S.A. no.

177 of 2019

DEBTS RECOVERY TRIBUNAL-JAIPUR

SFE-3/4, Nehru Place, Tonk Road, Jaipur

PRESIDING OFFICER : Vivek Saxena

S.A. No. 177 of 2019

1. NIDHI JAIN, W/o Shri Sunil Jain, R/o House
No. 25, Ward No. 15, Near Hanuman Mandir,
Maliyon Ki Gali, Guru Nanak Colony, Bundi,
Rajasthan

2. M/s NIDHI INDUSTRIES H-39(A), RIICO

Industrial Area, Hattipura, Bundi, Rajasthan
through proprietor Smt. Nidhi Jain

3, SHIMLA JAIN W/o Sh. Mahaveer Jain, R/o

House No. 25, Ward No. 15, Near Hanuman
Mandir, Maliyon Ki Gali, Guru Nanak Colony,
Bundi, Rajasthan

Applicants

VERSUS

STATE BANK OF INDIA, Indira Market, Bundi

323001, Rajasthan.

Respondent

Present –

Sh. Clevas Cletus, Counsel for the Applicants

Sh. K. Kapoor, Counsel for Respondent Bank

FINAL ORDER
(15.02.2020)

1. This S.A. was filed by the Applicants on

02.07.2019 being aggrieved by the actions taken
by the Respondent Bank.

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 S.A. no. 177 of 2019

2. An application U/s 5 of the Limitation Act is also

filed with a prayer to condone the delay in filing of
the Securitization Application.

3. Reply of the application filed U/s 5 of the

Limitation Act was filed on 24.07.2019 and the
delay in filing of the Securitization Application was
condoned.

4. Admittedly, the Applicant availed Cash Credit

Limit of Rs. 55.00 Lac and Letter of Arrangement
was issued on 30.10.2015. As per Letter of
Arrangement, the date of renewal of Cash Credit
facility was 31.08.2016. As per S.A., Notice U/s
13(2) of the SARFAESI Act, 2002 dt. 21.06.2017
was received by the Applicants.

5. It is argued by the Applicants that the account

was not liable to be declared as NPA as the
business was running and the Applicants were
submitting stock statement regularly. The account
was declared NPA on 01.05.2017. It is also argued
that they are paying the interest continuously and
as per statement of account at Page No. 56 there
is a debit balance of Rs. 49,69,516.43 against the
Limit of Rs. 55.00 Lac and therefore, the account
was declared NPA wrongly. It is also argued that
they have not received any letter/notice before
declaring their account as NPA.

6. Reply to the S.A. is filed and Rejoinder is also filed

by the Applicants.

7. Along with S.A., Copy of Notice U/s 13(2) of the

Act dt. 21.06.2017, Copy of Possession Notice dt.
26.09.2017, Copy of Account Statement and Copy
of O.A. No. 890/2018 filed by the Respondent
Bank, is enclosed.

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 S.A. no. 177 of 2019

8. Along with reply to the S.A., a handwritten letter

in original, by the Applicant Nidhi Jain dt.
19.08.2017 addressed to the Respondent Bank is
enclosed. The Notice U/s 13(2) of the Act was
issued on 21.06.2017 and admittedly, it was
received by the Applicants but during the course
of arguments it was admitted by the Applicants
that they have not filed any objection cum
representation against the Notice U/s 13(2) of the
Act but when the letter dt. 19.08.2017 was
referred during the course of arguments then
learned counsel appearing on behalf of the
Applicants submitted that the letter was given by
the Applicants under pressure and said plea is
also taken by the Applicants in the rejoinder filed
by them.

9. Here one thing is clear that till filing of the S.A.,

the Applicant was silent with regard to the letter
dt. 19.08.2017 written by them but when the said
letter came on record in original along with reply
of the S.A., they filed the rejoinder and took such
plea, which in my opinion is totally based on
afterthought story. This fact shows that the
Applicant is not coming with the clean hands.

10. The only objection with regard to the S.A. is

declaration of account NPA wrongly. No amount
has been deposited by the S.A. Applicant since
filing of the present S.A.

11. Learned Counsel appearing on behalf of the

Respondent Bank argued that in the letter dt.
19.08.2017, the Applicant, Nidhi Jain clearly
admitted that the Notice U/s 13(2) of the Act was
received by them, on account of unavoidable
circumstances, factory could not run, as on

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26.08.2017 she could deposit an amount of Rs.

10-15 Lac, She is having a stock of Rs. 15-20 Lac
and on or before 26.08.2017 she will file complete
Stock Statement.

