Allowed

Hdfc Bank Limited v. M/S Sandhu Collections and Others

DRT8 Apr 2026OA/1366/2024

Case brief

AI extract

What is this about?

DRT-III, Chandigarh heard an application by HDFC Bank for recovery of dues from a sole proprietorship and its guarantors. The bank proved a substantial debt classification as NPA. The Tribunal adjusted the claimed interest rate in favor of the borrowers and directed debt recovery via sale of secured assets.

What did the court decide?

Debt recovery of Rs.48,72,667.40 and Rs.31,09,423.09 with simple interest @8.00% p.a. directed to be recovered from sale of mortgaged/hypothecated assets or personal assets.

Hdfc Bank Limited versus M/S Sandhu Collections and Others — Company and Corporate | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1366/2024

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 21.11.2024

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DATE OF DECISION: 08.04.2026

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HDFC Bank Limited, a banking company, incorporated under Companies Act 1956, having its Registered Office at HDFC Bank House, Senapati Bapat Marg, Lower Parel-(West), Mumbai, Maharashtra-400013 and one of its branches, at Sunder Nagar Chowk, Ludhiana, Punjab, through its Authorized Signatory Sh. Madhur Sharma, who is duly authorized vide Board Resolution dated 12.12.2023 and presently posted as Assistant Vice President at HDFC Bank Ltd-Department for Special Operations, at 5^th Floor, B-21-14570, GT Road, Dholewal Chowk, Adjoining Gulzar Motors, Ludhiana (Punjab) -141008

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……..Applicant

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Versus

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M/s Sandhu Collections, a sole proprietorship concern situated at B-24-2676, Street No.8, Sunder Nagar, Ludhiana-141007 through its sole proprietor Sh. Gurpreet Singh Sandhu S/o Sh. Balwant Singh.

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Sh. Gurpreet Singh Sandhu S/o Sh. Balwant Singh R/o H.No. 2678, Shiv Mandir Street, Sunder Nagar, Ludhiana 141007.

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2^nd Address: B-24-2676, Street No.8, Sunder Nagar, Ludhiana 141007.

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Sh. Sahib Singh Sandhu S/o Sh. Ram Singh R/o H.No.2678, Shiv Mandir Street, Sunder Nagar, Ludhiana 141007.

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Smt. Gurbinder Kaur Sandhu W/o Sh. Gurpreet Singh R/o H.No. 2678, Shiv Mandir Street, Sunder Nagar, Ludhiana 141007.

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….……Defendants

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Advocates:

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Argued by Sh. Sumit Batra, Advocate for applicant (through VC) None for Defendants (already ex parte vide order dated 13.02.2026)

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OA NO.1366/2024 HDFC BANK LIMITED VS. M/S SANDHU COLLECTIONS AND OTHERS

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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 & Bankruptcy Act, 1993, against the defendants for recovery of Rs.79,82,090.49 (Rupees Seventy Nine Lacs Eighty Two Thousand Ninety and Paise Forty Nine Only) The Original Application has been filed through Sh. Madhur Sharma, Authorized Signatory of the applicant, who is competent to institute the Original Application vide Board resolution dated 22.11.2023, which is Annexure A1 to this OA.

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The brief facts of the OA are that Defendant no.1, through it’s the then proprietor Harbhajan Singh (who left the firm later and firm is taken over by Defendant No. 2), approached the applicant for grant CC Limit of Rs.12.00 Lacs and Term Loan of Rs.4.50 Lacs vide Loan Application dated 09.08.2014, which is Annexure A2 to this OA. Defendant Nos 2 & 3 stood as Guarantor. Thereafter, Defendant no.1, through it’s the then proprietor Harbhajan Singh, approached the applicant for grant of additional Term Loan of Rs.12.00 lacs vide Request Letter dated 10.01.2015, which is Annexure A16 to this OA. Defendant Nos 2 & 3 stood as Guarantor. Thereafter, Defendant no.1, through it’s the then proprietor Harbhajan Singh, approached the applicant for grant of another additional Term Loan of Rs.10.00 Lacs. Thereafter, Defendant no.1, through it’s the then proprietor Harbhajan Singh, approached the applicant for renewal of existing CC Limit vide Requested Letter dated 24.08.2016, which is Annexure A39 to this OA. Thereafter, Defendant no.1, through it’s the then proprietor Harbhajan Singh, approached the applicant for renewal of existing CC Limit. Thereafter, Defendant No. 2 taken over the firm and became the sole proprietor in place of Harbhajan Singh, the then proprietor of Defendant no.1 and the Defendant no. 1, through its sole proprietor Defendant no.2, again approached the applicant for enhancement of existing CC limit of Rs. 12.00 Lacs to Rs.25.00 Lacs vide Loan Application, which is Annexure A45 to this OA. Thereafter, the Defendant no. 1, through its sole proprietor Defendant

