Allowed

Union Bank of India v. M/S Shree Siddhivinayak Milk Product

DRT7 Jul 2026OA/61/2022

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed the Union Bank of India's original application to recover ₹50,14,113.52 and enforce hypothecated securities from the defendant borrower, who had defaulted on term loans and cash credit facilities.

What did the court decide?

Recovery of ₹50,14,113.52 with future interest at 11.70% per annum; direction to submit CGTMSE details; issue of Recovery Certificate.

Union Bank of India versus M/S Shree Siddhivinayak… — Contract and Commercial Disputes | DRT (2026)

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ORIGINAL APPLICATION NO.61 OF 2022

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DEBTS RECOVERY TRIBUNAL No.2, MUMBAI

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PRESIDING OFFICER: HARISH KUMAR KAUSHIK

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ORIGINAL APPLICATION NO.61 OF 2022

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Date of Institution: 04.07.2019 Date of Decision: 07.07.2026

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TOTAL CLAIM AMOUNT: ₹ 50,14,113.52/-

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UNION BANK OF INDIA,

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A body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act,1970 having its Central Office at Union Bank Bhavan, 239, Vidhan Bhavan Marg, Nariman Point Mumbai – 400 021 and a branch known as Dadar West Branch at Ashoka Complex, Ranade Road, Dadar West, Mumbai – 400 028 Through its Principal Officer and constituted Attorney Mr Moreshwar Kashinath, Jangle.

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… Applicant

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Versus

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M/S SHREE SIDDHIVINAYAK MILK PRODUCT, Proprietary concern of Sushil L Pandey, 12/103 Sonam Jyot CHSL, New Golden Nest Phase VII, Mira Bhayander Road, Bhayander East, Thane – 401105.

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…Defendant

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Page 1 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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APPEARANCES

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For the Applicant : Ms N. I. Bakali - Advocate

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For Defendant : Ex-parte

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J U D G M E N T

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(1) This is an application under Section 19(1) of the Recovery of the Debts due to Banks and Financial Institutions Act, 1993 renamed as Recovery of the Debt and Bankruptcy Act, 1993 (for short, ‘the 1993 Act’) to recover ₹50,14,113.52/- (Rupees Fifty Lakhs Fourteen Thousand One Hundred Thirteen and Paisa Fifty Two Only) as on 30.06.2019 with future interest @ 11.70% per annum with monthly rests thereon from the date of presentation of the Original Application i.e. 04.07.2019 till payment/realization and to enforce the hypothecated securities.

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The details of the claim amount are as under:-

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Sr	Amount du e and	Normal	Penal	Total am ou nt
No	payab le u nder Cash	Interest	Interest
	Credi t Faci lity	charged from	charged
	(Princi pal Ledger	01.04 .2019
	outstandi ng)	to
		30.06 .2019
1	₹48, 71, 941. 52/-	₹1,40, 786/-	₹1,386/ -	₹50,14,113.52/-

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(2) It is undisputed fact in the matter that the Defendant no.1 was duly served with the

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Page 2 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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summons vide order-sheet dated 15.09.2022. Despite service, the defendant did not enter its appearance and therefore, it was set ex-parte on 08.07.2025.

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(3) Defendant no.1 is the borrower who approached the Applicant Bank and sought financial assistance by way of Term Loan and Cash Credit Facilities. Pursuant to the loan application made by defendant, the Applicant sanctioned the loan and enhanced the Loan Facility time to time as given in the table below and the said loan is covered under CGTMSE Scheme. As per Sanction Letter dated 24.10.2016, the Term loan of ₹1.27 Lakhs is to be repayable in 60 EMIs of ₹25,000/per month + Interest @ 12.55+0.50% for CGTMSE cover and Term loan of ₹33.56 Lakhs to be repayable in 84 EMIs of ₹49,108/- per month + Interest @ 12.55% + 0.50% for CGTMSE cover.

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The details of the Sanctioned amounts are as

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under: -

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S r N	Date of Sanction	Nature of Facility	Amount of Sanction	ROI	Secu rity
o
1	25.08. 2012	Cash Credit	₹11. 00 Lakhs	Base R ate + 3.25 +0. 50	Hypothecated Stock an d Book-debt s cover ed under CGTSME Sch eme
		Ter m Loan	₹15. 00 Lakhs	Base R ate + 3.25 +0. 50	Hypothecated Pl ant an d Machin ery cover ed under CGTSME Sch eme

