Allowed

Bank of Baroda v. Shri Bhajan Singh

DRT29 Jan 2026TA/266/2022

Case brief

AI extract

What is this about?

Debts Recovery Tribunal-II Delhi allowed Bank of Baroda 's application for recovery of dues totaling 36.52 lakhs from multiple directors and firms involved in fraudulent loan availing. Tribunal held employee-defendants not liable as they did not benefit from misappropriated funds but directed recovery from other liable parties.

What did the court decide?

Directing Legal Respondents to pay jointly and severally sum of Rs. 3,65,21,947/- with interest and costs, excepting employees who are not liable.

Bank of Baroda versus Shri Bhajan Singh — Banking and Recovery | DRT (2026)

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Before SUSHIL^{KUMARRASTOGI, Presiding Officer} Debts Recovery^{Tribunal-Il,Delhi}

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TA No.265 OF²⁰²²

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BANK OF BARODA^{VS SHRI BHAIAN SINGH& ORS}

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Reserued on : 19.01.2O26

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Pronounced on^{: 29.01.2O26}

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-APPlicant bank Bank of Baroda

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Vs.

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Shri Bhajan^Singh

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Since deceased^{throughhis LR-}

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Smt. Opinder^{Kaur defendantno.22}

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Mls Krishna^Traders

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M/s Kohinoor^Metal

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Mls K.K. Trading^CorPoration

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M/s Konika Overseas

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M/s Bhagwan^{Dass EnterPrises}

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Mls Inderjeet^Metal

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M/s Balaji^Metals

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M/s Ritco^{Sales Corporation}

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M/s Surya^{& Co}

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Mis Ultra-Coat

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M/s Suman^Metals

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M/s Star^{Trading CorPoration}

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M/s Shivali EnterPrises

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M/s. R.S.^{Hard MetalMfg'Co.}

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M/s Bajrang^{Metal House}

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Shri B.D. Sharma

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Shri Ravinder^Malik

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Shri P.K. Sahi

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Shri Inderjeet^{Singh Suri}

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Shri Prem Singh^KalYan

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Smt. Opinder^Kaur

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Shri DeePak^Kumar

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ShriJai^{Prakash Sharma}

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Shri Anil Agarwal

^./

2 TANO. 266 of 2022

ShriDarshan^Singh

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S/o Late Shri^{Mela Singh}

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(Since deceased through^LR,

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i.e., defendantno'27)

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Smt. Jasbeer^{Kaur Saluja} Wo^{Late Shri Darshan Singh}

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Shri Dinesh^Kumar

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ShriMamam^Kumar

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Shri^{VishnuDutt Sharma}

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Shri Mahesh^Sharma

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Shri Ramesh^{Kumar Sharma}

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Smt.^{MaYa Devi}

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Wo^{Shri Shiv NaraYan Sharma}

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(Since deceased through^{LR i.e',}

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defendant^{no.34 and defendant nos'39 to 44)}

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Shri Shiv^{NaraYan Sharma}

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(Since deceased through^{LRs, i'e.,}

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Defendant nos.^{39 to 44)}

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Shri Sunil^{Dutt Sharma}

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Shri Mukhtiar^Singh

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ShriAtulAgarwal

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Shri^{Hari Mittar Agarwal}

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Smt.^{Narmada Sharma}

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Daughter of Late^{Shri Shiv Narayan Sharma}

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Shri R.P. Sharma

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Son of Late Shri.^{ShivNaryan Sharma}

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ShriMadan^{Mohan Sharma}

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Son of Late Shri.^{NaraYan Sharma}

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Shri Satish Chand^Sharma

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Son of Late Shri^{Shiv Narayan Sharma}

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Shri JaYaPrakash^Sharma

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Son of Late Shri^{Shiv Chand Sharma}

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ShriMahesh Chand^Sharma

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Son of Late Shri^{Shiv NaryanSharma - Defendants} -^.

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Present: Mr.

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Mr. los Chiramel,^{Counselappears} for aPPlicant^bank.

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Mr. Ravi Data,^{Counsel for defendant nos'6} & 25. None for other^defendants'

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FINAL ORDER

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This original application^{has been filed by the} applicant bank,^{on 18.01.1999throughSh' R'C'} Dahiya, Senior^{Manager of the applicantbank, under} Section 19 of^{the RDB Act, 1993againstthe defendants} for recovery^{of a sum of Rs.3,65,21,9471- togetherwith} cost, charges^{and pendentellite and future interest} @17.600/o^{from date of filing of this O'A' till the} realization^{in full.}

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The brief^{facts of the case as per application are} that defendant^{no'17 was appointed as Branch} Manager of the^{Mayapuri branch on 03'08'1994' At the} time of^{posting of defendant no'17 in the Mayapuri} branch, defendant^{no.18 was transferred to the branch} almost simultaneously^{as its Accountant'The banking} transactions of^{the plaintiffsMayapuri Branchwere} thus^placed in^{the trust under defendantno'17 & 18,} and they^{wereresponsibleto manage and accountfor} the assets and^{funds of the plaintiff. The loans were to} be sanctioned^{by the branchmanagerwith the} recommendation^{of the accountantand the balances} outstanding^{in the accountsof the customerswere} required to be^{reported to the higher authorities from} time to time as^{per norms and guidelinesof the bank,} so that there^{were periodical checks andsuperuision} over the working^{of the individualbranchesof the} applicant bank. It^{is submitted that after defendant} q

