Allowed

Indian Overseas Bank v. M/S Alsania Fashion and Another

DRT25 Aug 2026OA/916/2026

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal allowed an ex-parte application filed by a scheduled bank against a borrower for recovery of an NPA loan of Rs. 21.62 lakhs. The Tribunal exercised its discretion to grant simple interest at 8% per annum while issuing a recovery certificate.

What did the court decide?

Recovery Certificate issued; Defendants declared jointly and severally liable to pay Rs. 21,62,329.64 plus 8% p.a. interest.

Indian Overseas Bank versus M/S Alsania Fashion and Another — Execution and Attachment | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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ORIGINAL APPLICATION NO. 916/2026

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PRESIDED OVER BY MRIDULESH KUMAR SINGH

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DATE OF INSTITUTION: 18.06.2026

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DATE OF DECISION: 25.08.2026

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Indian Overseas Bank, a Body Corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 having its Central Office at 763, Anna Salai, Chennai- 600002 and amongst other places, a Branch Office at CMC, District Ludhiana, Punjab through its duly Constituted Attorney and Senior Manager, Smt. Abha Grover

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……..Applicant

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Versus

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M/S Alsania Fashions, 1^st Floor, Street no. 13, Sandhu Nagar, Near Hargobind Nagar, Ludhiana, Punjab through its Proprietor, Sh. Khurshed Alam

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Sh. Khurshed Alam, S/o Sh. Ali Mohammad Miyan, Proprietor M/S Alsania Fashions, R/o 1^st Floor, Street no. 13, Sandhu Nagar, Near Hargobind Nagar, Ludhiana, Punjab 2^nd Address: Plot no. 338, Street no. 8, Jassian Road, Ashiyana Colony, Ludhiana, Punjab

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….……Defendants

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Advocates:

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Argued by Sh. Rajan Arora, Advocate for applicant (through VC)

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None for defendants (already ex-parte vide order dated 18.08.2026)

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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. 21,62,329.64 (Rupees Twenty One Lacs Sixty Two Thousand Three Hundred Twenty Nine and Paise Sixty Four Only). The Original Application has been filed through Smt. Abha Grover, Senior Manager of the applicant, who is competent to institute the Original Application vide Power of Attorney dated 31.03.2010, which is Annexure A1 to this OA.

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2 OA/916/2026 INDIAN OVERSEAS BANK VS. M/S ALSANIA FASHIONS AND ANOTHER

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The brief facts of the OA are that defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for grant of CC Limit of Rs. 20.00 Lacs vide Loan Application dated 18.09.2023, which is Annexure A3 to this OA. Thereafter, defendant no. 1 through its Proprietor defendant no. 2 approached the applicant for renewal of CC Limit of Rs. 20.00 Lacs.

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The applicant sanctioned CC Limit of Rs. 20.00 Lacs vide Credit Sanction Advice dated 25.09.2023, which is Annexure A2 to this OA and the terms and conditions were duly accepted by the defendants. Thereafter, the applicant sanctioned renewal of CC Limit of Rs. 20.00 Lacs vide Credit Sanction Advice dated 29.10.2024, which is Annexure A10 to this OA.

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Defendant no. 1 through its Proprietor defendant no. 2 hypothecated their all kinds of stocks of hosiery and textile products, book debts and other current assets existing as well as future vide Letters of Hypothecation dated 25.09.2023, which are Annexure A6 to A8 to this OA.

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Documents Executed: Revised DP Note, Letter of Continuity and Undertaking, all dated 25.09.2023, which are Annexure A4, A5 and A9 to this OA; Legal Notice dated 05.06.2026 along with postal receipts, which are Annexure A11 to A14 to this OA and Statement of Account with certificate, which are Annexure A15 and A16 to this OA.

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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. 21,62,329.64 which is recoverable and the defendants were served recall notice 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 but no one appeared on behalf of defendants and they were proceeded ex-parte vide order dated 18.08.2026.

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In support of the OA, affidavit of Smt. Abha Grover , Senior Manager, Indian Overseas Bank h as been filed.

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Heard ex-parte arguments and perused record.

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3 OA/916/2026 INDIAN OVERSEAS BANK VS. M/S ALSANIA FASHIONS AND ANOTHER

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It was argued by learned counsel through VC, that in view of the documentary evidence brought on record which had gone unrebutted, the applicant had proved its case.

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From the perusal of all the Annexure A1 to A16 to this OA, it is proved that defendant no. 1 through its Proprietor defendant no. 2 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. 21,62,329.64 (Rupees Twenty One Lacs Sixty Two Thousand Three Hundred Twenty Nine and Paise Sixty Four 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 pendente lite and future rate of interest is concerned, the applicant has claimed interest @9.45% p.a. plus @2%p.a. penal interest with monthly rests from 01.06.2026 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 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 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.21,62,329.64 (Rupees Twenty One Lacs Sixty Two Thousand Three Hundred Twenty Nine and Paise Sixty Four Only) jointly and severally, with costs, current and future simple interest @8.00% p.a. in the loan

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OA/916/2026 INDIAN OVERSEAS BANK VS. M/S ALSANIA FASHIONS AND ANOTHER

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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 09.09.2026.

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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: 25.08.2026

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(MRIDULESH KUMAR SINGH)

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Presiding Officer,

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DRT-III, Chandigarh

Indian Overseas Bank v. M/S Alsania Fashion and Another

Case brief

What is this about?

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Indian Overseas Bank v. M/S Alsania Fashion and Another

Case brief

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