Dismissed

Juturu Lakshmi v. Union Bank of India

DRT15 Jun 2023SA/190/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal considered an application to set aside a possession notice dated 12.07.2022 issued under Section 13(4) of the SARFAESI Act. Finding that the bank properly served the notice on the co-obligant and affixed it to the property in compliance with Rule 8(1), the court dismissed the application.

What did the court decide?

The Securitisation Application No. 190 of 2022 was dismissed; the possession notice dated 12.07.2022 was upheld.

Juturu Lakshmi versus Union Bank of India — Company and Corporate | DRT (2023)

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IN THE DEBTS RECOVERY TRIBUNAL - II

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AT HYDERABAD

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DATED THIS THE 15TH DAY OF JUNE, 2023

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PRESENT: SH. RAMESHWAR KOTHE, B.Com, L.LB.^(Hons.), M.A. PRESIDING OFFICER

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Securitization Application No, 190 OF 2022

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Between:

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Smt. Juturu Lakshmi W/o Ramanaiah Aged about 49 years Occ: Housewife R/o D. No.25-650,31 to 50 Flat No.303, 3'd Floor 25th Ward, Parthasarathi Nagar Dharmavaram - 515 671 Anantha pur District.

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......Applica nt.

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And Union Bank of India Dharmavaram Branch Ananthapur District Rep. by its Authorised Officer.

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..,...Respondent.

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Counsel for the Applicants : Mr. D. Raghavulu. Counsel for Respondent Bank: Ms, Tarangini Pisipati.

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-: Q.-B-D-E-B:-

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The Applicant filed the^present Securitisation Application uls^{77 of} the Securitization and Reconstruction of^Financial Assets^and Enforcement of Security interest Act, 2002^{(hereinafter referred} to as "SARFAESI Act 2002") for setting aside the Possession Notice dated 72.07.2022 issued under Sec.13(4) against the^SA schedule property. fu*

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SA No.190/2022

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The case of the applicant as^per the averments of securitisation applicatlon, in brief, is that the applicant availed^{loan facilities} from the respondent bank and created mortgage over^SA schedule property as security. During Covid-19^pandemic,the business of sale of electronic^goods of applicant^got adversely affected and thus there was default in^payment of^instalments. The respondent bank without considering the request^for regularization of account declared the loan account as^NPA illegally. The respondent bank also did not^heed to^{request to} settle the account under OTS. The respondent bank^issued lmpugned^possession notice without issuing statutory^demand notice. The^possession notice was not served and neither it was afflxed on secured asset nor^published in two leading newspapers and thus there is violation of Rules 8(1) and 8(2) of Security Interest (Enforcement) Rules, 2002^(hereinafter "Rules, 20C2" for short). The value of the schedule^property is worth more than the outstanding dues. Hence this SA.

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The respondent bank filed the reply statement denying the averments of the SA. It is the submission of the respondent that the applicant has not come to the Tribunal with clean hands. Due to default in repayment of loan amount, the account became NPA by 01.06.2021, resulting in securitlsation proceedings starting from demand notice u/s 13(2) dated 24.02.2022 which was received by Juturu Venkatesh, son of applicant on 03.03.2022. Having no response to the demand notice, respondent proceeded further with possession notice u/s 13(4) dated 12.07.2022 which was duly served on the applicant/co-obligant on 12.O7.2022. A misprint relating to date of issuance of possession notice as 06,04.20?2 has been taken care of in the publication of the same

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5A No.190/2022

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taken out in the two newspapers dated t6.o7.2022 u/r 8(2) of the Rules, 2002. The applicant never approached either for regularisation of loan account or for OTS. The respondent bank has strictly followed the procedure of law while proceeding against the secured asset and therefore, the SA may be dismissed.

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The right of applicant for advancing oral arguments was forfeited on 72,04.2023.

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Heard learned counsel appearing for the respondent bank. Perused the written arguments filed by the applicant and the material documents filed by them.

