Allowed

State Bank of India v. M/s G S Fashion Point and others

DRT7 Jul 2026OA/503/2026

Case brief

AI extract

What is this about?

The Tribunal allowed the recovery application filed by State Bank of India against a partnership firm and its partners for an outstanding loan of Rs.24,45,760. The judgment declared the sum recoverable and fixed interest at 08% per annum.

What did the court decide?

Recovery of Rs.24,45,760 jointly and severally with simple interest @ 08% p.a.; issuance of Recovery Certificate.

State Bank of India versus M/s G S Fashion Point and others — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 503/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 27.03.2026

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DATE OF DECISION: 07.07.2026

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State Bank of India, a body Corporate constituted under State Bank of India Act, 1955 and having its Corporate Centre at Madame Cama Road, Nariman Point, Mumbai and having branches all over India and one of its Branches amongst other places at (Jhunir, District Mansa) AMCC Mansa, through its Authorized Officer, Sh. Dalip Kumar, Chief Manager.

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……..Applicant

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Versus

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M/s G S Fashion Point, Partnership firm through one of its partner Sh. Gori Shankar, VPO Boha Road, Jhunir-151506, Distt. Mansa, Punjab.

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Sh. Gori Shankar S/o Sh. Pawan Kumar, Partner M/s G S Fashion Point Partnership Firm, VPO Sardulgarh, Distt. Mansa, Punjab.

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Sh. Sandeep Kumar S/o Sh. Pawan Kumar, Partner M/s G S Fashion Point Partnership Firm, VPO Sardulgarh, Distt. Mansa, Punjab.

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…….Defendants

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Advocates:

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Argued by Sh. S.C. Prajapati, Advocate proxy for Sh. Omkar Gupta, Advocate for Applicant.

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None 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.24,45,760.00 (Rupees Twenty Four Lac Forty Five Thousand Seven Hundred Sixty Only). The Original Application has been filed through Sh. Dalip Kumar, Chief Manager, of the Applicant, who is competent to institute the Original Application.

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The brief facts of the OA are that the Defendant no.1, through its partners defendant nos.2 & 3, approached the applicant for sanction of

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OA/5032026 STATE BANK OF INDIA VS. M/S G.S. FASHION POINT AND OTHERS CC Limit of Rs.10.00 lacs vide Loan Application dated 06.06.2022, which is Annexure A1 to this OA.

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Thereafter, Defendant no.1, through its partners defendant nos.2 & 3, approached the applicant for enhancement of CC Limit from Rs.10.00 lacs to Rs.20.00 lacs vide Loan Application dated 15.11.2022, which is Annexure A6 to this OA. 3. The applicant sanctioned the CC Limit of Rs.10.00 lacs, vide Latter of Arrangement dated 10.06.2022, which is Annexure A3 to this OA and terms and conditions were duly accepted by the defendants. Thereafter, the applicant sanctioned the enhancement of CC Limit from Rs.10.00 lacs to Rs.20.00 lacs, vide Letter of Arrangement dated 30.04.2022, which is Annexure A7 to this OA. 4. Defendant no.1, through its partners defendant nos.2 & 3, hypothecated its stock and book debts vide Agreement of Loan Cum Hypothecation dated 10.06.2022, which is Annexure A4 to this OA; Documents executed: Partnership Deed dated 01.04.2022, which is Annexure A2 to this OA; Guarantee Agreement dated 10.06.2022, which is Annexure A5 to this OA; Supplemental Agreement dated 01.12.2022, which is Annexure A8 to this OA; Revival Letter dated 01.12.2022, which is Annexure A9 to this OA; Application Form dated 04.01.2024, which is Annexure A10 to this OA; Letter of Arrangement dated 24.04.2024, which is Annexure A11 to this OA; Revival Letter dated 24.04.2024, which is Annexure A12 to this OA; Legal Notice dated 17.03.2026, which is Annexure A13 to this OA; Statement of Account certified under the Bankers' Books Evidence Act, which is Annexure A14 to this OA. 5. The 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.24,45,760.00 (Rupees Twenty Four Lac Forty Five Thousand Seven Hundred Sixty Only), 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/5032026 STATE BANK OF INDIA VS. M/S G.S. FASHION POINT AND OTHERS

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The defendants were served summons to appear before this Tribunal and after the service of summons, Sh. Sarabjit Singh Grewal, Advocate, appeared on behalf of defendants and filed his Power of Attorney on 04.05.2026. Set of Paper Book was supplied to the counsel for defendants on 05.05.2026. But, no WS on behalf of defendants, was filed within or even after the expiry of stipulated period. Therefore, opportunity to file WS by defendants was closed and defense was struck of vide order dated 04.07.2026.

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In support of the OA, affidavit of Sh. Dalip Kumar, 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 proxy 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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None was present on behalf of defendants despite repeated calls for advancing the arguments.

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From the perusal of all the Annexures A1 to A14 to this OA, it is proved that the Defendant no.1, through its partners defendant nos.2 & 3, approached the applicant for availing of the loan facility, which was granted to them. 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, 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.24,45,760.00 (Rupees Twenty Four Lac Forty Five Thousand Seven Hundred Sixty 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. 10. In so far as pendente lite and future rate of interest is concerned, the applicant in relief clause has claimed interest @11.75% p.a. plus 2.00% p.a. penal interest with monthly rests from 21.03.2026 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

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OA/5032026

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STATE BANK OF INDIA VS. M/S G.S. FASHION POINT AND OTHERS

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instant case including nature of the 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 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.24,45,760.00 (Rupees Twenty Four Lac Forty Five Thousand Seven Hundred Sixty Only), jointly and severally, with costs, current and future simple interest @08.00%p.a. 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 of the defendant no.1 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 22.07.2026

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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. Pronounced by me in the open Tribunal .

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Dated: 07.07.2026.

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(MRIDULESH KUMAR SINGH)

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Presiding Officer,

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DRT-III, Chandigarh

State Bank of India v. M/s G S Fashion Point and others

Case brief

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State Bank of India v. M/s G S Fashion Point and others

Case brief

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