Allowed

State Bank of India v. Sh. Mehnga Singh

DRT5 May 2026OA/80/2026

Case brief

AI extract

What is this about?

Debts Recovery Tribunal allowed an original application filed by State Bank of India against Mehnga Singh for recovery of a defaulted term loan of Rs. 23 lakhs. The court granted a recovery certificate and ordered simple interest at 8% per annum.

What did the court decide?

Recovery Certificate issued for Rs. 23,21,530.00 with simple interest at 8% p.a.; sale of hypothecated or personal assets permitted.

State Bank of India versus Sh. Mehnga Singh — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.80/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 15.01.2026

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DATE OF DECISION: 05.05.2026

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State Bank of lndia, a Body Corporate constituted under the State Bank of lndia Act, 1955 having its Corporate Office at Madame Cama Road, Nariman Point, Mumbai and having Branches all over India, one of its Branch situated at Samrala, Chandigarh Road, Tehsil Samrala, District Ludhiana through its Chief Manager, Sh. Satanand Singh who is Authorized Officer

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……..Applicant

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Versus

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Sh. Mehnga Singh, S/o Sh. Sher Singh, R/o Village Satabgarh, PO Sherpur Bet, Tehsil Samrala, District Ludhiana, Punjab

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….……Defendant

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Advocates:

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Argued by Ms. Lovedeep Kaur, Advocate proxy for Ms. Puja Sharma, Advocate for applicant

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None for defendant (already ex-parte vide order dated 29.04.2026)

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FINAL ORDER

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Present Original Application was instituted by the applicant bank under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993, against the defendant for recovery of Rs. 23,21,530.00 (Rupees Twenty Three Lacs Twenty One Thousand Five Hundred Thirty Only). The Original Application has been filed through Sh. Satanand Singh, Chief Manager of the applicant, who is competent to institute the Original Application in terms of State Bank of India Regulations dated 02.05.1987, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant approached the applicant for the grant of Term Loan of Rs. 22.00 Lacs for purchase of Tractor and Equipments vide Loan Application dated 31.08.2024, which is Annexure A2 to this OA.

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The applicant sanctioned Term Loan of Rs. 22.00 Lacs for purchase of Tractor and Equipments vide Letter of Arrangement dated

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2 OA NO.80/2026 STATE BANK OF INDIA VS. MEHNGA SINGH

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23.10.2024, which is Annexure A3 to this OA and the terms and conditions were duly accepted by the defendant.

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Defendant hypothecated his movable asset namely Mahindra Tractor 605 Arjun 49.9HP bearing Chassis no. MBNBEBDY5RNE01140 and Engine no. NRE2UXE0108 vide Hypothecation Agreement dated 23.10.2024 and Invoice dated 29.10.2024, which are Annexure A4 and A5 to this OA. However, in the OA it is mentioned that despite repeated requests by the applicant, the defendant did not supply the original certificate of registration of agricultural tractor purchased with the loan. Documents executed: Legal Notice dated 23.10.2025, which is Annexure A6 to this OA and Statement of Account with certificate, which is Annexure A7 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. 23,21,530.00, which is recoverable and the defendant was served recall notice but he did not repay the outstanding amount, therefore, the applicant requested to accept the application and to issue Recovery Certificate accordingly. 6. The defendant was served summons to appear before this Tribunal, but no one appeared on behalf of the defendant and he was proceeded ex-parte vide order dated 29.04.2026. 7. In support of the OA, affidavit of Sh. Satanand Singh, Branch Manager , State Bank of India has been filed. 8. Heard ex-parte arguments and perused record. 9. It was argued by learned proxy counsel 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 Annexure A1 to A7 to this OA, it is proved that the defendant approached applicant for availing of loan facility which was granted to him and for that he had executed all the relevant documents in favour of the bank. The defendant failed to pay back the loan as per terms and conditions of the agreement between the parties. Subsequently, account of the defendant was classified as

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3 OA NO.80/2026 STATE BANK OF INDIA VS. MEHNGA SINGH

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NPA. From the documentary evidence brought on record, it is proved that applicant is entitled to recover a sum of Rs. 23,21,530.00 (Rupees Twenty Three Lacs Twenty One Thousand Five Hundred Thirty Only) along with interest from the defendant, 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 @9.00%p.a. plus @2% penal interest with monthly rests from 30.11.2025 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 asset, undertaking of the defendant, 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 defendant is liable to pay to the applicant a total sum of Rs.23,21,530.00 (Rupees Twenty three lacs twenty one thousand five handed thirty only) 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 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 defendant. 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. 13. Issue Recovery Certificate accordingly.

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Parties to appear before Learned Recovery Officer of this Tribunal on 26.05.2026.

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4 OA NO.80/2026

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STATE BANK OF INDIA VS. MEHNGA SINGH

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Copy of this order be given dasti to the applicant and be sent to defendant 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: 05.05.2026

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

State Bank of India v. Sh. Mehnga Singh

Case brief

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State Bank of India v. Sh. Mehnga Singh

Case brief

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