Dismissed

P Mathialagan v. Bank of India

DRT30 Oct 2023SA/644/2022

Case brief

AI extract

What is this about?

In this securitization application, the applicant challenged the legality of a possession notice issued under the SARFAESI Act. The Debts Recovery Tribunal examined allegations regarding NPA classification and procedural compliance.finding that the respondent had duly served the demand notice and complied with rules.

What the court decided

AI extract

P Mathialagan versus Bank of India — Banking and Recovery | DRT (2023)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 30^th day of October, 2023

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PRESENT: SHRI T. RAJESH

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PRESIDING OFFICER

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SA No.644 of 2022

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Mr. P. Mathialagan Son of Pontha Udaiyur D. No.1/14, Kurungulam Melpathi Muthukulam Vattam & Village – 613 303 …Applicant

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Versus

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The Authorised Officer Bank of India, Tamil University Pillayar, Thanjavur – 613 005 …Respondent

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Counsel for the Applicant : M/s A. Sam Arul Prasath & G. Sanjeevi Counsel for Respondent : Mr. N. Somasundaar

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FINAL ORDER

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This Securitization Application, in short SA, is filed u/s 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), herein after been referred as SARFAESI Act or the Act as the case be with a prayer to set aside the possession notice dated 19.11.2022 issued by the respondent and also for a direction to the defendant to restore possession.

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The applicant admits to be a borrower of a mortgage loan for Rs.11,00,000/-. The applicant admits that their business failed due to COVID-19. According to the applicant, the NPA classification is not in accordance with guidelines. It is also the case of the applicant that the respondent had hurriedly issued the possession notice dated 19.11.2022 stating the due as Rs.15,89,899.95. It is

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further contented that the officials of the respondent had virtually agreed for providing more time for the payment of overdue amount.

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In respect of the measures, it is the case of the applicant that no demand notice is issued by the respondent prior to the issuance of possession notice. The applicant is also alleging that the NPA classification is faulty and there is non-compliance of Rule 8.

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The respondent entered appearance and filed their counter contenting that there is no procedural irregularity in their measures leading to the possession notice. It is also contended that right from classification of account as NPA, the respondent had scrupulously followed the procedure as envisaged under the Act and the Rules. The respondent further denies the contention of the applicant as to the alleged non-service of demand notice and also as to the alleged flawed procedure in issuance of the impugned possession notice.

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Along with the counter, the respondent had produced the following documents viz., Demand notice along with postal receipts, Postal acknowledgment cards, Photograph evidencing affixture of possession notice, Possession notice publication and Statement of account. On the basis of above rebuttal and documents the respondent prays for dismissal of the SA.

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Heard the respective counsels for both sides considered the rival contentions in the light of respective pleadings and evidence produced by both sides. The only issue that arose for consideration is as to whether the measures taken by the respondent leading to the impugned possession notice are legally sustainable and in accordance with the statute.

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The applicant is disputing the legality of measures contending that the NPA classification is not in accordance with the statute. This contention is specifically denied by the respondent. According to the respondent, the NPA classification is in accordance with the guidelines of RBI. The respondent had produced the statement of account, which clearly evidences the status of the account. From the statement of account so produced, it is evident that the same is in default and the same justifies the classification of NPA.

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The next contention of the applicant as to the alleged non-issuance of demand notice is rebutted by the respondent as the respondent had produced the proof as to the service of demand notice on the borrower.

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The respondent had also produced the proof of publication of possession notice in two dailies, one in English in the light of the fact that the applicant is admitting the receipt of possession notice, the non-production of postal receipt in respect of possession notice is inconsequential, hence there is due compliance of Rule 8(1) and 8(2) of the Rules. No other contention is taken by the applicant at the time of hearing and pleadings.

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In view of the above discussion and findings as entered above, this Tribunal is of the view that there is no merit in the SA and the same is liable to be dismissed.

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In the result SA stands dismissed, all pending IA’s stands closed, no 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 PS, transcribed by him, corrected, signed and pronounced by me in Open Court on this the 30^th day of October, 2023)

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

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P Mathialagan v. Bank of India

Case brief

What is this about?

What the court decided

P Mathialagan v. Bank of India

Case brief

What is this about?

What the court decided

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Case details

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