The DRT (Appellate Tribunal) dismissed the appeal by the borrowers challenging SARFAESI measures. The court rejected the claim of non-service of the demand notice, applying the presumption of service under the General Clauses Act, and upheld the findings that symbolic possession was not taken as per the panchnama.
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BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI Present: Mr Justice Ashok Menon, Chairperson
Appeal No. 149/2011
Between
Sandip Janardan Acharekar & Anr … Appellant/s V/s.
Bandhan Bank Ltd. …Respondent/s
Mr Faizeen Shah, i/b Mr Sohel Kazi, Advocate for the Appellants. Mr Umar Azam, i/b M/s M.V. Kini & Co., Advocate for Respondent Bank.
The applicants in Securitisation Application (S.A.) No. 155 of 2010 challenge the dismissal of the S.A. by the Debts Recovery TribunalIII, Mumbai vide order dated 06.09.2010. The S.A. was filed challenging the Sarfaesi measures initiated by the creditor Gruh Housing Finance Ltd. for recovery of debt under the provisions of the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (“SARFAESI Act”, for short).
The appellants had approached Gruh Housing Finance Limited for a housing loan to purchase flat No. A/603, New Shivalaya CHS Ltd. Thane which the 1st Appellant had agreed to purchase from Celine J Upadhyaya and Jayant K Upadhyaya as per an agreement for sale, dated 12.04.2005. The appellants were granted a loan of ₹8,24,296/which they agreed to repay in 180 equated monthly instalments (EMI) of ₹8,239/-. An equitable mortgage was created by deposit of title
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deeds. The appellants did not repay a dime and the account was classified as a non-performing asset (NPA) in January 2007. A demand notice was issued under Sec. 13 (2) of the SARFAESI Act demanding a sum of ₹9,08,143.21 on 28.09.2007. As there was no response, a notice was issued under Sec. 13(4) to take symbolic possession of the secured asset. Thereafter, an order was obtained under Sec. 14 of the SARFAESI Act from the court of the Chief Metropolitan Magistrate (CMM) to take physical possession of the subject property. The appellants filed the S.A. on 16.02.2009 seeking a prayer to quash the demand notice under Sec. 13(2) and the taking of the symbolic possession of the subject property.
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order.
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the panchnama prepared by the authorised officer under Rule 4(1) of the Security Interest (Enforcement) Rules. Hence, the only two grounds which were taken by the appellants for challenging the Sarfaesi measures are the non-service of demand notice as well as the improper taking of symbolic possession. These two challenges would fail for the reasons stated above. The appellants have not raised any challenge regarding the order obtained under Sec. 14 of the SARFAESI Act.
The appellants are chronic defaulters who had not paid a dime towards the debt due. They have allegedly deposited with the bank a National Saving Certificate for ₹1 lakh but was never encashed by the creditor. The cheques issued towards payment of EMI were dishonoured and proceedings under Sec. 138 of the Negotiable Instrument Act were initiated. They have successfully protracted the litigation for over a decade.
The appeal has no merits and therefore, requires to be dismissed with all consequences of costs to the respondent.
mks-01.
Sd/Chairperson
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2 issues framed by the court
Whether the SARFAESI action is defective due to alleged non-service of the demand notice under Sec. 13(2).
Whether the taking of symbolic possession was improper or premature.
5 provisions across 4 enactments
Sandip Janardan Acharekar & Anr
Bandhan Bank Ltd.
Ashok Menon
As recorded by the court registry
12 orders share this CNR
Judgements on the same questions, provisions and authorities, from every court