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Page 3 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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	Total		₹26.00 Lak hs
2	11.06. 2014 (En han ced)	Cash Credit	₹20. 00 Lakhs	Base R ate + 1.75% + 0.50% (wherei n Base R ate is 10.25% ).	Hypothecated Stock an d Book-debts n ot ol der th an 90 day s cover ed under CGTSME Sch eme
		Ter m Loan-I	₹8.75 Lakhs	Base R ate + 1.75% + 0.50% (wherei n Base R ate is 10.25% ).	Hypothecated Pl ant an d Machin ery cover ed under CGTSME Sch eme.
	Total		₹28.75 Lak hs
3	13.03. 2015 (En han ced)	Cash Credit (Hy p.)	₹35. 00 Lakhs	Base Rat e + 3.25% + 0.50% (wherei n Base Rat e is 10. 00% )	Hypothecated Stock an d Book-debts n ot ol der th an 90 day s cover ed under CGTSME Sch eme
		Ter m Loan-I	₹4.36 Lakhs	Base Rat e + 4% + 0.50% (wherei n Base Rat e is 10. 00% )	Hypothecated Pl ant an d Machin ery cover ed under CGTSME Sch eme
		Ter m Loan-II	₹41. 25 Lakhs	Base Rat e + 4% + 0.50% (wherei n Base Rat e is 10. 00% )	E M of S hop at San pada, Navi Mumbai covered un der CGTS ME Scheme.
	Total		₹80.61 Lak hs
4	24.10. 2016	Cash Credit (Hy p.)	₹46. 00 Lakhs	MCLR + 3.65% - 1.00% + 0.50% i.e. 12.55% (wherei n 1 year MCLR is 9. 40% )	Hypothecated Stock an d Book-debts n ot ol der th an 90 day s cover ed under CGTSME Sch eme.
		Ter m Loan – I	₹1.22 Lakhs	MCLR + 3.65% + 0.50% - 1.00% + 0.50% i.e. 13.05% (wherei n	Hypothecated Pl ant an d Machin ery cover ed under CGTSME Sch eme.

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Page 4 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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			1-y ear MCLR 9.40% )	i s
	Ter m Loan - II	₹33. 55 Lakhs	MCLR 3.65%	+ +	E M of San pada,	S hop at Navi
			0.50%	-	Mumbai	covered
			1.00%	+	un der	CGTS ME
			0.50%	i.e.	Scheme.
			13.05% (wherei	n
			1-y ear
			MCLR 9.40% ).	i s
Total	-	₹80.77	-		-
		Lak hs

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(4) On 25.08.2012, 30.08.2012, 11.06.2014, 13.03.2015, 25.03.2015, 24.10.2016, 27.10.2016 and 07.12.2016, defendant signed and executed the loan and security documents as set out in paragraph nos.5.5, 5.7 and 5.9 (Page Nos.5, 6 and 7) of the Original Application. Defendant hypothecated Milk and Milk products i.e. Paneer, Shrikhand and Ghee to secure the loan.

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The details of the documents executed by the Defendant are as under:-

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(a) Accepted Sanction Letter dated 25.08.2012 for an amount of ₹15.00 Lakhs for Term Loan Facility and ₹11.00 Lakhs for Cash Credit Facility;

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(b) Demand Notice dated 30.08.2012 for an amount of ₹11.00 Lakhs;

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Page 5 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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amount of ₹11.00 Lakhs;

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(d) Hypothecation Agreement of Goods and Debts dated 30.08.2012 for an amount of ₹11.00 Lakhs;

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(e) Accepted Sanction Letter dated 11.06.2014 for an amount of ₹20 Lakhs for Cash Credit Facility and ₹8.75 Lakhs for Term Loan Facility;

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(f) Demand Promissory Note dated 11.06.2014 for an amount of ₹20.00 Lakhs;

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(g) Letter of Continuity (modified) dated 11.06.2014 for an amount of ₹20.00 Lakhs;

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(h) Supplementary Agreement to SD-06 Hypothecation Agreement dated 11.06.2014;

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(i) Accepted Sanction Letter dated 13.03.2015 for an amount of ₹35.00 Lakhs for Cash Credit (Hyp), ₹4.36 Lakhs for Term Loan-I and ₹41.25 Lakhs for Term Loan-II;

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(j) Demand Promissory Note dated 25.03.2015 for an amount of ₹35.00 Lakhs;

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(k) Letter of Continuity (modified) dated 25.03.2015 for an amount of ₹35.00 Lakhs;

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(l) Supplementary Agreement to SD-06 Hypothecation Agreement dated 25.03.2015;

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(m) Accepted Sanction Letter dated 24.10.2016 for an amount of ₹46.00 Lakhs for Cash Credit (Hyp), ₹1.22 Lakhs for Term Loan-I and ₹33.55 Lakhs for Term Loan-II;

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Page 6 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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(n) Demand Promissory Note dated 27.10.2016 for an amount of ₹46.00 Lakhs;

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(o) Letter of Continuity (modified) dated 27.10.2016 for an amount of ₹46.00 Lakhs;

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(p) Supplementary Agreement to SD-06 Hypothecation Agreement dated 07.12.2016;

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(q) Interest Agreement dated 07.12.2016.

