Dismissed

K S Consturction v. City Union Bank Limited

DRT13 Sept 2022SA/76/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed an application challenging a bank's sale notice. The court found no infirmities in the bank's procedural steps, including notice and publication, ordering the dismissal of the challenge while suggesting a negotiated settlement.

What did the court decide?

Sale notice sale notice stood dismissed; applicants allowed to negotiate settlement by 15.10.2022 before bank proceeds further.

K S Consturction versus City Union Bank Limited — Banking and Recovery | DRT (2022)

¶1

¶2

S.A. 76 of 2022 13.09.2022

¶3

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

¶4

Dated this the 13^th day of September, 2022

¶5

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

¶6

SARFAESI APPLICATION No. 76 of 2022

¶7

1. M/s.K.S. Construction
Rep. by its Proprietor
Mr.K.Sampath
No.101, No.2, Matha Kovil Street
Sogandi Village
Thirukalukundram Taluk
2. Mr.K. Sampath
S/o. Krishnan
No.3, Ward No.3, Madha Kovil Street
Sogandi Village
Kancheepuram – 603 405
3. Mrs.S.Shobana
W/o.K.Sampath
No.3, Ward No.3, Madha Kovil Street
Sogandi Village Kancheepuram – 603 405 ….Applicants
Vs.
The Chief Manager / Authorised Officer
City Union Bank
Mrs.G.Vasuki
Administrative Office “Narayana”
No.24-B, Gandhi Nagar
Kumbakonam – 612 001 ….Respondent
Counsels on record / appeared:
Counsel for Applicants : M/s. Shaikh Mehrunisa
Counsel for Respondent : M/s. Akshai Mani

¶8

¶9

S.A. 76 of 2022 13.09.2022

¶10

ORDER

¶11

This SA is filed challenging the Sale Notice dated 17.01.2022 issued by respondent bank scheduling sale to 25.02.2022 for recovery of a sum of Rs.88,38,554/-.

¶12

Heard Ld. Counsel appearing for respondent bank and perused records. It is the case of applicants that first applicant availed various credit facilities from respondent bank for their construction business and applicants 2 and 3 stood as guarantors for the loans thus availed. It is the case of applicants that they intended to negotiate with respondent bank for an amicable settlement of their dues in continuation to their payment of Rs.30 lakhs caused in September, 2021 after issuance of SARFAESI notice. Ld. Counsel for applicant reiterates that owing to Covid situation, their businesses were impacted and therefore they fell in arrears of their repayment schedule. Respondent bank did not credit the sum of Rs.30 lakhs equally in four loan accounts, instead respondent bank had credited a sum of Rs.24,43,141/- towards one loan account and made the other accounts as NPA. Despite repeated requests, respondent bank failed to furnish statement of accounts as the amount claimed in the sale notice is exorbitant.

¶13

Whereas Ld. Counsel for respondent bank while denying the averments in the SA, submitted that availing of loan, execution of loan and security documents and default thus committed are all admitted by applicant. It is submitted that the Principal borrower along with guarantor utilised the loan for their business need but failed to repay the same as per the terms of contract. Respondent bank had classified the loan account as NPA on 11.05.2021 and issued Section 13(2) notice on 10.08.2021, which

¶14

¶15

S.A. 76 of 2022 13.09.2022

¶16

was duly served on 14.08.2021, possession notice was issued on 08.11.2021, which was duly served, affixed and published in accordance to law. As the default of the borrower continued, respondent bank issued Sale Notice dated 17.01.2022 scheduling sale to 25.02.2022, which was also duly served, affixed and published on 18.01.2022 in two newspapers as evidenced from typed set of documents filed along with counter.

¶17

It is submitted by Ld. Counsel for respondent bank that no sale had taken place on the scheduled date for want of bidders and that there are no infirmities in the procedure adopted by respondent bank while issuing the subject impugned sale notice.

¶18

In the circumstances as applicant could not make out any infirmities in the procedure adopted by the respondent bank while issuing the impugned sale notice, there are no merits in the present SA and the same is liable to be dismissed.

¶19

Accordingly, this SA stands dismissed, however without costs. Interim order, if any granted and subsisting till this day stands vacated and all other IAs, if any pending stand closed. Applicants are at liberty to enter into any negotiated settlement with respondent by or before 15.10.2022, failing which respondent bank will be entitled to proceed further in accordance to law, if the default of the borrower continues beyond the said date.

¶20

With the above directions, this SA stands disposed

¶21

¶22

S.A. 76 of 2022 13.09.2022

¶23

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

¶24

(Dictated to PS, transcribed by her, corrected, signed and pronounced by me in Open Court, on this the 13^th day of September, 2022)

¶25

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

K S Consturction v. City Union Bank Limited

Case brief

What is this about?

What did the court decide?

K S Consturction v. City Union Bank Limited

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Parties & counsel

Coram

Case details

Similar cases

P C Bhaskar versus India Bulls Housing Finance Ltd.

M S M P Traders versus Indian Overseas Bank

Mr P Devanand versus State Bank of India

V Kumar versus Canara Bank

M/s.Chellammal Educational and Charitable Trust represented by its Managing Trustee Mr.v.Govindasamy versus City Union Bank Limited

Acharya Arts Proprietor K M Johnson versus Canara Bank