Allowed

Capital Small Finance Bank Limited v. Sh. Gurmej Singh through His Legal Heirs and Others

DRT2 Jun 2026OA/1739/2025

Case brief

AI extract

What is this about?

This order allowed an Original Application filed under Section 19 of the RDB Act for recovery of loan dues. The bank recovered Rs.27.08 lacs principal with eight percent simple interest, declaring defendants jointly and severally liable. Execution was directed against mortgaged land and personal assets.

What did the court decide?

Recovery ordered of principal sum of ₹27,08,353.90 with simple interest at 8% p.a., disclosed jointly and severally against mortgaged and personal assets.

Capital Small Finance Bank Limited versus Sh… — Contract and Commercial Disputes | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.1739/2025

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 05.12.2025

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DATE OF DECISION: 02.06.2026

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Capital Small Finance Bank Ltd. a body corporate established under the Companies Act, 1956 and having its Registered Office at MIDAS, Corporate Park, 3^rd Floor, 37 G.T. Road, Jalandhar, District Jalandhar, Punjab and Branch Office amongst other places at Rayya, District Amritsar through its General Power of Attorney Sh. Varun Khanna posted at Registered & Head office at Jalandhar.

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……..Applicant

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Versus

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Sh. Gurmej Singh (since deceased) S/o Sh. Dalip Singh through his Legal Heirs:

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1(i) Smt. Sukwinder Kaur Wd/o Late Sh. Gurmej Singh, R/o Ward No.1, Village Alia, Tehsil Khadoor Sahib, District Tarn Taran, Punjab – 143117.

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1(ii) Sh. Palwinder Singh S/o Late Sh. Gurmej Singh, R/o Ward No.1, Village Alia, Tehsil Khadoor Sahib, District Tarn Taran, Punjab – 143117.

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1(iii) Sh. Nirbhai Singh S/o Late Sh. Gurmej Singh, R/o Ward No.1, Village Alia, Tehsil Khadoor Sahib, District Tarn Taran, Punjab – 143117.

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Smt. Sukwinder Kaur Wd/o Late Sh. Gurmej Singh, R/o Village Alia, Tehsil Khadoor Sahib, District Tarn Taran, Punjab - 143117.

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Sh. Kuldip Singh S/o Sh. Rooj Singh, R/o Village Alia, Tehsil Khadoor Sahib, District Tarn Taran, Punjab - 143117.

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……..Defendants

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Advocates:

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Present Ms. Dipti Toni, Advocate for proxy for Sh. Vikas Sharma, Advocate for the applicant

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None for defendants (Already ex-parte vide order dated 30.05.2026).

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2 OA NO.1739/2025 CAPITAL SMALL FINANCE BANK LTD. VS SH. GURMEJ SINGH THROUGH HIS LEGAL HEIRS 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.27,08,353.90 (Rupees Twenty Seven Lacs Eight Thousand Three Hundred Fifty Three and Paise Ninety Only). The Original Application has been filed through Sh. Varun Khanna, Power of Attorney Holder of the applicant, who is competent to institute the Original Application vide General Power of Attorney dated 17.07.2025, which is Annexure A1 to this OA. 2. The brief facts of the OA are that Sh. Gurmej Singh (since deceased and husband of defendant 1(i) and father of defendant nos. 1(ii) & 1(iii)) and d efendant no. 2 approached the applicant for grant of Kisan Credit Card Limit of Rs.20,25,000.00 vide Loan Application dated 06.03.2019, which is Annexure A2 to this OA. 3. The applicant sanctioned the Kisan Credit Card Limit of Rs.20,25,000.00 and the terms and conditions were duly accepted by Sh. Gurmej Singh (since deceased and husband of defendant 1(i) and father of defendant nos. 1(ii) & 1(iii)) and d efendant no. 2 vide Agreement of Hypothecation of Standing Crops and other Movable Assets dated 13.03.2019, which is Annexure A3 to this OA. Defendant no. 3 stood as guarantor. Defendant Nos. 1(ii) and 1(iii) are neither borrowers, nor guarantors, nor mortgagors; however, being the legal heirs of Late Sh. Gurmej Singh, they have been duly impleaded as parties in the Original Application. 4. Sh. Gurmej Singh (since deceased and husband of defendant 1(i) and father of defendant nos. 1(ii) & 1(iii)) mortgaged his Immovable Properties i.e., Total Agriculture Land measuring 59K-0M detailed as under: (i) Agriculture Land measuring 53K–0M, situated in the area of Village Kalla, Tehsil Khadoor Sahib, District Tarn Taran, Hadbast No. 111. (ii) Agriculture Land measuring 6K–0M, situated in the area of Village Alia, Tehsil Khadoor Sahib, District Tarn Taran, Hadbast No. 131.

