Allowed

Central Bank of India v. Sh. Sukhpal Singh and Another

DRT21 May 2026OA/1088/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an application filed by Central Bank of India for recovery of dues. The court found the loan documents valid and adjusted the interest rate, ordering the defendants to repay the principal amount with interest.

What did the court decide?

Recovery Certificate issued. Defendants liable to pay Rs.27,66,248.25 with current and future simple interest @8.00% p.a. enforcement via sale of mortgaged property allowed.

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

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 1088/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 29.08.2023

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DATE OF DECISION: 21.05.2026

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Central Bank of India, a Body Corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at Chander Mukhi Building, Nariman Point, Mumbai- 400021 and having one of its Branch situated at Central Bank of India, Adjoining SBI Bank, Near New Courts, Patiala Road, Sunam, District Sangur, Punjab through Mrs. Urvashi Sharma who is presently working as Senior Manager, Central Bank of India, Regional Office, K.P. Complex, Adj. Hotel Park Plaza, Ferozepur Road, Ludhiana, Punjab constituted Power of Attorney Holder of the Bank and Principal Officer.

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……..Applicant

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Versus

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Sh. Sukhpal Singh S/o Sh. Nazar Singh, R/o VPO Ghasiwala, Sunam, District Sangrur, Punjab

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Sh. Gurpreet Singh S/o Sh. Jeet Singh, R/o H. No. 356, Amru Kotra Road Chaubas, Tehsil Sunam, District Sangrur, Punjab

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……Defendants

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Advocates:

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Argued by Ms. Ritika Kansal, Advocate proxy for Sh. Surinder Nath Sharma, Advocate for applicant (through VC)

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Sh. Raman Mohinder Sharma, Advocate for Defendant no. 1

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(through VC)

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None for defendant No. 2 (already ex-parte vide order dated 29.12.2025)

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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.27,66,248.25 (Rupees Twenty Seven Lacs Sixty Six Thousand Two Hundred Forty Eight and

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2 OA/1088/2023 CENTRAL BANK OF INDIA VS. SUKHPAL SINGH AND ANOTHER

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Paise Twenty Five Only). The Original Application has been filed through Mrs. Urvashi Sharma, Senior M anager of the applicant, who is competent to institute the Original Application vide Power of attorney dated 24.03.2014, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant no. 1 approached the applicant for grant of KCC Limit of Rs.1.80 Lacs and Agriculture Term Loan of Rs.33.33 Lacs vide Loan Application dated 03.10.2015, which is Annexure A2 to this OA. Defendant no. 2 stood as guarantor.

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Thereafter, the defendant no. 1 approached the applicant for renewal of KCC Limit of Rs.1.80 Lacs. Loan Renewal Application dated 21.11.2017, which is Annexure A12 to this OA and Loan Renewal Application dated 24.04.2021, which is Annexure A24 to this OA. 3. The applicant sanctioned KCC Limit of Rs.1.80 Lacs and Agriculture Term Loan of Rs.33.33 Lacs vide Sanction Letter dated 30.10.2015, which is Annexures A3 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the KCC Limit was renewed by the applicant on 21.11.2017. The applicant also sanctioned a Loan of Rs.1 Lac to defendant no. 1 in 2018. However, as per the OA, this accounts stands closed on 21.06.2019. 4. Defendant no. 1 mortgaged his immovable property i.e. Land Measuring 32Kanal-5Marla situated at Village Ghasiwala, Tehsil Sunam, District Sangrur, Punjab vide declaration dated 30.10.2015 u/s 4(1) of Punjab Agricultural Credit Operation and Miscellaneous Provisions (Banks) Act, which is Annexure A5 to this OA; Letter dated 30.10.2015 to Sub Registrar for creation of charge, along with its translation, which are Annexures A6 and A6T to this OA; Advocate Report on Title dated 08.10.2015, which is Annexure A4 to this OA. Documents executed: Loan cum Hypothecation Agreement, Term Loan Agreement, Form of Guarantee for advances and credits generally, Letter declaring acceptance of consent clause by the

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3 OA/1088/2023

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CENTRAL BANK OF INDIA VS. SUKHPAL SINGH AND ANOTHER

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Guarantor, Letter of continuity, all dated 03.11.2015, which are Annexures A7 to A11 to this OA; Loan cum Hypothecation Agreement, Supplementary Agreement, Letter declaring acceptance of consent clause by the Borrower, D.P. Note, Letter of Waiver, all dated 01.10.2018, which are Annexure A13 to A17 to this OA; Loan cum Hypothecation Agreement, Letter declaring acceptance of consent clause by the Borrower, Letter of continuity, D.P. Note, Letter of Waiver, Supplementary Agreement, all dated 27.01.2020, which are Annexure A18 to A23 to this OA; Recall Notice dated 09.06.2023, which is Annexure A25 to this OA; Statement of accounts, which are Annexures A26 and A27 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 both the loan accounts, there was a debit of Rs.27,66,248.25, which is recoverable and the defendants were served recall notice 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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The defendants were served summons to appear before this Tribunal after service upon the defendant, Sh. Raman Mohinder Sharma, Advocate appeared on behalf of defendant no. 1 on 02.03.2024 and filed his Power of Attorney. WS was filed by defendant no. 1 on 16.04.2024. However, the defendant no. 1 did not participate in process of admission or denial of documents, therefore, his opportunity to participate in admission or denial of documents was closed vide order dated 29.12.2025.

