Allowed

The Nainital Bank Ltd. v. Ms Laxmi Foods

DRT29 Jan 2026OA/194/2025

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the applicant bank's original application for recovery of Rs. 24.68 lakhs from the respondent firm, partners, and guarantors. The court declared joint and several liability and directed issuance of a recovery certificate against the defendants' assets and the mortgaged property.

What did the court decide?

Declaration of joint and several liability; Order to pay Rs. 24,68,365/- with interest @10%; Direction to issue Recovery Certificate for enforcement against all assets including hypothecated goods and

The Nainital Bank Ltd. versus Ms Laxmi Foods — Contract and Commercial Disputes | DRT (2026)

¶1

“ORIGINALAPPLICATION” No. 194 OF 2025

¶2

BEFORE THE DEBTS RECOVERY TRIBUNAL, JAIPUR

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PRESENT- SHRI VIMAL GUPTA

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PRESIDING OFFICER

¶5

O.A. NO. 194 OF 2025

¶6

DATE OF DELIVERY OF ORDER 29.01.2026

¶7

The Nainital Bank Ltd ., a body corporate constituted under the Indian Companies Act 2013 (erstwhile 1956) having its Head Office at G.B. Pant, Nainital and having its Regional OfficeDelhi at Sector-62, Gautam Budh Nagar, U.P and having its branch offices throughout India amongst other places at E-69 B, Banipark Extension, Shastri Nagar Branch, Jaipur, Rajasthan through its Constituted Attorney Sh. Dayal Singh.

¶8

…..Applicant Bank…..

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VERSUS

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1. M/s. LAXMI FOODS , a partnership firm through its partners Sh. Sameer Ali, Shahbaj Ali and Bhanwar Ali having its registered office at Plot No. 5, Durga Vihar, Sector-3, Malviya Nagar, Jaipur — 302017.

¶11

2. Sh. Sameer Ali S/o. Sh. Sarvar Ali as partner of Firm M/s. LAXMI FOODS Residing at Plot No. 7-8, Foysagar Road, Near GC -2, MS Rawat Colony, Ajmer (Raj).305001.

¶12

3. Sh. Shahbaj Ali S/o. Sh. Sarvar Ali, as partner of Firm M/s. LAXMI FOODS R/o Plot No. 78, Foysagar Road, Chamunda Choraha - Near MS Colony, Ajmer (Raj).305001.

¶13

4. Sh. Bhanwar Ali S/o. Sh. Lal Mohammed as partner of Firm M/s. LAXMI FOODS R/o. Plot No. 7, Shanti Vihar, Karoth Road, Rajgarh, Alwar. (Raj) 301408 .

¶14

Order signed and uploaded on 31.01.2026.

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OA No. 194 OF 2025

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5. Sh. Mohammad Farukh S/o. Sh. Bhanwar Ali, Guarantor as well as owner of the mortgage property, R/o: - Plot No. 7, Shanti Vihar, Karoth Road, Rajgarh, Alwar. (Raj) 301408.

¶18

6. Sh. Sunil Khan S/o. Sh. Sanjay Khan Guarantor R/o P. No. 300, Jagannath Puri, Boring Road, Jhotwara Jaipur (Raj) 302012.

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……Defendants…..

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Counsel for the Applicant Bank Sh. Sanjog Gupta Defendants Ex-parte

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JUDGMENT

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This Original Application was filed by the applicant bank on 04.12.2025 for recovery of outstanding amount of Rs. 24,68,365/- from the Defendants.

¶23

As per the pleadings, the defendant No. 1 is a partnership firm of which defendant No. 2 to 4 are the partners as well as guarantors and the said firm is engaged in the business of food items services etc. The defendant No. 5 and 6 are also the Guarantors of defendant No.1 Partnership firm and hence they are also jointly and severally responsible for business activities of the Firm as well as its all liabilities.

¶24

Defendant No. 1 firm through its partners defendants no. 2 to 4 had approached the applicant bank for availing Credit facility – Term Loan (Hypothecation) under General Scheme. After due consideration, credit facility (Term Loan) was sanctioned by the Applicant Bank in favour of

¶25

Order signed and uploaded on 31.01.2026.