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no.17^{joinedthe Mayapuri Branch as its Branch} Manager,^{he alloweddefendant no'24 and 30 to open} current^{accountno. 1901 at the Branchon 16'06'1995} in the name^{of defendant no'10 as its paftners'and on} 20.06.1995^{sanctionedcredit facilities to the said} defendant^{in the nature of Cash Credit Facilitywitha} limit of^{Rs.1,50,000'00 and Bills Purchasefacility with} a limit of^{Rs.50,000.00.The samewas within the} discretionary^{powersof defendantsno'17, and the loan} was recommended^{by defendantno'18'In} consideration^{of the sanctionand grant of the cash} credit facilities^{with a limit of Rs'1,50,000'00by the} applicant bank^{to defendant no'10, defendant no'24} and 30 on^{behalf of defendant no'10 executed and} delivered^{security documentsto the applicant bank on} 20.06.1995.^{In consideration of the sanction and grant} of the^{Bills Purchase Facilityby the applicantbankto} defendant^{no.10 with a limit of Rs'50'000'00'} defendant^{nos.24 and 30 on behalf of defendant no'10} executed and^{deliveredsecurity documentsto the} applicant^{bank on 20.06.1995'The defendant nos'32} and 33^{executed and delivered to the applicantbank} letter of^{guaranteedated 20'06'1995' The defendant} nos.10, 33^{and 34 created mortgage of immovable} property bearing no.^{K-56, New Mahavir Nagar' New} Delhi owned^{by them, and in the meanwhilenot to} create any^{encumbrancethereon and not to part with} possession thereof'^{Thereafter on 25'07 'L995'} defendant^{no.17permitted defendantno'1 to open} Current Account^{No' 1914 with the Plaintiff' The} defendant^{no.17 on 14.03.1996 sanctionedcash credit} facilities to^{defendant no'2 with alimit of} Rs.2,00,000'00^{withinhis-discretionary powers as the} a'

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Branch Manager^{of the Mayapuri Branch,which} was duly^{recommendedby defendantno'18 as the} accountant^{of the branch. In pursuanceof the sanction} of the above^{said facility to defendant no'2, defendant} no.1 executed^{and delivered security documentsto the} applicant bank^{on behalf of defendant no'2 on} 14.03.1996.^{Though defendant no'2 was sanctioned} only cash credit^{facility with a limit of Rs'2,00,000'00} by defendant^{no.17, the defendant nos'17and 18} however in^{illegal liaison and collusionwith defendant} no.1^{permitted defendant no.2 through defendant no'1} from April^{1996 onwards to avail Cash Credit facility far} in excess of the^{said limit of Rs.2,00,000'00 and also} granted Bills Purchase^{facility defendantno'2 without} any authorization^{whatsoever,notwithstanding the fact} that no such^{facility was ever sanctionedby the} applicant bank^{to defendant no.2 at that time' D-17 &} 18 also in total^{disregard of the guidelines issued by} the plaintiff in^{respect ofdispatch of} bills/documents/instruments/^{cheques,handedover} the^{purchase cheques directly to the D-1 insteadof} routing them^{through the collecting branch'It is further} submitted that^{defendant no.1, 17 & 18 having thus} enriched themselves^{to large sums of money belonging} to the^{plaintiffbank in an illegal and fraudulentmanner} also involved^{defendant no.24,30 & 31, who later on} joined as a partner of D-10 flrm,^{through defendant} no.10 firm in^{this shame and bogus transaction' The} defendant^{no.l, !7 & 18 in collusion with D-22 to D-38} hatched a conspiracy^{to further defraud the plaintiff} bank by opening^{several accountperiodicallyand} intermittently in^{the names of the flrmsowned,} managed and operated^{b_y--!pmThe defendant no'17} 9r

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TANO.^{266 of 2022} 6 the oPening of^{the current} after Permitting accounts,^{sanctionedcash credit facilitywith a limit of} Rs.2,00,000'00^{on behalfof the applicant bank to M/s} Kohinoor^{Metal i.e. defendantno'3, defendantsnos'1} and 23^{executed and delivered security documentsto} the applicant^{bank on 18'03'1996'The defendant} no.22 executed^{and deliveredto the applicant bank a} letter of^{guaranteedated 18.03'1995' In respect of the} cash credit^{facility with a limit of Rs'2'00'000'00} advanced by^{defendant no'17 on behalf of the} applicant^{bank to M/s Bhagwan Dass Enterprisesi'e'} defendant^{no.6, the defendants nos'25 executed and} delivered^{security documentsto the applicant bank on} 20.07.1996.^{The above credit facilities to defendant} no.6 were^{to be securedby the letter of guarantee of} Shri Sunit^{Agarwal,brother of defendant no'25' In} respect of^{the cash credit facility with a limit of} Rs.1,75,000/-^{advanced by defendant no'17 on behalf} of the applicant^{bank to M/s Ultra-Coati'e', defendant} no.11, the defendant^{no. 35 executedand delivered} security documents^{to the applicant "bankon} 27.08.Lgg6.^{The defendant nos' 24 and 30 executed} and delivered^{to the applicant bank a letter of} guarantee dated 27.08.1996'^{In respectof the cash} credit facility^{with a limit of Rs'2,00,000'00advanced} by defendant^{no.17 on behalfof the applicant bank to} M/s Konica^{OverseasIndia i'e' defendantno'5' the} defendants^{nos.24 executedand delivered security} documents^{to the applicant bank on 06'11'1996'The} defendant^{no.1 executed and delivered to the applicant} bank a letter^{of guarantee dated 22'11'1996'It is} further submitted^{that D-l in collusionwith D-17 & 18} applied in^{July,1996for renewalof Cash credit facility} s.l

