Allowed

Uco Bank v. M/S Samarth Food and Beverages and Another

DRT8 Apr 2026OA/298/2026

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an original application by UCO Bank against borrowers Muslim Samarth Food and Beverages and Smt. Rakhil. The adjudicating officer confirmed the debt, granted a modification of the interest rate to 8% per annum, and directed issuance of a recovery certificate.

What did the court decide?

Recovery certificate directed; Respondents declared liable to pay Rs.22,43,441.24 plus interest at 8% p.a.

Uco Bank versus M/S Samarth Food and Beverages and Another — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.298/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 07.02.2026

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DATE OF DECISION: 08.04.2026

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UCO BANK, a Body Corporate, constituted under the Banking Companies (Acquisition and Transfer of undertakings) Act, 1970 having its Head office at 10-Brabourn Road, Kolkata and its branches throughout India and amongst other branches having a Branch Office at Jagirpur, Ludhiana, through its Constituted Attorney Sh. Nitin Kaushal, Branch Manager, UCO Bank, Jagirpur Branch, Ludhiana and who is also the Principal Officer of the Plaintiff/Applicant Bank.

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……..Applicant

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Versus

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M/s Samarth Food and Beverages through its Proprietor Smt. Rakhil W/o Sh. Prabhjot Singh, Street No. 2, Gautam Colony, Rahon Road, Jagirpur, Ludhiana-141007.

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2^nd Address: H. No. 410, Street No. 3, New Vishwakarma Colony, Jamalpur, Ludhiana, Punjab-141010.

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Smt. Rakhil W/o Sh. Prabhjot Singh, R/o Street No. 2, Gautam Colony, Rahon Road, Jagirpur, Ludhiana-141007.

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2^nd Address: H. No. 410, Street No. 3, New Vishwakarma Colony, Jamalpur, Ludhiana, Punjab-141010.

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3^rd Address: H. No. 4227, Vardhman Nagar, Near Aggarwal, Phirkhanna, Jagirpur, Ludhiana-141007.

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……..Defendants

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Advocates:

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Argued by Sh. Varun Kumar Verma, Advocate for the applicant

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None for Defendants (Already ex-parte vide order dated 04.04.2026)

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993, against the defendants for recovery of Rs.22,43,441.24 (Rupees

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OA NO.298/2026 UCO BANK VS M/S SAMARTH FOOAD AND BEVERAGES AND ANOTHER

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Twenty Two Lacs Forty Three Thousand Four Hundred Forty One and Paise Twenty Four Only). The Original Application has been filed through Sh. Nitin Kaushal, Branch Manager, o f the applicant, who is competent to institute the Original Application vide Circular of the Bank dated 20.07.2012, 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.10.00 Lacs vide Application for MSME Loan dated 22.06.2023, which is Annexure A2 to this OA; 3. The applicant sanctioned the Cash Credit Limit of Rs.10.00 Lacs vide Sanction Letter, which is Annexure A3 to this OA. Thereafter, the applicant sanctioned the Term Loan of Rs.15.00 Lacs vide Sanction Letter, which is Annexure A8 to this OA and the terms and conditions were duly accepted by the defendants.

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Defendant no.1 through its proprietor defendant no.2 hypothecated its stocks related to beverages like soft drinks etc, finished goods & book debts and machinery.

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Documents executed: Demand Promissory Note, Letter of Waiver, Letter of Continuity, Composite Deed of Hypothecation, all dated 26.06.2023, which are Annexures A4 to A7 to this OA; Demand Promissory Note, Letter of Waiver, Composite Deed of Hypothecation, all dated 15.01.2024, which are Annexures A9 to A11 to this OA; Statement of Accounts along with certificate, which are Annexures A12 & A13 to this OA;

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The accounts became irregular and were classified as NPA and after adjusting debit and credit entries in loan accounts there was a debit of Rs.22,43,441.24, 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.298/2026 UCO BANK VS M/S SAMARTH FOOAD AND BEVERAGES AND ANOTHER

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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 04.04.2026.

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In support of the OA, affidavit of Nitish Kaushal, Branch Manager UCO Bank, h as been filed.

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Heard ex-parte 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 which had gone unrebutted, the applicant had proved its case.

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From the perusal of all the Annexures A1 to A13 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 the loans as per terms and conditions of the agreement between the parties. Subsequently, 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.22,43,441.24 (Rupees Twenty Two Lacs Forty Three Thousand Four Hundred Forty One and Paise Twenty 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 @10.60%p.a. with penal interest @02.00% monthly rests in both the accounts from 02.01.2026 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 and machinery, undertaking of the defendants, quantum of loans and prevalent market rates of interest which have gone drastically downhill in yester years, while exercising the discretion vested in this Tribunal,

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OA NO.298/2026 UCO BANK VS M/S SAMARTH FOOAD AND BEVERAGES AND ANOTHER

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this Tribunal deems it just and appropriate to grant simple interest @08.00%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. 11. In the result, the application is allowed declaring that the defendant no.1 through its proprietor defendant no.2 are liable to pay to the applicant a total sum of Rs.22,43,441.24 (Rupees Twenty Two Lacs Forty Three Thousand Four Hundred Forty One and Paise Twenty Four Only) jointly and severally, with costs, current and future simple interest @08.00%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 hypothecated stocks and machinery of the defendant no.1 through its proprietor defend no.2 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 28.04.2026. 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: 08.04.2026 (MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

Uco Bank v. M/S Samarth Food and Beverages and Another

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Uco Bank v. M/S Samarth Food and Beverages and Another

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