Samtex Fashions Ltd faces a significant financial liability after the Debt Recovery Tribunal-III (DRT-III) in Delhi passed an order in favor of National Asset Reconstruction Company Ltd (NARCL). The ruling imposes a claim of approximately ₹435.02 crore against SSA International Ltd, a wholly owned subsidiary, with Samtex acting as the corporate guarantor.

The order, dated October 3, 2026, and received by the company on October 15, 2026, allows the recovery application filed by NARCL. This development marks a critical juncture in the ongoing litigation involving the textile exporter and its subsidiary, which had been contesting the consortium bankers' claims.

Litigation background and tribunal ruling

The legal proceedings originated from loan applications taken by SSA International Ltd. Samtex Fashions had provided corporate guarantees for these loans. Over time, the consortium of bankers transferred the debt to NARCL, which subsequently filed an application (TA No. 446/2022) before the DRT-III against both the subsidiary and the parent company as guarantor.

In response to the recovery petition, SSA International filed a counterclaim (No. NDN/31/2023). Both matters were pending adjudication before the tribunal. The recent order resolves these proceedings by allowing the primary application in favor of NARCL while dismissing the counterclaim raised by the subsidiary.

Financial implications

The tribunal’s decision establishes a substantial financial burden on the entities involved. The aggregate amount involved is explicitly stated in the order, alongside additional costs and interest accruing until full payment is made.

The interest component is calculated at 10% p.a. on the principal amount, adding to the total liability over time. The dismissal of the counterclaim indicates that the tribunal did not find merit in the subsidiary's defense against the recovery proceedings.

Regulatory disclosure

Samtex Fashions disclosed this material development under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The intimation was submitted to BSE Limited, highlighting the change in status of the litigation. The company confirmed that no settlement terms or compensation payments have been finalized at this stage, and the matter remains subject to further legal or procedural steps if any appeal is pursued.

Samtex Fashions Limited held its 33rd Annual General Meeting on September 29, 2026, passing all three resolutions with over 99.97% of valid votes cast in favour across each item of business.

The meeting was conducted via video conferencing from 1:00 pm to 1:20 pm. A total of 111 members participated, including four from the promoter group and 107 from the public. The record date was September 22, 2026, on which 15,239 shareholders were eligible to vote. Remote e-voting was available from September 26, 2026 at 9:00 am to September 28, 2026 at 5:00 pm, with additional e-voting facilitated during the live meeting through the CDSL platform.

Resolutions passed at the meeting

The Board presented three items for shareholder approval. Two ordinary resolutions covered the adoption of FY26 financial statements and the re-appointment of Chairman and Managing Director Atul Mittal (DIN: 00223366), who retired by rotation. A special resolution addressed the shifting of the registered office within the same state and ROC jurisdiction.

Voting results

All three resolutions were passed with requisite majority. The scrutinizer's consolidated report, issued by Deepak Kukreja & Associates on September 29, 2026, confirmed the outcome based on data downloaded from the CDSL e-voting system. Total votes polled across all resolutions stood at 8,704,621, representing 11.68% of the total outstanding shares of 74,500,000.

Resolution 1: Adoption of FY26 financial statements

Resolution 2: Re-appointment of Atul Mittal

The promoter and promoter group were noted as interested in this resolution. All promoter votes were cast in favour via e-voting.

Resolution 3: Shifting of registered office

The scrutinizer confirmed that votes in favour were more than three times those cast against, satisfying the requisite majority for a special resolution.

Scrutinizer and compliance details

Deepak Kukreja & Associates, Company Secretaries (FCS No. 4140, CP No. 8265), served as scrutinizer, having been appointed by the Board at its meeting on August 27, 2026. The firm issued its consolidated report on September 29, 2026, with UDIN No. F004140H001656989. The voting results and scrutinizer's report were filed with BSE Ltd. and are available on the company's website as well as on the CDSL e-voting portal. No queries were received from shareholders other than those raised by six registered speakers during the meeting.