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in the^{name of D-2.It is further submittedthat the} competent^{authority at the Regional Authority's office} of the applicant^{bank at New Delhi, based on the} recommendation^{of the Branch Office, approved on} 30.10.1996^{renewal ofcash credit limit of} Rs.2,00,000'00^{and with a limit of BillsPurchase facility} Rs.15,00,000.00,^{subject to, inter alia, the condition} that defendants^{no.22 and 23 moftgagedtheir} immovable^{propertiesin favour of the PlaintiffBank i'e''} (a) Plots No. 49,^{50 and 51 admeasuring 600 square} yards and Plots^{No. 52 to 56 admeasuring300 square} yards, owned by defendant^{no'22 at NIT Faridabad'} Haryana.^{(b) Plots No. 31, 32 and 33 admeasuring600} square^{yards owned by defendantno'22 at NIT} Faridabad,^{Haryana. (c) Plots No' C-7 and C-B} admeasuring^{400 square yards owned by defendant} no.23 at^{Dabua Colony, Faridabad, Haryana'In} consideration^{of the sanction of Letter of Credit facility} against documentary^{acceptance by the applicant bank} to defendant^{no'2 with a limit of Rs'15,00,000'00'} defendant^{no.1 executedon behalf of defendant no'2} and delivered^{to the applicant bank a demand} promissory Note dated^{30.10'1996 agreeing and} undeftaking^{to repay the sum of Rs'15,00,000'00 with} interest @^{14olo per annumwith quarterly rests or such} rate as the^{bank may decide from time to time' To} secure the due^{payment of amountsoutstanding in the} aforesaid^{cash credit account of defendant no'2 the} defendant^{no.22 executed and delivered to the} applicant bank^{a letter of guaranteedated 30'10'1996'} To further^{secure the due repayment the defendants} no. 22 and^{23 also created equitable mortgageof} immovable^{propefties owrydby them as mentioned in} C"\

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Annexure^{'D' to the plaint, by deposit of title deedsof} the^{properties with the applicant bank' It is further} submitted^{that the defendant no'l who wasone of the} paftners of the defendant^{no'3 firm also appliedfor} credit facilities^{to the said firm, to the same extent as} was sanctioned^{to defendantno'2' Interestingly} enough,^{even the introductionof the current account} of defendant^{no.3 was given by defendantno'l as} proprietor of defendant^{no.2, whichfact alsoignored} by defendant^{no.17' The defendants no'17 and 18} recommended^{and put forward the application of} defendant^{no.3 to the regional authority of the} applicant bank^{for cash creditfacility with a limit of} Rs.2,00,000.00^{and Letter of Credit facilityagainst} documentary^{acceptance with alimit of} Rs.15,00,000.00'^{The Regionalauthority on} 29.10.1996^{approvedthese credit facilities to} defendant^{no.3 on the basis of the recommendations} made by the^{Branch Office. In considerationof the} sanction of the^{Letter of Credit facilityagainst} documentary^{acceptanceby the applicant bank to} a limit of^{Rs.15,00,000.00,} defendant^{no.3 with} 23 executed^{on behalf of} defendants^{no.1 and} defendant^{no.3 as its paftnersand delivered to the} applicant bank^{a Demand Promissory Note dated} 30.10.1996.^{To securethe due paymentof amounts} outstanding^{in the aforesaid cash creditaccount of} defendant^{no.3, the defendantno.22 executed and} delivered to^{the applicant bank a letter of guarantee} dated 30.10.1996'^{To fufther secure the due} repayment of^{amounts outstandingunder the Cash} Credit facility^{granted to defendant no'3, defendants} nos.2}and^{23 also extended the equitable mortgageof} 9x

