Dismissed

Amit Kumar Battu v. Union Bank of India

DRT26 Apr 2024SA/67/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal, Hyderabad, dismissed an application challenging an e-auction notice and sale of mortgaged property. The court held that the bank followed all statutory procedures under the SARFAESI Act, including valid service of notices and conducting a fair auction at market value.

What did the court decide?

The Securitization Application filed under Section 17 of the SARFAESI Act, 2002 is dismissed.

Amit Kumar Battu versus Union Bank of India — Banking and Recovery | DRT (2024)

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IN THE DEBTS RECOVERY TRIBUNAL. I AT HYDERABAD

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DATED THIS THE 26TH DAY OF APRIL,2024

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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SA.No.67 /2022

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1.Amit Kumar Battu, S/o GattaiahBattu, Aged 44 years, Occjournalist, H.No. l-7 -16 I 136 I 3, Srinivasa Nagar Colony, Temple Alwal, Hyderabad-500010.

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..Applicant.

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Versus

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l.Union Bank of India Rep. by its chief Manager O/o Mehdipatnam- 1 Branch, D.No. 13-06-434 I rc9e739 I t, Syed Plaza, Pillar No.84,

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Maruthi Nagar, Mehdipatnam, Hyderabad.

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Union Bank of India Rep. by its Authorized Officer O/o Mehdipatnam- 1 Branch, D.No. 13-06-434 I 139&,139 I l, Syed Plaza, Pillar No.84,

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Maruthi Nagar, Mehdipatnam, Hyderabad

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Mr. Mr. Kiran Kumar, S/o M. Rajagopal, R/o flat No.401,

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SrivenVenkataramana Apartments, Street No. 1 1, Chikkadapally, Hyderabad-sOO 020.

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,,._ 26APR2il2{ (Respondent No.3 is made party as pbr orders of This Hon'ble Tribunal in I.A.158212n^,,

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Counsel for the Applicant

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Counsel for the Respondents

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Courusel for Respondent No.3

.-.'

sA 67 /2022

.:ORDER:.

This application is filed by the Applicant u/s.17 of the SARFAESI Act, 2oo2, challenging the E Auction Sale Notice dt.25.o2.2o22 issued by the Respondents No.1&2 and also the subsequent auction conducted in respect of the application schedule property on 30.03.2022 tn favour of Respondent No.3and to declare the same as illegal and void.

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The averments made in the application, in brief, are that:

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The Applicant is the absolute owner of the schedule property and he availed housing loan from the Respondent Bank in the year 2ol7 and committed default in repayment of loan instalments. The Respondents No.1&2 issued e Auction Sale Notice dt.25.02.2o22 fixing the date of auction on 30.O3.2022. The Respondents No.1&2 have not issuedmandatory demand notice as contemplated u/s 13(2) of the SARFAESI Act, 2OO2. The description of the schedule property is not tallying with the descriptionmentioned in the title deed of the Applicant. Without issuing any demand notice, Respondents No.1&2 are not entitled to issue possession notice as contemplated u/s 13(a) of the Act. In the paper publication of Auction Sale Notice dt.25.O2.2O22 published in financial Express, the name of the owner of the schedule property was mentioned as Amit Gattaiah and the reserve price of the schedule property is fixedat Rs.21 lakhs whereas the loan availed in the year 2017 is Rs.47 lakhs and the reserve price is much below the market value of the schedule property. In the auction conducted on 30.03.2022, Respondent No.3 became the successful bidder and the sale of the schedule property wasconduced in collusionn bt Y:$:Pi*,5.=pondent Bank and the auction purchaser and,so,,Jhe.q..'g9'r'ql,iiaple to be set aside. Hence, ,,.,i the SA. , jt. u, fr.i. '. L')

