Dismissed

Chinnan K a v. Federal Bank

DRT23 Jul 2024SA/757/2023

Case brief

AI extract

What is this about?

This application challenged proceedings under Section 13 of the SARFAESI Act, 2002, including deposit notices and possession actions. The Tribunal dismissed the application, holding that applicants admitted the loan default, failed to object to notices, and did not prove non-compliance with statutory requirements.

What did the court decide?

Application dismissed; no costs awarded to applicants.

Chinnan K a versus Federal Bank — Banking and Recovery | 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 23^rd DAY OF JULY, 2024

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

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S.A No. 757 of 2023

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Between

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Chinnan K.A., S/o. Kochukunjan, House No.XI/583, Arakkal House, Janakeeya Road, Elamkunnapuzha, Kochi – 682 503.

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Ramani Chinnan, W/o. Chinnan K.A., House No.XI/583, Arakkal House, Janakeeya Road, Elamkunnapuzha, Kochi – 682 503. --- Applicants

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And

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The Authorized Officer, The Federal Bank Ltd. LCRD/Ernakulam Division, Ground Floor, Federal Towers, Marine Drive, Kochi-682031.

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--- Defendant

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SA No.757 of 2023

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This Securitization Application coming on 01.07.2024 for final hearing before me in the presence of Mr. Rajeesh K.G., Advocate appeared for the Applicants and Ms. Jyothilekshmi A.N., Advocate appeared for the defendant 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 12.12.2023 seeking to declare that the proceedings initiated by defendant u/s 13 of SARFAESI Act, 2002 against the property of the applicants described in the schedule is illegal and to set aside Annexure-A1 and A3 notices issued by defendant and Advocate Commissioner respectively and to declare that the property described in Annexure-A1 is not a secured asset as defined under the SARFAESI Act and to pay the cost of the proceedings.

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It is not in dispute that the applicants availed ODCC/Loan facility of Rs.15 Lakhs in the defendant bank on 18.08.2012 by creating security interest on the immovable property of the 1^st applicant in favour of the defendant bank. Default in repayment of the outstanding loan due is admitted by the applicants in the S.A. Hence, Demand Notice dated 26.11.2018 Annexure-A1 and A2 were issued to the applicants demanding to repay the outstanding loan due of Rs.16,43,160/- within a period of 60 days from the date of receipt of the notice. It is evidenced from Annexure-D3 and D4 that both the applicants received the Demand Notice. Indisputably, the applicants did not send any objection/ representation to the Demand Notice nor did they clear off their liability due to the defendant bank.

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Therefore, Possession Notice dated 26.7.2019 was issued for symbolically taking physical possession of the secured asset. The defendant bank has produced Annexure-D7 and D8 to show that Possession Notice was published in two leading newspapers, Deepika daily dated 30.07.2019.

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The defendant bank approached the Additional Chief Judicial Magistrate Court (MPs/MLAs) Ernakulam and filed application in MC No.192/2023 seeking assistance in taking physical possession of the secured assets. Order came to be passed appointing Advocate Commissioner to take physical possession of the secured asst. Pursuant to the direction given in MC No.192/2023, the Advocate Commissioner issued notice dated 29.8.2023, Annexure-A3 to the applicants informing them that he would take physical possession of the secured asset on 14.12.2023. The applicants having aggrieved

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Page 2 of 4

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SA No.757 of 2023

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against the aforesaid measures, have filed this S.A. seeking for the reliefs stated supra.

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One of the contentions raised by the applicants in the SA is that they have not created security interest over the immovable property. In Annexure-A1 Demand Notice it is clearly averred that for the availment of the credit facility, the 1^st applicant had created security interest in favour of the defendant bank by deposit of title deeds pertaining to his property described in the schedule to the Demand Notice. But, the applicants have not refuted the above averment of the defendant bank by sending any objection to the Demand Notice. Therefore, the applicants are not entitled to raise the aforesaid issue now. The applicants have not produced any proof to prove their contention that they approached the defendant bank requesting to either regularize their loan account or to grant few instalments facility to clear the dues.

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The applicant have not produced the copy of the petition and affidavit filed in MC No. 192/2023 filed by the defendants before the Additional Chief Judicial Magistrate Court (MPs/MLAs) Ernakulam Ernakulam, and also the copy of the order passed in MC No. 192/2023. It is also not the contention of the applicant 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 MC No. 192/2023. It is also not the contention of the applicant that the Additional Chief Judicial Magistrate Court (MPs/MLAs) Ernakulam passed order without having perused the contention of the affidavit and the documents filed in support of the affidavit and having satisfied over the same. Without challenging the aforesaid measures, challenging Annexure-A3 notice is unsustainable since this notice is cannot be construed as the measures contemplated under Section 14 (1) of the SARFAESI Act, 2002.

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In view of the foregoing reasons, this Tribunal holds that the applicants are not entitled to get the reliefs sought for in this SA. In the result, S.A No.757 of 2023 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 23^rd day of July, 2024.

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(Su. WILLYAHM) PRESIDING OFFICER

Mj/

Page 3 of 4

SA No.757 of 2023

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

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Sl. No.	Date	Particulars
1.	26.11.2018	True copy of S.13(2) notice issued by defendant.	Annexure-A1
2.	11.01.2023	True copy of letter issued by the defendant.	Annexure-A2
3.	29.08.2023	True copy of notice issued by Advocate Commissionerto theapplicants.	Annexure-A3
4.	---	True copy of postal cover proving the date of service of Annexure-A3 to the applicants on30.11.2023.	Annexure-A4

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

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Sl. No.	Date	Particulars
1.	26.11.2018	True copy of the notice issued to the 1^st applicant under Sec.13(2) of the SARFAESI Act, 2002.	Annexure-D1
2.	26.11.2018	True copy of the notice issued to the 2^nd applicant under Sec.13(2) of the SARFAESI Act, 2002.	Annexure-D2
3.	---	True copy of the proof of delivery card.	Annexure-D3
4.	---	True copy of the proof of delivery card.	Annexure-D4
5.	26.07.2019	True copy of the notice issued to the 1^st applicant under Sec.13(4) of SARFAESI Act, 2002.	Annexure-D5
6.	26.07.2019	True copy of the notice issued to the 2^nd applicant under Sec.13(4) of SARFAESI Act, 2002.	Annexure-D6
7.	30.07.2019	True copy of the publication in Deepika daily (Malayalam language)	Annexure-D7
8.	30.07.2019	True copy of the publication in Deepika daily (English language)	Annexure-D8

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(Su. WILLYAHM) PRESIDING OFFICER

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Mj/

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Page 4 of 4

Chinnan K a v. Federal Bank

Case brief

What is this about?

What did the court decide?

Chinnan K a v. Federal Bank

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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Case details

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