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immovable^{propertiesowned bythem as} mentioned^{in Annexure'D' to the plain! by deposit of} the title^{deeds to cover the amounts advanced to} defendant^{no'3 as well. The proposalsof Defendants} No.2 and 3^{in this regard, duly recommended by} Defendants^{No' 17 and 18 were forwarded to the} Regional^{Authority's office of the applicant bank at New} Delhi for sanction^{of the same' The competent} authority,^{after considerationof the aforesaid request'} on 24.02.t997^{allowedinterchangeabilityof foreign} letters of credit^{against documentary acceptance for} Rs.10,00,000.00^{to the cash credit (hypothecation)} account of^{defendantsno'2 and 3 respectively,subject} to the condition^{that the total limits under the cash} credit^{(hypothecation) account,ought not to exceed} Rs.12,00,000.00.^{The defendants no'2 and 3 thereafter} sought full^{interchangeability of the earlier sanctioned} limit of^{Rs.15,00,000.00 in their respective accounts} under the^{letters of credit facility against documentary} acceptance^{into cash credit(hypothecation)accounts} with the earlier^{sanctionedlimits of Rs'2,00,000'00} each, so as^{to bring the aggregate limitsunderthe cash} credit accounts^{to Rs.17,00,000'00 each with the} facility of inter-^{changeabilityfrom the letters of credit} facility. The^{proposalsin this regard duly recommended} by defendants^{no. 17 and 18 wereforwardedby them} to the Regional^{Authority's office of the applicant bank} at New Delhi'^{The RegionalAuthority's office of the} applicant^{bank after considering the aforesaid request'} on 28.04.1997^{permittedinter-changeability of the} cash credit and^{letters of credit againstdocumentary} acceptance^{facilities to defendantsno'2 and 3, thus} bringing the^{maximumlimit under the cash credit} €A

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the facility to^{Rs'17,00,000.00 subject to} interchangeability^{from the letters of credit facility to} the extent^{of Rs.15,00,000'00'In respect of the} enhancement^{of the limit to defendant no'2' defendant} no.1 executed^{and deliveredto the applicant bank the} security^{documentson 28'04'1997'The defendant} no.22^{executed a letter ofguaranteedated 28'04'1997'} The defendant^{no'1 executed and delivered to the} applicant^{bank the security documentson 28'04'1997'} After^{the transfer of defendantsno'17 and 18 from the} Mayapuri^{Branch of the applicant ban( the defendant} no.19^{took overchargeonly on 23'06'1997' During the} period from^{01'06'1997to 17'06'1997 the Branchwas} under^{the charge of Mr' l'D'K' lain who was on} deputation.^{Thereafter from 18'06'1997 to 22'06't997} the branch^{was under the temporary chargeof} defendant^{no.20 who was the seniormostofficer of the} Plaintiff^{in the branch, and acted as the Branch} Manager.^{He enhanced the cash creditlimit of M/s} Surya &^{Co i.e' defendant no' 10 from Rs'1'50'000'00} to Rs.4,50,000'00^{during the said period'In respect of} the^{enhancementof the timit under the cash credit} facility^{from Rs'1,50,000'00toRs'4'50'000'00} advanced^{by defendant no'20 unauthorizedly on behalf} of the^{applicant bank to M/s Surya & Co i'e' to} defendantno'l0,defendantsno'24'30and31its partners executed^{and delivered to the Plaintiff Bank} the security^{documentson 20'06'1997' The defendant} no.33^{executeda letter of guarantee dated20'06'1997} in favour^{of applicant bank' The defendantno'19} submittedincorrectandfalsereportstotheRegional Authority's^{officeperiodically' concealing the huge} outstandings^{illegally obtained by the defendants with} x

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l1 TANO.266of2022 of defendants^{no. !7,18and} the connivance 20. By the^{time defendant no'19 was appointed as} Branch^{Manager of the MaYaPuri} Branch,^the discretionary^{powersof the Branch Managersto grant} credit^{facilities to customers was increasedfrom} Rs.2,00,000.00^{by the applicant bank w'e'f' 01'06'1997} to Rs.10,00,000.00'^{Taking undue advantageof the} same,^{defendant No'19 unilaterally and in a mala fide} and^{fraudulentmanner, enhancedthe cashcredit limiB} inrespectofthedefendants,withtheproposalsfor enhancement^{oflimits duly recommended by} defendant^{no'20, to unduly favour the defendants'} group of^{firms' The same was apparentlydone to} conceallargeamountoffinancesitlegattyadvancedby D-17,^{18 & 20 to defendant no'2 to 11' In consideration} of the^{enhancementof the limit underthe cash credit} facitityfromRs'2,00,000'00toRs'10'00'000'00toM/s Konica^{Overseas i'e' defendant no'5' the defendant} no.24^{executed and delivered to the applicantbank the} security^{documens on 16'07'1997'The defendant} no.23^{executed a letter of guarantee dated 16'07'1997'} In consideration^{of the enhancement of the limit under} the cash^{credit facility from Rs'1'75'000'00to} Rs.3,00,000'00^{advanced by defendant no'19} unauthorizedlyonbehalfoftheapplicantbanktoM/s Ultra-^{Coat i'e' defendantno'11'the defendant no'35} executed^{and delivered to the applicant bank the} security^{documentson 20'08'1997'The defendant} no.30^{executed a letter of guarantee dated 16'07'1997'} It is further^{submitted that defendant no'19 did not} submit^{properrepoft to the RegionalAuthorityfrom} 23.06.1997^{upto August'1997' The RegionalAuthority} on coming^{to know abggllheirregularities committed} €^

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by D-17^{to D-21 in the MayapuriBranch' vide} letter dated^{09.08.1997 instructeddefendant no'19 not} to exercise^{his discretionary powers in the matterof} grant of credit^{facilities' Inspite of the same' D-19} purchased cheques^{worth Rs'51,00,000/-thereafter} and also^{enhanced the limits of D-11 as mentioned} above,^{in clear violation of the directionsof his superior} officers in^{the plaintiff's Mayapuribranch'It is further} submitted^{that the defendants are liable to reimburse} the amount^{fraudulently credited to the accountsof} defendant^{no'2 to 11 which they were not entitledto'} It is further^{submitted that the applicant bankis} entitled to^{sum of Rs'2,84,60,8251-from defendant} nos. 2 to 6^{and 9 to 11 and Rs'80'61'1221- from} defendant^{nos. 2,3 & 7 to 9 i'e' total sum of} Rs.3,65,21,9471-.

