Allowed

Union Bank of India v. M/S Good Luck Foods and Others

DRT24 Mar 2026OA/275/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the applicant bank's application for recovery of Rs.2.09 crore against respondents who failed to repay sanctioned loans. The court set a uniform interest rate of 8% p.a. and ordered the issuance of a Recovery Certificate.

What did the court decide?

Declaration of liability to pay Rs.2,09,15,638.00 with 8% simple interest; issuance of Recovery Certificate.

Union Bank of India versus M/S Good Luck Foods and… — Contract and Commercial Disputes | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.275/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 04.03.2022

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Date of Decision: 24.03.2026

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Union Bank of India, having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai-400021, having its Branch Office at Union Bank of India, S.C.O. 64/65, Sector-17B (Main), Chandigarh through its Attorney Holder Sh. Vivek Kumar, Branch Manager

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……..Applicant

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Versus

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M/S Good Luck Foods, through its Partners, situated at Village Ranimajra, Handesara Road, Lalru, Tehsil-Derabassi, District S.A.S Nagar, Mohali, Punjab, Pincode 140501.

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Sh. Ajay Narayan Goyal son of Sh. Satya Narayan Goyal, Partner of M/s Good Luck Foods, Resident of House No. 31, Sector-21, Panchkula-134109.

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Second Address: Flat No. 702, Block A, Royal Mansion, Peer Muchalla, Zirakpur, SAS Nagar, Punjab-140603.

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Smt. Sangeeta Goyal wife of Sh. Jagat Narayan Goyal, Partner of M/s Good Luck Foods, Resident of House No. 31, Sector - 21, Panchkula - 134109

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Second Address: Flat No. 702, Block A, Royal Mansion, Peer

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Muchalla, Zirakpur, SAS Nagar, Punjab-140603.

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….……Defendants

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Advocates:

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Argued by Sh. Ravinder Kumar, Advocate for applicant

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Defendants already ex-parte vide order dated 01.01.2026.

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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 & Bankruptcy Act, 1993, against the defendants for recovery of Rs.2,09,15,638.00 (Rupees Two Crore Nine Lacs Fifteen Thousand Six Hundred Thirty Eight Only). The Original Application has been filed through Sh. Vivek Kumar, Branch

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OA NO.275/2022 UNION BANK OF INDIA VS. MESSRS GOOD LUCK FOODS AND OTHERS

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Manager of the applicant, who is competent to institute the Original Application vide Power of Attorney dated 30.12.2013, 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 partners defendant nos.2 & 3 was availing the facilities of Cash Credit Limit of Rs.157.50 Lacs, Cash Credit (Seasonal) Limit of Rs.31.50 Lacs and Car Loan of Rs.12.00 Lacs from the applicant and approached the applicant for renewal and enhancement of the Cash Credit limit to Rs.180.00 Lacs, Cash Credit (Seasonal) Limit of Rs.45.00 Lacs. Defendant nos. 2 and 3 stood as guarantors.

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The applicant sanctioned renewal cum enhancement of the Cash Credit limit for Rs.180.00 Lacs, Cash Credit (Seasonal) Limit for Rs.45.00 Lacs vide sanction Letter dated 05.09.2017, which is Annexure A2 to this OA. The applicant sanctioned Car Loan of Rs.12.00 Lacs vide letter of sanction dated 30.07.2015, which is Annexure A17 to this OA. The terms and conditions were duly accepted by the defendants.

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Defendant No. 1 through its partners hypothecated stock and book debts etc. vide hypothecation agreement of good and debts dated 11.09.2017, which is Annexure A6 to this OA.

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Defendant No. 1 through its partners hypothecated Car namely HUNDAI CRETA 1.8 CRDI SX(O) bearing Registration no. HR03T3121, Chasis No. MALC381ULFM021877*H, vide hypothecation of vehicles agreement dated 08.09.2015, which is Annexure A20 to this OA; Registration Certificate of Car, is Annexure A29 to this OA.

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Defendant no. 1 through its partners mortgaged immovable property i.e. Poultry Farm Land and Building measuring 07Bighas-19Biswas situated at Village Rani Manjra, Tehsil Derabassi, District SAS Nagar, Mohali Punjab through equitable mortgage of sale deed bearing vasika no. 6185 dated 17.12.2007. Sale deed along with its translation filed on 05.03.2026 vide diary no. 3780 in compliance to order dated 05.02.2026. Except it following documents were also filed:

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OA NO.275/2022 UNION BANK OF INDIA VS. MESSRS GOOD LUCK FOODS AND OTHERS

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Title report dated 29.08.2014, which is Annexure A26 to this OA; Memorandum of entry dated 13.09.2017, along with declaration dated 11.09.2017, which are Annexure A27 (Colly) to this OA.; Valuation report dated 11.09.2017, which is Annexure A28 to this OA.

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Documents executed: Interest Agreement, D.P. Note, Letter of Undertaking, Letter of Continuity, Letter of general lien and set off, Letter of undertaking not to alienate hypothecated goods, letter of undertaking from guarantors, letter of confirmation (for MCLR Loans), Letter of undertaking from partners, declaration of partnership, Guarantee Agreement executed by defendant nos. 2 and 3, all dated 11.09.2017, which are Annexures A3 to A5 and A7 to A15 to this OA; Vetting report dated 14.09.2017 by Advocate, which is Annexure A16 to this OA; D.P. Note, Letter of undertaking from borrowers, declaration of partnership, letter of undertaking from guarantors, letter of guarantee, consent for takeover penalty, vetting report by Advocate, all dated 08.09.2015, which are Annexures A18, A19 and A21 to A25 to this OA; Balance Confirmation letter dated 04.07.2020, which are Annexures A30 and A31 to this OA; Balance Confirmation letter dated 05.01.2021, which is Annexure A32 to this OA; Notice dated 23.04.2021 u/s 13(2) of SARFAESI Act, which is Annexure A33 to this OA; Statement of Account with memoranda and Certificates, which are Annexure A34(Colly) to this OA. 5. The loan accounts became irregular and were classified as NPA and after adjusting debit and credit entries in the loan accounts there was a debit of Rs.2,09,15,638.00, 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. 6. 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 01.01.2026.

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OA NO.275/2022 UNION BANK OF INDIA VS. MESSRS GOOD LUCK FOODS AND OTHERS

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In support of the OA, affidavit of Sh. Vivek Kumar, Branch Manager, Union Bank of India has been filed. 8. Heard ex-parte 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 A34 to this OA, it is proved that the defendants approached applicant for renewal and enhancement 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 the loans as per terms and conditions of the agreement between the parties. Subsequently, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant bank is entitled to recover a sum of Rs.2,09,15,638.00 (Rupees Two Crore Nine Lacs Fifteen Thousand Six Hundred Thirty Eight 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 @10.45%p.a. in Car Loan and @11.30%p.a. in CC Limit, with 2% penal interest in both accounts from 04.03.2022 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 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 @8.00%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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OA NO.275/2022 UNION BANK OF INDIA VS. MESSRS GOOD LUCK FOODS AND OTHERS

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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.2,09,15,638.00 (Rupees Two Crore Nine Lacs Fifteen Thousand Six Hundred Thirty Eight Only), jointly and severally, with costs, current and future simple interest @8.00%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 aforesaid amount from the sale of mortgaged properties/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 16.04.2026.

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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. Pronounced by me in the open Tribunal . Dated: 24.03.2026.

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

Union Bank of India v. M/S Good Luck Foods and Others

Case brief

What is this about?

What did the court decide?

Union Bank of India v. M/S Good Luck Foods and Others

Case brief

What is this about?

What did the court decide?

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