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OA NO.1366/2024 HDFC BANK LIMITED VS. M/S SANDHU COLLECTIONS AND OTHERS

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no.2, again approached the applicant for GECL Term Loan of Rs. 4.84 lacs to overcome COVID-19 impact on Business. Thereafter, the Defendant no. 1, through its sole proprietor Defendant no.2, again approached the applicant for enhancement of CC limit of Rs. 25.00 to 30.00 Lac and for grant of WCTL of Rs.9.00 lac in addition to existing GECL of Rs.4.84 Lacs vide Requested Letter dated 25.01.2021, which is Annexure A60 to this OA. Thereafter, the Defendant no. 1, through its sole proprietor Defendant no.2 and defendant no.4 approached the applicant grant of Fresh Loan against Property of Rs.34.17 Lacs vide Loan Application dated 24.01.2022, which is Annexure A72 to this OA. 3. The applicant sanctioned the CC Limit of Rs.12.00 Lacs and Term Loan of Rs.4.50 Lacs vide Sanction Letter dated 05.09.2014, which is Annexure A3 to this OA. Thereafter, the applicant sanctioned additional Term Loan of Rs.12.00 Lacs vide Sanction Letter dated 10.01.2015, which is Annexure A17 to this OA. Thereafter, the applicant sanctioned the additional Term Loan of Rs.10.00 Lacs vide Sanction Letter dated 25.09.2015, which is Annexure A28 to this OA. Thereafter, the applicant sanctioned the renewal of existing CC Limit vide sanctioned Letter dated 30.09.2016, which is Annexure A40 to this OA. Thereafter, the applicant sanctioned the renewal of existing CC limit vide Sanctioned Letter dated 16.09.2017, 16.08.2018 which are Annexures A43 & A44 to this OA. Thereafter, the applicant sanctioned the enhancement of CC Limit of Rs.12.00 Lacs to Rs. 25.00 lacs vide Sanction Letter dated 07.09.2019, which is Annexure A46 to this OA. Thereafter, the applicant sanctioned the GECL Loan of Rs.4.84 lacs vide Sanction Letter dated 06.06.2020, which is Annexure A54 to this OA. Thereafter, the applicant sanctioned the renewal of existing CC limit of Rs. 25.00 Lacs with GECL Loan of 4.84 lacs vide Sanctioned Letter dated 15.09.2020, which is Annexures A58 to this OA. Thereafter, the applicant sanctioned the enhancement of CC limit of Rs. 25.00 to 30.00 Lac and WCTL of Rs.9.00 lacs vide Sanction Letter dated 15.01.2021, which is Annexure A61 to this OA. Thereafter, the applicant sanctioned

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OA NO.1366/2024 HDFC BANK LIMITED VS. M/S SANDHU COLLECTIONS AND OTHERS

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the Term Loan against Property of Rs.34.17 Lac vide Sanction Letter dated 28.02.2022, which is Annexure A73 to this OA.

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Defendant no. 2 mortgaged his immovable property i.e. Total Land Measuring 92 Sq.Yards situated at Village Taraf Saida Abadi Sunder Nagar, Hadbast No. 172, Tehsil and District Ludhiana, vide Registered Sale Deed bearing Vasika No. 6278 dated 14.06.2012, along with Translation, which are Annexures A11 & A-11/T to this OA; Memorandum of Mortgaged dated 10.09.2014, which is Annexure A12 to this OA.

