Dismissed

D Dinesh v. Union Bank of India

DRT7 Jul 2022SA/191/2022

Case brief

AI extract

What is this about?

Applicants challenged a sale notice for auctioning secured assets alleging valuation violations and procedural errors regarding property description and notice period. The Tribunal held that the sale schedule failed due to non-conduct and a subsequent notice was issued, rendering the challenge infructuous.

What did the court decide?

This Special Application stands dismissed, without costs, and any interim stay is vacated.

D Dinesh versus Union Bank of India — Banking and Recovery | DRT (2022)

SA No.191/2022

07.07.2022

IN THE DEBTS RECOVERY TRIBUNAL – III, CHENNAI

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Dated this the 07^th day of July, 2022

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Present: Shri Ganapathi K.R.K. Presiding Officer

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S.A. No. 191 of 2022

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Sh. D. Dinesh, S/o Sh. Dhanapal, No.1 & 2, Shanmuga Nagar, GNT Road, Kavarapettai – 601 206 2. Sh. D. Suresh S/o Sh. Dhanapal, No.1 & 2, Shanmuga Nagar, GNT Road, Kavarapettai – 601 206 ….Applicants

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– Vs. –

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The Authorised Officer, Union Bank of India Gummidipoondi Branch 315, GNT Road Gummidipoondi Thiruvallur Chennai – 601 201 ….Respondent Counsels on record / appeared: Counsel for Applicants : M/s R. Chandramohan Counsel for Respondent : M/s. S. Parthasarathy

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O R D E R

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This SA is filed challenging the E-Auction Sale Notice dated 25.03.2022 issued by respondent bank scheduling sale to 29.04.2022, for recovery of a sum of Rs.1,21,45,842/- from applicants.

SA No.191/2022

07.07.2022

Respondent bank, who is on caveat, entered appearance and filed counter and typed set of documents evidencing the actions taken by them under the Act.

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Heard Ld. Counsel appearing for respective parties and perused records.

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It is the case of applicants that they availed Housing Loan facility from Andhra Bank (now merged with Union Bank of India) to the tune of Rs.53 lakhs on 09.12.2014, repayable in 340 months with EMI of Rs.48,150/- per month and Overdraft facility to the tune of Rs.41,50,000/- on 04.07.2016, which is repayable in 120 months with EMI of Rs.41,500/-. Though applicants were regular in repayment of instalments and had thus far remitted 58 EMIs and 39 instalments, due to slump in business, they committed default in repayment of few EMIs. It is the case of applicants that respondent bank never stated, when the two loan accounts turned into NPA. At the time of availing loan, the secured assets were valued at Rs.2.5 crores, however respondent bank had valued the same at Rs.1.5 crores for a throw away price in violation of Rule 8(5) of SIE Rules, 2002. It is the further case of applicants that the description of the property is wrong in the sale notice dated 25.3.2022 as well in the possession notice, whereas the correct description is 1144 sq. ft. out of 2288 sq. ft. in respect of the undivided share in the secured assets as per the Settlement Deed dated 23.07.2016 and both the applicants have equal share in the property. Therefore, Sale Notice is erroneous and is issued in violation of Rule 8(6) (a) of SIE Rules as the description of the property is not in accordance to Settlement Deed. It is the further case of applicants that subject impugned sale notice is received by them on 30.03.2022, scheduling sale to 29.04.2022 and hence there is no clear 30 days from the date of service. Thus submitting, Ld. Counsel prayed for allowing the SA in view of the aforesaid infirmities.

SA No.191/2022

07.07.2022

Whereas respondent bank in their counter denied all the allegations contained in the SA except those that are specifically admitted therein. It is the case of respondent bank that availing of credit facility, execution of loan and security documents and default thus committed are all admitted by applicant. Despite repeated requests, as applicant did not come forward to repay the dues, respondent had classified the loan account as NPA on 31.01.2020 in accordance to RBI guidelines and issued Demand Notice under Section 13(2) of SARFAESI Act dated 04.02.2020, which was duly served to applicants on 26.02.2020, as evidenced from acknowledgment cards produced along with typed set of documents. As applicant did not come forward to clear the dues even after expiry of statutory period nor sent any objection / representation to demand notice, respondent bank proceeded further and took symbolic possession of the secured asset on 09.02.2022 which was duly served to applicants on 11.02.2022, affixed in the conspicuous place of the secured asset and published in two leading newspapers as warranted under law. Ld. Counsel for respondent bank submitted that even after issuance of possession notice as applicants did not come forward to clear the dues, respondent bank issued Sale Notice dated 26.03.2022 scheduling sale to 29.04.2022, which was acknowledged by applicants on 30.03.2022, sale notice was affixed on the secured asset and paper publication was effected in two dailies on 27.03.2022 in compliance of mandatory provisions of the Act and Rules made thereunder. The sale scheduled on 29.04.2022 did not take place and respondent bank issued second sale notice dated 02.05.2022, scheduling sale to 20.05.2022, which was also acknowledged by applicants. In view of the same, this SA challenging the sale notice dated 26.03.2022 has become infructuous. Ld. Counsel for respondent submitted that

SA No.191/2022

07.07.2022

there are no infirmities in the procedure adopted by the respondent while initiating measures under Act and the present SA is filed only to frustrate the recovery proceedings initiated by respondent bank and hence prayed for passing necessary orders.

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As applicant could not make out any tenable infirmities in the procedure adopted by the respondent bank while issuing the subject impugned sale notice and moreover, as the present sale notice impugned in this SA has become infructuous and that bank had issued second sale notice, this SA is liable to be dismissed.

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Accordingly, this SA stands dismissed, however without costs. Interim stay, if any granted and subsisting till this day stands vacated and all other IAs, if any pending stand closed.

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With the above observations, this SA stands disposed.

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A copy of the order be communicated to the parties concerned as per extant

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guidelines.

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(Dictated to PS, transcribed by her, corrected, signed and pronounced by me in Open Court, on this the 07^th day of July, 2022)

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Sd/- (GANAPATHI K.R.K) PRESIDING OFFICER

D Dinesh v. Union Bank of India

Case brief

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D Dinesh v. Union Bank of India

Case brief

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