Dismissed

A Raghavendra v. Andhra Pradesh Grameena Vikas Bank

DRT8 Apr 2024SA/86/2022

Case brief

AI extract

What is this about?

A debt recovery tribunal dismissed an application challenging the sale proceedings and possession of mortgaged property under the SARFAESI Act. The court found that the bank followed due procedure, including proper notices and auctions, and validly disposed of the proceedings against the applicant.

What did the court decide?

Application dismissed; bank's action in sale and possession upheld.

A Raghavendra versus Andhra Pradesh Grameena Vikas Bank — Banking and Recovery | DRT (2024)

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IN THE DEBTS RECOVERY TRIBUNAL - I AT HYDERABAD

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DATED THIS THE 8TH DAY OF APRIL,2024

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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SA.No.86/2C22

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A. Raghavendra, S/o. Sathyanarayana, Aged: Major, Occ: Business, R/o.H.No.3-3411, Nizampet, Quthbullapur, Ranga Reddy District.

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Applicant.

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Versus

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Andhra Pradesh Grameena Vikas Bank(APGVB) Head Office: Warangal. Branch: RASMECC, Ashoknagar, Tellapur, Sangareddy District. Rep. by its Authorized Officer.

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Respondent.

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Counsel for the Applicant

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Counsel for the Respondent

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Si Tadakanti Sridhar. Sri Mohammed Ubedulla.

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-:ORDER:.

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This application is filed by the Applicant u/s.17 of the SARFAESI Act, 2OO2, challenging the sale proceedings of the application schedule property held on 22.03.2022, in pursuance of the e-Auction-cum-Sale Notice dt.18.O2.2O22, including the proposed dispossession of the Applicant from the application schedule property by the Respondent through Advocate Commissioner notice dt.31.O3.2O22, issued in Crl.M.P.No.127 of 2022 on the file of Ld. Chief Metropolitan Magistrate, Rangareddy.

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The averments made in the application, in brief, are that, the Applicant availed loan facili the Respondent by mortgaging the application schedule After availing the loan, the Applicant paid for some time but, subsequently Covid_ 1_grjpande financial crunch, he defaulted in & Bo*Pflr which resulted in the classification of after requests made by

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SA.No.86/2022

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the Applicant for granting of some time for regularizing the loan account, the Respondent proceeded against the application schedule property without following the due procedure under the SARFAESI Act. The Respondent has failed to serve Demand Notice u/s.13(2) and the Possession Notice u/s.13(a) of the SARFAESI Act. The Respondent has failed to affix the Possession Notice on the schedule property and publish the said notice in two newspapers as contemplated under Rule 8(1) & (21 of the Security Interest (Enforcement) Rules, 2OO2.The Respondent published the e-Auction-cum-Sale Notice in the newspapers on 18.02.2022, fixing the auction of the schedule property on 22.03.2022, without serving the said notice on the Applicant. The Respondent without considering the payment of Rs.2,80,OOOl- made by the Applicant on 02.03.2022, proceeded with the auction of the schedule property. The Respondent sent a letter dt.13.04.2022, along with a copy of the e-Auction-cum-Sale Notice dt.18.02.2022, stating that the schedule propert5r was sold in the e- auction conducted on 22.O3.2022 for a bid amount of Rs.3i,55,000/but, the details of the auction purchaser were not disclosed. As per the sale notice, the reserve price of the schedule propert5r was fixed as Rs.39,85,000/- and whereas, the Respondent sold the schedule property for an amount of Rs.31,55,000/-, which is much lower than the reserve price, and same is in violation of the provisions of the SARFAESI Act and the Rules. Further, the Respondent is proceeding to take physical possession of the schedule property through Advocate Commissioner notice dt.31.O3.2022, issued in Crl.M.P.No.127 of 2022 on the hle of Ld. Chief Metropolitan Magistrate, Rangareddy, without following the due procedure laid down under the SARFAESI Act and the Rules, 2OO2. Hence, the SA.

