Allowed

Union Bank of India v. M/S the Urban Beauty House and Another

DRT5 Jan 2026OA/236/2025

Case brief

AI extract

What is this about?

The Tribunal allowed the debtor recovery application filed by Union Bank of India against M/s The Urban Beauty House and Sh. Medhavi Kalra for Rs. 20,45,500.55. The court ordered the defendants to pay the principal amount along with future simple interest at 8% p.a. and directed the issuance of a Recovery Certificate.

What did the court decide?

Recovery of Rs. 20,45,500.55 with future simple interest at 8% p.a.; issuance of Recovery Certificate; liberty to enforce via execution proceedings.

Union Bank of India versus M/S the Urban Beauty… — Contract and Commercial Disputes | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.236/2025

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 21.02.2025

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DATE OF DECISION: 05.01.2026

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Union Bank of India, a body corporate, constituted under Banking Companies (Acquisition & Transfer of Undertakings) Act 1970 having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai and having a Branch office inter-alia at Kesar Ganj, Ludhiana, through duly authorized person and attorney holder Sh. Rohit Chhabra, Branch Manager.

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……..Applicant

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Versus

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M/s The Urban Beauty House, Plot no. 72, Industrial Area-А, Sufian Chowk, Ludhiana 141008, (Through its prop. Sh. Medhavi Kalra)

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Sh. Medhavi Kalra son of Sh. Charanjit Kalra, Resident of M-4, RVEP, Omaxe Royal Regency, Near Sidharatha Resorts, Pakhowal Road, Thakkarwal, Ludhiana-142022 (Prop. of M/s The Urban Beauty House).

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….……Defendants

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Advocates:

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Argued by Sh. Rahul Garg, Advocate proxy for Sh. RK Chauhan, Advocate for applicant

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Defendants already ex parte vide order dated 17.11.2025

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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.20,45,500.55 (Rupees Twenty Lacs Forty Five Thousand Five Hundred & Paise Fifty Five Only). The Original Application has been filed through Sh. Rohit Chhabra, Branch Manager, of the applicant, who is competent to institute the Original Application vide General Power of Attorney dated 25.08.2020, 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

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OA NO.236/2025 UNION BANK OF INDIA VS. M/S THE URBAN BEAUTY HOUSE AND ANOTHER

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Cash Credit Limit of Rs.20.00 Lacs vide loan application dated 20.12.2022, which is Annexure A2 to this OA. 3. The applicant sanctioned the Cash Credit Limit of Rs.20.00 Lacs vide memorandum to Chief Manager dated 26.12.2022 and sanction letter dated 27.12.2022, which are Annexures A6 and A7 to this OA and terms and conditions of sanction dated 27.12.2022, which is Annexure A8 to this OA were duly accepted by the defendants. 4. Defendant no. 1 through its proprietor defendant no. 2 hypothecated stock of cosmetics and salon products vide. hypothecation (goods and debts) agreement dated 27.12.2022, which is Annexure A11 to this OA. Documents executed: GST Registration Certificate, Udyam registration certificate, which are Annexures A3 & A4 to this OA; Due Diligence report dated 23.12.2022, which is Annexure A5 to this OA; demand promissory note, letter of continuity, letter of undertaking from the borrower, AD-02A, Letter of undertaking not to alienate hypothecated goods, undertaking by defendants, deed of guarantee executed by defendant no. 2, letter of undertaking from guarantor, all dated 27.12.2022, which are Annexures A8 to A10 and A12 to A17 to this OA; Letter by bank of adjustment of overdue dated 04.10.2023, 26.10.2023,19.02.2024, 03.05.2024, 12.07.2024, 12.09.2024, which are Annexures A18 to A23 to this OA; Legal notice dated 28.11.2024 and postal receipts, which is Annexure A24 (Colly) to this OA and statements of account along with certificate under banker books evidence, which are Annexures A25 & A26 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.20,45,500.55, 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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OA NO.236/2025 UNION BANK OF INDIA VS. M/S THE URBAN BEAUTY HOUSE AND ANOTHER

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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 17.11.2025. 7. In support of the OA, affidavit of Sh. Rohit Chhabra, Branch Manager, Union Bank of India, has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned proxy 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 A26 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 bank is entitled to recover a sum of Rs.20,45,500.55 (Rupees Twenty Lacs Forty Five Thousand Five Hundred & Paise Fifty Five 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.

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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 @11.30%p.a. with 2% p.a. penal interest with monthly rests from 01.02.2025 till 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

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OA NO.236/2025 UNION BANK OF INDIA VS. M/S THE URBAN BEAUTY HOUSE AND ANOTHER

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@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.20,45,500.55 (Rupees Twenty Lacs Forty Five Thousand Five Hundred & Paise Fifty Five 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 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 .

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Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 15.01.2026.

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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: 05.01.2026.

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

Union Bank of India v. M/S the Urban Beauty House and Another

Case brief

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Union Bank of India v. M/S the Urban Beauty House and Another

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