Allowed

State Bank of India v. M/S S. K. Fabrics and Another

DRT22 Apr 2026OA/1196/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the bank's application under Section 19 of the RDB Act for recovery of dues of Rs. 25.84 L. It directed recovery with a uniform interest rate of 8% p.a. and authorized enforcement via SARFAESI sale or attachment of assets.

What did the court decide?

Declared recovery of Rs.25,84,558.54 plus costs and simple interest at 8% p.a. from filing date till realization. Directed issuance of Recovery Certificate and allowed execution under SARFAESI Act.

State Bank of India versus M/S S. K. Fabrics and… — Contract and Commercial Disputes | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 1196/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 27.06.2022

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DATE OF DECISION: 22.04.2026

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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 Offices, at Sector 17A, Chandigarh and one of its Branches, at SMEC-2, Civil Lines Ludhiana, through its Chief Manager.

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……..Applicant

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Versus

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M/s S.K. Fabrics, Plot No. 60, Daba Road, Kabir Nagar, Sherpur Chowk, Ludhiana, through its proprietor Sh. Kamal Kumar S/o Sh. Vinod Kumar.

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Sh. Kamal Kumar S/o Sh. Vinod Kumar, proprietor of M/s S.K. Fabrics, R/o H.No. 30/20/b, Guru Gobind Singh Nagar, Back Side Apollo Hospital, Ludhiana, Punjab.

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2^nd Address: H.No. 186, Sarabha Nagar Extension, Pakhowal Road, Ludhiana.

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.……Defendants

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Advocate:

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Argued by Sh. K.C. Bhatia, Advocate for the applicant

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None for Defendants (already ex parte vide order dated 16.04.2026)

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19 of the Recovery of Debts and Bankruptcy Act 1993, against the defendants for recovery of Rs.25,84,558.54 (Rupees Twenty Five Lacs Eighty Four Thousand Five Hundred Fifty Eight and Paise Fifty Four Only). The Original Application has been filed through Sh. Abinash Kumar Roy, Chief Manager, of the applicant bank, who is competent to

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institute the Original Application.

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OA/1196/2022 STATE BANK OF INDIA VS. M/S S.K. FABRICS AND ANOTHER

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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 the grant of CC Limit of Rs.22.00 Lacs, vide Loan Application dated 22.05.2013, which is Annexure A1 to this OA. 3. The applicant sanctioned the CC Limit of Rs.22.00 Lacs vide Sanction Letter dated 06.07.2013, which is Annexure A2 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the applicant sanctioned the FITL Loan of Rs.1,34,188/- on 27.08.2020 to cover interest in moratorium period provided in COVID19. 4. Defendants hypothecated their stocks and book debts vide Loan cum Hypothecation Agreement dated 05.08.2013, which is Annexure A4 to this OA. The CC Limit is covered under CGTMSE Scheme. Documents executed : Letter of Arrangement dated 05.08.2013, which is Annexure A3 to this OA; Revival Letters, dated 30.06.2016, 02.05.2019 and 08.01.2020, which are Annexures A5 to A7 to this OA; Statement of Accounts with certificate, which are Annexures A8 & A9 to this OA; Legal Notice dated 29.12.2021, which is Annexure A10 to this OA

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The 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.25,84,558.54 (Rupees Twenty Five Lacs Eighty Four Thousand Five Hundred Fifty Eight and Paise Fifty Four Only), 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, but no one appeared on behalf of the defendants and they were proceeded ex-parte on 16.04.2026 7. In support of the OA, affidavit of Sh. Abinash Kumar Roy, Chief Manager, State Bank of India, has been filed.

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OA/1196/2022 STATE BANK OF INDIA VS. M/S S.K. FABRICS AND ANOTHER

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Heard ex parte arguments and perused record. 9. It was argued by learned counsel 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 Annexure A1 to Annexure A10 to this OA, it is proved that the defendants approached applicant for availing of the Loan Facilities, which were 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 loans as per terms and conditions of the agreement between the parties. Subsequently, both the 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.25,84,558.54 (Rupees Twenty Five Lacs Eighty Four Thousand Five Hundred Fifty Eight and Paise Fifty Four 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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In so far as pendent elite and future rate of interest is concerned, the applicant has claimed interest @10.25% p.a. in CC Limit and interest @11.65% in FITL with monthly rests from 02.06.2022 till the realization. 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 hypothecated asset, 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 simple uniform interest @08.00% 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. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of

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OA/1196/2022 STATE BANK OF INDIA VS. M/S S.K. FABRICS AND ANOTHER

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Rs.25,84,558.54 (Rupees Twenty Five Lacs Eighty Four Thousand Five Hundred Fifty Eight and Paise Fifty Four Only), jointly and severally, with costs, current and future simple interest @08.00% 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 hypothecated assets 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.

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Parties to appear before Learned Recovery Officer of this Tribunal on 13.05.2026 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: 22.04.2026

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

State Bank of India v. M/S S. K. Fabrics and Another

Case brief

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State Bank of India v. M/S S. K. Fabrics and Another

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