Allowed

Ragolu Raghupati Naidu v. Central Bank of India

DRAT6 Aug 2025REGULAR APPEAL/71/2024

Case brief

AI extract

What is this about?

This single judge appeal challenged an order dismissing a Section 17 SARFAESI application due to delay. The DRAT held that the Limitation Act applies, distinguishing prior SC rulings, and directed the lower tribunal to decide the condonation prayer afresh.

What did the court decide?

Impugned order set aside; DRT directed to decide application under Section 5 of Limitation Act.

Ragolu Raghupati Naidu versus Central Bank of India — Banking and Recovery | DRAT (2025)

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Reportable/Non-Reportable

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Appeal No. 71 of 2024-DRAT-Kolkata

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IN THE DEBTS RECOVERY APPELLATE TRIBUNAL AT KOLKATA

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Appeal No. 71 of 2024 (Arising out of M.A. 53 of 2022 SAUn in DRT, Visakhapatnam)

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HON’BLE MR. JUSTICE ANIL KUMAR SRIVASTAVA CHAIRPERSON

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Sri Ragolu Raghupati Naidu, Managing Partner M/s Sree Raghavendra flour and Dal Mill, 38-30-269/2, Punjab hotal Junction, Marripalem, Visakhapatnam.

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… Appellant

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-Versus-

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The Authorised Officer, Central Bank of India, 50-81-24, J.K. Centre, First Floor, Seethammapeta, Dwarka Nagar, Visakhapatnam-530016;

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M/s Sri Dwaraka Shipping and Logistics A partnership firm, Rep. by Sri Karavanja Srinivasa Rao and Sri B. V. Nageswara Rao, having its office at 25-12-14, Rajavari Street, Godavari Ward, Visakhapatnam – 530 001;

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Sri Karavanja Srinivasa Rao, Managing Partner, D. No.38-31-23, Durga Sai Nilayam Green Gardens, Marripalem, Visakhapatnam – 530 024;

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Sri B. V. Nageswara Rao, Partner, D. No.49-32-15/4, FF-5, Parvathamma Heights, Ramakrishna Nagar, Visakhapatnam.

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… Respondents

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Counsel for Appellants … Mr. Nemani Srinivas Counsel for Respondents … Mr. Sudhir Kumar Senapati

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JUDGMENT : 06^th August, 2025

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THE APPELLATE TRIBUNAL :

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1. Instant appeal has arisen against the order dated 30.12.2022 passed by the learned DRT, Visakhapatnam in MA No.53/2022 in S.A. (UN). Appellant preferred a Civil Revision Petition No. 308 of 2023 before Hon’ble Andhra Pradesh High Court and the State of Andhra Pradesh against the impugned order which was dismissed by the Hon’ble High Court as not maintainable on 30.8.2023.

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Appeal No. 71 of 2024-DRAT-Kolkata SLP No. 23220 of 2023 was filed before the Hon'ble Supreme Court against the judgment of the Hon’ble High Court which was dismissed on 19.10.2023 with liberty to the Appellant to file an appeal before DRAT. Consequent thereto, appeal is filed by the Appellant. The Learned DRT dismissed the Securitisation Application filed under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (hereinafter referred to the ‘Act’) on the ground of limitation holding that the Application, under Section 17 of the Act, filed after more than 45 days is not maintainable. Feeling aggrieved by the impugned order, Appellant preferred the appeal.

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2. So far as the facts of the matter are concerned, Securitisation Application under Section 17 of the Act was filed by the Appellants challenging the e-auction sale conducted on 20.01.2022 in pursuance of the e-Auction Sale Notice dated 18.12.2021 with a delay of 173 days. An application under Section 5 of the Limitation Act for condonation of delay in preferring the Securitisation Application was also filed on certain grounds, regarding high handedness by the Secured Creditor.

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3. An objection was raised by the Secured Creditor regarding maintainability of the Application under Section 5 of the Limitation Act. It was further contended by the Secured Creditor that sale has already been confirmed and sale certificate has been issued in favour of the Auction Purchaser and the Sale Certificate was registered and possession was also delivered.

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Appeal No. 71 of 2024-DRAT-Kolkata 4. Learned DRT held that the Application under Section 17 of the Act is filed in the nature of a suit which should have been filed within 45 days. Accordingly, the Application, under Section 5 of the Limitation Act, was dismissed.