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OA No. 194 OF 2025

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Defendants in the year 2019 vide sanction letter dated 26.07.2019.

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It is submitted that by executing the documents, the Defendants duly hypothecated, as primary security, the whole stock, semi-finished and finished goods etc. and other movables, both present and future in favour of Applicant Bank, which hypothecated stock and goods are more particularly described in Schedule of the Hypothecation Agreements.

¶30

That with the view to secure the Credit Facility of Rs. 30.00 Lakh granted by the applicant bank to the Defendant no. 1 through its partners defendants no. 2 to 4, Defendants No. 5 and 6 had given Guarantee whereby they agreed to and Guaranteed the Applicant bank for due payment and discharge on demand of all amount due to the applicant bank by Defendant No. 1 firm in respect of the credit facility with interest, banking and other charges and expenses, which the applicant bank in the course of its business charged against defendant No.1 together with all relative interest, charges & expenses. Thus, the defendant No 5 & 6 are also Guarantor of defendant No.1 Partnership Firm for said Credit facility and as such they are also responsible, jointly and severally, for activities as well as its all liabilities.

¶31

It is submitted that in order to collaterally secure repayment of amounts due and arising under the aforesaid Loan facility of Rs.30.00 Lakh to the Defendants, Defendant No. 5 Sh. Mohammad Farukh offered his immovable property situated

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Order signed and uploaded on 31.01.2026.

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OA No. 194 OF 2025

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at Plot No. 97-A, Rohini Nagar, Tehsil Phagi, Jaipur admeasuring 416.66 square yard for creation of Equitable Mortgage in favour of applicant bank by depositing the original title deeds i.e., Original Regd. Patta deed dt 04.04.2019 which is executed by Jaipur Development Authority in favour of Sh. Mohammad Farukh.

¶36

It is submitted that thereafter, besides the above, as per RBI and Banking guidelines the applicant bank was also sanctioned in the above-said cash credit account and sanctioned FITL under COVID 2019 scheme of Rs. 1,48,999/- in favour of the defendants which was also utilized by the defendants.

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It is submitted that to acknowledge the liabilities the relevant defendants had executed Letter of Acknowledge of debts (LAD) in favour of the applicant Bank and the particulars of the same, which is contained in the Letter of Acknowledge of debts dt 01.06.2022. That since the security documents were executed by Defendants on 26.07.2019 in favour of the applicant Bank, had executed Letter of Acknowledge of debts dt 01.06.2022 and create equitable mortgage of immovable property in favour of applicant bank, this Application is being filed within the period of limitation laid down under Limitation Act 1963 read with Section 24 of RDB Act, 1993.

¶38

Defendants failed to maintain financial discipline and therefore, their loan account was classified as NPA on

¶39

Order signed and uploaded on 31.01.2026.

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¶41

OA No. 194 OF 2025

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31.12.2020. Applicant Bank has therefore, filed this original application for recovery of its dues against the Defendants.

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10.It is submitted that it is pertinent to mentioned that after obtaining loan from applicant Bank the Defendants not maintain the account as per guidelines Defendants did not operate the Credit facility in consonance with the undertaken obligation. Thereafter on enquiry it comes in the knowledge of the applicant Bank that Defendants in conspiracy with each other in order to cause illegal loss to the applicant Bank and receive illicit gains for themselves has fraudulently obtain various loan/ finance from Bank by preparing forged documents for which a FIR No. 0122 as on dt. 13.03.2024 before Police Station Shastri Nagar has been lodged against borrowers and others Borrowers, which is pending for investigation. That the Applicant Bank also inform to the Defendants as they are jointly and severally liable towards all the dues of Applicant Bank which the Applicant Bank is entitled to realize and called upon them to make payment of outstanding amount along with future interest and expenses. However, despite of said information, the defendants failed to make payment of the outstanding amount to the Applicant Bank. That all the defendants being the principal borrowers & guarantor are jointly and severally. liable towards the Applicant Bank to make payment of the dues.

