Dismissed

Mr Ekambaram Son of Ramalingam and Manjula Wife of Ekambaram v. Iifl Home Finance LimitedU

DRT29 Dec 2023SA/409/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed the Securitization Application filed by borrowers against the respondent bank. The Tribunal held that applicant contentions regarding NPA classification and procedural lapses lacked merit and evidence, finding the statutory measures lawful.

What did the court decide?

Securitization Application dismissed; all pending interim applications closed.

Mr Ekambaram Son of Ramalingam and Manjula Wife of Ekambaram… — Banking and Recovery | DRT (2023)

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IN THE DEBT RECOVERY TRIBUNAL –II CHENNAI Dated this 29^th day of December, 2023

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PRESENT: SHRI T.RAJESH PRESIDING OFFICER

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S.A. 409 of 2023

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Mr.Ekambaram.R., S/o.Mr.Ramalingam.

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Mrs.Manjula, W/o.Mr.Ekambaram.

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Both are same address: New Door No.9, Old Door No.5, Plot No.82, Arcot Street, T.Nagar, Chennai – 600 017. … Applicants. Vs.

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The Authorised Officer, IIFL Home Finance Limited, Old No.41, New No.76, Block-1, Nu Tech Building, 3^rd Floor, 1^st Main Road, CIT Nagar West, Nandanam, Chennai – 600 035. … Respondent. Counsel for Applicants : M/s.D.Durairaj. Counsel for Respondent : M/s.S.K.Mariyappan.

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ORDER

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The Securitization Application is filed by the applicants u/s.17 of the Securitisation and Reconstruction of Financial Assets and

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Enforcement of Security Interest Act, 2002 (hereinafter been referred to as the SARFAESI Act or the Act as the case be) with a prayer to set aside the measures leading to the procurement of the section 14 orders from the Ld.CMM, Egmore, Chennai in Crl.M.P.No.21497/2023 dt.11.08.2023 by the respondent.

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The Applicants contend that the Applicants had approached the respondent bank for development of construction work and availed a mortgage loan for Rs.3,03,34,200/-. It is also contended that the repayment schedule was revised and subsequently due to the COVID the business became sick as per the RBI guideline, the respondent bank has given addition top up loan for a sum of Rs.40,00,000/-. It is further contended that the Applicants had made remittance up to February 2023. It is also contended that the respondent without following the contractual obligation had increased the rate of interest and initiated the impugned measures without following the RBI guide lines.

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It is also stated by the Applicants that though the Applicants tried to settle the liability, the respondent had without considering all these and without considering the said fact had brought the property for public auction at a distress value. In respect of the measures also the Applicants contend that the demand notice is not legally sustainable as the NPA itself is in violation of the rules. It is also stated that the demand notice is not served on the borrowers and that the exact dues is not mentioned in the notice. The Applicants are also having dispute as to the procedure followed in issuance of possession note.

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Along with the SA, the Applicant had produced the petition filed under section 14 of the Act, affidavit of respondent and the order passed by the Ld. Magistrate.

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The respondent had filed their counter denying the contentions taken by the Applicants in their challenge as to the measures. It is contended that the measures taken by them are in accordance with statute. It is also stated that the account is duly classified as NPA in accordance with the master circular of RBI. The respondent stated that they had followed the procedure as envisaged under the Act in issuance of the demand notice and possession notice. In respect of the sale notice also, it is stated that the respondent had followed the

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procedure as required in the statute and that the measures taken by

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them leading to the procurement of section 14 order does not suffer from any procedural infirmity. Along with the counter, the respondent had produced the following documents:

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i) Demand notice with proof as to tracking.

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ii) Paper publication of demand notice.

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iii) Possession notice.

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iv) Intimation of possession notice with postal receipts.

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v) Photograph evidencing of affixture of possession notice.

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vi) Paper publication of possession notice.

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vii) Sale notice.

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viii) Paper publication of sale notice.

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ix) E-auction letter.

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x) Board Resolution.

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Hence on the basis of above contentions and documents, the respondent seeks for dismissal of the SA.

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Heard the learned counsels for both sides and considered the rival contentions. The only issue that is to be gone into and decided is as to whether the measures taken by the respondent is in accordance with the statute or not?

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The main contention taken by the Applicants is as to the classification of account as NPA. The Applicants submit that the account is classified as NPA despite prompt and regular payments.

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This contention is denied by the respondent who specifically states

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that the account is classified as NPA due to the defaults occurred in

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the account. Even after filing the counter, no proof as to the so claimed prompt remittances is produced by the Applicants to substantiate the said contention. In view of the fact that there is no evidence as to the payments, this Tribunal is not inclined to accept the said contention.

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In reply to the alleged flaws in issuance of demand notice, the respondent had produced the proof as to the service of demand notice as the postal track records of the service of demand notice is produced. The respondent had also produced the proof of paper publication of the demand notice.

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Even though the Applicants are putting forward a case as to the procedural flaws in issuance of the possession notice and sale notice, the same is inconsequential, as the issuance of possession notice and sale notice are not sinequonon for initiating measures under section 14 of the Act.

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In view of the above discussions and findings, the only conclusion this Tribunal come to arrive at is that there is no merit in any of the contentions of the Applicants and the SA is liable to be dismissed.

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In the result SA stands dismissed, all pending IA’s stands closed, no

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orders as to cost. Issue copies in accordance with Rule 16 of the Debt Recovery Tribunal (procedure) Rules 1993.

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(Dictated to PA, transcribed by him, corrected, signed and pronounced by me in the Open Court, this 29^th day of December, 2023)

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

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Mr Ekambaram Son of Ramalingam and Manjula Wife of Ekambaram v. Iifl Home Finance LimitedU

Case brief

What is this about?

What did the court decide?

Mr Ekambaram Son of Ramalingam and Manjula Wife of Ekambaram v. Iifl Home Finance LimitedU

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

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