12. For the purpose of more clarity, the letter dt.

19.08.2017 is being reproduced here –

Jheku lgk;d egkizca/kd egksn;]

,l-ch-vkbZ- cSad]
cwna h jktLFkku
fo"k; & esjh lh-lh- fyfeV ds lEca/k esAa
egksn;]
mijksDr fo"k; esa fuosnu gS fd esjh lh-lh- fyfeV vkidh 'kk[kk esa py
jgh gS QSDV~h ds fu;fer ugha py ikus ds dkj.k QeZ dk [kkrk ,u-ih-
,- gks x;k ,oa vkids }kjk vaMj lSD’ku 13@2 ds varxZr dk;Zokgh dk
uksfVl izkIr gqvk gSA bl lEca/k esa vkils fuosnu djrh gWw fd QSDV~h
dks eSa vifjgk;Z dkj.kksa ls fu;fer ugha pyk ikbZ FkhA ijarq vc esjk
LokLF; Bhd gS vkSj bls iqu% lqpk: :i ls pykuk pkgrh gWwA eSa ;g
Hkh fuosnu djrh gWw fd 26-8-17 rd vius lh-lh- [kkrs esa 10 ls 15
yk[k vkSj tek djok nwxa h rFkk esjh lk[k lhek Hkh ?kVkdj 40 yk[k
dj nh tkosA vkt fnukad 19-8-17 dks [kkrs esa 50 gtkj :- vkSj tek
djok fn, gSa rFkk 15 ls 20 yk[k :- ds eky dk LVkWd LVsVesaV Hkh ns
jgh gWw rFkk 26-8-17 rd iwjk LVkWd LVsVesaV Hkh ns nwaxh vr% eq>s [kkrk
pykus dh vuqefr nh tkos ,oa esjs fo:) vaMj lsD’ku 13@2 dh
dk;Zokgh dks LFkfxr djus dh d`ik djsA vkidh d`ik gksxhA
fuf/k tSu
izksijkbVj eS0 fuf/k b.MLV~ht

13. Ld. Counsel appearing on behalf of Respondent

Bank also argued that on 06.09.2019 Copies of
Inspection Reports dt. 17.01.2017, 23.02.2017,
24.03.2017 and 21.04.2017 were filed and copies
of the same were also given to the learned counsel
appearing on behalf of Applicants.

14. Perused all the Inspection Reports and found that

there was negligible stock, unit was not going on
and the Applicant was advised to start the unit
and to get regularize the account. But, no such
steps were taken by the Applicant.

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 S.A. no. 177 of 2019

15. Ld. Counsel for the Applicant raised the objection

with regard to genuineness of the Inspection
Reports but I am of the view that the Applicants
failed to produce on record any such Stock
Statement/ Inspection Report, which can prove
that the Inspection Reports filed by the
Respondent Bank are not genuine and therefore
the objection raised by them is of no use.

16. Ld. Counsel for the Respondent Bank argued that

the amount of Cash Credit facility was utilized by
the Applicants as the same was withdrew by them
and no stock was found during the course of
Inspection and he prayed to dismiss the S.A. with
exemplary cost.

17. Ld. Counsel for the Applicants placed on reliance

on the Judgement of Hon’ble Supreme Court in
the matter Joseph Severance Vs Benny Mathew
reported in (2005) 7 Supreme Court Cases 667,
wherein in Para 10 & 11 it is held by the Hon’ble
Apex Court that –

“10. As observed in Veerayee Ammal V. Seeni

Ammal, (SCC p. 141, para 13) it is – Looking at all
the circumstances of the case; a reasonable time
under ordinary circumstances; as soon as
circumstances will permit; so much time as is
necessary under the circumstances, conveniently to
do what the contract requires should be done; some
more protracted space than „directly‟; such length of
time as may fairly, and properly, and reasonably
be allowed or required, having regard to the nature
of the act or duty and to the attending
circumstances; all these convey more or less the
same idea: (vide P. Ramanatha Aiyar‟s The Las
Lexicon)
11 According to Advance Law Lexicon by P.
Ramanatha Aiyar, 3rd Edn., 2005 reasonable time
means as follows:
“That is a reasonable time that preserves to each
party the rights and advantages he possesses and

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 S.A. no. 177 of 2019

protects each party from losses that he ought not to

suffer.
„Reasonable Time‟ is defined to be so much time as
is necessary, under the circumstances, to do
conveniently what the contract or duty requires
should be done in a particular case.”

18. Perused the Judgement and found that the

Applicant do not get any support from the said
Judgement, because this is not a case in which,
sufficient opportunity was not granted to the
Applicants rather it is the Applicant, who asked
for sometime through their letter dt. 19.08.2017
but in fact as on date no amount against the
outstanding amount could be deposited and
therefore, the Applicants got more than reasonable
time and so more time cannot be granted to them.
Accordingly, the Applicants do not get any support
from the Judgement of the Hon’ble Apex Court.