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As per written arguments, the contentions of the applicant are that the respondent bank declared the loan account as NpA without heeding to the request for regularization of account nor did it consider the request to set e the account under OTS. No demand notice was served under Sec.13(2) before issuing the impugned possession notice dated L2.07.2022 under Sec.13(4). The respondent bank has violated Rules B(1) and 8(2) of the Rules, 2002 in serving. affixing and publishing of the possession notice and therefore, the SA may be a owed by setting aside possession notice dated 72.07.2022.

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Per contra, it is submitted by the learned counsel for the respondent bank that due to default committed in payment of loan instalments, the loan account was classified as NpA on 01.06.2021 as per RBI guidelines, The demand notice dated 24.02.2022 issued under Sec.13(2) was personally received by none other than son of applicant Mr.Juturu Venkatesh. Despite receipt of demand notice, the applicant/co-obligant did not come forward to clear the outstanding and hence possession notice ,z?Q*s,', t, 1/'t<''t"

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sA No'190/2022

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dated L2.07.2022^{was issued u/s 13(4)of the SARFAESI Act,} 2002 which^{was served on the co-obligantwho is husband of the} applicant.^{The symbolicpossessionwas taken on 12'07 '2022'rhe} typographical^{mistake crept in the date column was rectifiedwhile} publishing the possession^{notice. Learned counselhowever} submits that^{the same was neither contended by the applicant nor} was there any^{changein the particulars of noticeAccording to} learned counsel, the^{possessionnotice was affixedon secured} asset and^{published in 'The Hans Indla'and'Eenadu'Englishand} Telugu languages on^{!6.O7.2022. While relying on proof} documents^{annexedto the reply statement,the learnedcounsel} sought for dismissal^{of the SA}

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The^point that arises^{for consideratlon is : -}

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Whether the applicant^{made out anyvalidground to} set aside the^{possessionnoticedated 12'07'2022} issued by the^{respondent bank under 5ec.13(4)of} the SARFAESI Act, 2002?

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The applicant ln the^{written argumentstook a specific contention} that respondent^{bank failed toproduce any postal} acknowledgements^{as proof of service. It is pertinent to note that} the thrust of the^{provision of Rule 8(1) is on 'delivery'and} affixture of^{possession notice. Therefore it is not mademandatory} under Rule 8(1) to^{servepossession notice through registered} post also. In the instant case,^{sincethe respondent bankcaused} to^{personallyserve the possession notice on the co-obligantof the} loan transaction, who^{is the husband of the applicant underhis} acknowledgement and^{also evidencedby photograph, I find no} merit in the^plea that^{the said notice was not served by registered} post. For better appreciation, the relevant^{portionof the Rule 8(1)} is reproduced hereunder: ffi*

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sA No.190/2022

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"(1) Where the secured asset is an immovable property, the authorised officer shall take or cause to be taken possession, by delivering a possession notice prepared as nearly as possible in Appendix-Mo these rules, to the borrower and by affixing the possession notice on the outer door or at such conspicuous place of the property.,,

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The respondent bank has filed documents as proof of servlce of demand notice daled 24.02.2022, possession notice dated 12.07.2022, photographs evidencing service and affixture of the possession notice and publication in 'The Hans India, and^,Eenadu, English and Telugu languages on 16.07.2022. Thus, the respondent bank has demonstrated that it had followed the procedure contemplated under the provisions of the SARFAEIS Act and the rules made thereunder while proceeding against the secured asset i.e., the SA schedule property.

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In the foregoing circumstances, I am constrained to find that the applicant failed to make out any valid ground to quash the possession notice dated 72.07.2022 issued under Sec.13(4) of the SARFAESI Act, 2002 by the respondent bank in respect of SA schedule property and accordingly the SA is liabte to be dismissed.

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In the result, the SA is dismissed.

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Consequently, Interlocutory Applications pending, if any, shall stand closed.

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No order as to costs. Communicate a copy of this order to the parties concerned.

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(Dictoted to the Steno, corrected, signed ond pronounced by me in the 15th doy olJune,2023).

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court on this the

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$-*> ESHWAR KOTHE) RESIDING OFFICER

Juturu Lakshmi v. Union Bank of India

Case brief

What is this about?

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Juturu Lakshmi v. Union Bank of India

Case brief

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