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2026 Supreme(Online)(DRAT) 255

BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI
Vivek Bharti Sharma, Chairperson
Wateredge Hospitality Pvt Ltd – Appellant
Versus
STATE BANK OF INDIA – Respondent
I.A. No. 279/2026(Stay)|Regular Appeal No. 41/2026



Advocates:
For the Appellants/Petitioners: Herbert A Naronha, Suresh R. Tandel, Alpana S. Tandel, Jay N. Tandel, Jeet S. Tandel
For the Respondents: Rajesh Nagory

An ex-parte decree cannot be set aside based on irregularities in the service of summons if the defendant had actual notice of the hearing and sufficient time to appear.

Headnote:(A) Service of Summons - Notice of Hearing - Irregularity in service does not justify setting aside an ex-parte decree if the defendant had actual notice of the hearing date and sufficient time to appear. (Para 5, 6)

(B) Interim Relief - Prima Facie Case - Receipt of summons by a director of a company, who is also a family member of other defendants, is deemed sufficient notice, and failure to appear constitutes a lack of due diligence. (Para 9)

(C) Irreparable Loss - Debt Recovery - Non-repayment of a loan to a bank precludes a finding of irreparable loss for the purpose of granting an interim stay. (Para 10)

Issues: Whether the Appellants are entitled to an interim stay of the order dismissing their application to set aside an ex-parte decree.

Table of Content
1. challenge to ex-parte order based on improper service of summons. (Para 1 , 2 , 3)
2. actual notice of hearing outweighs irregularities in summons service. (Para 4 , 5 , 6)
3. receipt of summons by a director constitutes sufficient notice for a prima facie case. (Para 7 , 8 , 9)
4. non-repayment of loan negates the claim of irreparable loss for interim stay. (Para 10)

The Appellants have challenged the order dated 15.10.2025 (page No. 537) whereby the Learned DRT-II, Ahmedabad has dismissed the application under Section 22(2)(g) of the RDB Act for setting aside the ex-parte judgment an I.A. No. 279/2026 is moved in Appeal for interim stay.

2. The Learned Counsel for the Appellants would further submit that this Misc. Application for interim relief in present appeal is made on the ground that no service of summons of Original Application was affected on Appellant Nos. 1, 2, 3 and 5 rather it was Appellant No. 4/Defendant who had received the summons by speed post for all Appellants/Defendants. He would further submit that summons were even not served with a copy of plaint and annexures; that, even the postal stamp amount paid on the speed post was only ₹25/- which means that it could not have contained the plaint. He would further Submits that the Original Application filed in by Respondent contained around 250 pages i.e. including the application and annexures and documents filed therewith.

3. Learned Counsel for the Appellants would further submit that the Learned DRT-II, Ahmedabad erred in observing that once the summon is received by Defendants than defendant was under duty to exercise diligence to appear in the court and take the date and tell the court that he has not received the annexures and plaint, so that, the same may be supplied to them to contest the case.

Learned Counsel for the Appellants would rely upon the judgment in “Bimla Wati Sharma vs. State Bank of Patiala & Ors., AIR 1992 P&H 101” and would submit that the Hon’ble Punjab and Haryana High Court observed that No summons can be regarded to have been duly served unless it is accompanied by a copy of the plaint. ‘Due service’ means service of summons along with the plaint.

4. Per contra, the Learned Counsel for the Respondent would submit that the service of summons on the all Appellants/Defendants was affected through Defendant No. 4; that, the Defendant No. 4 is wife of the Appellant No. 3 and sister-in-law ‘s the Appellant No. 2 and 5 and is also the director of the Appellant No. 1 Company.

5. The Learned Counsel for the Respondent would further submit that Learned DRT-II, Ahmedabad has specifically observed in para 21 of its order dated 15.10.2025 (page no. 549).

Learned Counsel for Respondent would rely upon the judgment passed by Hon’ble Supreme Court in “Sunil Poddar case” as quoted by the Learned DRT-II, Ahmedabad in the impugned order. The same is reproduced here as under-

“19. It is, therefore, clear that the legal position under the amended Code is not whether the defendant was actually served with the summons in accordance with the procedure laid down and in the manner prescribed in Order V of the Code, but whether (i) he had notice of the date of hearing of the suit; and (ii) whether he had sufficient time to appear and answer the claim of the plaintiff. Once these two conditions are satisfied, an ex parte decree cannot be set aside even if it is established that there was irregularity in service of summons. If the Court is convinced that the defendant had otherwise knowledge of the proceedings and he could have appeared and answered the plaintiffs claim, he cannot put forward a ground of non service of summons for setting aside ex parte decree passed against him by invoking Rule 13 of Order IX of the Code. Since the said provision applies to Debt Recovery Tribunals and Appellate Tribunals under the Act in view of Section 22(2)(g) of the Act, both the Tribunals were right in observing that the ground raised by the appellants c

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