Debts Recovery Tribunal dismissed an application seeking to set aside possession notices issued by the bank and Advocate Commissioner, holding that omission of property value in notices was not fatal and procedural requirements were met.
Application for declaration of nullity of possession notices and setting aside Advocate Commissioner notices dismissed. No costs awarded.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
Fair Order
IN THE DEBTS RECOVERY TRIBUNAL - 1 AT ERNAKULAM
DATED THIS 23rd DAY OF AUGUST, 2023
PRESEN T: Su. WILLYAHM, B.Sc., M.L. [DISTRICT JUDGE - Retd] PRESIDING OFFICER
S.A No. 83 of 2023
Between
--- Applicants
And
--- Defendants
SA No.83 of 2023
This Securitization Application coming on 07.07.2023 for final hearing before me in the presence of Ms. Anjali R., Advocate for the Applicant and Mr. Santhosh Kumar K., Advocate for the defendants and upon hearing arguments of learned Counsels for both the parties and upon perusing the material on records, this Tribunal delivered the following:
O R D E R
The applicants together have availed an amount of Rs.30,00,000/- and Rs.10,00,000/- as housing loan from the defendants by mortgaging their property having an extent of 4.05 Ares and a residential building situated therein bearing No.276/A, comprising in Re-Sy. No.26/5/3 in Aikkaranadu South village, Kunnathunadu Taluk. Initially, the applicants were highly prompt and regular in repaying the monthly instalments without any fail and later, due to the outbreak of Covid-19 pandemic and its allied restrictions, the business run by the applicants fell into losses and the applicants had to go through severe financial stringencies and as a result, they committed minor defaults in paying the monthly instalments.
The loan account of the applicants was classified as nonperforming asset and the defendants have issued notice dated 05.05.2022, Annexure-A1 under Section 13(2) of the Act demanding to pay an amount of Rs.38,72,288.55. Later, the defendants issued notice dated 25.08.2022, Annexure-A2 under Section 13(4) of the Act and took symbolic possession of the secured asset.
The defendants filed application under Section 14 of the Act to appoint an Advocate Commissioner to take physical possession of the secured asset. Later, the said application was transferred to Additional Chief Judicial Magistrate Court (MPs/MLAs), Ernakulam and re-numbered as M.C. No.830 of 2022. The Advocate Commissioner appointed as aforesaid issued notice dated 05.01.2023,
Page 2 of 7
SA No.83 of 2023
Annexure-A3 informing that the secured asset will be taken possession on or after 23.01.2023. On 23.01.2023 the Advocate Commissioner visited the secured asset and filed interim report before the court requesting the assistance of Police officials, Village Officer and the order to break open to execute the commission warrant. On 27.01.2023, the court granted the above assistance to the Advocate Commissioner and posted the case to 20.04.2023 for filing the commission report.
The defendants have not made any specific mention as to the number, area and value of the residential building either in AnnexureA1 demand notice or in Annexure-A2 possession notice. The nonmentioning of the details of the residential building in the above notices are fatal and therefore, all the steps taken by the defendants pursuant to above notices are to be annulled. It is also to be noted that the value of the landed property and the residential building together would fetch more than Rs.80,00,000/- and on the other hand the amount claimed by the defendants is Rs.38,72,288.55. A true copy of the building tax receipt dated 23.03.2022 issued by the Poothrikka Grama Panchayat is produced as Annexure-A5.
The applicants are living in the secured asset along with their two daughters who are pursuing their graduation in law. If the applicants along with two daughters are thrown away from the secured asset, they may not be able to withstand the probable social stigma as they are not having any other alternative residence to have their accommodation. The applicants are still ready and willing to clear off the liability with the defendant bank provided they are afforded with a reasonable time. The applicants have no other option but to approach this Hon'ble Tribunal under Section 17 of the Act for the reliefs.
The applicants availed a Term Loan (Housing) facility of Rs.30,00,000/- on 30.11.2018 and another loan (Housing top up) facility of Rs.10,00,000/- on 02.05.2019. Towards collateral security mortgage by deposit of title deed was created in favour of the defendant bank over 4.05 Ares in Re. Sy.No.26/5/3, Old Sy.No.686/3 of Aikaranadu South Village, Kunnathunadu Taluk, Ernakulam district in the name of the applicants.