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5. I have heard the Learned Counsel for the parties and perused the record.

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6. Learned Counsel for Appellant would submit that the Application, under Section 5 of the Limitation Act, for condonation of delay in filing the Application under Section 17 of the Act is legally maintainable. Learned Counsel has placed reliance upon the judgment of Division Bench of the Hon’ble High Court of Judicature at Hyderabad for the State of Telangana and for the State of Andhra Pradesh in Writ Petition No. 45198 of 2017 dated 15.06.2018 in Porus Laboratory Private Limited -vs- Indian Bank and Sajida Begum -vs- State Bank of India, (2012) 6 ALT 130, (Division Bench).

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7. Learned Counsel for the Appellant further submits that the issue of maintainability of the Application, under Section 5 of the Limitation Act for condonation of delay in preferring an application under Section 17 of the Act, is still pending before the Hon’ble Supreme Court in the matter of SLAP (C) No. 4754 of 2021 in the case of K.J. George and Another -vs- The Authorised Officer, Indian Bank.

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8. Learned Counsel for the Respondent submitted that the scheme of the SARFAESI Act as well as the Recovery of Debts and Bankruptcy Act, 1993 (in short RDDB Act) is for expeditious disposal of the Application, under Section 17

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Appeal No. 71 of 2024-DRAT-Kolkata filed under SARFAESI Act, as well as under Section 19 of the RDDB Act. Relevant provisions are referred to by the Learned Counsel for Appellant. The Learned Counsel for Respondent further submits that the provisions are meant for expeditious disposal of the matter so as to safeguard and recover the public money by the Banks. Learned Counsel placed reliance upon the case of Gopal Sardar -vsKaruna Sardar (AIR 2004 SC 3068) . Learned Counsel further placed reliance upon the Judgment of the Hon’ble Supreme Court in Bank of Baroda & Another -vsParasaadilal Tursiram Sheetgra Private Limited & Others, (AIR 2022 SC 3803). Learned Counsel submits that the provision of the Act are mandatory in nature and delay cannot be condoned. 9. At the very outset, as far as the issue of the scheme and object of the SARFAESI Act as well as the RDDB Act are concerned, there cannot be two opinions that both the Acts were enacted by the legislature for expeditious disposal of the matters. Scheme of the Acts were also discussed and laid down by the Hon’ble Apex Court in the case of Mardia Chemicals Limited & Others -vs- Union of India & Others [(2004) 4 SCC 311] and Mathew Varghese -vs- M. Amritha Kumar & Others [(2014) 5 SCC 610] , even in the case of Transcore -vs- Union of India [(2008) 1 SCC 125] Hon’ble Apex Court held that the SARFAESI Act is enacted for quick enforcement of the security. Although, Hon’ble Apex Court in the particular case of Bank of Baroda -vs- Parasaadilal (supra) observed that it is unfortunate that

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Appeal No. 71 of 2024-DRAT-Kolkata the proceedings where property has been brought to sale and third-party rights created under the provisions of the Act have remained in conclusive even after a decade.

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10. Section 17 (1) of the Act reads as under: -

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“Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, [may make an application alongwith such fee, as may be prescribed,] [Substituted by the Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Act, 2004 (30 of 2004), Section 10, for "may prefer an appeal" (w.e.f. 21.6.2002)] to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken”

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11. Perusal of the provision would reveal that the Securitisation Application under Section 17 of the Act may be filed by any person aggrieved by any of the measures, referred under Section 13 Sub section (4) of the Act, to the DRT within 45 days from the date of which such measure had been taken. In the case Porus Laboratory (supra), Hon’ble High Court of Judicature at Hyderabad for the State of Telangana and for the State of Andhra Pradesh, Division Bench, after considering the law on the subject, categorically held that the provisions of Section 5 of the Limitation Act of 1963 would be applicable to a belated application made under Section 17 of the SARFAESI Act. This is judgment of the Hon’ble Division Bench of Undivided High Court of Andhra Pradesh and Telangana which is binding. Even in the Judgement of Bank of Baroda -vs- Parasaadilal (supra), Hon’ble Apex Court held that Securitisation Application, as required under the Act, should be filed within 45 days but it is nowhere held that application, under Section 5 of the

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Appeal No. 71 of 2024-DRAT-Kolkata Limitation Act, would not be applicable. An application, filed under Section 17 of the Act, should be disposed in accordance with the scheme of the Act as has been held in the case of Transcore -vs- Union of India , (supra), wherein it was held that the SARFAESI Act is enacted for the quick enforcement of the security, but the law laid down by the Hon’ble Division Bench in the case of Porus Laboratory (supra), specifically held that Section 5 would be applicable to the facts of the case.

