anr.

Case brief

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State Bank of India v. M/S Virasat E Punjab and Anr.

Case brief

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