Allowed

Idbi Bank Limited v. Messrs G N W Garments and Another

DRT2 Mar 2026OA/413/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the bank’s application for recovery of Rs.50.84 lakhs against the garment firm and proprietor, rejecting arguments about blank signatures and deprivation of limitation. The court fixed uniform interest at 8% p.a. and ordered enforcement via SARFAESI Act.

What did the court decide?

Recovery of Rs.50,84,882.16 jointly and severally with costs and simple interest @8% p.a.; Recovery Certificate issued.

Idbi Bank Limited versus Messrs G N W Garments and… — Contract and Commercial Disputes | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.413/2022

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 01.03.2022

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DATE OF DECISION: 02.03.2026

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IDBI Bank Ltd., A Company Incorporated and Registered under The Companies Act, 1956 and a Banking Company within the meaning of Section 5(C) under Banking Regulation Act, 1949 and having its Registered Head Office at IDBI Tower, WTC Complex Cuffe Parade, Colaba, Mumbai-400005, carrying on the business of banking and having branches all over India and one of its Branches amongst other places a Branch Office at Sunder Nagar, Ludhiana, District Ludhiana, Punjab through its Branch Manager Sh. Anshul Methi.

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……..Applicant

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Versus

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M/S G N W Garments, Proprietorship Firm at G-5-1285, Street No. 0, Kabir Nagar, Basti Jodhewal, Ludhiana-140007, Punjab through its Sole Proprietor Sh. Mohamad lliyas Ahmad Ansari S/O Sh. Sh. Ajoob Ansari.

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Sh. Mohamad lliyas Ahmad Ansari S/o Sh. Ajoob Ansari, Proprietor of M/S G N W Garments, proprietorship firm, G-51285, Street No. 0, Kabir Nagar, Near Bal Singh Nagar, Basti Jodhewal Ludhiana 140007- Punjab.

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….……Defendants

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Advocates:

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Argued by Sh. Omkar Gupta, Advocate for Applicant

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None of 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.50,84,882.16 (Rupees Fifty Lacs Eighty Four Thousand Eight Hundred Eighty Two and Paise Sixteen Only). The Original Application has been filed through Sh. Anshul Methi, Branch Manager of the applicant who is competent to

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2 OA NO.413/2022 IDBI BANK LIMITED V/S. M/S G N W GARMENTS AND ANOTHER

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institute the Original Application vide Delegation of Powers, 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.40.00 Lacs vide Loan Application dated 20.05.2017, which is Annexure A2 to this OA. Thereafter, the defendant no.1 through its proprietor defendant no.2 approached the applicant for grant of Working Capital Term (WCTL) Loan due to COVID-19 pandemic vide request letter dated 30.07.2020, which is Annexure A18 to this OA. 3. The applicant sanctioned the CC Limit of Rs.40.00 Lacs vide Sanction Letter dated 20.05.2017, which is Annexure A3 to this OA and the terms and conditions are accepted by defendants. Thereafter, the limit was renewed by the applicant vide renewal sanction letter dated 12.07.2018 and 20.01.2020, which are Annexures A15 and A16 to this OA. Thereafter, the applicant sanctioned Working Capital Term Loan (WCTL) of Rs.7.90 Lacs vide sanction letter dated 30.07.2020, which is Annexure A19 to this OA. 4. Defendant no. 1 through its proprietor defendant no. 2 hypothecated stock and book debts vide hypothecation cum loan agreement dated 24.05.2017, which is Annexure A12 to this OA; Supplemental Deed of Hypothecation cum loan agreement dated 30.07.2020, which is Annexure A21 to this OA.

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Defendant no. 2 mortgaged his immovable property i.e. House measuring 112 Sq. Yards bearing MC no. B-XXV/G-5/1285, situated at Village Taraf Jodhewal, Hadbast no. 77, Abadi known as Kabir Nagar, Tehsil and District Ludhiana, Punjab through equitable mortgage of sale deed bearing vasika No.3035 dated 17.05.2007, along with its translation, which is Annexure A8 to this OA; and Chain of title bearing vasika no. 7290 dated 18.06.1996 and bearing vasika no. 9375 dated 03.07.1989, along with their translation, which are Annexures A6 and A7 to this OA; Declaration and undertaking dated 24.05.2017 in the matter of mortgage by deposit of title deeds, which

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3 OA NO.413/2022 IDBI BANK LIMITED V/S. M/S G N W GARMENTS AND ANOTHER

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is Annexure A4 to this OA; Affidavit dated 16.05.2017, which is Annexure A5 to this OA; Letter to Tehsildar for entry in revenue records, with its translation, which is Annexure A9 to this OA; Jamabandi for the year 200-2001, 2005-2006, 210-2011, along with translation, which are Annexure A10 to this OA; Declaration and undertaking dated 30.07.2020 in the matter of mortgage by deposit of title deeds, which is Annexure A23 to this OA.

