Allowed

Union Bank of India v. Ms Shree Shyam Enterprises and Another

DRT24 Apr 2026OA/53/2026

Case brief

AI extract

What is this about?

The DRT allowed an original application filed by Union Bank of India to recover Rs 25.08 lakhs from a borrower who defaulted on a term loan. The court determined liability, awarded simplified interest, and directed issuance of a recovery certificate.

What did the court decide?

Recovery of Rs. 25,07,718.80 with costs and simple interest at 8.00% p.a. from date of filing until realization.

Union Bank of India versus Ms Shree Shyam Enterprises and… — Company and Corporate | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 53/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 08.01.2026

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DATE OF DECISION: 24.04.2026

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Union Bank of India, a body corporate, constituted under Banking Companies (Acquisition & Transfer of Undertakings) Act 1970 having its Head Office at 239, Vidhan Bhawan Marg, Nariman Point, Mumbai and having a Branch Office inter-alia at Basant City, Ludhiana, through its duly authorized person Sh. Simranjeet Singh, Branch Manager.

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……..Applicant

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Versus

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M/s Shree Shyam Enterprises, 353 Chander Nagar, Civil City, Ludhiana 141001.

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2nd address: 353 min Street no.2, Chander Nagar, backside Gurudwara Sahib, Civil City, Ludhiana 141001 (through its proprietor Kanchan defendant no.2)

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Kanchan daughter of Sh. Subhash Chander R/O House no. В- 34- 2400/32, Street no.2, Friend Colony, Chander Nagar, Ludhiana (proprietor of M/s Shree Shyam Enterprises, defendant no.1).

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.……Defendants

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Advocates:

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Argued by, Sh. Shubham Pabbi, Advocate proxy for Sh. R.K. Chauhan, Advocate for Applicant

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None for Defendants (already ex parte vide order dated 21.04.2026)

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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.25,07,718.80 (Rupees Twenty Five Lakhs Seven Thousands Seven Hundred Eighteen and Paise Eighty Only). The Original Application has been filed through Sh. Simranjeet

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2 OA/53/2026 UNION BANK OF INDIA VS M/S SHREE SHAM ENTERPRISES AND ANOTHER

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Singh, Branch Manager of the applicant, who is competent to institute the Original Application vide Authority letter dated 31.10.2025, 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 Term Loan of Rs. 24.90 Lacs vide Application Form dated 18.03.2025, which is Annexure A2 to this OA. 3. The applicant sanctioned the Term Loan of Rs. 24.90 Lacs vide Sanction Letter dated 24.03.2025, which is Annexures A8 to this OA and the terms and conditions were duly accepted by the defendants vide Terms & Conditions of Sanction dated 24.03.2025, which is Annexures A9 to this OA. 4. Defendants hypothecated their Machines purchased out of the term loan vide Hypothecation Agreement dated 24.03.2025, which is Annexure A13 to this OA. Tax Invoice of Machines dated 26.04.2025, which is Annexure A18 (colly) to this OA. Documents executed: GST Registration Certificate dated 13.01.2023, which is Annexure A3 to this OA; Udyam Registration Certificate dated 21.01.2023, which is Annexure A4 to this OA; Quotation of Machines, dated 15.03.2025, which is Annexure A5 to this OA; Sanction Advice, Memorandum of Sanction Authority, both dated 24.03.2025, which are Annexure A6 & A7 to this OA; Annexure –I, Demand Promissory Note, Letter of Continuity, all dated 24.03.2025, which are Annexures A10 to A12 to this OA; AD-02, Letter of undertaking from the borrower, Letter of undertaking not to alienate hypothecated goods, application for disbursement loan, all dated 24.03.2025, which are Annexures A14 to A17 to this OA; Letter for Adjustment of Overdues dated 02.07.2025, 11.09.2025, ,06.10.2025, which are Annexures A19 to A21 to this OA; Legal Notice dated 03.10.2025 with Postal Receipts, which are Annexures A22 & A23 (colly) to this OA; Statement of Account with Certificate, which are Annexures A24 & A25 to this OA. 5. The loan account became irregular and was classified as NPA and after adjusting debit and credit entries in loan account, there was a debit of Rs.25,07,718.80 (Rupees Twenty Five Lakhs Seven Thousands Seven Hundred Eighteen and Paise Eighty Only), which is recoverable and the

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3 OA/53/2026 UNION BANK OF INDIA VS M/S SHREE SHAM ENTERPRISES AND ANOTHER

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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, b ut no one appeared on behalf of the defendants and they were proceeded ex-parte on 21.04.2026

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In support of the OA, affidavit Sh. Simranjeet Singh, Branch Manager , Union Bank of India, has been filed. 8. Heard ex-parte arguments and perused record.

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It was argued by learned Proxy counsel that in view of the documentary evidence brought on record, the applicant had proved its case. From the perusal of all the Annexures A1 to A25 to this OA, it is proved that the defendants approached applicant for availing of the loan facility, which was granted to them and for that they had executed all the relevant documents in favour of the applicant. 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.25,07,718.80 (Rupees Twenty Five Lakhs Seven Thousands Seven Hundred Eighteen and Paise Eighty 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 @10.25% p.a. plus 2% penal interest with monthly rests from 01.12.2025 till the realization. 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 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 @8.00% p.a. in the loan account

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4 OA/53/2026 UNION BANK OF INDIA VS M/S SHREE SHAM ENTERPRISES AND ANOTHER

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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.25,07,718.80 (Rupees Twenty Five Lakhs Seven Thousands Seven Hundred Eighteen and Paise Eighty Only), jointly and severally, with costs, current and future simple interest @8.00% 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 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.

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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 15.05.2026

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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 . Dated: 24.04.2026

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(MRIDULESH KUMAR SINGH)

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Presiding Officer, DRT-III, Chandigarh

Union Bank of India v. Ms Shree Shyam Enterprises and Another

Case brief

What is this about?

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Union Bank of India v. Ms Shree Shyam Enterprises and Another

Case brief

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