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(5) After availing the loan, defendant did not adhere to the financial discipline and committed default in payment of instalments and repayment of the loan and accordingly the account of the borrower was declared as Non-Performing Assets (N.P.A.) on 31.03.2019 as per RBI Guidelines. Therefore, on 02.04.2019, the applicant, re-called upon defendant to liquidate the outstanding in the sum of ₹48,87,703.52/- (Rupees Forty-Eight Lakhs Eighty-Seven Thousand Seven Hundred Three and Paisa Fifty-Two Only) within 7 days of receipt of the said notice. Despite notice, defendant no. 1 failed and neglected to pay.

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(6) As on 30.06.2019, there was owing, due and payable by defendant to the applicant the aggregate sum of ₹50,14,113.52/- (Rupees Fifty Lakhs Fourteen Thousand One Hundred Thirteen and Paisa Fifty-Two Only) with future interest @ 11.70% per annum with monthly rests thereon. The applicant has maintained the loan ledger extract and the entries posted therein are made in

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Page 7 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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the usual and ordinary course of the banking business.

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(7) Since, defendant failed and neglected to make the payment, the applicant was left with no other alternate but to file the Original Application which was presented on 04.07.2019.

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(8) The applicant has filed affidavit (exhibit-6) in lieu of examination in chief of Mr Moreshwar Kashinath Jangle, Chief Manager and list of documents (exhibit-7) thereby adducing in evidence the documents at AW-1 to AW-20, which are admitted in evidence, read, recorded and exhibited.

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(9) Accordingly, in the Original Application was filed for the recovery of ₹50,14,113.52/- (Rupees Fifty Lakhs Fourteen Thousand One Hundred Thirteen and Paisa Fifty-Two Only) on 04.07.2019.

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(10) The Tribunal has scrutinised and examined the averments contained in the Original Application and analysed the evidence adduced by the applicant which has gone unchallenged, uncontroverted and unrebutted.

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(11) Upon careful scrutiny and the examination of the Original Application, analysing the evidence and giving due weightage to the documentary evidence adduced by the applicant, the Tribunal views that there is no reason to disbelieve the claim made by the applicant bank.

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Page 8 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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(12) In view of the observations made hereinabove, Original Application filed by the applicant deserves to be allowed.

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(13) Hence, the following order:

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ORDER

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(A) The Original Application No.61 of 2022 is allowed with costs.

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(B) Defendant is hereby ordered and directed to pay to the applicant, the aggregate sum of ₹50,14,113.52/- (Rupees Fifty Lakhs Fourteen Thousand One Hundred Thirteen and Paisa FiftyTwo Only) with future simple interest @ 11.70 % per annum thereon from the date of presentation of the Original Application i.e. 04.07.2019 till payment/realization after adjusting the recoveries made by the Applicant under SARFAESI Act, 2002 or any other amount paid by the borrower after filing of this Original Application No.61 of 2022.

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(C) The aforesaid adjudicated amount is secured by the valid and subsisting hypothecated properties, that is, Milk and Milk products i.e. Paneer, Shrikhand and Ghee and Stocks, Book Debts and Plant & Machinery.

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(D) The aforesaid adjudicated amount is secured by the valid and subsisting mortgaged property, that is, EM of Shop at Sanpada, Navi Mumbai.

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(E) Defendant is hereby entitled to redeem the hypothecated and mortgaged properties as per law

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Page 9 of 10

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ORIGINAL APPLICATION NO.61 OF 2022

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failing which the applicant has right to proceed to sell the hypothecated and mortgaged properties and recover dues as per law.

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(F) The Applicant is also hereby directed to submit/ furnish the details of claim amount received from the Central Government since the facility is granted under CGTMSE Scheme and the details of Mortgaged properties as per Sanction Letter dated 24.10.2016 before Ld. Recovery Officer.

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(G) Issue Recovery Certificate.

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(H) The learned Registrar is directed to send a copy of the judgment and recovery certificate to (i) the applicant, (ii) defendant and (iii) the Recovery Officer by post and email.

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(Harish Kumar Kaushik) Presiding Officer, DRT-2, Mumbai

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Page 10 of 10

Union Bank of India v. M/S Shree Siddhivinayak Milk Product

Case brief

What is this about?

What did the court decide?

Union Bank of India v. M/S Shree Siddhivinayak Milk Product

Case brief

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What did the court decide?

What the court decided

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