In this SARFAESI proceedings, applicants challenged the banks demand notice, possession notice, and subsequent District Magistrate order. The court held that the bank actions were legal and procedural requirements were met.
Application challenging the banks demand notice, possession notice, and DM order was dismissed as meritless.
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.
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DEBTS RECOVERY TRIBUNAL – 1, KOLKATA JEEVANSUDHA BLDG. 9TH FLOOR, 42/C, J.L.NEHRU ROAD, KOLKATA – 700071
BEFORE SHRI AMBUJA MOHAN DAS, PRESIDING OFFICER
SA No. 206 of 2023
Director of M/S. Gupta Fasteners Pvt. Ltd. Son of Late Laxmi Narayan Agarwal, 56/1/1, Kings Road, Howrah- 711101.
Director of M/S. Gupta Fasteners Pvt. Ltd. Wife of Late Laxmi Narayan Agarwal, 56/1/1, Kings Road, Howrah- 711101.
Son of SurjaKanta Biswas, 54/5/1, Biren Roy Road (West), Kolkata700008.
………… Applicants
Vs.
Axis Bank
Registered Office at 1, Shakespeare Sarani, AC Market Building, 4th Floor, Back Side, Kolkata- 700071.
………..Respondent
Present:
For Applicant: Mr. Samrat Mukherjee, Ld. Counsel
For Respondents: Mr. D. Mukherjee and Ms. Kuheli Deb, Ld. Counsels
J U D G M E N T
Delivered on 18th April, 2024
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that the said property is a flat bearing no. 607, on the 6th floor measuring 796 sq. ft.within the building situated at premises no. 56/1/1, Kings Road, Trimurti Villa, within P.S. Golabari, Dist- Howrah. The Applicant No.1 is the company and the Applicant No. 2 and 3 are the Directors and owners of the said flat. The Applicant no. 4 is the Guarantor.
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Act and Rules by classifying the account as NPA, issuing demand notice, possession notice to the applicants, order of the DM and taking physical possession of the secured property. Therefore, the S.A. is not maintainable and is liable to be dismissed.
“Where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect of such debt is classified by the secured creditor as non-performing asset, then, the secured creditor may require the borrower by notice in writing to discharge in full his liabilities to the secured creditor shall be entitled to exercise all or any of the rights under sub-section (4).”
“The demand notice may invite attention of the borrower to provisions of sub-section (8) of section 13 of the Act, in respect of time available to the borrower, to redeem the secured assets.” Therefore, as per section 13(2) of the Sarfaesi Act and Rule 3(5) of the Sarfaesi Rules, 2002, the creditor is required to issue demand notice demanding from the borrowers to satisfy all the outstanding dues of the bank. “
8.The applicants have also challenged that in the demand notice, the respondent bank has not given the details of amount. In the demand notice, the limit of the credit facility sanctioned is described as Rs.30 lakhs at the rate of interest of 3 months MCLR + 6.25% i.e. 14.25% per annum and it is also informed the total outstanding amount including interest as on 21.06.2019 is Rs.36,10,976.84/-. Besides, the respondent bank has also given a statement of account. The applicants made a representation on 20/09/2019 which the
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respondent bank annexed in their objection. Though the applicants stated that the demand notice and the possession notice are illegal but is not able to prove on which ground, the said notices are illegal. The applicants made representation dated 20/09/2019. The respondent bank replied the representation and rejected the representation and also the proposal for settlement. The respondent bank has annexed the demand notice, possession notice and sending of possession notice by speed post, affixation of possession notice and demand notice in the conspicuous part of the property and the publication of the said possession notice in English and Bengali newspapers. There is no specific challenge to the order of the Ld. D.M. by the Applicant. Therefore, the Sarfaesi actions, of the respondent bank are legal. There is no ground for any relief for the applicants. There is no merit of the Sarfaesi Application as well as IA/156/2024 and IA/1171/2023. It is ordered as follows:
O R D E R
ii) Sarfaesi actions of the respondent bank are legal.
iii) Consequently, other pending I.A.s, if any, are also disposed of.
Copy of the Judgment/Final Order be uploaded in the Tribunal’s website.
File is consigned to the Record Room.
(Dictated to Stenographer., transcribed by him, corrected, signed and pronounced by me in the open Court on this the day 18th April, 2024.
(Ambuja Mohan Das)
Presiding Officer
Order Sheet (continuation)
Case NO. SA/206/2023 M/S. Gupta Fasteners Pvt. Ltd.vs. Axis Bank Ltd,
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| Date of the Order |
Order with Signature | Office action with date and dated Signature of Parties when necessary |
|---|---|---|
| 18/04/2024 | Present: For Applicant: Mr. Samrat Mukherjee, Ld. Counsel For Respondents: Mr. D. Mukherjee and Ms. Kuheli Deb, Ld. Counsels |
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| Matter was heard in open Court on this the day of 07.03.2024. |
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| The detailed order in six pages annexed separately. The gist of the order is as follows: |
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| i) S.A along with IA/157/2024 and IA/1171/2023 are dismissed on contest against the Respondent Bank. ii) Sarfaesi actions of the respondent bank are legal. iii) Consequently, other pending I.A.s, if any, are also disposed of. Copy of the Judgment/Final Order be uploaded in the Tribunal’s website. |
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| File is consigned to the Record Room. (Dictated to Stenographer., transcribed by him, corrected, signed and pronounced by me in the open Court on this the day 17thApril, 2024. (Ambuja Mohan Das) Presiding Officer |
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3 issues framed by the court
Whether the demand notice and possession notice issued by the bank under the SARFAESI Act complied with statutory requirements.
Whether the borrowers have any right to relive the application against the banks enforcement actions.
Whether the orders of the District Magistrate and the SARFAESI actions of the bank are maintainable.
3 provisions across 2 enactments
M/S. Gupta Fasteners Pvt. Ltd.
Mr. Chandra Kant Gupta
Mrs. Santosh Rani Gupta
Mr. Hrishikesh Biswas
Axis Bank
Ambuja Mohan Das
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
