Allowed

Punjab National Bank v. M/S Crystal Knitfab and Others

DRT3 Jul 2026OA/453/2026

Case brief

AI extract

What is this about?

Debt Recovery Tribunal allowed the bank's application against partners of a farming company for recovery of an overdue loan of Rs. 62.43 Lakhs. The court ordered payment with interest and authorized recovery via asset sale.

What did the court decide?

Defendants directed to pay Rs. 62,43,158.45 plus 8% simple interest; Recovery Certificate issued; execution to be taken hypothecated and personal assets.

Punjab National Bank versus M/S Crystal Knitfab and Others — Company and Corporate | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 453/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 17.03.2026

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DATE OF DECISION: 03.07.2026

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Punjab National Bank, a Body Corporate and Nationalized Bank under the provisions of the Banking Companies (Acquisition and Transfer of Undertakings) Act of 1970, with its Head Office at Plot no. 4, Sector 10, Dwarka, New Delhi- 110075 and being the Successor of Oriental Bank of Commerce and United Bank of India by virtue of the Scheme of Amalgamation notified by the Central Government u/s 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 and amongst other a Branch Office at Feroze Gandhi Market, Ludhiana, Punjab through its Constituted Attorney and Senior Manager, Sh. Nikhil Kumar Kundal, S/o Sh. Ashok Kumar, presently posted at Asset Recovery Management Branch, Ludhiana, Punjab situated at 1^st Floor, Site no. 5, Ferozepur Road, Ludhiana, Punjab

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……..Applicant Versus

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M/S Crystal Knitfab situated Opposite Maharaja Palace, Rahon Road, Village Bazra, Ludhiana, Punjab- 141008 through its Partners

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Sh. Amandeep Sharm a, S/o Sh. Surinder Sharma, R/o 3748/6, Jassian Road, New Tagore Nagar, Haibowal Kalan, Ludhiana, Punjab- 141001

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Sh. Ramesh Sharma, S/o Sh. Surinder Sharma, R/o H. no. 343748/6, near New Drycleaner, New Tagore Nagar, Haibowal Kalan, Ludhiana, Punjab- 141001

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…..Defendants

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Advocates:

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Argued by Sh. Kanwar Harbir Singh Bath, Advocate for applicant None for defendants (already ex-parte vide order dated 01.07.2026)

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2 OA NO. 453/2026 PUNJAB NATIONAL BANK VS. M/S CRYSTAL KNITFAB AND OTHERS

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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. 62,43,158.45 (Rupees Sixty Two Lacs Forty Three Thousand One Hundred Fifty Eight and Paise Forty Five Only). The Original Application has been filed through Sh. Nikhil Kumar Kundal, Senior Manager of the applicant, who is competent to institute the Original Application vide Power of Attorney dated 27.03.2020, which is Annexure A1 to this OA.

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The brief facts of the OA are that defendant no. 1 through its Partners defendant nos. 2 and 3 approached the applicant for grant of CC Limit of Rs. 30.00 Lacs vide Loan Application dated 28.05.2012, which is Annexure A2 to this OA. Thereafter, defendant no. 1 through its Partners defendant nos. 2 and 3 approached the applicant for enhancement of CC Limit to Rs. 40.00 Lacs. Thereafter, defendant no. 1 through its Partners defendant nos. 2 and 3 approached the applicant for renewal of CC Limit of Rs. 40.00 Lacs. Thereafter, defendant no. 1 through its Partners defendant nos. 2 and 3 again approached the applicant for renewal of CC Limit of Rs. 40.00 Lacs. Thereafter, defendant no. 1 through its Partners defendant nos. 2 and 3 approached the applicant for grant of Term Loan of Rs. 9.00 Lacs. Thereafter, defendant no. 1 through its Partners defendant nos. 2 and

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3 approached the applicant for grant of WCTL of Rs. 8.00 Lacs.

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The applicant sanctioned CC Limit of Rs. 30.00 Lacs vide Sanction Letter, which is Annexure A3 to this OA and terms and conditions were duly accepted by the defendants. Thereafter, the applicant sanctioned enhancement of CC Limit to Rs. 40.00 Lacs vide Sanction Letter dated 18.12.2014, which is Annexure A5 to this OA. Thereafter, the applicant sanctioned renewal of CC Limit of Rs.40.00 Lacs vide Sanction Letter dated 30.03.2021, which is Annexure A7 to this OA. Thereafter, the applicant again sanctioned renewal of CC Limit of Rs. 40.00 Lacs vide Sanction Letter dated 30.12.2022, which is Annexure A8 to this OA. The applicant sanctioned Term Loan of Rs.9.00 Lacs vide Sanction Letter dated 27.06.2015, which is

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3 OA NO. 453/2026 PUNJAB NATIONAL BANK VS. M/S CRYSTAL KNITFAB AND OTHERS

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Annexure A9 to this OA. The applicant sanctioned WCTL of Rs. 8.00 Lacs vide Sanction Letter dated 01.10.2020, which is Annexure A11 to this OA.

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Defendant no. 1 through its Partners defendant nos. 2 and 3 hypothecated their stocks of yarn, knitted cloth, consumables and receivables vide Agreements of Hypothecation dated 18.06.2012, 18.12.2014 and 27.06.2015, which are Annexure A4, A6 and A10 to this OA. Documents executed: Pronote, Agreement of WCTL and Master Agreement, all dated 29.10.2020, which are Annexure A12 to A14 to this OA; Balance and Security Confirmation Letters dated 01.12.2017, 17.10.2020 and 18.03.2023, which are Annexure A15 to A18 to this OA; Accounts Statement, which are Annexure A19 to A21 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. 62,43,158.45, which is recoverable and the defendants were served recall notice 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 summons to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 01.07.2026. 7. In support of the OA, affidavit of Sh. Nikhil Kumar Kundal, Senior Manager, Punjab National Bank has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned counsel that in view of the documentary evidence brought on record which had gone unrebutted, the applicant bank had proved its case.

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From the perusal of all the Annexure A1 to A21 to this OA, it is proved that defendant no. 1 through its Partners defendant nos. 2 and 3 approached applicant for availing of the loan facilities which were granted to them and for which 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

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4 OA NO. 453/2026 PUNJAB NATIONAL BANK VS. M/S CRYSTAL KNITFAB AND OTHERS

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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. 62,43,158.45 (Rupees Sixty Two Lacs Forty Three Thousand One Hundred Fifty Eight and Paise Forty Five 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 pendente lite and future rate of interest is concerned, the applicant in relief clause has claimed interest @10.45%p.a. in CC Limit Account and Term Loan Account and @8.90% p.a. in WCTL Account plus @2% penal interest 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 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 all 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.62,43,158.45 (Rupees Sixty Two Lacs Forty Three Thousand One Hundred Fifty Eight and Paise Forty Five Only) jointly and severally, with costs, current and future simple interest @8.00% p.a. in all 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 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

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5 OA NO. 453/2026 PUNJAB NATIONAL BANK VS. M/S CRYSTAL KNITFAB AND OTHERS

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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 18.07.2026.

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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: 03.07.2026

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

Punjab National Bank v. M/S Crystal Knitfab and Others

Case brief

What is this about?

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Punjab National Bank v. M/S Crystal Knitfab and Others

Case brief

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What did the court decide?

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