Allowed

Indian Bank v. M/S Mahaveer Fabrics and Another

DRT28 Jul 2026OA/713/2026

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an application by Indian Bank against fabric owners for recovery of a loan default of Rs. 25.46 lakhs. The court directed payment with 8% interest and authorized recovery via sale of assets.

What did the court decide?

Direct order for payment of Rs. 25,46,361.00 plus 8% simple interest; directed recovery via sale of hypothecated assets under SARFAESI Act or attachment of personal assets.

Indian Bank versus M/S Mahaveer Fabrics and Another — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 713/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 14.05.2026

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DATE OF DECISION: 28.07.2026

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Indian Bank (erstwhile Allahabad Bank), on the basis of Amalgamation Scheme dated 04.03.2022, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970, having its Corporate Office at 254-260, Avvai Shanmugam Salai, Royapettah, Chennai, Tamil Nadu–600014, and having its Zonal Office at Ludhiana and amongst other branches a Branch at Chaura Bazar, Ludhiana, Punjab, through its Branch Manager, Sh. Nirmal Anand, duly constituted and authorized signatory.

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……..Applicant

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Versus

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M/s Mahaveer Fabrics, through its Proprietor, having its Registered Office situated at House No. 27-M, Basant Vihar, Street No. 3, Near Water Tank, Noorwala Road, Ludhiana, Punjab–141008.

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Smt. Anju Jain, W/o Sh. Anil Jain, Proprietor, M/s Mahaveer Fabrics, R/o House No. 27-M, Basant Vihar, Street No. 3, Near Water Tank, Noorwala Road, Ludhiana, Punjab–141008.

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.……Defendants

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Advocates:

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Argued by Sh. Prerit Thakur, Advocate proxy for Sh. S.K. Dhir, Advocate for applicant

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None for Defendants (already ex parte vide order dated 24.07.2026)

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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.25,46,361.00 (Rupees Twenty Five Lac Forty Six Thousand Three Hundred Sixty One Only). The Original

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2 OA/ 713/2026 INDIAN BANK VS M/S MAHAVEER FABRICS AND ANOTHER

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Application has been filed through Sh. Nirmal Anand, Branch Manager, of the applicant, who is competent to institute the Original Application vide Authority Letter dated 10.10.2025, which is Annexure A1 to this OA. 2. The brief facts of the OA are that the defendant no. 1, through its proprietor defendant no. 2, approached the applicant for OCC Limit of Rs.19.90 lacs vide Loan Application dated 06.09.2021, which is Annexure A2 to this OA.

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Thereafter, the defendant no. 1, through its proprietor defendant no. 2, approached the applicant for CC-GST Limit of Rs.5.10 lacs vide Loan Application dated 22.12.2023, which is Annexure A8 to this OA. 3. The applicant sanctioned the OCC Limit of Rs.19.90 lacs vide Sanction Letter dated 27.09.2021, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the applicant sanctioned the CC-GST Limit of Rs.5.10 lacs vide Sanction Letter dated 22.12.2023, which is Annexure A9 to this OA. 4. Defendant no. 1, through its proprietor defendant no. 2, hypothecated its stock and book debts vide Agreement for Hypothecation of Movables dated 01.10.2021, which is Annexure A5 to this OA; Agreement for Open Cash Credit dated 22.12.2023, which is Annexure A10 to this OA; Documents executed: Agreement for Open Cash Credit dated 01.10.2021, which is Annexure A4 to this OA; Joint & Several D.P. Note dated 01.10.2021, which is Annexure A6 to this OA; Letter of Continuity dated 01.10.2021, which is Annexure A7 to this OA; Recall Notice dated 16.10.2025 and 05.09.2025, which is Annexure A11 to this OA; Statement of Accounts along with Certificate under the Bankers' Books Evidence Act, which are Annexures A12 & A13 to this OA. 5. 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.25,46,361.00 (Rupees Twenty Five Lac Forty Six Thousand Three Hundred Sixty One Only), which is recoverable and the defendants

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3 OA/ 713/2026 INDIAN BANK VS M/S MAHAVEER FABRICS AND ANOTHER

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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. 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 24.07.2026. 7. In support of the OA, affidavit of Sh. Nirmal Anand, Branch Manager , Indian Bank, has been filed. 8. Heard ex-parte arguments and perused record. 9. 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. From the perusal of all the Annexures A1 to A13 to this OA, it is proved that the defendant no. 1, through its proprietor defendant no. 2, approached applicant for availing of the loan facilities, which were granted to them. Defendants had executed all the relevant documents in favour of the applicant. The defendants failed to pay back the loans as per terms and conditions of the agreement between the parties. Subsequently, both the 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.25,46,361.00 (Rupees Twenty Five Lac Forty Six Thousand Three Hundred Sixty One 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 pendent elite and future rate of interest is concerned, the applicant has claimed interest @11.85%p.a. with half yearly rests from 18.02.2026 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 loans and prevalent market rates of interest

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4 OA/ 713/2026 INDIAN BANK VS M/S MAHAVEER FABRICS AND ANOTHER

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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 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. 11. In the result, the application is allowed declaring that the defendants are liable to pay to the applicant a total sum of Rs.25,46,361.00 (Rupees Twenty Five Lac Forty Six Thousand Three Hundred Sixty One 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 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. 12. Any other application pending stands disposed of. 13. Issue Recovery Certificate accordingly. 14. Parties to appear before Learned Recovery Officer of this Tribunal on 12.08.2026 15. 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: 28.07.2026 (MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Indian Bank v. M/S Mahaveer Fabrics and Another

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Indian Bank v. M/S Mahaveer Fabrics and Another

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