Allowed

State Bank of India v. M/S New Punia Trading Company and Another

DRT21 Jan 2026OA/1572/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank's application for recovery of Rs.23.86 lakhs from borrowers who failed to repay a cash credit limit, adjusting the claimed interest rate to 8% per annum and directing issuance of a Recovery Certificate.

What did the court decide?

Recovery of Rs.23,86,074.00 with simple interest at 8% p.a. and issuance of Recovery Certificate.

State Bank of India versus M/S New Punia Trading Company and… — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1572/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 01.08.2022

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DATE OF DECISION: 21.01.2026

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State Bank of India a body corporate constituted under the (Subsidiary Banks) Act 1959 having Corporate Office at Madam Cama Road, Nariman Point, Mumbai and one of its Local Head Office at Sector 17A, Chandigarh and one of its branches amongst other places at Branch Office Dudhan Sudhan District Patiala (Punjab) through its Chief Manager Sh. Amrinder Sheo of the Applicant.

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……..Applicant

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Versus

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M/s New Punia Trading Company through its proprietor Sh. Harsewak Singh S/o Sh. Avtar Singh, Office at Shop no. 30, Grain Market, Tehsil Dudhan Sadhan, District Patiala (Punjab).

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Sh. Harsewak Singh S/o Sh. Avtar Singh R/o Village Mehon, Tehsil Dudhan Sadhan, District Patiala (Punjab)

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……….Defendants

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Advocates:

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Argued by Sh. Jatinder Kumar Sharma, Advocate for the applicant Defendants are ex-parte vide order dated 02.08.2024

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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.23,86,074.00 (Rupees Twenty Three Lac Eighty Six Thousand and Seventy Four Only). The Original Application has been filed through Sh. Amrinder Sheo, Chief Manager o f the applicant, who is competent to institute the Original Application in terms of Gazette Notification published in Gazette of India dated 26.09.1959, 26.08.1972 and 27.03.1987 under Regulation no. 76 and 77 of State Bank of India Regulations framed in exercise of

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OA/1572/2022 STATE BANK OF INDIA VS M/S NEW PUNIA TRADING COMPANY AND ANOTHER

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the powers conferred by sub section 3 of section 50 of the State Bank of India Act, 1955 with previous sanction of the Central Government.

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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 grant of Cash Credit Limit of Rs.20.00 Lacs vide Loan Application dated 02.07.2013. Thereafter, defendant no. 1 through its proprietor defendant no. 2 approached the applicant the applicant for renewal of the Limit vide Loan Application dated 11.09.2015, 24.10.2016, 16.03.2018 and 30.11.2019.

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The applicant sanctioned Cash Credit Limit of Rs.20.00 Lacs vide sanction and Letter of Arrangement dated 02.07.2013, which are Annexures A1 and A2 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the applicant renewed the Limit vide Letter of Arrangements dated 11.09.2015, 27.10.2016, 16.03.2018 and 30.11.2019 which are Annexures A5 to A8 to this OA.

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Defendant no. 1 through its proprietor defendant no. 2 hypothecated stock and book debts, etc. vise agreement of loan cum hypothecation dated 02.07.2013, which is Annexure A3 to this OA. Defendant no. 2 mortgaged his immovable property i.e. Commercial Plot measuring 09 Biswa-15-1/3 Biswasi situated at Village Ram Nagar Chuniwala, Tehsil and District Patiala , Punjab, vide Mortgage Deed bearing Vasika No. 517 dated 01.07.2013, along with its translation, which is Annexure A4 to this OA. Documents executed : Hypothecation Agreement dated 02.07.2013 which is Annexure A3 to this OA; Legal Notice dated 07.04.2021 and Notice dated 30.06.2021 u/s 13(2) of SARFAESI Act, with postal receipt which is Annexure A9 to this OA; Account Statement which is Annexure A10 to this OA.

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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.23,86,074.00, which is recoverable and the defendants

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OA/1572/2022 STATE BANK OF INDIA VS M/S NEW PUNIA TRADING COMPANY AND ANOTHER

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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 notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 02.08.2024

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In support of the OA, affidavit of Sh. Amrinder Sheo, Chief Manager, State Bank of India h as been filed.

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Heard arguments and perused record.

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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 Annexures A1 to A10 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, account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum Rs.23,86,074.00 (Rupees Twenty Three Lac Eighty Six Thousand and Seventy 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 account. 10. In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest in @12.75%pa with penal interest @2% p.a. with monthly rests from 01.02.2022 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

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OA/1572/2022 STATE BANK OF INDIA VS M/S NEW PUNIA TRADING COMPANY AND ANOTHER

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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 @08.00%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.23,86,074.00 (Rupees Twenty Three Lac Eighty Six Thousand and Seventy Four Only) jointly and severally, with costs, current and future simple interest @08.00%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/mortgaged properties 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

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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

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Tribunal on 03.02.2026.

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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 .

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Dated: 21.01.2026.

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

State Bank of India v. M/S New Punia Trading Company and Another

Case brief

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State Bank of India v. M/S New Punia Trading Company and Another

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