The applicants committed default in the repayment of the said loan facilities which led to the declaration of credit facility as an NPA on 31.03.2022. The defendant bank issued notice dated 05.05.2022,
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SA No.83 of 2023
Annexure-A1 under Section 13(2) of the SARFAESI Act, to the applicants and the same was served to them. The applicants have not given any objection to the above said demand notice and not settled the loan liabilities. Therefore, the defendant bank has taken symbolic possession of the secured asset on 25.08.2022. The true copy of the possession notice dated 25.08.2022 is produced by the applicants in the above S.A as Annexure-A2. Annexure-A2 possession notice has served to the applicants and was affixed at the secured asset. The defendant bank has published Annexure-A2 possession notice in Janmabhoomi daily and in Indian Express daily on 31.08.2022. True copy of the paper publication of Annexure-A2 possession notice in Janmabhoomi daily on 31.08.2022 is produced as Annexure-B1. True copy of the paper publication of Annexure-A2 possession notice in Indian Express daily on 31.08.2022 is produced as Annexure-B2. Even after the possession notice, the applicants were not ready to settle the due amount in their loan accounts.
The defendant bank filed an application under Section 14 of the SARFAESI Act, for taking physical possession of the secured asset before the learned Chief Judicial Magistrate Court, Ernakulam. The said application under Section 14 of the SARFAESI Act was numbered as M.C. No.830/2022 on the file of learned Additional Chief Judicial Magistrate Court (MP/MLA) Ernakulam. The learned Additional Chief Judicial Magistrate Court (MP/MLA) Ernakulam was pleased to appoint an Advocate Commissioner to take physical possession of the secured asset and Annexure-A3 notice has issued to the applicants to take physical possession of the secured asset.
There is no discrepancies as alleged in Annexure-A1 demand notice and Annexure-A2 possession notice that building number and value of the secured asset has not been provided in Annexure-A1 demand notice and Annexure-A2 possession notice. In Annexure-A1 demand notice and Annexure-A2 possession notice, bank clearly stated details of the secured asset. Value of the secured asset is not required to state in Annexure-A1 demand notice and Annexure-A2 possession notice as per the SARFAESI Act and its Rules. There was no breach of any statutory proceedings under the SARFAESI Act, and in fact all the requisite procedures under the said Act have been complied with while initiating the impugned proceedings. This Hon'ble Tribunal may be pleased to dismiss the above S.A. with exemplary cost.
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SA No.83 of 2023
Page 5 of 7
SA No.83 of 2023
In the result, the SA No.83 of 2023 stands dismissed. No costs.
Dictated to Steno, taken down, transcribed, typed by him, corrected and pronounced by me in the open court on this the 23rd August, 2023.
(Su. WILLYAHM)
PRESIDING OFFICER
Mj/
Page 6 of 7
SA No.83 of 2023
List of documents filed by the Applicant along with the S.A.
| Sl. No. |
Date | Particulars | |
|---|---|---|---|
| 1. | 05.05.2022 | True copy of the notice under Sec.13(2) ofthe SARFAESI Act. |
Annexure-A1 |
| 2. | 25.08.2022 | True copy of the notice under Sec.13(4) ofthe SARFAESI Act. |
Annexure-A2 |
| 3. | 05.01.2023 | True copy of the notice issued by the Advocate Commissioner Mr.Akhil Das to the1stapplicant. |
Annexure-A3 |
| 4. | 05.01.2023 | True copy of the notice issued by the Advocate Commissioner Mr.Akhil Das to the 2nd applicant. |
Annexure-A4 |
| 5. | 23.03.2022 | True copy of the building tax receipt issued by the Poothrikka Grama Panchayat. |
Annexure-A5 |
List of documents filed by the Defendant Bank along with the Written Statement
| SL. | Date | Particulars | ||
|---|---|---|---|---|
| No. | ||||
| 1. | 31.08.2022 | True copy of the paper publication Annexure-A2 possession notice Janmabhoomidaily. |
of in |
Annexure-B1 |
| 2. | 31.08.2022 | True copy of the paper publication Annexure-A2 possession notice Indian Express daily. |
of in |
Annexure-B2 |
(Su. WILLYAHM) PRESIDING OFFICER
Mj/
Page 7 of 7
2 issues framed by the court
Whether the omission to mention the value of the secured asset in the demand and possession notices under the SARFAESI Act vitiated the notices and warranted setting aside subsequent Advocate Commissi
Whether the applicant bank complied with statutory requirements while initiating possession proceedings under Section 13 and 14 of the SARFAESI Act.
4 provisions across 1 enactments
Jayalakshmi
Saju Thuruthikunnel
Su. WILLYAHM
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
