Dismissed

Sulaiman K T v. The Manjeri Co. Operative Bank Ltd.

DRT20 Nov 2023SA/604/2022

Case brief

AI extract

What is this about?

In this Securitization Application, the applicants challenged notices for taking physical possession of mortgaged property under the SARFAESI Act, alleging procedural lapses. The Tribunal held that sufficient service of notices via postal acknowledgment and newspaper publication validated the process, and dismissed the application.

What did the court decide?

The Securitization Application No. 604 of 2022 stood dismissed with no costs awarded. The order confirms the validity of the possession notices and rejects the claim to delay possession or regularizat

Sulaiman K T versus The Manjeri Co. Operative Bank Ltd. — Execution and Attachment | DRT (2023)

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT ERNAKULAM

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DATED THIS 20^th DAY OF NOVEMBER, 2023

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PRESENT: Su. WILLYAHM, B.Sc., M.L. [DISTRICT JUDGE - Retd] PRESIDING OFFICER

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S.A No. 604 of 2022

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Between

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Sulaiman K.T., S/o. Abdurahiman, Kalladithodi House,

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Manjeri P.o, Malappuram – 680 302.

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Saudabi V., W/o.Abdurahiman, Kalladithodi House, Manjeri P.o, Malappuram – 680 302.

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Ayub K.T., S/o. Abdurahiman, Kalladithodi House, Manjeri P.o, Malappuram – 680 302.

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--- Applicants

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And

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The Manjeri Urban Co-operative Bank Ltd., rep. by its General Manager (Authorised Officer), Court Road, Manjeri P.O., Malappuram – 676 121.

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--- Defendant

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This Securitization Application coming on 13.10.2023 for final hearing before me in the presence of Mr. Raynold Fernandez, Advocate for the Applicants and Mr. K.Vidyasagar, Advocate for the defendant and upon hearing arguments of learned counsels for all the parties and upon perusing the material on records, this Tribunal delivered the following:

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SA No.604 of 2022

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O R D E R

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This Securitisation Application was filed on 22.12.2012 seeking to declare that the measures initiated by the defendant bank under the SARFAESI Act, 2002 as illegal and unsustainable and to declare that the demand notice as invalid and to stay all further proceedings pursuant to Annexure-A2 Advocate Commissioner notice dated 06.12.2022 and Annexure-A6 Advocate Commissioner notice dated 18.01.2023 and Annexure-A7 Advocate Commissioner notice dated 24.07.2023 and to direct the defendant bank to regularize the loan accounts of the applicants and for other reliefs.

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It is submitted by the counsel for the applicants that the date of sanctioning of the loan and date of classification of the loan account as Non-Performing Asset is not stated in the demand notice dated 12.02.2018 and that demand notice was issued by the authorised officer and not by the defendant Bank and that the demand notice was not published in two leading news papers one in vernacular language having sufficient circulation in the locality and that the authorised officer is not the Chief Manager of the bank and that the Mariyumma, the mother of the 1^st and 3^rd applicant, who is aged 79 years is bed-ridden and that the mortgage is the sole residential property of the applicants and that the Chief Judicial Magistrate Court, Manjeri passed order in Crl. MP No.3043/2018 appointing Advocate Commissioner to take physical possession of the secured asset and that the Advocate Commissioner issued notice dated 06.12.2022 to the applicants informing them that physical possession will be taken on 20.12.2022 and that subsequently the Advocate Commissioner issued Annexure-A6 and A7 notices informing the applicants that physical possession of the property would be taken and that dispossession of the property will throw the applicants and their family including the bed-ridden mother of the 1^st and 3^rd applicants to the street and that one Mr. Abdulla from Manjeri is interested in purchasing the secured asset and that some time may be granted to clear the mortgage loan and that penal interest has been charged and that the defendant is attempting to take physical possession of the secured asset without adhering to the procedure contemplated under the SARFAESI Act, 2002 and the Security Interest (Enforcement) Rules, 2002 and that therefore, the SA may be allowed as prayed for.

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The counsel appearing for the defendant bank submitted that the applicants after having availed a loan of Rs.36,50,000/- on 31.12.2015 upon creation of security interest over the immovable property by deposit of title deeds committed default in repayment of the loan due and that hence the loan account became a Non-