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It^{is further submifted that after the aforesaid} fraud was^{detectedby the applicant bank,the applicant} initiated^{departmentalaction against defendantno' 17} to 21 and^{defendantno'17 to 19 also remained} suspended^{from service. In the circumstances'the} defendant^{no.1 approached the applicant in September} 1997 and^{sought cash credit facilities to the extent of} Rs.1,25,00,000/-^{and bills purchase facility with a limit} of Rs.60,00,000/-^{by providing adequate security to the} satisfaction^{of the plaintiffbank' D-1 also sought} conversion^{of the balanceoutstanding in the various} accounts^{of the group into term loan repayable in 24} monthly^{installments. Detailed proposal in this regard} submitted^{by defendant no'2 to 4 and 8' The defendant} no.1 admitted^{in writing that the over saidaccounts} pertain to him.^{However,he falsely alteged that the} q

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remaining^{accountnamely those of defendant no'5 to} 7 and 9^{to 11 did not concern him' In a subsequent} letter dated^{09.10.1997,D-l admittedthat defendant} no.2 to^{4 and 6 to 9 firms belonged to him' The} applicant^{bank's headoffice therefore'aftercareful} considerationofallaspectsofthematter,especiallythe fact that^{without adequate securitiesit would have} been^{extremely difficult to realize the outstanding} amountsfromthedefendants'sanctionedcredit facilities to^{defendants nos'2 to 4 and B' strictly subject} to the^{various termsand conditionsi'e'' (i)' Cash Credit} against^{stocks/book debts of Rs'50'00'000/-'Bills} Purchase^{(cheque)of Rs'10,00,000/-'Demand Loan of} Rs.18,63,000^{and L/C (D'P) Of Rs'15'00'000/- to} defendant^{no.2. (ii). Cash Credit against stocks/book} debts of^{Rs.50,00,000/-, Bills Purchase (cheque)of} Rs.g,10,000/-,^{DemandLoanof Rs'10'61'0001-andUC} (D.P) Of^{Rs.15,00,000to defendant no'3' (iii)' Cash} Credit against^{stocks/book debts of Rs'48'50'000/- to} defendant^{no.4. (iv)' Cash Credit against stocks/book} debts of^{Rs.20,00,000/-and Demand Loan of} Rs.11,65,000/-^{to defendantno' 2 to 4 and 8 totaling} to Rs.258,49,000/-.^{Ttie above offer of the applicant} bank^{was subjectto the condition that all stocks and} book debts^{of defendants no'2 to 4 and 8 ought to be} hypothecated^{with the applicant bank' These} defendantswerealsorequiredtofurnishequitable mortgage^{of immovableproperty of the approximate} value of^{Rs.265,00,000'00'The advanceswere to be} guaranteed by^{defendantsno' 1' 22 and 23 besides} equitable^{mortgageof properties ownedby defendants} no.22 and^{23 the title deeds of which were already} deposited^{with the applicgnt bank earlier'As a first} A

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condition^{of the aforesaidoffer' the Demand loans} sanctioned^{to defendantsno' 2 and 3 totaling} Rs.29,24,000.00^{were to be repaid to the applicant} bank by^{15.03.1998'The cash credit faciliWof} Rs.48,50,000.00^{granted to defendantno'4 was to be} liquidated^{within a period of two years in monthly} instalments^{of Rs'2,00,000'00along with interestat the} applicable^{rate. The demand loan of Rs'11'65'000'00} sanctioned^{to defendantno'B was to be recovered by} cut back^{of Zlo/ofrom each bill purchased/ discounted} by the^{applicantbank' In respectof the aforesaidoffer} of the^{applicant bank made to defendant no'2'} defendant^{no'1 acting on behalf of defendant no'2'} executd^{and deliveredto the applicant bank the} security^{documents on 01'04'1998'The defendant} no.22^{executed a letter of guarantee dated 01'04'1998'} Inrespectoftheaforesaidofferoftheapplicantbank made^{to defendantno'3' defendantno'1 acting on} behalf^{of defendantno'3' executed and delivered to the} applicant^{bank the security documentson 01'04'1998'} The defendant^{no'22 executed a letter of guarantee} dated^{01.04.1998'The defendant no'1produced the} aforesaid^{person of statedto be Mr' SatishKumar} Manocha,^{who executed and delivered to the applicant} bank,^{a letter of guaranteedated 24'04'1998' In} respectoftheaforesaidofferoftheapplicantbank relating^{to variouscredit facilitiesto defendant no'4'} thedefendantno'23actingasproprietorofdefendant no.4executedvarioussecuritydocumentsinfavourof applicant^{bank'The defendantno'l executed a letter} of^{guaranteedated 01'04'1998'The defendant no'1} produced^{the aforesaid person of stated to be Mr'} Satish^{Kumar Manocha' who-executed and delivered to} #.