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12. In the Judgment of Anirudh Singh -vs- Authorised Officer (2024 SCC Online MP 205): (AIR 2024 MP 92), Hon’ble Division Bench of Madhya Pradesh High Court, held that the issue before the Hon’ble Apex Court in Bank of Baroda -vs- Parasaadilal (supra), was about the applicability of the order passed by the Allahabad High Court, but the question of limitation or applicability of Section 5 of the Limitation Act in preferring an application under Section 17 of the SARFAESI Act was not before the Hon’ble Apex Court. Accordingly, the Division Bench of Madhya Pradesh High Court, after considering the Hon’ble Apex Court Judgment, held that: -

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“7.3 The special law i.e. SARFAESI Act does not expressly exclude the application of the provisions from Sections 4 to 24 of the Limitation Act (including Section 5) and therefore the benefit under Section 5 of Limitation Act shall be available to the cause of action raised in an application under Section 17 of SARFAESI Act.

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8. Now applying the aforesaid principle of law to the fact situation attending the present case, it is obvious from plain reading of SARFAESI Act that while prescribing the period of 45 days for filing an application u/s.17(1) this special Act does not expressly bar the application of Section 5 of Limitation Act.

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Appeal No. 71 of 2024-DRAT-Kolkata 8.1 Consequent upon the above discussion, it is obvious that provisions of Section 5 of the Limitation Act would apply with full force and are available for making a prayer for condonation of delay before the DRT in applications u/S.17(1) which are filed after expiry of 45 days.”

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Division Bench of the Andhra Pradesh High Court in the case of Porus Laboratory (supra), has specifically held that the provisions of Section 5 would be applicable in an application preferred under Section 17 of the SARFAESI Act.

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13. Now coming to the Judgment of the Hon’ble Apex Court in the case of Gopal Sardar (supra), which was the case wherein the provisions of Section 8 of the West Bengal Land Reforms Act were under consideration and the Hon’ble Apex Court held that Section 5 of the Limitation Act cannot be pressed for a belated application under Section 8 of the of the West Bengal Reforms seeking condonation of delay. Provision of Section 8 of the West Bengal Reforms Act reads as under: -

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“Right of purchase by co-sharer or contiguous tenant-(1) If a portion or share of a plot of land of a raiyat is transferred to any person other than a co-sharer of a raiyat in the plot of land, the bargadar in the plot of land may, within three months of the date of such transfer, or any co-sharer of a raiyat in the plot of land may, within three months of the service of the notice given under subsection (5) of Section 5, or any raiyat possession land adjoining such plot of land, may, within four months of the date of such transfer, apply to the Munsif having territorial jurisdiction for transfer of the said portion or share of the plot of land to him, subject to the limit mentioned in section 14M on deposit of the consideration money together with a further sum of ten per cent of that amount."

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14. Case law of Hon’ble Apex Court in Gopal Sardar (supra) is not applicable to the facts of the present case.

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15. On the basis of the above discussion, I am of the considered view that the provisions of Section 5 of the

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Appeal No. 71 of 2024-DRAT-Kolkata Limitation Act would be applicable in the matter of application under Section 17 of the Act preferred before the DRT, Visakhapatnam, as laid down by the Hon’ble High Court of Andhra Pradesh in the case of Porus Laboratory (supra). Accordingly, impugned order is liable to be set aside.

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O R D E R

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Appeal is allowed. Impugned order, passed by DRT, Visakhapatnam in M.A. 53 of 2022 in S.A. (UN), is set aside.

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Learned DRT, Visakhapatnam is directed to decide the Application, under Section 5 of the Limitation Act, in accordance with law as per the observations made in the body of judgment.

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No comment herein is made as regards the tenability of claim for condonation of delay in preferring S.A. which is left to the DRT to go into.

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No order as to costs.

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File be consigned to Record room.

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Copy of the Judgment/Final Order be uploaded in the Tribunal’s Website.

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Order signed, dated and pronounced in open Court.

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(Anil Kumar Srivastava,J) Chairperson