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Documents executed: Demand Promissory Note dated 24.05.2017, which is Annexure A11 to this OA; Common Guarantee Deed dated 25.05.2017, which is Annexure A13 to this OA; Revival Letter dated 04.07.2018, which is Annexure A14 to this OA; Revival Letter dated 20.01.2020, which is Annexure A17 to this OA; Demand Promissory Note dated 30.07.2020, which is Annexure A20 to this OA; Affidavit dated 30.07.2022, which is Annexure A22 to this OA; Notice dated 21.09.2021, with postal receipts, which is Annexure A24 to this OA; Notice dated 12.10.2021, with postal receipts, which is Annexure A25 to this OA; Statement of Accounts with certificate, which are Annexures A26 & A27 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 loan accounts there was a debit of Rs. 50,84,882.16 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 notices to appear before this Tribunal. Sh. Rajesh Gupta, Advocate appeared on behalf of defendants on 04.09.2023 and filed his Power of Attorney. WS on behalf of defendants was filed on 25.09.2023. Sh. Himanshu Rai, AGM of the applicant produced documents for their admission or denial on 28.05.2024 and 02.08.2024 wherein the document was seen by the learned counsel for defendants who admitted the signatures of defendants on original documents but denied their contents. Thereafter, Sh. Sahil Nain, Advocate filed his Memo of Appearance on

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4 OA NO.413/2022

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IDBI BANK LIMITED V/S. M/S G N W GARMENTS AND ANOTHER

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behalf of the defendants on 03.07.2025 and was directed to file Power of Attorney after obtaining no objection from earlier counsel but no Power of Attorney was filed by him.

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The brief facts of WS filed by defendants are that the application is not maintainable in present form and has not been filed by a competent and authorized person. It was further stated that the documents attached with the application are also not enforceable as the same were not executed by the defendants and the defendants were compelled to sign on blank forms/documents which were later filled by the bank to suit their convenience. It was further stated that no proper statement of the account has been filed by the applicant. It was further stated that the applicant has filed false affidavit in support of the application. It was further stated that the claim of the applicant is highly inflated and exaggerated and applicant has charged excessive rate of interest contrary to the contracted rate of interest. It was further stated that the application is not within period of limitation.

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In support of the OA, affidavit of Sh. Anshul Methi, Manager, IDBI Bank Ltd. has been filed.

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Heard arguments and perused record.

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No one appeared on behalf of defendants for arguments. It was argued by learned counsel for applicant that in view of the documentary evidence brought on record, the applicant has proved its case. It was further argued the OA is not time barred. From the perusal of all the Annexures A1 to A27 to this OA, it is proved that the defendants 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, accounts of the defendants were classified as NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs.50,84,882.16 (Rupees Fifty Lacs Eighty Four Thousand Eight Hundred Eighty Two

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5 OA NO.413/2022 IDBI BANK LIMITED V/S. M/S G N W GARMENTS AND ANOTHER

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and Paise Sixteen 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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The defendants in their written statement had stated that signatures of defendants were taken by the applicant on blank documents and the documents were filled by the applicant later. However, the defendants did not lodge any complaint before any Higher Forum of the Bank or Court of Law. Therefore, it is inferred that cock and bull story is prepared by the defendants before this Tribunal.

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Further, the present application was filed by applicant on 01.03.2022 and is not barred by Limitation as per revival letter dated 20.01.2020 (Annexure A17) and documents executed by defendants on 30.07.2020 (Annexure A20 to A23) .

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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 @11.00%p.a. with 2% penal interest and monthly rests in CC Limit and @8.80%p.a. with 2% penal interest and monthly rests in WCTL from 01.01.2022 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 loans 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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In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.50,84,882.16 (Rupees Fifty Lacs Eighty Four Thousand Eight

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OA NO.413/2022

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IDBI BANK LIMITED V/S. M/S G N W GARMENTS AND ANOTHER

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Hundred Eighty Two and Paise Sixteen 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. 13. Any other application pending stands disposed of . 14. Issue Recovery Certificate accordingly. 15. Parties to appear before Learned Recovery Officer of this Tribunal on 19.03.2026. 16. 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: 02.03.2026.

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

Idbi Bank Limited v. Messrs G N W Garments and Another

Case brief

What is this about?

What did the court decide?

Idbi Bank Limited v. Messrs G N W Garments and Another

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

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