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the applicant^{bank,a letter ofguaranteedated} 24.04.Lgg8.^{In respectof the aforesaid offer of the} applicant^{bank relatingto various credit facilitiesof} defendant^{no.8, defendant no'28 as proprietor of} defendant^{no'8 executed various security documentsin} favour^{of applicantbank on 01'04'1998'The defendant} nos.1 &^{22 executeda letter of guaranteedated} 01.04.1998.^{The defendant no'1 producedthe} aforesaid^{person of statedto be Mr' SatishKumar} Manocha,^{who executed and delivered to the applicant} bank, a^{letter of guarantee dated 24'04'1998'As per} theaforesaidoffer,apartfromtheguaranteesof defendants^{no'1 and 22,thedefendants no' 2 to 4 and} Swerealsotofurnishthepersonalguaranteeofone Shri Arvind^{Wadhwafor a sum of Rs'265'00'000'00'} The defendants^{had howeverfaited to obtain the} guarantee^{of the said personand had insteadoffered} the^{personal guaranteeof one Shri SatishKumar} Manocha.^{As stated above' the defendantswere to} furnishequitablemortgageofimmovablepropertyfor a sum^{of Rs.265,00,000'00 to the satisfactionof the} applicant^{bank' The defendant no'l initially deposited} the^{photo copy of title deeds of immovable property} bearing^{No. 39 in E Block' Greater Kailash Part II' New} Delhi^{belongingto Late Rai Bahadur Chunilal'On} verification^{of the propefit was found that the owner} of the^{property had no intention of creatingany} mortgage^{and that defendant no'1 had fraudulently} submitted^{the photo copy of the title deeds of the said} property. Thereafter^{defendant no'l submitted the} original^{title deed of immovableproperty bearingNo' 3} in Block^{A, ShankarGarden' New Delhi' in the name of} Shri K.N.^{Nigamtn6 glpj-Singh'On verification of the}

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proPeflil, it^{was found that the samebelonged to one} Smt.^{Geeta Arora and her brotherShri A'P' Pahuja'and} that they^{also had no intention of creating any} moftgage^{of the propeflry in favour of the Plaintiff'} much^{less as security for amounts advanced to the} defendants.^{It was thus clear that defendantno'1 had} once^{again submittedbogus documentsto the} applicant^{bank to satisfy the requirementof creating} equitable^{moftgage for a sum of Rs'255'00'000'00as} per the head^{office sanction of the applicantbank' The} defendant^{no'1 then submitted the documents with} regard^{to immovable property bearing No' 40 in Block} G, East^{of Kailash, New Delhi purportedly owned by one} Shri Satish^{Kumar Manocha' On verification of the} registration^{pafticularsof the title deeds of the} property,^{they were found to be correct' Accordingly'} on 24'04.1998,^{the defendant no'l accompaniedby} one^{personstated to be Shri S'K' Manochavisited the} Mayapuri^{Branchof the applicant bank and deposited} the^{purported original titte deeds of the said ProPeO'} along^{with a letter dated 02'04'1998 attegedlyissued} by Delhi^{DevelopmentAuthority the lessor of the land'} permitting^{him to moftgagethe said property in favour} of the^{applicantbank' The applicantbank thereafter} surprised^{to find that the person produced by} defendant^{no'1 as Mr' Satish KumarManochawas} infact^{an impersonator and the alleged perpetual lease} deed dated^{23.04'tg74, affidavitof shri s'K'Manocha} agreeing^{to create equitabte mortgageof the property} also the^{letter dated 02'04'1998of DDA permitting the} lessee to^{create equitable mortgageof the propefiin} favour of^{the applicant bank and the guarantee given} by Shri^{Satish Kumar tvl2ocha' were all forged and} 9r

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17 TANO.^{266 of 2022} fabricated^{documents without any validityin the}

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eyes^{of the law.}

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It is further^{submittedthat the defendant no'2 &} 3 failed^{to deposit the amount in term loan of} Rs.29,24,000/-'^{Itis fufther submittedthat the} documents^{executed by defendantno' 1 to 4'B'22and} 28 continue^{to be valid and bindingon them'The} applicant^{bank has sent various lettersand reminders} to defendants^{to repay the amountoutstanding against} them^{to the applicantbank but they failedand} neglected^{to do so' Therefore' the appticantbank} served^{a legal noticedated 08'01'1999to the} defendants^{but failed to recoverthe same' Thus' the} present O.M.A'^{is preferred by the applicant bank to} recover^{its dues'}