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nying all the adverse contentions of the and his wife availed ndent by mortgaging icant failed repay the

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loan as per the terms of sanction, the loan account was classified as NPA and Demand Notice dt.21.06.2021 u/s.13(2) was issued to the Applicant and his wife viz., Smt A. Durga Bhavani, who is the coborrower, to pay the loan outstanding within 60 days. The Applicant,s wife personally received the said Demand Notice. The Demand Notice sent through Registered Post Ack. Due, sent to the Applicant returned with endorsement as 'Un-claimed'. As the Applicant failed to repay the outstanding dues, the Respondent took symbolic possession of the schedule property on 04.09.2021 by issuing the possession Notice u/s.13(a) of the Act. The Possession Notice dt.04.09.2021, sent to the Applicant by Registered Post, returned un-served with endorsement as 'Un-claimed'. The Possession Notice was affixed on the schedule property and was also published in 'Financial Express' and 'Mana Telangana' newspapers dt.09.09.2o21. The Respondent obtained valuation of the schedule property on 18.1o.2021 and as per the said valuation the realizable value of the said property is Rs.31,B4,Tool-. As per another valuation dt.06.r1.2o21, the reahzable value of the said property is Rs.29,15,000/-. The Respondent issued Notice prior to Sale dt.15.02.2022 and the said notice was personally served on the Applicant. Thereafter, the Respondent published the e-Auctioncum-sale Notice in English and relugu newspapers dt. 19.02.2022, fixing the auction of the schedule propert5r on 22.o3.2o22. The said e- Auction-cum-Sale Notice was aflixed on the schedule property. In the e-auction held on 22.o3.2o22, one Mrs. J. Shobha, w/o. Mr. N. Lazar, R/o' Quthbullapur, Medchal, was declared as successful bidder for an amount of Rs.31,55,000/- and Sale confirmation Advice was issued in her favour on 22.O3.2022. Thereafter, the Advocate Commissioner appointed in Crl.M.P.No.l27 of 2022 on the {ile of Chief Metropolitan Magistrate, cyberauua,,"p.H;ffi, ffiqgacate notice dt. 3 1 .o 3 .2022 on the Applicant, tot,&nbn th*hppitehtTp"d her wife vide letter dt.16.04.2022, *q"di.li'f ti-. td':*L.",. ,fr'fu.-i"." tiu 1e.o4 .2022. ii Thereafter, the Advoca,te c0rrtrnffiffi toot-tc;$er physical possession of the schedule propglty,.and aeriueiea t[.6"same to the Authorized officer of the Respqn{erit.*on 2o.le,,:ioh!' rn' movables in the

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schedule property were also handed over to the Applicant, which was also acknowledged by the Applicant. The Respondent has also executed registered Certificate of Sale in favour of the auction purchaser vide Doc.No.2873ll2022 dt.2o.lo.2o22 before the SubRegistrar, Quthbullapur, Medchal-Malkjgiri District. The Respondent has duly followed the procedure laid down under the SARFAESI Act and the Rules, 2oo2 and the application filed by the Applicant is liable to be dismissed.

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Heard arguments of the Ld. Counsels on both sides and also perused the Written Arguments filed by the Ld. Counsel for the Respondent.

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Now, the points that arise for consideration are:-

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whether the Applicant has established any valid grounds for setting aside the e-Auction-cum-sale Notice dt.19.02.2022 and, the action of the Respondent in taking physical possession of the schedule property?

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ii) To what relieP

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Point No.(i):-

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There is no dispute regarding the fact that the Applicant and his wife availed Housing Loan from the Respondent by mortgaging the application schedule property as security in favour of the Respondent. There is also no dispute that, after availing the said loan, the Applicant committed default in repayment of the loan amount and the loan account came to be classified as NPA by the Respondent. The contentions of the Apphjgffier{kLt, the Respondent without following the due p.o.ffiffiiffiffi"-"nder the SARFAESI Act and the Rules, 2OO2 the the schedule property and also for taking physical p_osseision or irrpJ'bchedule property. The Respondent, to ;l;;e F;",U8"?sil$+i; it has duly rorowed i: :.-i-i the provisions of the'SATRFAESI Act and tge* ,^{2OO2, filed material}

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SA.No.86/2022

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documents along with its Reply statement. I have gone through the said documents.

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The Respondent issued Demand Notice dt.21.06.2021, u/s.13(2) of the SARFAESI Act, demanding the Applicant and his wife Smt A. Durga Bhavani (co-borrower) to repay the outstanding dues of Rs.24,61,7621- within 60 days from the date of the said notice. As per the endorsement appearing on the office copy of the said notice filed by the Respondent, the said notice was personally received by the wife of Applicant. Further, as per the postal track report filed by the Respondent, the said notice sent to the Applicant got returned unserved with endorsement as "[Jn-claimed", which is deemed service. So, there is no violation said to have committed by the Respondent u/s.13(2) of the SARFAESI Act, while issuing the Demand Notice.