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SA No.604 of 2022

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Performing Asset on 01.05.2016 and that the demand notice, Annexure-B1 was received by the applicants and that even after expiry of 60 days’ time for repayment of the loan due, no payment was made by the applicants and that therefore, Annexure-B5 possession notice was issued on 09.07.2018 and that possession notice sent to the 2^nd applicant was received by him and that possession notice to 1^st and 3^rd applicants was returned as unclaimed notice and that intimation about the possession notice sent to the applicants 1 and 3 was also returned unclaimed and that possession notice was affixed on the conspicuous place of the secured asset and that possession notice was also published in two leading newspapers, one in vernacular language having sufficient circulation in the locality and that Sale notice, Annexure-B12 was served and that the judgment AnnexureB13 passed by the Hon'ble High Court of Kerala in W.P (C) No. 7663/2021 directing the applicants to pay the entire outstanding amount in 12 equally monthly installments was not complied with by the applicants and that the defendant filed Annexure-A3 petition under Section 14(1) of the SARFAESI Act, 2002 before the Chief Judicial Magistrate Court, Manjeri and that Annexure-A4 order was passed appointing Advocate Commissioner to take physical possession of the secured asset and that Annexure-A2 notice issued by the Advocate Commissioner was challenged by the applicants by filing W.P (C) No. 41038/2022 before the Hon'ble High Court of Kerala and that judgment was passed dismissing the writ petition on the ground that the applicants had no case and that no even one instalment was paid pursuant to the direction passed in Annexure-B13 judgment and that the applicants did not file objection to the demand notice and that since the authorised officer of the defendant bank is the General manager of all the branches of the defendant bank, he is competent to issue the demand notice as per the Rule 2(a) of Security Interest (Enforcement) Rules, 2002 and that since demand notice was served to the applicants, there is no necessity of publication of demand notice in two leading newspapers and that the applicants are chronic defaulters in making repayments of the outstanding loan due, and that therefore the SA is liable to be dismissed with costs.

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Availment of loan to the tune of Rs.36,50,000/- by the applicants from the defendant bank upon creation of security interest by deposit of title deeds over the immovable property belonging to the 2^nd and 3^rd applicants situated in Sy. No.308/4 of Narukkara village, Eranad Taluk, Malappuram district in favour of the defendant bank and default in repayment of the outstanding loan due is admitted by the applicants in the S.A.

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On account of default in repayment of the outstanding loan due, their loan account came to be classified as Non-Performing Asset on 01.05.2016 and demand notice, Annexure-B1 was issued to the

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Page 3 of 8

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SA No.604 of 2022

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applicants calling upon them to pay the outstanding loan due within 60 days from the date of receipt of the demand notice. The applicants received the demand notice as evidenced from the perusal of Annexure-B3, copies of postal acknowledgment cards. Hence this Tribunal does not find any force in the contention of the applicants that demand notice was not published in two leading newspapers, one in vernacular language having sufficient circulation in the locality. The amount of loan sanctioned is mentioned in the demand notice. However, the date of classification of loan account is not mentioned in the demand notice as contended by the applicants, but the provisions of Section 13(2) of the SARFAESI Act, 2002 does not contemplate the mentioning of the date of classification of NPA in the demand notice. The applicants have also not stated any convincing reason in the SA as to how they got prejudice over non mentioning of the date of classification of NPA in the demand notice. Further, the applicants did not send any objections raising the above said issue. Therefore, the contention of the applicants in this regard is liable to be rejected.

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It is not in dispute that the applicants did not send any objection or representation to the demand notice and that they did not comply with the terms of the Annexure-B1 demand notice, which was issued by the authorised officer who is none other than the General Manager of the defendant bank. Thus it is evident that the above said officer is competent to issue the demand notice as per Rule 2(a) of Security Interest (Enforcement) Rules, 2002.

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Since the applicants failed to discharge their liability due to the defendant bank, possession notice, Annexure-B5 was issued on 09.07.2018 for symbolically taking possession of the secured asset. The defendant has produced Annexure-B6, copies of acknowledgment cards, Annexure-B7 and B8 copies of registered returned postal covers, to prove his contention that possession notice was received by the 2^nd applicant and that possession notice sent to the 1^st and 3^rd applicants was returned as unclaimed. The defendant has also produced copies of Annexure-B9 photograph and B10 and B11 copies of paper publications to prove his contention that possession notice was affixed on the conspicuous place of the secured asset and that it was published in two leading newspapers, Malayala Manorama daily edition dated 14.7.2018 and Chandrika Daily edition dated 14.7.2018.

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On application Annexure-A3 filed under Section 14(1) of the SARFAESI Act, 2002 by the defendant before the Chief Judicial Magistrate Court, Manjeri, order Annexure-A4 came to be passed in Crl. MP No.3043/2018 appointing Advocate Commissioner to take physical possession of the secured asset. Pursuant to the above order, the Advocate Commissioner issued Annexure-A2 notice dated 06.12.2022, subsequently Annexure-A6 notice dated 18.01.2023 and

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SA No.604 of 2022

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ultimately Annexure-A7 notice dated 24.07.2023 was issued informing them that he would take physical possession of the secured asset.

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It is not the case of the applicants that the requirements for furnishing the particulars contemplated under Clause (i) to (ix) to the provisions of Section 14(1) of the SARFAESI Act, 2002 was not complied with by the defendant in Annexure-A3 petition filed in Crl. MP No.3043/2018 and that Annexure-A4 order passed by the Chief Judicial Magistrate Court,, Manjeri suffers from any infirmity or irregularity. The applicants have not produced the certified copy of the affidavit filed by the defendant in Crl MP No.3043/2018. However, they have produced certified copy of the petition in Crl. MP No.3043/2018. A perusal of the same shows that all the details, such as availment of financial assistance by the applicants from the defendant bank upon creation of security interest over the immovable property, default in repayment of the outstanding loan due, classification of loan account as Non-Performing Asset, the outstanding loan account as on the date of issuance of the demand notice, issuance of demand notice to the applicants and receipt of the same by the applicants, issuance of the possession notice, description of property with its boundaries are stated. A perusal of Annexure-A4 Order shows that the learned Chief Judicial Magistrate Court, Manjeri after having perused the averments of the application and affidavit and after having satisfied over the same, passed order appointing Advocate Commissioner to take physical possession of the secured asset. Pursuant to the above order, Advocate Commissioner issued Annexure-A4, A6 and A7 notices to the applicants for taking physical possession of the secured asset. Hence the aforesaid notices are not challengeable in any manner.

