Allowed

State Bank of India v. Mohd. Shahbaz Faisal

DRT18 Jun 2026TA/696/2022

Case brief

AI extract

What is this about?

In this Recovery of Debts application, the Debts Recovery Tribunal construed a Tripartite Agreement regarding a housing loan. The Tribunal held that since the builder received the loan amount and the borrower had no possession, the builder was solely liable to pay the outstanding dues to the bank.

What did the court decide?

The defendant no.3 (Builder) is directed to pay Rs.44,70,066.1 along with cost and interest within 30 days; in case of default, recovery shall be made from the sale of the mortgaged flat or personal a

State Bank of India versus Mohd. Shahbaz Faisal — Contract and Commercial Disputes | DRT (2026)

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Before SUSHIL KUMAR RASTOGI, Presiding Officer Debts Recovery Tribunal-Il, Delhi

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TA No.696 OF 2022

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STATE BANK OF INDIA VS MOHN. SHAHBAZ FAISAL & oRs

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Reserued on : 15.05.2026 Pronounced on : 18.06,2026

State Bank of India

-Applicant bank

Vs.

Mohd. Shahbaz Faisal

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Mohd. Shahnawaz Altamash

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M/s Sanchar Nest Shahkari Awas Samiti Ltd - Defendants

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Present Shri. Pradeep Dhaka, Counsel appears for applicant bank. Defendants are expafte, since, 10.0L.2024.

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FINAL ORDER

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This original application has been filed by the applicant bank, on 19.08.2019 through Shri.^Sushil Kumar Chadha, Chief Manager of the applicant bank, under Section 19 of the RDB Act, 1993 against^the defendants for recovery of a sum of^{Rs.44,70,0661'} together with cost, charges and^{pendentelliteand} future interest @10.95olo from date of filing of^{this O.A.} til! the realization in full.

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The brief facts of the case are that at the^request of the defendant nos.1 & 2, the applicant^bank sanctioned a Housing Loan Facility of Rs.46,00,000/-^on 27.03.20L8 and out of said sanctioned amount of Rs.46,00,000/- a total sum of Rs.43,70,000/-^{has been} disbursed as^per request of lp defendant^{nos.1 & 2 for} i.-'_ c)\i

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TA NO. 696 of 2022

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purchasing property being a^{3BHKplus seruant room} Flat having an^{area of 1709 sq. feet to be allottedin} Tower-A, Plot^{No.GH-07, Palamwood Enclave, Sector-} 6, Wave City,^{NH-24, Ghaziabad,Uttar Pradesh beinga} member having^{share certificate no.668of defendant} no.3. The defendant^{nos.1 & 2 haveexecutedall} necessary loaning^{documents on L4.02.20L8 and} 27.03.20L8. The defendant^{no.1 has undertaken to} create an equitable^{mortgage of the aforesaid property.} The defendantno.3^{had givenno objectionto moftgage} of the aforesaid^{propefi.A TripartiteAgreement dated} 27.03.2018 executed^{betweendefendantnos.l & 3 with} the applicant^bank.

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It is^{further submitted that the defendants} enjoyed and utilized^{the Loan facility, but failedto} maintain the^{financial discipline and failed to repay the} due amounts.^{The applicant bank requestedthe} defendants to^{regularize the loan account by visits and} letters, but there^{was no response from the defendants,} hence the account^{was classifiedas NPA on 10.05.2019.} Therefore, the^{applicant bank serued a legalnotice} dated L5.07.2019^{to the defendants, demanding the} amount due^{as on that date, but failed to recoverthe} same. Thus,^{the present o.A.rr.A.is preferredby the} applicant bank^{to recover its dues.}

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on notice^{by this Tribunal, defendantnos.l & 2} put appearance through^{counsel but failed to file} written statement.^{Thereafter, the defendant nos.1 & 2} failed to^{put appearancein the matter. The defendant} no.3 failed to^{put appearanceat all. Accordingly, the} defendants^{were proceededagainst expafte on} L0.0L.2024. sI v

v sI i t

TANO.696of2022

The applicant^{bank has filed its respective} evidence.

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Heard^{the Ld. Counsel of applicant bankand} perused the records.^{From perusat of the record,it is} clear that at^{the time of executing loan documentsthe} applicant^{bankhas entered into a TripartiteAgreement} with the builder^{along with the borrower' Para 2 of the} Tripartite agreement^{is as follows:-}