¶44

11.It is submitted that the defendants being the principal borrowers and guarantors, are jointly and severally liable towards the Applicant Bank to make payment of the aforesaid dues to the Applicant Bank which the Applicant

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Order signed and uploaded on 31.01.2026.

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OA No. 194 OF 2025

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Bank is entitled to realize, inter-alia, by sale of hypothecated assets and the personal assets of the Defendants for realization of dues of the Applicant Bank.

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Summons were issued to the Defendants on 26.03.2025 through court commissioner and Sh. Piyush Khandelwal undertook to file Vakalatnama on behalf of defendants.

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13.In this matter, no Vakalatnama has been filed, in view of this proxy counsel who appears mark his presence. However, on 09.07.2025, the presence of Mr. Piyush Khandelwal, advocate is marked. Not only this, but on 03.07.2025 also, the Registrar has noted his presence and his undertaking to file the Vakalatnama is also noted. Such statement of counsel is not acceptable. Therefore, defendants are proceeded ex parte. In view of this conduct, this OA stands decreed.

¶51

The Applicant Bank filed the evidence affidavit of Shri Dayal Singh coupled with the recitals in the documents, viz Exhibit A/1 to A/20 marked on behalf of the applicant bank, clinches the claim of the applicant bank against the Defendants. Hence, I hold that the Defendants are jointly & severally liable to pay to the applicant bank the claim made in O.A. with future interest and costs.

¶52

In the result, this O.A. No. 194 OF 2025 is allowed declaring that:-

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a) The Defendants are jointly & severally liable to pay to the applicant bank a sum of Rs. 24,68,365/- (Rupees Twenty Four Lac Sixty Eight Thousand Three Hundred and Sixty Five Only) with pendente lite and

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Order signed and uploaded on 31.01.2026.

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OA No. 194 OF 2025

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future interest @ 10% (simple) from 28.11.2024 till the date of realization.

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b) The applicant bank is entitled to recover the above amount from the sale of hypothecated assets and equitable mortgaged property – Residential Plot situated at Plot No. 97 A, Rohini Nagar, Tehsil Phagi, Jaipur admeasuring 416.66 Sq. Yards in the name of Sh. Mohammad Farukh as well as from the personal movable and immovable properties/assets of Defendants. The applicant bank is entitled to proceed against the same towards recovery of its debt.

¶59

c) Counsel for the Applicant Bank has filed an IA 1283/2025 for attachment against the Defendant no. 4 Sh. Bhanwar Ali who is the owner of property converted land khasra no. 265, 266 area 201.65 Sq. yds/168.60 Sq. mts. situated at Karoth Road, Rajgarh, Alwar, Rajasthan. Defendant No. 4 is directed to maintain status quo with respect to the said property. So far as attachment is concerned, the same shall be dealt with by the Recovery Officer.

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d) The applicant bank is entitled to the costs of the O.A.

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16.The recovery certificate be issued forthwith and be sent to the Recovery Officer, DRT, Jaipur.

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17.Parties are directed to appear before the Recovery Officer, DRT, Jaipur on 13.03.2026 .

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18.Prepare Recovery Certificate accordingly.

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Order signed and uploaded on 31.01.2026.

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OA No. 194 OF 2025

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19.A copy of the Judgment and Recovery Certificate be given or sent by registered post to each of the parties free. A copy of the Recovery Certificate be sent to the Recovery Officer of this Tribunal for necessary action as per the law.

¶68

(Vimal Gupta) Presiding Officer, Debts Recovery Tribunal, Jaipur

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Order pronounced in the open court today i.e. 29.01.2026 .

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(Vimal Gupta) Presiding Officer, Debts Recovery Tribunal, Jaipur

¶71

Order signed and uploaded on 31.01.2026.

