Allowed

State Bank of India v. Sh. Nihal Singh and Another

DRT5 Jan 2026OA/1081/2023

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's application for recovery of Rs. 23,38,295 from borrowers who defaulted on a KCC loan. The tribunal granted 8% simple interest from the filing date and ordered issuance of a recovery certificate.

What did the court decide?

Recovery of Rs. 23,38,295 with 8% simple interest; issuance of Recovery Certificate; liberty to enforce through execution sale of properties.

State Bank of India versus Sh. Nihal Singh and Another — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1081/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION:17.06.2023

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DATE OF DECISION: 05.01.2026

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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-А, Chandigarh and one of its Branch Office at Bhawanigarh, Tehsil and District Sangrur through its Chief Manager Sh. Binod Kumar.

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……..Applicant Versus

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1. Sh. Nihal Singh son of Sh. Arjan Singh, resident of Village Kherhi Chandwa, Tehsil and District Sangrur, Punjab.

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Sh. Paramjit Singh son of Sh. Nihal Singh, resident of Village Kherhi Chandwa, Tehsil and District Sangrur, Punjab.

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…….Defendants

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Advocates:

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Argued by Ms. Rupinder Kaur, Advocate proxy for Sh. Rajnish K Jindal, Advocate for the applicant

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Defendants already ex-parte vide order dated 12.11.2024

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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.23,38,295.00 (Rupees Twenty Three Lacs Thirty Eight Thousand Two Hundred Ninety Five Only). The Original Application has been filed through Sh. Binod Kumar, Chief Manager, of applicant who is competent to institute the Original Application the 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 (3) of

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OA NO.1081/2023 STATE BANK OF INDIA VS.NIHAL SINGH AND ANOTHER

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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 no.1 had approached the applicant for the grant of KCC Limit of Rs.13.50 Lacs vide loan application dated 14.03.2014, which is Annexure A1 to this OA. Defendant no.2 stood as a guarantor. 3. The applicant sanctioned the KCC Limit of Rs.13.50 Lacs vide Letter of arrangement dated 25.03.2014, which is Annexure A2 to this OA and terms and conditions were duly accepted by the defendants. 4. Defendant no.1 had mortgaged his immovable properties i.e. land measuring 10Bigha-08Biswa situated at Village Khehri Chandwa, Tehsil and District Sangrur, Punjab vide Registered Mortgage deed bearing vaiska no. 3450 dated 24.03.2014, along with its translation, which is Annexure A6 to this OA. Documents executed : Hypothecation agreement, Letter of undertaking, deed of guarantee, all dated 25.03.2014, which are Annexures A3 to A5 to this OA; Notice dated 15.03.2023, which is Annexure A7 to this OA and Statement of account, which is Annexure A8 to this OA.

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The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in loan account there was a debit of Rs.23,38,295.00, 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 notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 12.11.2024. 7. In support of the OA, affidavit of Sh. Binod Kumar, Chief Manager, State Bank of India, has been filed.

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OA NO.1081/2023 STATE BANK OF INDIA VS.NIHAL SINGH AND ANOTHER

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Heard ex-parte 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 A8 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 the parties. Subsequently, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.23,38,295.00 (Rupees Twenty Three Lacs Thirty Eight Thousand Two Hundred Ninety Five 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 @10.95% p.a. along with 2% penal interest with half yearly rests from 06.05.2023 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/hypothecated assets, 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 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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OA NO.1081/2023 STATE BANK OF INDIA VS.NIHAL SINGH AND ANOTHER

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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.23,38,295.00 (Rupees Twenty Three Lacs Thirty Eight Thousand Two Hundred Ninety Five Only) jointly and severally, with costs, current and future simple interest @08.00%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 hypothecated/mortgaged properties 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. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 15.01.2026. 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.

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Pronounced by me in the open Tribunal . Dated: 05.01.2026.

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

State Bank of India v. Sh. Nihal Singh and Another

Case brief

What is this about?

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State Bank of India v. Sh. Nihal Singh and Another

Case brief

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