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4.^{On noticeby this Tribunal' defendant nos'l'3 to} 8, 10,^{11, t2, !4 to 28' 30 to 35 and 37 & 38 put} appearance^{throughcounsel' The defendant nos' 3 to} 8, 10,^{11, !2,14to27'30'31' 33' 34 and defendant} 37 have^{filed written statement but faited to file} evidence'^{The defendantnos'1' 2'9' !3'22'28'29'32'36} have^{failed to file written statementand right to file} written^{statement of} defendant^nos' !,2,g,!3,22,28,29,32'36^{was closedvide order dated} 3t.01.2003.Thereafteronlydefendantno.6&25have taken Part^{in the Proceedings'}

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5.^{In the written statement the defendantnos'6 &} 25 have^{deniedthe fact mentionedin the O'A' It is} submittedthesuitoftheappticantbankishopelessly d

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i I I I I I I I i

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TANO.266of2022 18 barred^{bY 'time.} It is^{submittedthat the sake of} argument^{it maybe taken that the defendant nos' 6 &} 25 has^{executed the documentas mentionedin para} 39 of the^{plaint,the suit of the applicant bank is barred} by time.^{The allegation of the applicant bank is that the} defendant^{nos' 6 & 25 has executedthe document} including^{D'P. Note on2OJ'96'Theapplicant bank has} not alteged^{any acknowledgement of the defendant'} The suit^{has been flted by the applicant bank in January} 99. As^{such, the Suit is barred by time' It is submitted} that the^{suit is bad for mis-joinder of parties' The} defendant^{nos.6 & 25 has no connectionwith} defendant^{no.l and with defendant nos' 17 to 21' The} defendant^{nos.6 & 25 also has no connection with} defendantno.2to5,T'L6'23'24and26-38'Assuch' the suit^{is liable to be dismissed' It is further submitted} that^{the suit is bad for mis-joinder and causes of action} and is^{liable to be dismissed' In the entire suit/plaint} the^{plaintiff has made the allegationagainst the} defendant^{nos'6 & 25 only in paras No'39-40'The} allegation^{in these paras are of the effectthat the} defendant^{nos'6 & 25 was sanctioneda cash credit} facility of^{Rs.2 lacs by defendantno'17 and the} defendant^{no'25 has executed the loan/security} documents^{as mentioned in these paras' In the rest of} the^{plaint, the allegations are againstotherdefendants'} The applicant^{bank even has not made any it has} allegation^{against the defendant nos'6 & 25 that it has} withdrawn^{the moniesfrom the account belonging to} the remaining^{defendants'As such' the suit is bad for} mis-^{joinder and cause of action and is liable to be} dismissed.^{It is further submitted that the presentsuit} is a fraud^{on the defendant nos'6& 25' The defendant} 6A

TANO.266of2022¹⁹

current^{account with the} nos. 6 &^{25 simPlY had a} applicant^{bank and has never availed any credit facility'} Thedefendantnos.6&25hasperusedthestatement ofaccountofthecurrentA/cNo.2035filedbythe applicant^{bank. Most of the high value debit entriesin} the statement^{of account No'2035 has no connection} with^{the defendant nos'6 & 25' Thesedebit entries may} be the^{result of the fraud played by the other} defendants^{on the applicant bank' The defendant nos'6} & 25^{has no liability for these debit entries' The} defendant^{nos'6 & 25 from its memory is able to pin} point certain^{entries' It is submittedthat the statement} of current^{accountno'2035 filedby the applicant bank} inthisHon.bleCourtiswrong.Thedefendantnos.6& 25 has^{no liabitity for the debit entries made in the} sbtement.As,such,thesuitoftheapplicantbank against^{the defendantNo'6 & 25 is liable to be} dismissed.^{It is submittedthat in case' all the entries} in the^{statement of account are checked' un-authorized} entries^{are removed and the statementof accountis} properly^{balanced,the defendantnos'6 & 25 has no} liabitity^{towards the applicantbank as allegedin the} plaint. As^{such, the suit is liable to be dismissed' It is} further^{submitted that the plaint of the applicant bank} is highly^{vague' The applicant bank has faited to} discloseitscauseofactionagainstthedefendantnos.6 & 25.^{The plaint does not contain any speciflcallegation} against^{the defendant nos'6& 25' In Annexure C' of} the^{plaint, the applicant bank has shown the liability of} Rs.26,72,674'00^{against defendant nos'6& 25' In fact'} the defendant^{nos'6& 25 has no liability amount much} the suit^{is liabte to be'} less of^{this amount'At-.t!th,}

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TANO.266of2022²⁰ dismissed.^{Itis prayedthat this Honble Tribunal} maY dismiss^{the PresentO'A'}

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6 The applicant^{bank has fited its evidence'}

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HeardtheLd'^{@unselsof applicantbankandthe} Ld. Counsel^{for defendantno'6 & 25 and perusedthe} record.

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8.^{The first contentionof the defendantno'6 & 25} is that^{the application is barredby limitation'But from} perusal of^{the record it is clearthat the OA has been} flled^{within limitation period'Therefore' the contention} of the^{defendant has no force'}

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9.^{The next contention of the defendant nos' 6 & 25} is that^{defendant no'6 & 25 simply had a current} account^{with the applicant bank and has never availed} any credit^{facility and not executedany documents'} Therefore,^{defendantno'6 & 25 are not liable to pay} the dues^{of the applicant bank' In this regard I have} perused the^{record' On perusalof record it is clear that} thedefendantno.25istheproprietorofdefendantno'6 company^{and defendant no'25 has duty signed and} executed^{the loan documentsin favour of the applicant} bank.^{There is no evidence on behalf of the defendant} no. 25^{that he has not signed the loan documents'} Therefore,^{the contention of the defendant no' 6 & 25} has no^force.

