Allowed

State Bank of India v. Messrs Teji Industries and Others

DRT26 May 2026OA/28/2023

Case brief

AI extract

What is this about?

The Tribunal allowed an Original Application filed by State Bank of India for recovery of a NBFC loan amount. Finding the defendants liable, the Tribunal decreed the principal amount along with reduced simple interest at 8% per annum and issued a Recovery Certificate.

What did the court decide?

Recovery of principal amount of Rs. 55,44,137.98 with simple interest at 8% p.a. and issue of Recovery Certificate for enforcement.

State Bank of India versus Messrs Teji Industries and Others — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 28/2023

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 29.12.2022

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DATE OF DECISION: 26.05.2026

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State Bank of India, a Body Corporate constituted under the provisions of the State Bank of India Act, 1955 (23 of 1955) having its Corporate Office at Madame Cama Road, Nariman Point, Mumbai, Maharashtra400021 carrying on its Business of Banking in India and abroad and having one of its Local Head Office at Sector 17A, Chandigarh having its Branch amongst other places at Dugri II, Ludhiana, Punjab- 141001 and one of the Specialized Branch known as Stressed Assets Recovery Branch, 3^rd Floor, Admin Office Building at Fountain Chowk, Civil Lines, Ludhiana, Punjab- 141001 through its Chief Manager, Sh. Chanchal Singh

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……..Applicant Versus
1. M/S Teji Industries, a Proprietorship Firm at Plot no. 92-93,
Amaltas Enclave, Hazoori Bagh Colony, Village and Post Office
Bhattian, Jalandhar Byepass Road, District Ludhiana, Punjab-
141008 through its Proprietor, Smt. Paramjit Kaur Teji, W/o Sh.
Mohinder Singh Teji
2^ndAddress:1073, Sardar Nagar, Basti Jodhewal, Rahon Road,
Ludhiana, Punjab- 141007
2. Smt. Paramjit Kaur Teji, W/o Sh. Mohinder Singh Teji, Proprietor
of M/S Teji Industries, R/o House no. 2, Amaltas Enclave, near
DD Public School, Hazoori Bagh Colony, Village and Post Office
Bhattian, Jalandhar Byepass, District Ludhiana, Punjab- 141008
3. Sh. Harpreet Singh Teji, S/o Sh. Mohinder Singh Teji, R/o House
no. 2, Amaltas Enclave, near DD Public School, Hazoori Bagh
Colony, Village and Post Office Bhattian, Jalandhar Byepass,
District Ludhiana, Punjab- 141008 …Defendants

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2 OA/28/2023 STATE BANK OF INDIA VS. M/S TEJI INDUSTRIES AND OTHERS

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Advocates:

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Argued by Sh. Vivek Verma, Advocate for applicant Sh. Gurnam Singh, Advocate for defendants

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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 the defendants for recovery of Rs. 55,44,137.98 (Rupees Fifty Five Lacs Forty Four Thousand One Hundred Thirty Seven and Paise Ninety Eight Only). The Original Application has been filed through Sh. Chanchal Singh, Chief Manager of the applicant, who is competent to institute the Original Application vide Notification dated 02.05.1987, which is Annexure A to this OA.

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The brief facts of the OA are that defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for grant of Term Loan of Rs. 11.00 Lacs and CC Limit of Rs. 10.00 Lacs for Unit I vide Application for Loan dated 28.02.2008, which is Annexure A1 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 again approached the applicant for grant of CC Limit of Rs. 15.00 Lacs and Term Loan of Rs. 56.50 Lacs for Unit II. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 again approached the applicant for enhancement of CC Limit to Rs. 25.00 Lacs, renewal of Term Loan of Rs. 53.31 and Term Loan II of Rs. 1.47 Lacs for Unit II. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for merger of both the units vide Request Letter dated 30.06.2011, which is Annexure A7 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of CC Limit of Rs. 35.00 Lacs. 3. The applicant sanctioned Term Loan of Rs. 11.00 Lacs and CC Limit of Rs. 10.00 Lacs for Unit I vide Letter of Arrangement dated 15.03.2008, which is Annexure A2 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the

