Allowed

Punjab National Bank v. Sh. Karnail Singh through His Legal Heirs and Another

DRT19 Mar 2026OA/895/2025

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the bank's application for recovery of Rs. 27,30,180.99 along with simple interest at 8% p.a., directing the respondent legal heirs to pay the amount or face execution proceedings via sale of hypothecated assets.

What did the court decide?

Recovery of Rs.27,30,180.99 with simple interest at 8% p.a. via Recovery Certificate and sale of assets.

Punjab National Bank versus Sh. Karnail Singh through His… — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO.895/2025

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 09.07.2025.

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DATE OF DECISION: 19.03.2026

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Punjab National Bank, a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Head Office at Plot No.4, Sector 10, Dwarka, New Delhi110075 and its Branch Offices throughout India including BranchARMB, Ludhiana, Punjab.

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……..Applicant Versus

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Sh. Karnail Singh s/o Sh. Inder Singh r/o House No.129, Kuthakheri, Tehsil Rajpura, District Patiala, Punjab-140401 since deceased and now representing through his following Class-1 Legal Heirs:

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(a) Smt. Amarjit Kaur Wd/o Sh. Karnail Singh, R/o House No. 129, Kuthakheri, Tehsil Rajpura, District Patiala, Punjab-140401.

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(b) Sh. Harmeet Singh S/o late Sh. Karnail Singh, R/o House No. 129, Kuthakheri, Tehsil Rajpura, District Patiala, Punjab 140401.

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(c) Manjit Kaur D/o Late Sh. Karnail Singh, R/o House No. 129, Kuthakheri, Tehsil Rajpura, District Patiala, Punjab 140401.

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Sh. Harmeet Singh S/o Sh. Karnail Singh, R/o House No.129, Kuthakheri, Tehsil - Rajpura, District Patiala, Punjab-140401.

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……….Defendants

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Advocates:

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Argued by Ms. Seerat, Advocate proxy for Sh. D.K. Gupta, Advocate for the applicant

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Defendants already ex-parte vide order dated 22.01.2026.

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2 OA/895/2025 PUNJAB NATIONAL BANK VS. KARNAIL SINGH THROUGH HIS LEGAL HEIRS AND ANOTHER

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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.27,30,180.99 (Rupees Twenty Seven Lacs Thirty Thousand One hundred Eighty & Paise Ninety Nine only). The Original Application has been filed through Sh. Lakhvinder Singh, Senior Manager, of the Applicant who is competent to institute the Original Application vide General Power of Attorney dated 27.03.2020, which is Annexure A1 to this OA.

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The brief facts of the OA are that the defendant No.1 (since deceased) approached the applicant for grant of KCC Limit of Rs.10.00 Lacs vide loan application dated 07.05.2011. Later, the defendant No.1 approached the applicant for grant of financial assistance to repay Debt of Private Money Lender via Term loan of Rs.1.00 Lac vide loan. Defendant no. 2 stood as guarantor.

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The applicant sanctioned KCC Limit of Rs.10.00 Lacs vide sanction dated 07.05.2011, which is Annexure A2 to this OA and sanctioned Term Loan of Rs.1.00 Lac for Debt Swap vide sanction dated 30.12.2015, which is Annexure A8 to this OA.

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Defendant no. 1 (since deceased) mortgaged his immovable property i.e. land measuring 09Bigha-19Biswa situated at Village Lohakheri, Tehsil Rajpura, District Patiala, Punjab vide Mortgage deed bearing Vasika No. 1348 dated 23.05.2011, along with translation, which is Annexure A7 , A7-T to this OA.

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Documents executed: Hypothecation agreement dated 27.05.2011 which is Annexure A3 to this OA; Letter of undertaking dated 27.05.2011 which is Annexure A4 to this OA; Letter of consent dated 27.05.2011 which is Annexure A5 to this OA; Affidavit dated 09.05.2011, which is Annexure A6 to this OA; Hypothecation agreement –TL dated 30.12.2015, which is Annexure A9 to this OA;

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3 OA/895/2025 PUNJAB NATIONAL BANK VS. KARNAIL SINGH THROUGH HIS LEGAL HEIRS AND ANOTHER

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Agreement of Guarantee dated 30.12.2015, which is Annexure A10 to this OA; Letter of undertaking from legal heir dated 26.10.2016, which is Annexure A11 to this OA; BC Letters dated 19.03.2014, 26.10.2016, 03.10.2019 & 28.07.2022, which are Annexures A12 & A15 to this OA; Legal notice dated 28.08.2021, along with postal receipt, which is Annexure A16 to this OA; Letter of undertaking from legal heir dated 28.07.2022, which is Annexure A17 to this OA; Notice dated 06.05.2025, along with postal receipts, which is Annexure A18 to this OA and Statements of the Accounts with certificate, which are Annexures A19 to A21 to this OA.

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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.27,30,180.99, 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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The defendants were served notices to appear before this Tribunal but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 22.01.2026.

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In support of the OA, affidavit of Sh. Lakhvinder Singh, Senior Manager, Punjab National Bank, has been filed.

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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 which had gone unrebutted, the applicant had proved its case. From the perusal of all the Annexures A1 to A21 to this OA, it is proved that the defendant no. 1 (since deceased) approached applicant for availing of the loan facilities which were granted to him and for that he had executed all the relevant documents in favour of the bank. The defendants failed to pay back the loans as per terms and conditions of the agreement

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4 OA/895/2025 PUNJAB NATIONAL BANK VS. KARNAIL SINGH THROUGH HIS LEGAL HEIRS AND ANOTHER

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between the parties. Subsequently, 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.27,30,180.99 (Rupees Twenty Seven Lacs Thirty Thousand One Hundred Eighty & Paise Ninety Nine only) along with interest from the defendants, jointly and severally, from the date of filing of the present Original Application till realization of the accounts.

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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 in KCC Limit @10.30% p.a. along with 2% penal interest & interest in Term Loan @12.00% p.a. along with 2% penal interest with yearly rests from 01.07.2025 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 mortgaged property/hypothecated assets, undertaking of the defendants, quantum of loans 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 uniform simple interest @08.00%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.

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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.27,30,180.99 (Rupees Twenty Seven Lacs Thirty Thousand One Hundred Eighty & Paise Ninety Nine only), jointly and severally, with costs, current and future simple interest @08.00%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

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OA/895/2025 PUNJAB NATIONAL BANK VS. KARNAIL SINGH THROUGH HIS LEGAL HEIRS AND ANOTHER

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aforesaid amount from the sale of the mortgaged property/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 09.04.2026.

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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.

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Pronounced by me in the open Tribunal .

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Dated: 19.03.2026

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(MRIDULESH KUMAR SINGH)

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Presiding Officer,

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DRT-III, Chandigarh

Punjab National Bank v. Sh. Karnail Singh through His Legal Heirs and Another

Case brief

What is this about?

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Punjab National Bank v. Sh. Karnail Singh through His Legal Heirs and Another

Case brief

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