Dismissed

N Divakar v. Tamilnad Mercantile Bank Limited

DRT20 May 2023SA/310/2022

Case brief

AI extract

What is this about?

In this SARFAEI application challenging a sale certificate issued by the bank, the Tribunal observed that the bank followed the prescribed procedure. Finding the applicant failed to establish any infirmities in the sale process or the issuance of the certificate, the Tribunal dismissed the application without costs.

What did the court decide?

This SARFAESI application stands dismissed without costs. Interim order, if any granted and subsisting till this day stands vacated and all other IAs, if any pending stand closed.

N Divakar versus Tamilnad Mercantile Bank Limited — Execution and Attachment | DRT (2023)

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S.A. 310 of 2022 20.05.2023

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 20^th day of May, 2023

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

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SARFAESI APPLICATION No. 310 of 2022

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N.Divakar

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S/o. Nagamuthu No. 5/3, Manimegalai Street New Perungalathur Chennai – 600 063 ….Applicant

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Vs.

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1. The Authorised Officer

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Tamil Nadu Mercantile Bank Ltd No.29, Kamaraj High Road Devi Kaumariamman Nagar, Mettukuppam Nerkundram Chennai – 600 107

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2. Mr.G.Janarthanan

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C/o Tamil Nadu Mercantile Bank Ltd No.29, Kamaraj High Road Devi Kaumariamman Nagar, Mettukuppam Nerkundram Chennai – 600 107 ….Respondents

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Counsels on record / appeared:

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Counsel for Applicant : M/s. V.Ramamurthy, R.Vijay Kumar, B.Ramprasad & H.Yuga Shree Counsel for respondent bank : M/s K.N.Chinnakrishnan & E.Kumar

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ORDER

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This is an SA filed by applicant challenging the sale certificate issued by the respondent bank pursuant to sale notice dated 20.04.2022.

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S.A. 310 of 2022 20.05.2023

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Heard Ld.Counsels appearing for both the parties.

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It is the case of applicant that during the pendency of their challenge to the sale notice scheduling sale to 17.05.2022 in SA No.234/2022, respondent bank had hurriedly proceeded further with the conclusion of sale and pursuant to receipt of the sale consideration from the auction purchaser, purported sale certificate is also issued, which acts are all contrary to the provisions of law and the rules made under the SARFAESI act. It is the case of applicant that respondent bank ought not to have proceeded further with the issuance of sale certificate since their challenge to the very sale notice itself is pending adjudication. It is also the further case of applicant that the property has been grossly undervalued and the additions made to the structures have not been properly valued owing to which the fixation of reserve price is not in accordance to law and in accordance to the subsisting conditions. Ld.Counsel for applicant has submitted that valuation of the building will be definitely more and higher and that the respondent bank with an intention to cause loss to the applicant herein, has sold away the property for a very low price. It is also the case of applicant that the auction purchaser has not remitted the amount within the time permitted under the law and that respondent bank has been, hand in glove with the Auction purchaser to cause financial loss to the applicant herein. Ld.Counsel submits that the present challenge to the sale certificate issued pursuant to the concluded sale on 17.05.2022 is only challenged to bring to the fore, the illegal actions of the respondent bank in the name of recovery taking undue advantage of the provisions of the SARFAESI act. Ld.Counsel for applicant further reiterated that the procedure followed by the respondent bank while concluding the sale and issuing the sale certificate impugned in the present SA is not in

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S.A. 310 of 2022 20.05.2023

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accordance to law and is violative of even principles of natural justice. Submitting so, Ld.Counsel has prayed for appropriate orders.

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Whereas Ld.Counsel appearing for the respondent bank has filed its counter and typed set of documents evidencing their actions. It is demonstrated by the Ld.Counsel for respondent bank that the actions followed by the respondent bank are in accordance to law while issuing the impugned sale certificate and that the same has been duly registered in favour of the Auction purchaser after receipt of the entire bid amount, which has since been adjusted towards the borrowers loan account. Intimation of the same has also been delivered to the borrowers / guarantors. Ld.Counsel also submitted that in terms of the orders of the Hon’ble DRAT in RA (SA) No.186/2018 & MA (SA) No.94/2018 Union Bank of India Vs. Benoy A.S dated 22.08.2022, wherein it is held that issuance of a sale certificate and its subsequent registration are all administrative acts only and do not come within the purview of the meaning of the word “measures” as contemplated under Sec.13 and hence the very challenge laid down by the borrower does not have legs to stand. Ld.Counsel further submitted that pursuant to conclusion of sale and issuance of sale certificate, respondent bank has also delivered physical possession of the property to the Auction purchaser and therefore nothing survives in the present SA.

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From the foregone submissions of both the parties, it is evident that respondent bank has followed the procedure as warranted under law and that there were no infirmities in the procedure adopted while concluding the sale and subsequently issuing the eventual sale certificate in favour of the Auction purchaser. It is also submitted that

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S.A. 310 of 2022 20.05.2023

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physical possession of the property is also duly caused under proper acknowledgement and therefore nothing survives in the present SA. Applicant, except for making bald allegations against the actions of the respondent bank could not establish any tenable infirmities, calling for interference by this Tribunal.

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

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Accordingly, this SA stands dismissed, however without costs. Interim order, if

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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 directions, this SA stands disposed.

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

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(Dictated to Steno (DD), transcribed by her, corrected, signed and processed through e-drt, on this the 20^th day of May, 2023)

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Sd/-

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(GANAPATHI K.R.K)

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PRESIDING OFFICER

N Divakar v. Tamilnad Mercantile Bank Limited

Case brief

What is this about?

What did the court decide?

N Divakar v. Tamilnad Mercantile Bank Limited

Case brief

What is this about?

What did the court decide?

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