19. In other case of M/s Stan Commodities Pvt. Ltd.

Vs Punjab & Sind Bank decided by Hon’ble
Jharkhand High Court (2008 SCC Online Jhar
169), it was held that –

“... prior information/opportunity to settle the

controversy/doubts regarding classification of
account as NPA is justified, whether the
Respondent Bank was duty bound to communicate
its decision to the Petitioner with regard to
declaration of the account as NPA and to dispose of
the representation/objection, as required under the
provision of Section 13 (3-A) of the SARFAESI Act,
2002.”
20. Here, I would like to make it clear that till the
filing of S.A., Applicant did not disclose the fact
that they wrote a letter dt. 19.08.2017 after receipt
of the Notice U/s 13(2) of the Act, but when the
letter came on record along with reply, they took
objection in the Rejoinder that the letter was

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written by them under pressure created by the

Respondent Bank. During the course of
arguments also the Applicants denied, having filed
any objection to the Notice U/s 13(2) but
ultimately, letter dt. 19.08.2017 is on record and
therefore, it cannot be said that the information
with regard to declaration of the account as NPA
was not given to them and the reasonable time
was not granted to the Applicant.

21. Sufficient opportunity was granted to the

Applicant and as admitted in the letter dt.
19.08.2017 the business activities were found
closed so it is not a case that the Applicant faced
loss in business but it was an intentional act in
which, the business activities were found closed
and amount of C.C. Limit was utilized by the
Applicants and now the Respondent Bank is
struggling for recovery of amount.

22. One more Judgement of Hon’ble Allahabad High

Court in the matter of Ritta Bagga Vs Union of
India (215 (4) AWC 3679) is filed and Para No. 26
to Para No. 30 of the said Judgement are referred
by the learned counsel for the Applicant.

23. Perused the Judgement carefully and I do not find

any reason to consider the case of the present
Applicant as per the guidelines of the present
Judgement because the C.C. Limit was not
withdrew abruptly and as the amount has already
been withdrawn by the Applicants, the business
activities were closed, no stock statement was filed
and therefore, it was not a case where the Bank
stopped the credit facility or the Bank has recalled
the credit facility. This is a case where the
Applicant can be defined as wilful defaulter, who

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is siphoned of the amount of public at large and

do not want to repay the amount.

24. One more Judgement of Hon’ble High Court of

Madras in the matter of M/s Signal Apparels Pvt.
Ltd. Vs Canara Bank (2015 (5) CTC 337) is filed
and Para No. 14 & 15 of the said Judgement has
been referred.

25. Perused the Judgement. Para No. 14 & 15 of the

said Judgement deals with the declaration of an
account as NPA in a transparent manner and as
per guidelines of Reserve Bank of India. I have
perused the Notice U/s 13(2) of the Act and also
perused the statement of account and I am of the
view that the account was declared as NPA in a
transparent manner. All the details were given to
the Applicant, the fact that the business premises
is closed before 19.08.2017, the Applicant was
having stock statement of Rs. 15-20 Lac, for which
no stock statement was filed and therefore, I am of
the considered view that this is not a case where
the Applicant was having sufficient stock could
not run the business on account of certain
difficulties but is a matter, where no business
activities were going on as the amount was utilize
for some other purpose. The Notice U/s 13(2) is a
detailed one and I am of the view that there is no
such provision, which cast a duty upon the
Secured Creditor to issue a Notice before declaring
the account as NPA, if the borrower fails to deposit
the amount, as due, in three consecutive months
then the account can be declared as NPA.

26. After having gone through the entire facts,

evidence and circumstances of the case I am of the
view that this is a matter of wilful default, entire

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facts were not brought before this Tribunal by the

Applicant, business activities were found closed,
business premises is closed and I do not find any
illegality in the actions taken by the Respondent
Bank and so the S.A. is dismissed.

27. Copy of the order be given free to all the concerned

parties. File be placed before the Registrar for
compliance. After compliance file be consigned to
record.

Presiding Officer
DRT Jaipur

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 S.A. no. 177 of 2019

Court of the Presiding Officer

Debts Recovery Tribunal, Jaipur

Case S.A. No. 177 of 2019

Nidhi Jain & Ors. Vs State Bank of India

15.02.2020

Present –

Sh. Clevas Cletus, Counsel for Applicant

Sh. K. Kapoor, Counsel for Respondent Bank.

Order dictated separately and pronounced in open Court. As

per Order S.A. No. 177/2019 is dismissed. Copy of the order
be given free to the concerned parties. File be placed before
Registrar for compliance. After compliance file be consigned
to record.

Presiding Officer
DRT Jaipur

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