¶72

¶73

OA No. 194 OF 2025

¶74

BEFORE THE DEBTS RECOVERY TRIBUNAL, JAIPUR PRESENT- SHRI VIMAL GUPTA

¶75

PRESIDING OFFICER

¶76

O.A. NO. 194 OF 2025

¶77

DATE OF DELIVERY OF ORDER 29.01.2026

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RECOVERY CERTIFICATE

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(UNDER SUB Section 22 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (Act 51 of 1993)

…..Applicant Bank…..

VERSUS

2. Sh. Sameer Ali S/o. Sh. Sarvar Ali as partner of Firm M/s. LAXMI FOODS Residing at Plot No. 7-8, Foysagar Road, Near GC -2, MS Rawat Colony, Ajmer (Raj).305001.

¶85

3. Sh. Shahbaj Ali S/o. Sh. Sarvar Ali, as partner of Firm M/s. LAXMI FOODS R/o Plot No. 78, Foysagar Road, Chamunda Choraha - Near MS Colony, Ajmer (Raj).305001.

¶86

4. Sh. Bhanwar Ali S/o. Sh. Lal Mohammed as partner of Firm M/s. LAXMI FOODS R/o. Plot No. 7, Shanti Vihar, Karoth Road, Rajgarh, Alwar. (Raj) 301408 .

¶87

Order signed and uploaded on 31.01.2026.

¶88

¶89

OA No. 194 OF 2025

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5. Sh. Mohammad Farukh S/o. Sh. Bhanwar Ali, Guarantor as well as owner of the mortgage property, R/o: - Plot No. 7, Shanti Vihar, Karoth Road, Rajgarh, Alwar. (Raj) 301408.

¶91

6. Sh. Sunil Khan S/o. Sh. Sanjay Khan Guarantor R/o P. No. 300, Jagannath Puri, Boring Road, Jhotwara Jaipur (Raj) 302012.

¶92

……Defendants…..

¶93

Recovery Certificate for Rs. 24,68,365/-

¶94

In terms of final order dated 29.01.2026 passed by this Tribunal in the above mentioned case, it is ordered that the-

¶95

a) The Defendants are jointly & severally liable to pay to the applicant bank a sum of Rs. 24,68,365/- (Rupees Twenty Four Lac Sixty Eight Thousand Three Hundred and Sixty Five Only) with pendente lite and future interest @ 10% (simple) from 28.11.2024 till the date of realization.

¶96

b) The applicant bank is entitled to recover the above amount from the sale of hypothecated assets and equitable mortgaged property – Residential Plot situated at Plot No. 97 A, Rohini Nagar, Tehsil Phagi, Jaipur admeasuring 416.66 Sq. Yards in the name of Sh. Mohammad Farukh as well as from the personal movable and immovable properties/assets of Defendants. The applicant bank is entitled to proceed against the same towards recovery of its debt.

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c) Counsel for the Applicant Bank has filed an IA 1283/2025 for attachment against the Defendant no.

¶98

Order signed and uploaded on 31.01.2026.

¶99

¶100

OA No. 194 OF 2025

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4 Sh. Bhanwar Ali who is the owner of property converted land khasra no. 265, 266 area 201.65 Sq. yds/168.60 Sq. mts. situated at Karoth Road, Rajgarh, Alwar, Rajasthan. Defendant No. 4 is directed to maintain status quo with respect to the said property. So far as attachment is concerned, the same shall be dealt with by the Recovery Officer.

¶102

d) The applicant bank is entitled to the costs of the O.A.

¶103

Parties are directed to appear before the Recovery Officer, DRT, Jaipur on 13.03.2026 .

¶104

The Recovery Officer shall realize the amount as per this Certificate in the manner and mode prescribed under Section 25 and 28 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (as amended from time to time) from the above named Certificate Debtor.

¶105

This Certificate has been issued under my signatures and seal of the Tribunal on this 29.01.2026 .

¶106

(Vimal Gupta) Presiding Officer, Debts Recovery Tribunal, Jaipur

¶107

Order signed and uploaded on 31.01.2026.