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Documents executed: Demand Promissory Notes, Letter of Continuity Security, Master Facility Agreement, Term Loan Agreement, Letter of Hypothecation, Power of Attorney, Letter to Continuity Guarantee, all dated 05.09.2014, which are Annexures A4 to A10 to this OA; Deed of Indemnity dated 05.09.2014, which is Annexure A13 to this OA; Declaration Cum Indemnity dated 10.09.2014, which is Annexures A14 to this OA; Valuation Report dated 11.07.2024, which is Annexures A15 to this OA; Demand Promissory Note, Letter of Continuity Security, Supplementary Agreement, Term Loan Agreement, Supplementary Agreement, Power of Attorney, Letter to Continuity Guarantee, Memorandum of Mortgaged, Deed of Indemnity, Declaration Cum Indemnity, all dated 10.01.2015, which are Annexures A18 to A27 to this OA; Demand Promissory Note, Letter of Continuity Security, Supplementary Agreement, Term Loan Agreement, Supplementary Agreement, Power of Attorney, Letter to Continuity Guarantee, Memorandum of Mortgaged, Deed of Indemnity, Declaration Cum Indemnity, all dated 25.09.2015, which are Annexures A29 to A38 to this OA; Demand Promissory Note, Amendment Agreement, Both dated 30.09.2016, which are Annexures A41 to A42 to this OA; Master Facility Agreement, Deed of Hypothecation, Power of Attorney, Letter of Continuity Guarantee, Memorandum of Mortgaged, Deed of Indemnity, Declaration Cum Indemnity all dated 07.09.2019, which are Annexures A47 to A53 to this OA; Facility Agreement, Supplementary

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OA NO.1366/2024 HDFC BANK LIMITED VS. M/S SANDHU COLLECTIONS AND OTHERS

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Deed of Hypothecation, Declaration Cum Undertaking, all dated 06.06.2020, which are Annexures A55 to A57 to this OA; Addendum dated 15.09.2020, which is Annexure A59 to this OA; Letter of Continuity Security, Supplementary Agreement, Addendum, Term Laon Agreement, Supplementary Letter of Hypothecation, Power of Attorney, Letter of Continuity Guarantee, Memorandum of Mortgaged, Deed of Indemnity, Declaration Cum Indemnity, all dated 25.01.2021, which are Annexures A62 to A71 to this OA; Loan Agreement, Additional Schedule, both dated 02.03.2022, which are Annexures A74 & A75 to this OA; Memorandum of Mortgaged, Deed of Indemnity, Declaration Cum Indemnity, both dated 04.03.2022, which are Annexures A76 & A77 to this OA; Recall Notice dated 26.05.2023, which is Annexure A78 to this OA; Notice Under Section 13(2) of SARFAESI Act 2002, dated 15.07.2023, which is Annexure A79 to this OA; Statement of Accounts, Interest Calculation of CC, Closure of GECL, TL, LAP, all dated 31.02.2024, which are Annexures A80 to A87 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.79,82,090.49 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.

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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 13.02.2026 7. In support of the OA, affidavit of Sh. Madhur Sharma, Authorized Signatory, HDFC Bank Limited, has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned counsel through Video Conferencing, that in view of the documentary evidence brought on record which had gone unrebutted, the applicant bank had proved its case. From the

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OA NO.1366/2024 HDFC BANK LIMITED VS. M/S SANDHU COLLECTIONS AND OTHERS

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perusal of all the Annexures A1 to A87 to this OA, it is proved that the defendants approached applicant bank 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, all the accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.48,72,667.40 (Rupees Forty Eight Lacs Seventy Two Thousand Six Hundred Sixty Seven and Paise Forty Only) along with interest from the defendant nos. 1 to 3 and Rs.31,09,423.09 (Rupees Thirty One Lacs Nine Thousand Four Hundred Twenty Three and Paise Nine Only) along with interest from the defendant nos. 1, 2 & 4, jointly and severally, from the date of filing of the present Original Application till realization of the accounts.

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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 @18.00% p.a. with monthly rests from 01.04.2024 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 @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.

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In the result, the application is allowed declaring that the defendant nos. 1 to 3 are liable to pay to the applicant a total sum of Rs.48,72,667.40 (Rupees Forty Eight Lacs Seventy Two Thousand Six

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OA NO.1366/2024 HDFC BANK LIMITED VS. M/S SANDHU COLLECTIONS AND OTHERS

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Hundred Sixty Seven and Paise Forty Only) and defendant nos. 1, 2 & 4 are liable to pay to the applicant a total sum of Rs.31,09,423.09 (Rupees Thirty One Lacs Nine Thousand Four Hundred Twenty Three and Paise Nine Only), jointly and severally, with costs, current and future simple interest @8.00% p.a. in all 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/hypothecated assets of 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 . 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 28.04.2026 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: 08.04.2026

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

Hdfc Bank Limited v. M/S Sandhu Collections and Others

Case brief

What is this about?

What did the court decide?

Hdfc Bank Limited v. M/S Sandhu Collections and Others

Case brief

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What the court decided

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