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3 OA NO.1739/2025 CAPITAL SMALL FINANCE BANK LTD. VS SH. GURMEJ SINGH THROUGH HIS LEGAL HEIRS AND OTHERS

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Vide declaration u/s 4(1) of Punjab Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act along with Request for creation of Charge in favour the bank dated 12.03.2019, which is Annexure A6 to this OA.

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Documents executed: Demand Promissory Note, Guarantee Deed, both dated 13.03.2019, which are Annexures A4 & A5 to this OA; Recall Notice dated 22.10.2025 along with postal receipts, which is Annexure A7 to this OA; Statement of Account along with certificate, which is Annexure A8 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 the loan account there was a debit of Rs.27,08,353.90, 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 30.05.2026.

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In support of the OA, affidavit of Sh. Varun Khanna, Power of Attorney Holder , Capital Small Finance Bank Limited has been filed. 8. Learned proxy counsel for applicant was present but no arguments were advanced. None was appeared on behalf of defendants for arguments. Perused record. 9. From the perusal of all the Annexures A1 to A8 to this OA, it is proved that Sh. Gurmej Singh (since deceased and husband of defendant 1(i) and father of defendant nos. 1(ii) & 1(iii)) and defendant no. 2 approached applicant for availing of loan facility which was granted to them, defendant no. 3 stood as guarantor 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,

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4 OA NO.1739/2025 CAPITAL SMALL FINANCE BANK LTD. VS SH. GURMEJ SINGH THROUGH HIS LEGAL HEIRS AND OTHERS

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it is proved that applicant bank is entitled to recover a sum of Rs.27,08,353.90 (Rupees Twenty Seven Lacs Eight Thousand Three Hundred Fifty Three and Paise Ninety 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 pendente lite and future rate of interest is concerned, the applicant in relief clause has claimed interest @13.05%p.a. with half yearly rests with penal interest @2.00%p.a. in the loan account from 01.10.2025 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 properties, 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 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 sum of Rs.27,08,353.90 (Rupees Twenty Seven Lacs Eight Thousand Three Hundred Fifty Three and Paise Ninety Only), along with interest, 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 mortgaged properties of Sh. Gurmej Singh (since deceased and husband of defendant 1(i) and father of defendant nos. 1(ii) & 1(iii)) 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 defendant nos.

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5 OA NO.1739/2025

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CAPITAL SMALL FINANCE BANK LTD. VS SH. GURMEJ SINGH THROUGH HIS LEGAL HEIRS AND OTHERS

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1(i), 2 & 3 and by attachment and sale of personal assets of the defendant nos. 1(ii) & 1(iii) to the extent, they inherited from the properties of deceased defendant no. 1. 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 23.06.2026. 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: 02.06.2026 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Capital Small Finance Bank Limited v. Sh. Gurmej Singh through His Legal Heirs and Others

Case brief

What is this about?

What did the court decide?

Capital Small Finance Bank Limited v. Sh. Gurmej Singh through His Legal Heirs and Others

Case brief

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