sA6712022

Respondents No.1&2 filedtheir Reply statement denying all the adverse allegations made in the sA. The contentions of the Respondentsare that, the Applicant is a borrower and his wife is coobligant and they availed housing loan of Rs.47 lakhs from the Respondent Bank in the year 2Ol7 and after availing loan facilities, the Applicant committedldefault in repayment of the loan amounts and so, the loan account was classified as NpA and the Respondent No.2 issued demand notice u/s 13(2) of the Act dt.03.12.2019 to the Applicant and his wife and when the said notices were avoided, the same was published in Hans India and Mana Telangana newspapers dt. 10. 12 .2019 . Thereafter symbolic possession of the schedule property was taken on 20.O3.2021 and possession notice was issued to the Applicant and his wife and the said notice was affixed on the schedule property and also published in both Telugu and English dailynewspapers. Thereafter the Respondents No.1&2 obtained valuation of the schedule property from the approved valuerof the Bank and e Auction Sale Notice dt.2s.o2.2o22 was issued to the Applicant and his wife and the said notice was duly served on them and the Respondent No.2 published the said notice inMana Telangana and Hans India and it was also affixed on the schedule property. In the auctionconducted on 30.03.2022, Respondent No.3 became the successful bidder and he paid the entire sale consideration and thus the Respondents No.1&2 have followed the procedure laid down under the provisions of sARFAESI Ac, 2oo2 and Rules made thereunder and there are no deviations. Accordingly, Respondents No.1&2 prayed for the dismissal of the SA.

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Respondent No.3, auction purchaser filed his Reply contending that he became the successful in the auction conducted.;i f-,f,9"?,?,9?,? bidder for an ,mou.,t'1o{ 6r.iipiinsq he p aiaid 25o/o of the bid amount on the d",,: of auction+"tprr ""dfu)Wa the balan ce 7so/oof the sale considerationl a[ter .?"F

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sA67l2O22

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Heard arguments and perused the material brought on record.

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Now, the points that arise for consideration are,-

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i) whether the Applicant has established" ang ualid ground" for setting aside e Auction sale Notice dt.2s.02.2o22 issued" bg the Respondents No.1&2 and also the auction conducted. against the schedule property on 30.03.2022 infauour of Respond.ent No.3?

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iil To uthat relieft

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Point No.li):-

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During the course of arguments, Ld. Counsel for the Applicant and Ld. Counsel for the Respondents No.1&2 reiterated their respective versions as stated supra.

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The undisputed facts of the case are that the Applicant availed housing loan of Rs.47,00 ,ooo l-from the Respondent Bank by mortgaging the schedule property whereas the wife of the Applicant is the co-obligant and after availing the loan, the Applicant committed default in repayment of the loan amount. There is also no dispute regarding the receipt of e Auction sale notice dt.25.o2.2o22 by the Applicant and his wife in respect of the schedule property. But the specific contention of the Applicant is that he has not received any demand notice or possession notice from the Respondents No.1&2 and the valuation of the schedule property mentioned by the Respondent No.2 is much less than the market value and in the publication, the reserve price was shown as Rs.21 lakhs only and the name of the owner 9t property was also wrongly mentioned. 7$ iPR :irJ24