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¶109

OA No. 194 OF 2025

¶110

BEFORE THE DEBTS RECOVERY TRIBUNAL, JAIPUR PRESENT- SHRI VIMAL GUPTA

¶111

PRESIDING OFFICER

¶112

O.A. NO. 194 OF 2025

¶113

DATE OF DELIVERY OF ORDER 29.01.2026

¶114

SCHEDULE TO RECOVERY CERTIFICATE

MEMO OF COST

…..Applicant Bank…..

VERSUS

2. Sh. Sameer Ali S/o. Sh. Sarvar Ali as partner of Firm M/s. LAXMI FOODS Residing at Plot No. 7-8, Foysagar Road, Near GC -2, MS Rawat Colony, Ajmer (Raj).305001.

¶121

3. Sh. Shahbaj Ali S/o. Sh. Sarvar Ali, as partner of Firm M/s. LAXMI FOODS R/o Plot No. 78, Foysagar Road, Chamunda Choraha - Near MS Colony, Ajmer (Raj).305001.

¶122

4. Sh. Bhanwar Ali S/o. Sh. Lal Mohammed as partner of Firm M/s. LAXMI FOODS R/o. Plot No. 7, Shanti Vihar, Karoth Road, Rajgarh, Alwar. (Raj) 301408 .

¶123

Order signed and uploaded on 31.01.2026.

¶124

¶125

OA No. 194 OF 2025

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5. Sh. Mohammad Farukh S/o. Sh. Bhanwar Ali, Guarantor as well as owner of the mortgage property, R/o: - Plot No. 7, Shanti Vihar, Karoth Road, Rajgarh, Alwar. (Raj) 301408.

¶127

6. Sh. Sunil Khan S/o. Sh. Sanjay Khan Guarantor R/o P. No. 300, Jagannath Puri, Boring Road, Jhotwara Jaipur (Raj) 302012.

¶128

……Defendants…..

¶129

S.No.	Item of Costs	Amount (Rs.)
1	Fee on the Application	27,005.00
2	Process Fee (Inc. Publication)	NIL
3	Advocate Fee	1,250.00
4	Court Commissioner’s Fees	10,000.00
5	Commission/Receiver/Valuation	NIL
6	Miscellaneous Charges	NIL
	Total	38,255.00

¶130

(Vimal Gupta) Presiding Officer, Debts Recovery Tribunal, Jaipur

¶131

Order signed and uploaded on 31.01.2026.

OA No. 194 OF 2025

29.01.2026

Counsel:

Sh. Sanjog Gupta, Counsel for Applicant Bank Defendants are ex-parte

¶137

Judgment dictated separately and pronounced in the open court. As per order the O.A. is allowed. Recovery Certificate be prepared accordingly and the Registry is directed to verify the Recovery Certificate as per Regulation 24(1) and (2) of Debts Recovery Tribunal Jaipur Regulation 2015 and after verification place the same before the Tribunal.

¶138

(Vimal Gupta) Presiding Officer, Debts Recovery Tribunal, Jaipur

¶139

Order signed and uploaded on 31.01.2026.

OA No. 194 OF 2025

29.01.2026

Counsel:

Sh. Sanjog Gupta, Counsel for Applicant Bank Defendants are ex-parte

¶145

The Tribunal vide order dated 29.01.2026 , directed the Registrar to verify the Recovery Certificate as per Regulation 24(1) and (2) of Debts Recovery Tribunal Jaipur Regulation 2015.

¶146

The Registrar vide order dated 29.01.2026 verified the Recovery Certificate as per Regulation 24(1) and (2) of Debts Recovery Tribunal Jaipur Regulation 2015. Recovery Certificate be prepared accordingly. Copy of the Judgment and Recovery Certificate be given free to the concerned parties as well as be sent to the Recovery Officer for further proceedings. File be put up before the Registrar for compliance. After compliance file be consigned to record.

¶147

(Vimal Gupta) Presiding Officer, Debts Recovery Tribunal, Jaipur

¶148

Order signed and uploaded on 31.01.2026.

The Nainital Bank Ltd. v. Ms Laxmi Foods

Case brief

What is this about?

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The Nainital Bank Ltd. v. Ms Laxmi Foods

Case brief

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