Allowed

S Sandhiya v. Tamilnad Mercantile Bank Limited

DRT23 Jun 2023SA/94/2022

Case brief

AI extract

What is this about?

Single Member Bench of DRT Chennai allowed the application challenging a possession notice issued by a bank due to an admitted error in property boundary description in the notice. The action was set aside with liberty to proceed afresh, granting the applicant eight weeks to sell non-mortgaged property to clear the dues.

What did the court decide?

Possession notice set aside; applicant permitted eight weeks to sell non-mortgaged property to discharge dues; liberty to initiate action afresh thereafter.

S Sandhiya versus Tamilnad Mercantile Bank Limited — Banking and Recovery | DRT (2023)

SA 94/2022

23.06.2023

IN THE DEBTS RECOVERY TRIBUNAL – III, CHENNAI

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Dated this the 23^rd day of June, 2023

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

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S.A. No. 94 of 2022

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(Final order dated 31.05.2023 is amended vide order in MA No.93/23 in SA No.01/2022 dated 23.06.2023 and following corrigendum order is issued)

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Mrs. S. Sandhiya, W/o Mr. B. Suresh, Old D.No.1/124, New D.135, Kalavi Street, Govindavadi Village, Kancheepuram – 631 502 …..Applicant – Vs. –

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The Authorised Officer, Tamilnad Mercantile Bank Limited, Kancheepuram Branch, No.40A, Vanigar Street, Kancheepuram – 631 501 …..Respondent

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Counsels on record / appeared:

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Counsel for Applicant : M/s. P. Murugan Counsel for Respondent : M/s. K.N. Chinnakrishnan, E. Kumar

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ORDER

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This SA is filed by applicant challenging the Possession Notice dated 30.10.2021 issued by respondent bank for recovery of a sum of Rs.23,82,951/- from applicant.

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Respondent bank entered appearance and filed counter and typed set of documents evidencing the action taken by them under the Act.

SA 94/2022

23.06.2023

Heard Ld. Counsels appearing for the respective parties. It is the case of applicant that she and her husband had availed two different facilities from respondent bank and mortgaged common property as security for due discharge of both the loan accounts. Ld. Counsel for applicant submit that during the pendency of SA No.01/22, filed by the husband, wherein interim condition is complied upon and stay is in force against the said property, respondent bank had issued yet another possession notice against the same property claiming the dues from wife (applicant herein) as if it is a different security available to them for the loan availed in the name of wife. Ld. Counsel for applicant submits that notwithstanding the infirmity in the procedure adopted by the respondent bank, applicant intends to discharge her debt due to the respondent by selling away non-mortgaged property, which is available with them and have already taken steps for the same. Ld. Counsel submits that four to six weeks time would be sufficient for applicants to sell that property and discharge the debt due to respondent bank and prayed time for the same.

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Ld. Counsel for applicant submits that respondent bank had not described the property as was mortgaged to them and had included the existing building to the same, which according to applicant was not mortgaged and that it was only a vacant land that was mortgaged. It is also submitted that the boundaries mentioned in the possession notice are incorrect and are not tallying with that of the title deed or the mortgage deed executed in favour of the respondent bank. The schedule mentioned both in the demand notice as well as possession notice is not in accordance to the mortgage deed or title deed deposited with the respondent bank.

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Whereas Ld. Counsel appearing for respondent bank had submitted that respondent bank had followed the procedure as warranted under law while issuing

SA 94/2022

23.06.2023

the subject impugned possession notice and on the direction of this Tribunal has withheld themselves from any further action in view of the compliance of interim condition in SA No.01/2022 by the applicant’s husband. Ld. Counsel re-iterates that there are no procedural infirmities that applicant had made out for the Tribunal to interfere in the procedure. With regard to the description of property, Ld. Counsel for respondent bank has admitted that property described in possession notice impugned in this SA contains erroneous description of Eastern boundaries as Plot No.5, when it has to be Plot No.6 and that Plot No.5 is the plot that is mortgaged in favour of respondent bank.

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Applicant, while contending that the actions of the respondent bank are not in accordance to law had also raised an issue that boundaries stated are wrong, which fact is admitted by respondent bank. In such circumstances, it would not be rightful for this Tribunal to allow the actions of the Authorised Officer to continue. Hence the same are hereby set aside.

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It is also contended that during the subsistence of stay by this Tribunal in SA No.01/2022, respondent bank had issued yet another possession notice in the name of wife, although for a different loan, but the mortgaged property is one and the same. It is a settled preposition of law that SARFAESI is only determination of mortgage rights of a secured creditor and cannot be distinguished against individuals independently when the loans have common immovable property as security. However, applicant or respondent bank did not clarify or explain as to how the Possession Notice issued to husband is dated 23.11.2021 and challenged in SA No.01/2022, while Possession Notice issued to wife is dated 30.10.2021 and is challenged in SA No.94/2022, claiming interim stay in SA No.01/2022 as an infirmity.

SA 94/2022

23.06.2023

It appears that respondent bank had initiated its SARFAESI action in accordance to law (although description of property is admitted to be improper) by issuing Possession Notice to wife on 30.10.2021 and to husband on 23.11.2021. Whereas applicant challenged Possession Notice of husband dated 23.11.2021 in SA No.01/22 and obtained an interim order by complying the interim condition. Subsequently, applicant challenged Possession Notice dated 30.10.2021 issued against wife dated 30.10.2021 in SA No.94/2022. The said fact of issuing notices to both borrowers on two different dates, although for the same common mortgaged property has led to this confusion, as if the actions of the respondent bank are against to law, notwithstanding their improper description of property. For these reasons, the actions to Authorised Officer of secured creditor are hereby set aside, however with liberty to initiate action afresh if the default of the borrower continues.

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8. Consequently, SA stands allowed.

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In the circumstances, as applicant intend to settle her loan account within a period of four to six weeks by selling away non-mortgaged property, applicant is permitted to do so in any case not later than eight weeks from today, failing which respondent bank will be entitled to proceed further in accordance to law, if the default of the borrower continues. As SA is allowed, interim stay, if 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 observations, these SAs stands disposed.

SA 94/2022

23.06.2023

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

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(Dictated to PS, transcribed by her, corrected, signed and pronounced by me in Open Court, on this the 23^rd day of June, 2023)

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Sd/- (GANAPATHI K.R.K) PRESIDING OFFICER

S Sandhiya v. Tamilnad Mercantile Bank Limited

Case brief

What is this about?

What did the court decide?

S Sandhiya v. Tamilnad Mercantile Bank Limited

Case brief

What is this about?

What did the court decide?

What the court decided

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