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sA6712022

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As the Applicant has been contending that he has not received either demand notice or the possession notice allegedly issued by the Respondents No.lBL2, the initial burden lies on the Respondents No.1&2 to prove that they have duly issued the said notices to the Applicant. In order to establish the same, the Respondents No.l&2 have filed certain material documents along with the Reply statement filed by them. As per the said documents, it is clear that the Respondent No.2 has issued Demand Notice dt.O3. 12.2019 u/s 13(2) of the SARFAESI Act, 2OO2 and sent the said notice to the Applicant and his wife by registered post but the Applicant and his wife got the said notices returned and so, the Respondent No.2 published the said notice in Hans India and Mana Telangana daily newspapers dated 10.12.2019. So there was valid service of demand notice to the Applicant and his wife as contemplated u/s 13(2) of the SARFAESI Act, 2OO2. As there wasno response from the Applicant to the said demand notice, the Respondent No.2 proceeded u/s.13(4) of the SARFAESI Act by issuing Possession Notice dt.20.03.2021 and the said notice was sent to the Applicant and his wifebut the said notices were also got returned by them. So, the said possession notice was published in Financial Express and Mana Telangana dt.25.03.2O2L and also got aflixed on the schedule property as prescribed under Rule 8(1)&(2) of the Security Interest (Enforcement) Rules, 2OO2. Thereafter the Respondent No.2 obtained valuation report from the approved valuer of the Bank before fixing the reserve price in respect of the schedule property. As per the said valuation report, it is clear that the concernedvaluer inspected the schedule property and came to the conclusion that the Distress sale value of the schedule property is Rs.50,83,000/- whereas Realizable value is l-^{and market value isRs.72,62,000/-Thereafter} Kespon fttts,No.1&2 issued Auction Sale Notice dt.25.O2.2022 and 1, ,t.' thg:,$aid noti$=p'i1vas sent to the Applicant and his wife by registered Z^{p"fff?fttrtn"*r,on the scheduleproperty and also published in Hans} India and Mgtrr'qi Telangana newspapers dt.26.02.2022. As per the

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. i, ."h 'H"{o\ ) E"n"t't "|nr.l^L

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sA67l2O22

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publication of the Sale Notice in the newspapers, it is clear that the reserve price of the schedule property is fixed at Rs.72 lakhs but not Rs.21 lakhs as contended by the Applicant. The name of the owner of the schedule property is clearly mentioned as Battu Amit Kumar i.e. the Applicant herein. Since the Respondent No.2 got published the comprehensive sale notice in respect of some other properties also, the Applicant got confused and contended that the reserve price of the schedule propertSr was fixed at Rs.21 lakhs even though the reserve price of the schedule property is fixed at Rs.72 lakhs which is as per the prevailing market value arrived by the approved valuer of the Respondent Bank.

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In the auction conducted on 30.O3.2022, Respondent No.3 participated and became the successful bidder and his bid price was Rs.73 lakhs and as per the documents available on the record, it is clear that the Respondent No.3 paid the entire sale consideration of Rs.73 lakhs.So in view of the above, it is evident that the Respondents No.1&2 have duly followed the procedure laid down under the SARFAESI Act and the Rules, 2OO2, while issuing the demand notice, possession notice and sale notice and also in conducting auction of the schedule property.

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1 1. So, considering all the circumstances, I hold that the Respondents No.1&2 have duly followed the procedure laid down under the SARFAESI Act and Rules, 2OO2, in conducting auction of application schedule property on 30.03.2022 pursuant to the Auction Sale Notice dt.25.O2.2O22 towards recovery of the outstanding dues from the Applicant. So, the Applicant has failed to establish any ground for setting aside the auction conducted by Respondents No.1&2 under the SARFAESI Act againp!':t!,ersch!,,Sfp property and so, the present SA filed by the Appli6'aqt iS Tia,bls- toSg,,diimissed. Accordingly, this pointare answered, against thell epplicant';.and in favour of the Respondents No.l&,2. 1 ? ,.11..) rni"r (" ''-^ij :' : I ;1.!/ l: - a-' ,:6i" 'i {Y

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sA 6712022

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Point No.(iil:-

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In the result, the present Securitization Application is dismissed. consequently, the Interlocutory Applications, pending if any, shall stand disposed of. No order as to costs.

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communicate a copy of this order to the parties concerned.

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(Dictated to the P.A, transcribed bg her, conected, signed and pronounced bg me in the open couri on this the 26h dag of Apm, 2024).

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sd/(G. GOPTCHAND) PRESIDING OFFICER

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%*.A

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DRT-r, rry&tP",4tf4B.

Amit Kumar Battu v. Union Bank of India

Case brief

What is this about?

What did the court decide?

Amit Kumar Battu v. Union Bank of India

Case brief

What is this about?

What did the court decide?

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