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One of the reliefs sought for by the applicants in the SA is to declare that the applicants have time to repay the mortgage loan as per the terms agreed between the applicants and the defendant. The applicants having committed default in repayment of outstanding loan due by violating the terms and conditions of the loan account are not entitled to get such relief. The other relief sought for by the applicants is to regularize/restructure the loan accounts. This relief sought for by the applicants does not fall under the category of measure contemplated under Section 13(4) of the SARFAESI Act, 2002. Further this Tribunal has no power to direct the secured creditor to regularise or restructure the loan accounts of the borrowers. It is upto the applicants to approach the defendant for such relief. In the demand notice Annexure-B1 as well as in the possession notice, Annexure-B5, the description of the property with boundaries is clearly stated for its identification. Hence the relief sought for by the applicants to declare that the secured asset is not identifiable from the

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SA No.604 of 2022

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recitals given in both demand unsustainable.

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and possession notices is

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The applicants have miserably failed to prove their case so as to get the reliefs sought for in the SA which deserves to be dismissed. In the result, the SA No.604 of 2022 stands dismissed. No costs.

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Dictated to Steno, taken down, transcribed, typed by him, corrected and pronounced by me in the open court on this the 20^th day of November, 2023.

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(Su. WILLYAHM) PRESIDING OFFICER

Mj/

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SA No.604 of 2022

List of documents filed by the Applicants along with the S.A.

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Sl. No.	Date	Particulars
1.	30.09.2022	True copy of Medical certificate issued byDr.Ahammedkutty.	Annexure-1
2.	06.12.2022	A copy of the dispossession notice issued by theAdvocate Commissioner.	Annexure-2
3.	17.09.2018	Certified copy of CMP No.3043/2018	Annexure-3
4.	21.11.2019	Certified copy of order appointing Advocate Commissioner	Annexure-4
5.	19.12.2022	Certified copy of the judgment in W.P.(C) No. 41038/2022 passed by the Hon'bleHighCourt of Kerala.	Annexure-5
6.	18.01.2023	True copy of the Inspection notice issued by theAdvocate Commissioner.	Annexure-6

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List of documents filed by the Defendant Bank along with the Written Statement

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SL. No.	Date	Particulars
1.	12.02.2018	True copy of the demand notice under Section 13(2) of the SARFAESI Act, issued by the defendant to applicants 1 to 3 alongwith itsEnglishtranslation.	Annexure-B1
2.	14.02.2018	True copy of the postal receipt in the name ofthe applicant.	Annexure-B2
3.	15.02.2018	True copy of the acknowledgment card by which it is seen that the applicants 1 to 3 received the Annexure-B1 demand notice on 15.02.2018 along with its Englishtranslation.	Annexure-B3
4.	17.07.2018	True copy of the postal receipt in the name ofapplicants1to 3.	Annexure-B4
5.	09.07.2018	True copy of possession notice issued by the defendant to the applicants alongwith itsEnglishtranslation.	Annexure-B5
6.	18.07.2018	True copy of the acknowledgment card by which it is seen that the 2^nd applicant received Annexure-B5 possession notice on 18.7.2018 along with itsEnglishtranslation.	Annexure-B6

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SA No.604 of 2022

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7.	--	True copy of the registered cover by which it is seen that Annexure-B5 possession notice has been sent to the 1^stapplicant and was returned as unclaimed notice along with its English translation.	Annexure-B7
8.	---	True copy of the registered cover by which it is seen that Annexure-B5 possession notice has been sent to the 3^rdapplicant and was returned as unclaimed notice along with its English translation.	Annexure-B8
9.	--	True copy of the photo which shows the possession notice affixed on the wall near the front door of the house in the mortgaged property.	Annexure-B9
10.	14.07.2018	True copy of the newspaper publication of Annexure-B5 possession notice in Malayala Manorama daily along with its Englishtranslation.	Annexure-B10
11.	14.07.2018	True copy of the newspaper publication of Annexure-B5 possession notice in Chandrika daily along with its English translation.	Annexure-B11
12.	17.03.2021	True copy of the sale notice issued by the defendant to the applicants along with itsEnglishtranslation.	Annexure-B12
13.	27.10.2021	True copy of the judgment in W.P.(C) No. 7663/2021 on the file of the Hon'bleHighCourt of Kerala.	Annexure-B13

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(Su. WILLYAHM) PRESIDING OFFICER

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Mj/

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Sulaiman K T v. The Manjeri Co. Operative Bank Ltd.

Case brief

What is this about?

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Sulaiman K T v. The Manjeri Co. Operative Bank Ltd.

Case brief

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