Dismissed

M/s Ranjit Singh Tej Pal and Brothers v. State Bank of India

DRT26 Sept 2022SA/118/2022

Case brief

AI extract

What is this about?

Applicants challenged a Securitisation Application filed by a bank, alleging violation of Section 13(2) due to lack of notice. The Tribunal rejected the procedural challenge, citing lack of substantial prejudice and specific pleading, dismissing the application with costs.

What did the court decide?

Securitisation Application dismissed with costs.

M/s Ranjit Singh Tej Pal and Brothers versus State Bank of India — Banking and Recovery | DRT (2022)

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DEBTS RECOVERY TRIBUNAL-2, CHANDIGARH, PRESIDED OVER BY M.M. DHONCHAK

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DATED THE 26^th DAY OF SEPTEMBER , 2022

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SECURITISATION APPLICATION NO.118/2022

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M/s Ranjit Singh Tej Pal and Brother, through its authorised signatory Jasbir Singh S/o Joginder Singh R/o Dera Nanak Pura, Village Kirmach, Tehsil Thanesar, Kurukshetra-136119

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Harbhajan Singh, S/o Joginder Singh R/o Dera Nanak Pura, Village Kirmach, Tehsil Thanesar, Kurukshetra-136119

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…..Applicants

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Versus

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State Bank of India, Stressed Assets Recovery Branch, SCO-70, Sector-5, Panchkula

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State Bank of India, Kurukshetra, SCO 88 and 89, Sector-2, Urban Estate Kurukshetra-136118

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…..Respondents

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Argued by: Sh. Sakal Sikri counsel for the applicants Sh. Sh. Arvind Rajotia counsel for the respondents bank

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ORDER

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This Securitisation Application is under Section 17 (1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the Act’ for brevity). 2. In brief, it is the case of the applicants that in the year 2005, the applicants availed of cash credit of Rs.30,00,000/- and mortgaged his land; that in the year 2008, Sh. Harbhajan Singh-applicant No.2 purchased shop No.133 at New Grain Market, Thanesar, (hereinafter referred to as ‘the property in question’ for brevity); that an amount of Rs.38,29,300/- as interest was paid by applicant No.1 till the year 2021; that no notice under

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SA/118/2022 M/S RANJIT SINGH AND ANOTHER VS STATE BANK OF INIDA

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Section 13(2) of the Act was issued and notice dated 26.04.2022 was received straightaway which was for possession of the property in question and since demand notice was not issued, therefore, the applicants could not exercise their right under Section 13(3A) of the Act.

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Reply to the SA was filed wherein inter alia it was contended that in the year 2005, respondent bank sanctioned cash credit facility of Rs.20,00,000/- to applicant No.1 which was enhanced in the year 2013 to the tune of Rs.30,00,000/- at the request of applicant No.1; that applicant No.2 stood as guarantor by executing equitable mortgage deed by deposing title deed on 23.05.2013; that apart from the equitable mortgage executed by applicant No.2, Sh. Joginder Singh son of Sh. Bhole Ram executed registered mortgage deed No.3351 dated 16.08.2013 in respect of agricultural land measuring 62 Kanals 7 Marlas; that applicant No.1 refused to accept the demand notice whereas applicant No.2 did not come to collect the demand notice despite repeated reminders and demand notice was also published in the newspapers. Rest of the averments made in the SA were also denied in reply to the SA.

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Rejoinder was filed wherein the averments made in the SA were reiterated and that of the reply to the SA were controverted. 5. I have heard learned counsel for the parties and also gone through the record carefully. 6. It was argued by Sh. Sakal Sikri, Advocate for the applicants that notice under Section 13(2) of the Act was not received. Counsel for the respondent bank drew the attention of this Tribunal towards Annexure R-8. Annexure R-8 reflects signature of Sh. Harbhajan Singh on 22.12.2021 upon notice dated 23.11.2021. Annexure R-8 is under Section 13(2) of the Act. Sh. Arvind Rajotia, advocate further drew the attention of this Tribunal towards Annexure R-5 wherein postman on 04.12.2021 made remarks that despite information the addressee did not come to collect. Annexure R-5

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SA/118/2022 M/S RANJIT SINGH AND ANOTHER VS STATE BANK OF INIDA

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pertains to Ranjit-applicant No.1 and also there are similar remarks with regard to Sh. Harbhajan Singh-applicant No.2. Sh. Arvind Rajotia, advocate drew the attention of this Tribunal towards Annexure R-7 which was pasting of notice on 28.12.2021. Sh. Arvind Rajotia, advocate further drew the attention of this Tribunal towards Annexure R-6 which is extract of the newspapers Times of India dated 30.12.2021 and Hindi newspaper. These publications are with regard to notice under Section 13(2) of the Act. These were published on 29.12.2021 in Hindi newspaper and on 30.12.2021 in English newspaper.

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The argument of Sh. Sakal Sikri, advocate that there was violation of the rules, cannot be taken into consideration because alleging violation of the rules in itself is not sufficient and the foundation has to be laid by way of the pleadings. A case has to be build-up that this is the violation of this Rule so that the other party gets an opportunity to explain away the violation of the said Rule/law. It is not a pure question of law which can be argued straightaway and it is a mixed question of law and facts and on the basis of the facts it has to be shown that law/Rule has been violated.

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Hon’ble Supreme Court of India, in the case of M/s L&T Housing

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Finance Limited Vs. M/s Trishul Developers and Another, in Civil Appeal No. 3413 of 2020 (arising out of SLP (c) No.18360 of 2019 , it was held that the proceedings under the provisions of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, cannot be held to be bad in law merely on raising a trivial objection which has no legs to stand unless the person is able to show any substantial prejudice being caused on account of the procedural lapse as prescribed under the Act or the Rules framed thereunder still with a caveat that it always depends upon the facts of each case to decipher the nature of the procedural lapse being complained of and the resultant prejudice, if any,

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SA/118/2022 M/S RANJIT SINGH AND ANOTHER VS STATE BANK OF INIDA

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being caused and there cannot be a straitjacket formula which can be

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uniformly followed in all the transactions .

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