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No one appeared on behalf of defendant no. 2 and he was proceeded ex-parte vide order dated 29.12.2025.

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7. The brief facts of WS of defendant no.1 are that the present application of applicant is not maintainable in its present form as per section 19 of RDB Act. It is further stated that there is no cause of action whatsoever that arises out of the alleged documents. It is further stated that the applicant has been charging excessive interest and expenditure. It is further stated that the application of applicant is

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4 OA/1088/2023 CENTRAL BANK OF INDIA VS. SUKHPAL SINGH AND ANOTHER

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not maintainable as the same has been filed through a duly competent and authorized person as documents relate to the time when the official concerned was not holding the designation as on the date of filing of the application and was not been posted at the place, as such he was not aware of the facts of the case. It is further stated that the claim of the bank is based on false, fabricated and manufactured documents. It is further stated that the statement of account is incorrect and rate of interest charged is contrary to guidelines of the bank and further alleged documents itself. It is further stated that the statement of account filed by applicant claiming alleged amount are not true and correct. It is further stated the application of is based on vague and incorrect averments.

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In support of the OA, affidavit Mrs. Urvashi Sharma, Senior Manager, Central Bank of India, has been filed.

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Heard arguments and perused record.

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It was argued by learned proxy counsel for applicant through video conferencing that in view of the documentary evidence brought on record, the applicant had proved its case.

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It was argued by learned counsel for defendant no. 1 through video conferencing that he has filed WS and OA may be disposed on merits considering the contentions made in the WS. He did not advance any other argument.

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No one appeared on behalf of defendant no. 2 for arguments.

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From the perusal of all the Annexures A1 to A27 to this OA, it is proved that the defendant no. 1 approached applicant for availing of the loan facilities, which were granted to him for which defendant no. 2 stood as guarantor. The defendants had executed all the relevant documents in favour of the applicant. The defendants failed to pay back the loans as per terms and conditions of the agreement between the parties. Subsequently, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.27,66,248.25 (Rupees Twenty Seven Lacs Sixty Six Thousand Two Hundred Forty

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5 OA/1088/2023 CENTRAL BANK OF INDIA VS. SUKHPAL SINGH AND ANOTHER

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Eight and Paise Twenty 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 amount.

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The defendant nos. 1 in his written statement had stated that that the claim of the applicant is based on false, fabricated and manufactured documents. However, in this regard, he did not lodge any complaint before any Higher Forum of the Bank or Court of Law. Therefore, it is inferred that cock and bull story was prepared by the defendant no. 1 before this Tribunal.

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Further, it is stated by defendant no. 1 that no cause of action arises out of alleged documents. In this regard, it is pertinent to mention that as per documentary evidence filed by applicant, KCC Limit of Rs.1.80 Lacs and Agriculture Term Loan of Rs.33.33 Lacs was sanctioned by the applicant on 30.10.2015 and loan and security documents were executed by the defendants. The loan accounts became irregular and were classified as NPA and the defendants did not repay the outstanding amount despite service of notice of recall by the applicant. The application filed by applicant is not barred by limitation. Therefore, submission of defendant no. 1 that no cause of action arises out of documents is totally incorrect.

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Also, Mrs. Urvashi Sharma, Senior Manager of applicant is duly competent to file this application as per her Power of Attorney dated 24.03.2014 (Annexure A1) issued by the competent authority of the applicant.

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At the time of arguments or before it, Learned counsel for Defendant No. 1 has not produced any evidence which could create any doubt on the claim of the applicant. Contents of WS are vague and contradictory. Therefore, there is no reason to disbelieve the documentary evidence produced by the applicant from Annexures A1 to A27.

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The defendant no. 1 in his WS has stated that the applicant has been charging excessive interest. As per the judgement of Apex Court ( Central Bank of India v/s Ravindra AIR 2001 SC 3095) , award

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6 OA/1088/2023 CENTRAL BANK OF INDIA VS. SUKHPAL SINGH AND ANOTHER

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of interest pendente lite and post-decree is discretionary with the Court as it is essentially governed by Section 34 of the CPC de hors the contract between the parties. In a given case if the Court finds that in the principal sum adjudged on the date of the suit the component of interest is disproportionate with the component of the principal sum actually advanced the Court may exercise its discretion in awarding interest pendente lite and post-decree interest at a lower rate or may even decline awarding such interest. The discretion shall be exercised fairly, judiciously and for reasons and not in an arbitrary or fanciful manner.

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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 @9.50%p.a. with @2% penal interest and half yearly rests from 13.07.2023 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 loans 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 @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. 12. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.27,66,248.25 (Rupees Twenty Seven Lacs Sixty Six Thousand Two Hundred Forty Eight and Paise Twenty Five 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 property of defendant no. 1 in execution proceedings if not sold earlier under the provisions

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OA/1088/2023 CENTRAL BANK OF INDIA VS. SUKHPAL SINGH AND ANOTHER

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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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13. Any other application pending stands disposed of. 14. Issue Recovery Certificate accordingly. 15. Parties to appear before Learned Recovery Officer of this Tribunal on 12.06.2026. 16. 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: 21.05.2026

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

Central Bank of India v. Sh. Sukhpal Singh and Another

Case brief

What is this about?

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Central Bank of India v. Sh. Sukhpal Singh and Another

Case brief

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