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3 OA/28/2023

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STATE BANK OF INDIA VS. M/S TEJI INDUSTRIES AND OTHERS

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applicant sanctioned CC Limit of Rs. 15.00 Lacs and Term Loan of Rs.56.50 Lacs for Unit II vide Letter of Arrangement dated 14.01.2009, which is Annexure A5 to this OA. Thereafter, the applicant sanctioned enhancement of CC Limit to Rs. 25.00 Lacs, renewal of Term Loan of Rs. 53.31 Lacs and Term Loan II of Rs. 1.47 Lacs for Unit II vide Letter of Arrangement dated 06.12.2009, which is Annexure A6 to this OA. Thereafter, after merger of both units by defendant no. 1, the CC Limit of Rs. 10.00 Lacs of Unit I and Rs. 25.00 Lacs of Unit II was merged into single CC Limit of Rs. 35.00 Lacs by applicant along with review of Term Loan I of Rs. 42.12 Lacs and Term Loan II of Rs. 0.76 Lacs vide Approval Letter dated 08.07.2011 and Letter of Arrangement dated 11.07.2011, which are Annexure A8 and A9 to this OA. Thereafter, the applicant sanctioned renewal of CC Limit of Rs. 35.00 Lacs vide Letter of Arrangement dated 10.04.2017, which is Annexure A13 to this OA. Defendant no. 3 stood as guarantor.

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As per OA, the Term Loan Accounts stands closed.

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Defendant nos. 2 and 3 mortgaged their immovable property i.e. Land measuring 466 Sq. Yards situated at Village Bhattian, Hadbast no. 89, Tehsil and District Ludhiana, Punjab vide Sale Deed bearing vasika no. 6556 dated 16.08.2016, Deed bearing vasika no. 4442 dated 25.07.2013 and Deed bearing vasika no. 5192 dated 05.09.2013, along with their translation and Letter of Confirmation and Memorandum for recording extension of Mortgage, both dated 10.04.2017, which are Annexure A16 to A20 to this OA.

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Defendant no. 1 through its Proprietor defendant no. 2 hypothecated their stocks, receivables, plant and machinery etc. vide Agreement of Loan cum Hypothecation dated 15.03.2008, 11.07.2011 and 10.04.2017, which are Annexure A3, A10 and A14 to this OA. Documents executed: Guarantee Agreements dated 15.03.2008 and 10.04.2017, which are Annexure A4 and A15 to this OA; Link Letter

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and Guarantee Agreement, both dated 11.07.2011, which are

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Annexure A11 and A12 to this OA; Revival Letters dated

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4 OA/28/2023 STATE BANK OF INDIA VS. M/S TEJI INDUSTRIES AND OTHERS

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22.12.2010, 22.03.2014, 25.03.2016 and 13.12.2019, which are Annexure A21 to A24 to this OA; Legal Notice dated 25.11.2022 along with postal receipts, which is Annexure A25 to this OA; Statement of Account, which is Annexure A26 to this OA; Notice dated 06.12.2018, which is Annexure A27 to this OA; Possession Notice dated 19.09.2019, which is Annexure A28 to this OA and Valuation Report dated 14.11.2022, which is Annexure A29 to this OA.

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The CC Limit 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. 55,44,137.98, 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 and after service upon defendants, Sh. Yogesh Kumar, Advocate appeared on behalf of defendants on 28.05.2025 and filed Memo of Appearance. POA on behalf of defendants was filed on 27.06.2025. WS on behalf of defendants was filed on 27.06.2025. Thereafter, the process of admission or denial of documents was completed on 21.11.2025.

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In support of the OA, affidavit of Sh. Chanchal Singh, Chief Manager , State Bank of India has been filed.

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Heard arguments and perused record.

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It was argued by learned counsel for applicant that in view of the documentary evidence brought on record, the applicant had proved its case. Learned counsel for defendants submitted that lenient view may be taken at the time of decree and prayed for granting of simple rate of interest. It was further argued that he is not pressing for any other grounds.

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From the perusal of all the Annexure A and A1 to A29 to this

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OA, it is proved that the defendant no. 1 through its Proprietor

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OA/28/2023 STATE BANK OF INDIA VS. M/S TEJI INDUSTRIES AND OTHERS

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defendant no. 2 approached applicant for availing of the loan facility, which was granted to them. Defendant no. 3 stood as guarantor. Defendants 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, the account of the defendants was classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs. 55,44,137.98 (Rupees Fifty Five Lacs Forty Four Thousand One Hundred Thirty Seven and Paise Ninety 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 amount.

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In so far as pendent elite and future rate of interest is concerned, the applicant in relief clause has claimed interest @12.60%p.a. plus @2% penal interest with monthly rests from 03.12.2022 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 hypothecated assets/mortgaged property, 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 @08.00% 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.55,44,137.98 (Rupees Fifty Five Lacs Forty Four Thousand One Hundred Thirty Seven and Paise Ninety Eight Only), jointly and severally, with costs, current and future simple interest @08.00% p.a.

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6 OA/28/2023 STATE BANK OF INDIA VS. M/S TEJI INDUSTRIES AND OTHERS

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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/mortgaged property 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. 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 17.06.2026. 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: 26.05.2026 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

State Bank of India v. Messrs Teji Industries and Others

Case brief

What is this about?

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State Bank of India v. Messrs Teji Industries and Others

Case brief

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