Allowed

Union Bank of India v. M/S Dev Foods and Another

DRT15 May 2026OA/253/2026

Case brief

AI extract

What is this about?

The DRT allowed the bank's application for recovery of dues. The Tribunal affirmed the liability of the defendants to pay the principal amount and modified the interest rate from the claimed rates to a uniform simple interest of 7.5% p.a.

What did the court decide?

Declaration of liability to pay Rs.31,79,317.64 with simple interest at 7.5% p.a. and direction to issue Recovery Certificate.

Union Bank of India versus M/S Dev Foods and Another — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.253/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 10.02.2026

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DATE OF DECISION: 15.05.2026

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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 Civil Lines, Ludhiana, through its duly Authorized Person and Power of Attorney holder Sh. Antesh Sinha, Branch Manager.

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……..Applicant

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Versus

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M/s Dev Foods, through its proprietor Sh. Sunil Kumar Yadav, Plot no. 277, near Sofa Gadda Factory, Street no. 3, Dhandra Road, Shaheed Baba Deep Singh Nagar, Dugri, Ludhiana, Punjab-141013.

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2. Sh. Sunil Kumar Yadav S/o Sh. Suresh Kumar Yadav, R/o Guru Nanak Colony, Block-A, Backside Near Family Mega Mart, Meraddo Colony, Ludhiana-141006.

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2nd address: Shop no. 6-11, Ground Floor, ULTRATECH Shopping complex, Gordhanpura Chowki, Kotputli-27, Rajasthan-91, India-303109.

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3rd address : 6-Kalyanpuri, Jaipur, Rajasthan-302021.

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……..Defendants

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Advocates:

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Argued by Sh. Amod Kumar Thakur, Advocate proxy for Sh. R K Chauhan, Advocate for the Applicant

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None for Defendants (Already ex-parte vide order dated 11.05.2026).

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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

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2 OA/253/2026 UNION BANK OF INDIA VS M/S DEV FOODS AND ANOTHER

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the defendants for recovery of Rs.31,79,317.64 (Rupees Thirty One Lacs Seventy Nine Thousand Three Hundred Seventeen and Paise Sixty Four Only). The Original Application has been filed through Sh. Antesh Sinha, Branch Manager of the applicant, who is competent to institute the Original Application vide Power of Attorney dated 08.01.2024, 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 grant of Cash Credit Limit of Rs.24,50,000.00 vide Application Form for MSMEs dated 29.10.2020, which is Annexure A2 to this OA. Thereafter, the defendant no. 1 through its proprietor defendant no. 2 again approached the applicant for renewal of Cash Credit Limit of Rs.24,50,000.00 and Sanction of Fresh UGECL Term Loan of Rs.5,35,000.00 vide request letter dated 13.10.2022, which is Annexure A12 to this OA;

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The applicant sanctioned the Cash Credit Limit of Rs.24,50,000.00 vide Memorandum of Sanction dated 30.10.2020, which is Annexure A5 to this OA. Thereafter, the applicant sanctioned the Term Loan under UGECL Scheme of Rs.5,35,000.00 vide Sanction Advice and Memorandum of Sanction, both dated 14.10.2022, which are Annexures A13 & A14 to this OA and the terms and conditions were duly accepted by the defendant no. 1 through its proprietor defendant no. 2. Defendant no. 2 stood as guarantor.

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Defendant no. 1 through its proprietor defendant no. 2 hypothecated its Stocks and Book Debts vide Hypothecation Agreement of Goods & Debts dated 02.11.2020, which is Annexure A8 to this OA.

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Documents executed: GST Registration Certificate dated 04.12.2018, which is Annexure A3 to this OA; Udyog Aadhar Registration Certificate dated 05.09.2019, which is Annexure A4 to this OA; Demand Promissory Note, Letter of Continuity, Letter of Undertaking from Borrower(s), AD-02A, Deed of Guarantee all dated

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OA/253/2026

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UNION BANK OF INDIA VS M/S DEV FOODS AND ANOTHER

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02.11.2020, which are Annexures A6, A7 & A9 to A11 to this OA; Demand Promissory Note, Letter of Continuity, General Term Loan Agreement, Letter of Undertaking from Borrower(s), Interest Agreement, AD-02A, Composite Hypothecation Deed, all dated 15.10.2022, which are Annexures A15 to A21 to this OA; Demand Promissory Note, Letter of Continuity, General Term Loan Agreement, AD-02A, Debit Balance Confirmation Letter, all dated 31.03.2023, which are Annexures A22 to A26 to this OA; Legal Notice dated 28.05.2025 along with Postal Receipts, which is Annexure A27 (Colly) to this OA; Statement of Accounts along with certificates, which are Annexures A28 to A31 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 loan accounts there were a debit of Rs.31,79,317.64 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

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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 11.05.2026.

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In support of the OA, affidavit of Sh. Antesh Sinha, Branch Manager, Union Bank of India has been filed.

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Heard ex-parte arguments and perused record.

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It was argued by learned proxy counsel for applicant that in view of the documentary evidence brought on record which had gone unrebutted, the applicant had proved its case.

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From the perusal of all the Annexures A1 to A31 to this OA, it is proved that the defendant no. 1 through its proprietor defendant no. 2 approached applicant 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

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OA/253/2026 UNION BANK OF INDIA VS M/S DEV FOODS AND ANOTHER

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the loan as per terms and conditions of the agreement between the parties. Subsequently, both the loan accounts were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.31,79,317.64 (Rupees Thirty One Lacs Seventy Nine Thousand Three Hundred Seventeen and Paise Sixty 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 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 @10.50%p.a. with monthly rests with penal interest @2.00% in Cash Credit Account and interest @07.50%p.a. with monthly rests with penal interest @2.00% in Term Loan Account from 01.02.2026 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 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 @07.50%p.a. in both 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 is liable to pay to the applicant a total sum of Rs.31,79,317.64 (Rupees Thirty One Lacs Seventy Nine Thousand Three Hundred Seventeen and Paise Sixty Four Only), with costs, current and future simple interest @07.50%p.a. in both 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

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OA/253/2026

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UNION BANK OF INDIA VS M/S DEV FOODS AND ANOTHER

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aforesaid amount from the sale of hypothecated assets 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 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 06.06.2026.

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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: 15.05.2026

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

Union Bank of India v. M/S Dev Foods and Another

Case brief

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Union Bank of India v. M/S Dev Foods and Another

Case brief

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