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The^{next contenUon of defendantnos'6 & 25 is} that^{most of the high value debit entries in the} J

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TANO.266of2022^2l no statement^{ofaccountNo.2035 has} connection^{with the defendant nos'6& 25' These debit} entriesmaybetheresultofthefraudplayedbythe other^{defendantson the applicantbank' It is submitted} that^{in case, all the entries in the statement of account} are^{checked, un-authorizedentries are removedand} the statement^{of account is properly balanced' the} defendant^{nos'6 & 25 has no liabitity towards the} appticant^{bank as alteged in the plaint' In this regard I} have^{gone throughthe statementof account' There} appears^{no discrepancyin the statementof account'} Therefore,^{the contention of the defendant no' 6 & 25} is vague^{and cannot be relieduPon'}

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11.^{In the light of the abovediscussions' the present} TA deserves^{to be allowed against all defendants} except^{defendantno'17 to 21' who are employeesof} the applicant^{bank' It is claimed that these employees} have^{granted loan to the firms and other defendantsin} connivance^{with those persons' From perusal of the} record^{it is clearthat these officials have never taken} any financial^{assistance from the applicant bank' If they} have^{connivance with the borrowers and the} guarantors,^{the applicant bank is fulty competent to} take departmental^{action as well as criminalaction} against^{these personsbut the amount cannotbe} recovered^{from thesepersonsas the amount has not} been^{taken by these personsin the usual courseof the} business^{of the bank and the same cannot be defined} as debt^{as per provision contained under the RDB Act'} ,).

TANO.266of2022²²

ORDER

I^{hereby allow this T'A' of the ApplicantBank and} directtheLRofdefendantno'1'defendantnos'2to16' defendant^{no.22 to 25, LR of defendantno'26'} defendant^{no.27 to 32, LRs of defendant no'33& 34} and^{defendantno.35 to zl4 to pay jointly and severally} to the^{applicant a sum of Rs'3'65'21'947/-along with} cost,^{expensesand interest@ 14olo from the date of} filing^{of this O.A' which has become T'A' till the date of} realization.^{However, the liability of LRs of deceased} defendant^{no'l, 26, 33 & 34 is limited to the extentof} propefi/assets^{inherited by them from deceased} defendant^{no.1, 26, 33 & 34' The defendant no' 22 as} LR of^{deceased defendantno'1 is also liable to pay to} the applicant^{bank the amount to the extent of assets} inherited^{by her fromdeceaseddefendant no'1' The} dbfendant^{no'27 as LR of deceased defendant no'26 is} also^{liable to pay to the applicant bank the amount to} the extent^{of assets inherited by her from deceased} defendant^{no'26' The defendant no'39 to 44 as LRs of} deceased^{defendantno'33 & 34 are also liable to pay} to the^{applicantbank the amount to the extent of assets} inherited^{by them from deceaseddefendant no'33and} defendant^no'34'

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Z) In^{case of failure to depositthe above amount} within^{the stipulated period' the same shall be} recovered^{from the sale of mortgaged properties (a)} PlotsNo.3L,32and33admeasuring600squareyards at NIT^{Faridabad, Haryana (b) Plots No' 49' 50 and 51} admeasuring600squareyards'NITFaridabad' Haryana'^{(c) Plots No'} 12^{jo55 admeasuring 300} s)

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TANO.266of2022²³

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square^{yards, atNIT Faridabad'Haryana'(d)} Plot no.5,^{Khasrano'3514, VillageDabua' Faridabad'} Haryana^{admeasuring 160 sq'yds'In case of short fall'} the same^{shall be recovered from the sale of personal} movable^{and immovableassets of the LR of defendant} no.1,^{defendantnos' 2 to 16, defendant no'22 to 25'} LR of defendant^{no'26, defendant no'27 to 32' LRs of} defendant^{no.33 & 34 and defendant no'35 to 44'}

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3)^{RecoveryCertificatebe issuedforthwith andbe} sent to^{RecoveryOfficer, Debts Recovery Tribunal-Il'} Delhi.

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The^{registryof this Tribunalis herebydirected to} issue^{free copy of the order and send the same to both} the^parties.

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Parties^{are directedto appear before the Ld'} Recovery^{Officer,DRT-II, Delhion30'03'2026' Pending} IAs, if anY,^{standdisPosed of'}

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File be^{consigned to records'}

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Date :^29.01.2026

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This^{judgement has}

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st (susHIL KUMIR RASToGI) PRESIDING^OFFICER DRT-II,^Delhi been signed,^datedand

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pronounced^{in oPen coutt'}

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Date :^29.01.2026

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sa (susHrL ru(an nAStoc) PRESIDING^OFFICER DRT-II,^Delhi

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Bank of Baroda v. Shri Bhajan Singh

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Bank of Baroda v. Shri Bhajan Singh

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