Dismissed

Haneefa T K v. Poonvala Housing Finance Ltd.

DRT6 Sept 2024SA/520/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal, Ernakulam dismissed the applicant's Set-Aside Application filed to challenge physical possession proceedings under Section 14 of the SARFAESI Act, 2002. The Court held that the recovered asset steps are legally justified and the claim of exorbitant amount cannot be entertained under this Act.

What did the court decide?

The application to set aside Annexure-A2 proceedings and Annexure-A6 notice is dismissed. No costs.

Haneefa T K versus Poonvala Housing Finance Ltd. — Consumer Protection | DRT (2024)

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT ERNAKULAM

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DATED THIS 6^th DAY OF SEPTEMBER, 2024

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

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S.A No. 520 of 2022

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Between

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Haneefa T.K., S/o. T.K. Moideenkutty, Fidha Mahal, Tharipanaparambhu, Jayanthy Road, Nallalam Post, Kozhikode District-673027.

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--- Applicant

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And

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M/s. Poonvala Housing Finance Ltd. 4^th Floor, City Gallery, Kannur Road, Near YMCA, Calicut-673 001, Represented by its Authorized Officer.

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M/s. Magma Fincorp Limited, 4^th Floor, City Gallery, Kannur Road, Near YMCA, Calicut-673 001, Represented by its Branch Manager.

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--- Defendants

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SA No.520 of 2022

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This Securitization Application coming on 03.09.2024 for final hearing before me in the presence of Ms. Gilda Davis, representing the Counsel for the Applicant and Mr. Philip T. Varghese, Counsel 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:

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O R D E R

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This Securitisation Application was filed on 26.10.2022 seeking to set aside Annexure-A2 proceedings and A6 Advocate Commissioner notice and to declare that the 1^st defendant has no right or authority to initiate Annexure-A2 proceedings and that the amount demanded in Annexure-A2 application is highly exorbitant.

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The applicant has admitted in the SA that he availed a Housing loan of Rs.21,00,000/- from the 2^nd defendant Finance Limited upon creation of equitable mortgage over his immovable property in favour of the 2^nd defendant. He has also admitted his default in repayment of the outstanding loan due and that the 2^nd defendant initiated proceedings against him under the Arbitration and Conciliation Act, 1966.

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Award dated 16.01.20202, Annexure-A1 came to be passed by the Arbitrator permitting the 2^nd defendant to realize the outstanding loan due with interest. The 2^nd defendant approached the District Court, Kozhikode for execution of the Arbitration Award and the matter is still pending before the Additional District Court-IV, Kozhikode.

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Subsequently, the 1^st defendant filed application AnnexurA2 in CMP No.779/2022 before the CJM Court, Kozhikode under Section 14 of the SARFAESI Act, 2002. Order came to be passed appointing Advocate Commissioner to take physical possession of the secured asset. The Advocate Commissioner issued notice dated 25.10.2022 Annexure-A6 informing the applicant that he would take property on 04.11.2022. The applicant having aggrieved against the aforesaid measures, filed this S.A.

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It is submitted by the counsel appearing for the applicant that, the amount and the interest claimed is highly exorbitant and that the waiver of interest granted by the Central Government was not extended to the applicant by the defendants and that the request of the applicant to grant OTS facility was not considered by the defendants and that the applicant remitted a sum of Rs.3,00,000/-

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Page 2 of 6

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SA No.520 of 2022

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pursuant to the direction given by the Hon’ble High Court of Kerala as per Annexure-A4 judgment and that therefore the SA may be allowed as prayed for.

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Per contra it is submitted by the counsel appearing for the defendants that the applicant did not make any payment after 01.10.2021 and that the Hon’ble High Court of Kerala in WPC No.27058/2022 deferred taking physical possession of the secured asset for a period of three weeks subject to payment of Rs.3,00,000/within a period of two weeks and that the applicant did not pay the amount within the stipulated period and that on application filed by the applicant, the Hon’ble High Court of Kerala enlarged the time upto 13.09.2022 to pay the amount and that Annexure-A4 judgment records the request of the applicant for breathing time to approach this Tribunal for the reliefs under Section 14 of the SARFAESI Act and that the loan availed by the applicant is the mortgage loan and not the housing loan and that the Award passed by the Arbitrator was not complied with by the applicant and that there is no illegality or irregularity in respect of issuance of Anneuxre-A6 notice and that the interest claimed for the outstanding loan due is only in accordance with the terms of the contract and the Arbitral Award, Annexure-A1 and that the learned CJM after proper consideration of the facts and the records, passed order appointing Advocate Commissioner to take physical possession of the secured asset and that there is no illegality or irregularity in the Order and that therefore S.A may be dismissed with cost.

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The provisions of Section 14(1) of the SARFAESI Act, 2002 enables the secured creditor to approach the Chief Metropolitan Magistrate or the Chief Judicial Magistrate or the District Magistrate seeking assistance for taking physical possession of the secured asset for the purpose of selling it or transferring it. Hence the contention of the applicant that 1^st defendant has no legal right or authority to initiate Annexure-A2 proceedings against the applicant as well as against the secured asset is untenable.