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"2. That the^{Buitder/Developeragres that it has no} objection to^{the Bonower() mortgaging the said flat} with propottionate^{sharein land to the SBI as recurity} for the sid^{toan agred to be advand by the SBI for} the^{purposeofpurchase/constructionofthesaid flat' In} the event of^{defautt in the repaymentof loan and/orthe} Bonower(s) ommitting^{any other defaultwhich makes} the Bonower(s)^{liable for the repaymentof the entire} amount outstanding^{in the said toan as per the terms of} the Loan Agrement^{executedbetween the Bonower(s)} and the SBI,^{the Buitdershall at the calt of 5BI, be} under obtigation^{to cancel the fuoking and pay all the} amounb receivd^{by the Builderfrom the Bonowe(s)} or on fuhalf^{of the Bonower(s)to the SBI includingalso} any amount^{paid by the Bonower to the Builder'} However, the^{builder/developershall be entitled to} recover cancellation^{and/orany othercharges, if any} payabte by the Bonower^{under the terms of application} form for^{purchase of the said flat and/or agreement to} sale/anstruction^{out of the Bonowerl contribution'} ttpn^{payment of the amounts by the Builder/Developr} to SBI as aforesaid,^{the SBI and the Bonower will not} have any claim,^{charge, lien, mortgage, right, title and} interest etc.^{whaboever, over the sid flat' SBI shall} issue a certificate^{to releaeSnymortgage/charge/lien} c\i

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TA NO. 696 of 2022

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created on the said flat. The Borower^hereby expressly agrees that in the event of default^{in either} repayment of the loan or any other default^{by the} Borrower, 5BI shall be entitled to^{requestthe Builder to} cancel the booking and return the amounB^{received by} the Builder and the Borower agrees^{and acknowledges} that any such request by SBI and^{payment made by the} Builder under this clause to SBI shall be^{binding upon} the Borrower."

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B. As per conditions contained^{in the Tripaftite} Agreement dated 27.03.2018 at^{para no.Z, in case of} default by the borrower the amount^{which has been} paid by the borrower to the builder has to be returned to the bank. In the^present case^{the borrower has made} default in repayment of the^{EMIs and therefore,as per} condition agreed between the^{parties, the builder is} under obligation to return the entire^{amount whichhe} has received from the borrower or^{from the applicant} bank in lieu of the^payment of^{the constructionof the} flat. Moreover, from the^perusal of^{the entire facts it is} apparent that the borrower^{has taken the loan and the} loan amount has been^paid to^{the builderfor} construction of the flat. The applicant^{bank has not} claimed that the builder in^{violation of the termsand} conditions has handed over^{the flat to the defendant} nos.1 & 2. The borrower^{has not taken any amount in} his account and the entire^{amount has been paid to the} builder. In addition to this^{the borrowerhas also paid} the margin money to the^{builder and also paid ceftain} EMIs as mentioned by^{the applicant bank. The borrower} has not^got the^{possessionof the flat. If the borrower} is directed to^pay the amount^{whichhas been actually} paid to the builder this ryi!!-amount double^{penalty on} gAt.

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TA NO. 696 of 2022

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the borrower.^{The borrower has receivedno} money and^{has still paid the margin moneyand also} certain EMIs^{to the bank and has got in return nothing'} In such circumstances^{and as per agreedterms and} conditions^{it is only the builderwho is liable to pay the} defaulted^{amount to the applicant bank'}

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In the light^{of the above discussions, the present T'A'} deserues to^{be allowed against the defendant no.3'}

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ORDER

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t) I^{hereby allow this T'A' of the ApplicantBank and} direct the^{defendant no. 3 to pay to the applicant bank} within 30^{days from today, a sum of Rs'44,70,0661-} along with^{cost, expenses and interest @ B'55o/o from} thedateoffilingofthiso.A.whichhasbecomeT.Atill the date^{of realization.}

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In^{case of failure to depositthe above amount} within the^{stipulatedperiod, the same shatl be} recovered^{from the sale of the mortgagedproperty} being 3BHK^{plus seruant room Flat having an area of} LTogsq.feettobeallottedinTower-A,PlotNo.GH-07, Palam Wood^{Enclave, Sector-6,Wave City' NH-24'} Ghaziabad,UttarPradesh.Incaseofshoftfall,thesame shallberecoveredfromthesaleofpersonalmovable and immovable^{assets of the defendant no' 3'}

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3)RecoveryCertificatebeissuedforthwithandbe senttoRecoveryOfficer,DebtsRecoveryTribunal-Il' Delhi.

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4)TheregistryofthisTribunalisherebydirectedto issuefreecopyoftheorderandsendthesametoboth the^pafties.

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ex \

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TA NO. 696 of 2022 6

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Parties are directed^{to appear before the Ld.} Recovery Officer, DRT-II,^{Delhi on 18.08 .2026. Pending} IAs, if any, stand disPosed^of.

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File be consigned to records. I s)

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Date : 18.06.2026

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(SUSHIL KUMAR RASTOGI) PRESIDING OFFICER DRT-II, Delhi

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This^judgement has^{been signed, dated and}

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pronounced in open court.

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5"\

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Date : 18.06.2026

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(susHIL rurdln nX3rocl) PRESIDING OFFICER DRT-II, Delhi

State Bank of India v. Mohd. Shahbaz Faisal

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State Bank of India v. Mohd. Shahbaz Faisal

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