Allowed

Canara Bank v. M/s Shiv Shakti Traders and Another

DRT20 Apr 2026OA/1237/2022

Case brief

AI extract

What is this about?

The Tribunal allowed the bank's application for recovery of a term loan of Rs. 50,11,603.00 against borrowers who defaulted. The court awarded interest at 8% p.a. and directed the issuance of a Recovery Certificate for enforcement through sale of assets under SARFAESI Act.

What did the court decide?

Recovery of Rs. 50,11,603.00 with costs and simple interest at 8% p.a.; issuance of Recovery Certificate; liberty to enforce via sale of hypothecated and personal assets.

Canara Bank versus M/s Shiv Shakti Traders and… — Contract and Commercial Disputes | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1237/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 08.12.2021

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DATE OF DECISION: 20.04.2026

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Canara Bank, a body corporate and nationalized Bank under the provisions of the Banking Companies (Acquisition and Transfer of Undertakings) Act of 1970 with its Head Office at J C Road, Bangalore and amongst other a Branch Office at Bharat Nagar Chowk, Ludhiana, District Ludhiana, Punjab through its Constituted Attorney and Manager Sh. Shaharyaar Sufnaan.

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……..Applicant

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Versus

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M/s Shiv Shakti Traders, through its proprietor Sh. Vipan Kumar, registered office at B-24-331/1, street No. 17, New Madhopuri, Ludhiana, District Ludhiana, Punjab.

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Sh. Vipan Kumar S/o Sh. Tarsem Kumar, registered office at B- 24-331/1, Street No. 17, New Madhopuri, Ludhiana, District Ludhiana, Punjab.

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2^nd Address: House No. 112, Ward No. 15, Jain Mohalla, Samana, District Patiala.

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……..Defendants

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Advocates:

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Argued by Sh. Aseem Kataria, Advocate for the applicant (through

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VC)

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None for defendants (Already ex-parte vide order dated 16.03.2026)

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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 and Bankruptcy Act, 1993, against the defendants for recovery of Rs.50,11,603.00 (Rupees Fifty Lacs Eleven Thousand Six Hundred and Three Only). The Original Application has been filed through Sh. Shaharyaar Sufnaa n, Manager

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2 OA/1237/2022 CANARA BANK VS M/S SHIV SHAKIT TRADERS AND ANOTHER

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of the applicant, who is competent to institute the Original Application vide Power of Attorney of Bank Official dated 26.04.2016, which is Annexure A1 to this OA.

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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 Term Loan of Rs.37,49,780.00 vide Application Form for Loans to Micro & Small Enterprises dated 08.12.2017, which is Annexure A2 to this OA.

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The applicant sanctioned Term Loan of Rs.37,49,780.00 vide Sanction memorandum dated 08.12.2017, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendant no.1 through its proprietor defendant no. 2. 4. Defendant no.1 through its proprietor defendant no. 2 had hypothecated its Sewing Machines and stocks vide Deed of Hypothecation date 08.12.2017 which is Annexure A4 to this OA. Documents executed: Letter of proprietorship dated 08.12.2017, which is Annexure A3A to this OA; Letter of Undertaking, Pronote, both dated 08.12.2017, which are Annexures A5 & A6 to this OA; Particulars of Vehicles/Machinery/Equipment/Livestock etc., hypothecated dated 12.04.2018 which are Annexure A7(Colly) to this OA; Restructuring of Loan request letter dated 06.07.2019 which is Annexure A8 to this OA; Debt Creditor Agreement, Debt Restructuring Agreement, both dated 06.07.2019 which are Annexures A9 & A10 to this OA; Legal notice dated 24.09.2021 along with postal receipts, which is Annexure A11 to this OA; Statement of account along with Certificate which is Annexure A12 to this OA. 5. 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.50,11,603.00 which is recoverable and the defendants were served recall noticed but they did not repay the outstanding amount,

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3 OA/1237/2022 CANARA BANK VS M/S SHIV SHAKIT TRADERS AND ANOTHER

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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 but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 16.03.2026.

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In support of the OA, affidavit of Sh. Shaharyaar Sufnaan, Manager, Canara Bank has been filed.

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Heard ex-parte arguments and perused record.

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It was argued by learned counsel for applicant through video conferencing 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 A12 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, loan account was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum Rs.50,11,603.00 (Rupees Fifty Lacs Eleven Thousand Six Hundred and Three 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. 10. In so far as pendente lite and future rate of interest is concerned, the applicant in relief clause has claimed interest @13.50% p.a. with monthly rests from 30.10.2021 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 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

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OA/1237/2022 CANARA BANK VS M/S SHIV SHAKIT TRADERS AND ANOTHER

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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.50,11,603.00 (Rupees Fifty Lacs Eleven Thousand Six Hundred and Three 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 hypothecated assets of the defendant no.1 through its proprietor defendant no.2 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. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 11.05.2026. 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.

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Pronounced by me in the open Tribunal . Dated: 20.04.2026

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

Canara Bank v. M/s Shiv Shakti Traders and Another

Case brief

What is this about?

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Canara Bank v. M/s Shiv Shakti Traders and Another

Case brief

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