The Debts Recovery Tribunal allowed the bank's application for recovery of Rs. 48.40 lakhs against a builder and guarantors. The court granted a Recovery Certificate, fixing uniform interest at 8% p.a.
Recovery Certificate issued; Defendants to pay Rs. 48,40,480.96 with interest @8% p.a. from filing date; enforcement via sale of hypothecated assets.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH
ORIGINAL APPLICATION NO.1139/2024
PRESIDED OVER BY MRIDULESH KUMAR SINGH
DATE OF INSTITUTION: 19.09.2024
DATE OF DECISION: 13.04.2026
Canara Bank, a Body Corporate constituted under Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, having its Head Office at 112, J.C. Road, Bangalore and inter alia having a Branch Office, Dalhousie Road, Pathankot, Punjab through its Chief Manager and Principal Officer, Sh. Sudhir Kumar Kashyap
……..Applicant
Versus
Advocates:
Argued by Sh. Yogesh Kumar, Advocate for applicant None for defendants
FINAL ORDER
2 OA/1139/2024 CANARA BANK VS. M/S KEWAL BUILDERS AND OTHERS
Limit of Rs. 20.00 Lacs vide Application dated 13.11.2014, which is Annexure A2 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 again approached the applicant for enhancement of OCC Limit of Rs.35.00 Lacs vide Application dated 15.12.2015, which is Annexure A8 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of OCC Limit of Rs. 35.00 Lacs vide Letter of Renewal dated 15.12.2015, which is Annexure A13 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of OCC Limit of Rs. 35.00 Lacs vide Letter of Renewal dated 04.03.2017, which is Annexure A15 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of OCC Limit of Rs.35.00 Lacs vide Letter of Renewal 31.03.2018, which is Annexure A18 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of OCC Limit of Rs. 35.00 Lacs vide Letter of Renewal 10.07.2019, which is Annexure A21 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for grant of GECL of Rs. 6.00 Lacs vide Loan Application dated 24.06.2020, which is Annexure A24 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for grant of GECL Extension of Rs.3,77,761.00 vide Loan Application dated 10.11.2021, which is Annexure A32 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of OCC Limit of Rs. 35.00 Lacs vide Letter of Renewal dated 13.12.2021, Which is Annexure A36 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of OCC Limit of Rs. 35.00 Lacs vide Letter of Renewal dated 05.12.2022, Which is Annexure A39 to this OA. 3. The applicant sanctioned the OCC Limit of Rs. 20.00 Lacs vide Sanction Letter dated 13.11.2014, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the applicant sanctioned enhancement of OCC Limit of Rs.35.00 Lacs vide Sanction Letter dated 15.12.2015, which is
3 OA/1139/2024 CANARA BANK VS. M/S KEWAL BUILDERS AND OTHERS
Annexure A9 to this OA. Thereafter, the applicant sanctioned renewal of OCC Limit of Rs. 35.00 Lacs vide Sanction Letter dated 31.03.2018, which is Annexure A17 to this OA. Thereafter, the applicant sanctioned the GECL of Rs. 6.00 Lacs vide Sanction Memorandum dated 24.06.2020, which is Annexure A25 to this OA. Thereafter, the applicant sanctioned the renewal of OCC Limit of Rs. 35.00 Lacs vide Sanction Letter dated 14.09.2020, which is Annexure A29 to this OA. Thereafter, the applicant sanctioned the GECL Extension of Rs.3,77,761.00 vide Sanction Memorandum dated 10.11.2021, which is Annexure A33 to this OA. Thereafter, the applicant sanctioned renewal of OCC Limit of Rs. 35.00 Lacs vide Sanction Letter dated 13.12.2021, which is Annexure A35 to this OA. Thereafter, the applicant sanctioned renewal of OCC Limit of Rs. 35.00 Lacs vide Sanction Letter dated 05.12.2022, which is Annexure A38 to this OA. Defendant no. 3 stood as guarantor.
Documents executed: DP Note, Cash Credit Agreement, Guarantee Agreement and Letter, all dated 13.11.2014, which are Annexure A4 (Colly) to A7 to this OA; DP Note, Supplemental Agreement Guarantee Agreement and Link Letter, all dated 15.12.2015, which are Annexure A10 to A12 and A14 to this OA; Letter of Guarantee dated 04.03.2017, which is Annexure A16 to this OA; Letter of Guarantee and Letter of Proprietorship, both dated 31.03.2018, which are Annexure A19 and A20 to this OA; Letter of Guarantee and Letter of Proprietorship, both dated 10.07.2019, which are Annexure A22 and A23 to this OA; DP Note, Agreement cum Deed of Hypothecation and Letter of Proprietorship, all dated 24.06.2020, which are Annexure A26 to A28 to this OA; Letter of Proprietorship and Letter of Guarantee, both date 14.09.2020, which are Annexure A30 and A31 to this OA; Agreement cum Deed of Hypothecation dated 10.11.2021, which is Annexure A34 to this OA; Letter of
4 OA/1139/2024 CANARA BANK VS. M/S KEWAL BUILDERS AND OTHERS
Guarantee dated 13.12.2021, which is Annexure A37 to this OA; Letter of Guarantee and Letter of Proprietorship, both dated 05.12.2022, which are Annexure A40 and A41 to this OA; Confirmation Letters dated 15.12.2015 and 10.11.2021, which is Annexure A43 to this OA; Acknowledgments of Debt and Security dated 15.12.2015, 04.03.2017, 31.03.2018, 08.01.2021, 06.03.2022 and 17.02.2023, which is Annexure A44 (Colly ) to this OA; Cersai dated 22.12.2020, which is Annexure A45 to this OA; Demand Notice dated 25.04.2023, which is Annexure A46 to this OA; Possession Notice dated 19.07.2023, which is Annexure A47 to this OA; Statements of Accounts, which are Annexure A48 to A50 to this OA and Valuation Report dated 27.07.2023, which is Annexure A51 to this OA.
5 OA/1139/2024 CANARA BANK VS. M/S KEWAL BUILDERS AND OTHERS
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. 48,40,480.96 (Rupees Forty Eight Lacs Forty Thousand Four Hundred Eighty and Paise Ninety Six 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.
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 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 all 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.
6 OA/1139/2024 CANARA BANK VS. M/S KEWAL BUILDERS AND OTHERS
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 04.05.2026. 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: 13.04.2026
(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh
1 issue framed by the court
Whether the debtor and guarantor are liable to repay the outstanding loan amount along with interest.
2 provisions across 2 enactments
Canara Bank
M/S Kewal Builders
Sh. Sanjay Sharma
Smt. Sujata Sharma
Mridulesh Kumar Singh
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
