Allowed

Senthil Kumar v. State Bank of India

DRT18 Aug 2023SA/109/2023

Case brief

AI extract

What is this about?

This application challenged a possession notice issued under the SARFAESI Act. The applicant admitted defaults but disputed NPA classification and notice service. With the respondent absent, the Tribunal allowed the application and set aside the impugned measures, allowing the bank to re-initiate proceedings.

What did the court decide?

The measures leading to the issuance of the impugned possession notice are set aside. The respondent is permitted to re-initiate proceedings by re-issuing a demand notice following proper procedure.

Senthil Kumar versus State Bank of India — Banking and Recovery | DRT (2023)

¶1

BEFORE THE DEBTS RECOVERY TRIBUNAL – II AT CHENNAI

¶2

Dated this 18^th day of August, 2023

¶3

PRESENT : SHRI T.RAJESH PRESIDING OFFICER

¶4

SA No.109/2023

¶5

Mr.G.Senthil Kumar, S/o.M.Govindan, No.336/4, Jeginikollai Village, Bargur Town & Panchayat Taluk, Burgur, Krishnagiri District – 635 104.

¶6

… Applicant.

¶7

Vs.

¶8

The Authorized Officer, State Bank of India, Solur Branch, No.107, Byepass Road, Ambur, Tirupattur District – 635 802. … Respondent. Counsel for Applicants : M/s.R.Kannan. Counsel for Respondent : Absent.

¶9

O R D E R

¶10

This application is filed by applicant under section 17(1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (herein after called SARFAESI Act or the ‘Act’, as the case be), with a prayer to set aside the impugned possession notice dt.21.02.2023 issued by the respondent.

¶11

The applicant is admitting the availment of credit facility of

¶12

Rs.14,00,000/- as housing loan, Rs.6,50,000/- as top up loan,

¶13

¶14

Rs.7,50,000/- as mortgage loan and Rs.4,00,000/- as Cash Credit facility. The creation of security interest is also admitted. The applicant is not disputing the defaults occurred in the account. The impugned possession notice is challenged contending that the date of classification of account as NPA is without any basis and demand notice is not issued to all the parties. The applicant is also disputing the mode of service of demand notice as according to him no notice is served or affixed. The contentions are also raised in respect of service and publication of impugned possession notice. Along with SA the applicant had produced impugned possession dt.21.02.2023.

¶15

Notice was taken out to the respondent and the respondent was duly served on 23.03.2023. Despite service of notice on respondent, there was no representation for respondent on 03.05.2023. From 03.05.2023, the case was adjourned to 19.06.2023. From 19.06.2023 the matter was posted for disposal on 07.08.2023. On 07.08.2023 also, there was no representation for respondent leaving this Tribunal to decide the matter only on the basis of un-rebutted contentions of the applicant.

¶16

Heard the Ld. Counsel for applicant and considered the contentions as taken in the SA in the light of pleadings therein and the documents submitted by him. The only issue that needs to be looked

¶17

¶18

into is as to the legality of measures leading upto the issuance of impugned possession notice.

¶19

In view of the fact that the applicant is admitting the defaults occurred in the account, this Tribunal is not inclined to interfere with the decision of the respondent in classifying the account as NPA.

¶20

The applicant is disputing the service of demand notice and possession notice. These contentions are not rebutted by the respondent by entering appearance and by filing counter. In view of the un-rebutted contentions of the applicant, this Tribunal is of the view that SA is to be allowed.

¶21

In the result,

¶22

(i) SA 109/2023 stands allowed

¶23

(ii) The measures taken by the respondent leading to the issuance of impugned possession notice is set aside. It is made clear that the respondent will be at liberty to re-initiate the denovo proceedings by re-issuing the demand notice by following the procedure, if so advised.

¶24

(iii) The respondent is directed not to mulct the cost of the proceedings leading upto the issuance of impugned possession notice and also the demand notice on the

¶25

¶26

applicant. If any debit had already been made in this regard, necessary reversals had to be made forthwith.

¶27

(iv) In view of the facts and circumstances of the case, since the applicant is compelled to approach this Tribunal, a cost of Rs.50,000/- is imposed on the respondent which is to be adjusted at the time of settlement or closure of the account, as the case be.

¶28

All pending IAs stands closed. Issue copies in accordance with

¶29

Rule 16 of the Debt Recovery Tribunal (Procedure) Rules, 1983.

¶30

( Dictated to PA, transcribed by him, corrected, signed and pronounced by me in the Open Court, this 18^th day of August, 2023 )

¶31

Sd./(T.RAJESH) PRESIDING OFFICER DRT-II, CHENNAI

Senthil Kumar v. State Bank of India

Case brief

What is this about?

What did the court decide?

Senthil Kumar v. State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

A Sathish Kumar versus Canara Bank

Ms Sanjana Textiles and Furnitures versus City Union Bank Limited

Canara Bank versus Golden Woods

Arasu E versus Cholamandalam Investment and Finance Company Ltd.

The Karur Vysya Bank Ltd., versus Mr. v. Sathiyanathan

The Karur Vysya Bank Ltd., versus Mr. S. Murali