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The applicant has not produced the copy of the petition and affidavit filed in CMP No.779/2022 filed by the defendants before the Chief Judicial Magistrate Court, Kozhikode and also the copy of the order passed in CMP No.779/2022. It is also not the contention of the applicant in the SA that the statutory requirements contemplated under Clause (i) to (ix) to the proviso of Section 14(1) of the SARFAESI Act, 2002 was not complied with by the defendants in respect of filing of the affidavit in CMP No.779/2022. It is also not the contention of the applicant that the Chief Judicial Magistrate Court, Kozhikode, passed order without having perused the contention of the affidavit

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Page 3 of 6

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SA No.520 of 2022

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and the documents filed in support of the affidavit and having satisfied over the same. Whereas the defendants have averred in their written statement that the learned CJM Kozhikdoe after having considered the facts and records appointed the Advocate Commissioner to take possession of the secured asset. Since the applicant has failed to prove that the statutory requirements contemplated under Clause (i) to (ix) to the provisions of Section 14 of the SARFAESI Act, 2002 were not complied with and that the CJM Kozhikode passed order without having perused the contents of the affidavit and the documents filed in support of the affidavit and having satisfied over the same, to take physical possession of the secured asset, the reliefs sought for by the applicant to set aside Annexure-A2 proceedings and Annexure-A6 notice issued by the Advocate Commissioner cannot be granted. Further issuance of Annexure-A6 notice by the Advocate Commissioner is not the measure contemplated under Section 13(4) of the SARFAESI Act, 2002.

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The applicant has not produced any material before this Tribunal that the amount and the interest demanded by the defendants in Annexure-A2 application is highly exorbitant. Hence the relief sought for by the applicant to declare that the amount and the interest demanded in Annexure-A2 is highly exorbitant is liable to be rejected. Moreover, such relief cannot be considered and granted under the SARFAESI Act, 2002.

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The applicant has failed to prove his case so as to get the relief sought for in the SA.

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In the result, S.A No.520 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 6^th day of September, 2024.

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(Su. WILLYAHM) PRESIDING OFFICER

Mj/

Page 4 of 6

SA No.520 of 2022

S C H E D U L E

District : Kozhikode Sub District : Meenchanda Taluk : Kozhikode Firka : Town Amsam : Nallalam Desom : Nallalam Right : Jenmam Village : Cheruvannur Tenure : Garden land Re. Sy Block No. : Nil Re. Sy. No. : 63 Re. Sy Sub Div. No. : 1 Old Survey No. : 95/4 Extent : 5.35 cents (2.165 Ares)

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Description

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All that is part and parcel of the land having an extent of 5.35 cents (2.165 Ares) and situated in Re.Sy. No.63/1, Old Sy. No.95/4 and located at Nallalam Desom, Cheruvannur Village, Kozhikode Taluk and Kozhikode District and the residential house situated therein bearing Kozhikode Corporation Assessment No.06/289 – B; which is more particularly described as Secured Asset in Annexure-A2 complaint filed by the 1^st defendant.

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Boundaries

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East : Public Road South : Properties of Assu and Basheer West : Property of Haris North : Public Road

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Page 5 of 6

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SA No.520 of 2022

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

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Sl.	Date	Particulars
No.
1.	16.01.2020	True copy of Arb. E.P No.28/2020 in Arbitration No.ARB/112/2019 pending before Additional District Court-IV, Kozhikode.	Annexure-A1
2.	09.05.2022	True copy of CMP No.779/2022 pending on the files of Chief Judicial Magistrate Court,Kozhikode.	Annexure-A2
3.	05.05.2022	True copy of statement of accounts produced by the 1^stdefendant in CMP No.779/2022 pending on the files of Chief Judicial Magistrate Court, Kozhikode.	Annexure-A3
4.	25.08.2022	True copy of judgment of Hon'ble High Court of Kerala in W.P.(C) No.27058 of 2022.	Annexure-A4
5.	29.09.2022	True copy of the order passed by Hon'ble High Court of Kerala in I.A. No.1/2022in W.P.(C)No.27058/2022	Annexure-A5
6.	25.10.2022	True copy of the notice issued by Advocate Commissioner appointed by	Annexure-A6
		CJM Court, Kozhikode in CMP No.779/2022.
7.	05.05.2022	True copy of statement of accounts with respect to the loan availed by the applicantfromthe defendants.	Annexure-A7

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List of documents filed by the defendants along with the written statement

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Sl. No.	Date	Particulars
1.	22.07.2021	True copy of the Certificate of Incorporation issued by the Registrar of Companies, Kolkata pursuant to the change of name of Magma Fincorp Ltd toPoonawalla FincorpLtd.	Annexure-D1
2.	18.08.2022	True copy of the letter issued by the applicantwithtrueEnglishtranslation.	Annexure-D2

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(Su. WILLYAHM) PRESIDING OFFICER

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Mj/

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Page 6 of 6

Haneefa T K v. Poonvala Housing Finance Ltd.

Case brief

What is this about?

What did the court decide?

Haneefa T K v. Poonvala Housing Finance Ltd.

Case brief

What is this about?

What did the court decide?

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