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As the Applicant and his wife failed to repay the outstanding dues as claimed in the Demand Notice, the Respondent took symbolic possession of the schedule property by issuing possession Notice dt.04.09.2021 u/s.13(a) of the SARFAESI Act. As per the copy of the postal track report filed by the Respondent, the said notice sent to Applicant got returned un-served with endorsement as^{,,ljn-claimed,,,} which is deemed service. The Respondent has also filed photographs depicting affixture of Possession Notice on the schedule property and also copies of publication of Possession Notice dt.04.09.2021 in the 'Financial Express' English daily and 'Mana Telangana,Telugu daily dated 09.09.2021. So, it is clear that, the Respondent has duly complied with Sec.13(4) r/w. Rule 8(1) & (2) of the SARFAESI Act and the Rules,2OO2, while issuing the possession Notice.

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As per the copy of the Valuation .2021 obtained from Mr. N. Dattathrevudu, approve$fy.6]ffiiFffUW&A\Aeen fi l ed by the &Ws:enⁿ Respondent in its material dbc,frrnents, e reaffi va1ue of the ii 'E# schedule propert5r is Rs.3t,s+'Xoo1o f,h..^F.jpo"a?ffihas also liled another valuation report dtiol t zuoil fltt"ffi& r:eg,ij, Aparna & ',..r...', ,, ".t/i :l.r r. '.,.,"^{i;./ i:i} rJ'f" r:- c^{r'-;'1 g} Pfli*T"; 4 "

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SA.No.86/2022

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Associates, as per which the realizable value of the schedule property is Rs.29,16,000/-. The Respondent has filed a copy of Notice prior to sale dt.15.o2.2o22 giving 30 days time to borrower to redeem the property and as per the endorsement appearing on the said notice, the Applicant has acknowledged the said notice. So, it is clear that, there is no violation of Rule 8(5) & 8(6) of the Rules,2oo2, said to have been committed by the Respondent.

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The Respondent has filed copies of publication of e-Auction-cum-Sale Notice dt.18.02 .2022, fixing the auction of the schedule property on

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22.o3.2022, for a reserve price of Rs.3l,3s,o00/-, in 'Financial Express' English daily and 'Mana Telangana'Telugu daily newspapers dt.19.o2.2022. The Respondent has also filed copy of 1etter dt.19.o2.2o22 intimating the Applicant about the e-auction of the schedule property on 22.03.2022 and also photographs depicting affixture of the sale Notice on the schedule property. So, I do not find any irregularity said to have been committed by the Respondent Bank in complying with Rule 8(7) & 9(1) of the Rules,2OO2.

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In the auction of the schedule property conducted by the Respondent on 22.03.2022, one Mrs. J. Shobha, W/o. Mr. N. Lazar, stood as highest bidder for an amount of Rs.31,s0,000/- as against the reserve price of Rs.31,35,000/-. upon remittance of 2soh of the bid amount, the Respondent issued sale confirmation Advice dt.22.o3.2o22 in favour of the auction purchaser and advised her to pay the balance bid amount within 15 days from the date of confirmation. Upon payment of balance bid amount, the Respondent issued Sale certilicate in favour of the auction purchaser, which is registered as Doc.No.2873rl2o22, at.zgffiipffiqg*nv of which is filed by the

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t2. rhe Respondent r"dLil fl,.d ,;rr*; ,#lu$uo"",. commissioner Notice dt.31 .o3.2o2T.ikuedt5 the npfllicane1,fd his wife for vacating the application sch&ule warrant issued in -' - "tP;oR..ty^: ,- ,.1: ,^{, + '.ffi"} -,.=,,,#n;:^' ..' --,;.,'.,"{ -#Ilr'"

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SA.No.86/2022

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cr1.M.P.No.l27 /2022 on the file of Ld. cMM, cyberabad at L.B. Nagar and a copy of the letter issued by the Applicant and his wife dt.16.04.2o22, to the Advocate commissioner requesting time till 19.O4.2022 for vacating the premises and also photographs depicting taking over physical possession of the schedule property by the Advocate Commissioner and also a copy of the letter of the Applicant acknowledging receipt of movables in the schedule property 03.06.2022.

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So, in view of the above facts and circumstances of the case, I am of the considered view that the Respondent has duly followed the procedure laid down under the SARFAESI Act and the Rules, 2OO2, in conducting auction sale of the schedule property and also in taking physical possession of the schedule property. so, I hold that, the Applicant has failed to establish any valid ground for setting aside the e-Auction-cum-Sale Notice dt.18.02.2022 and the action of the Respondent Bank in taking physical possession of the schedule property. Accordingly, this point is answered against the Applicant and in favour of the Respondent.

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Point No.(ii):-

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14- 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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A Raghavendra v. Andhra Pradesh Grameena Vikas Bank

Case brief

What is this about?

What did the court decide?

A Raghavendra v. Andhra Pradesh Grameena Vikas Bank

Case brief

What is this about?

What did the court decide?

What the court decided

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