Allowed

T Subba Reddy v. State Bank of India

DRT19 Sept 2024SA/87/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed an application to reject a Security Application filed by mortgagees challenging a property auction. The court held the application was barred by limitation as the Sale Certificates were issued in 2020 and no valid exclusion of time was available for these specific applicants.

What did the court decide?

Rejection of Security Application No. 87 of 2023 filed by the Applicants.

T Subba Reddy versus State Bank of India — Banking and Recovery | DRT (2024)

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THE DEBTS RECOVERY TRIBUNAL-I AT HYDERABAD DATED THIS THE 19TH DAY OF, SEPTEMBER I2c.24 PRESENT: SRI. GUMMADI GOPICHAND HON'BLE PRESIDING OFFICER

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IA. NO. 1039 ()F 2023 IN sA. NO. A7 0F 2023

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Between

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State Bank of India, SAMB-II, D. No.3-4- 1013/A, 1't Floor, CAC TSRTC Bus Station, Kachiguda, Hyderabad-500027. And another.

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....Applicant/s

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And

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Sri. Talamati Subba Reddy, R/o. Vendodu Village, Gudur Mandal, SPSR Nellore District, Andhra pradesh, And others.

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...Respondent/s

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DOCKET ORDER DT. 19.O9.2024.

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This Interlocutory Application is filed by the petitioners/Respondents No. l&2 under order 7 Rule II of cpc r/w section 22(2r ot RDB Act, 1993 r/w section 17 of SARFAESI Act, 2002to reject the SA gZ /23 as barred by limitation. In the affidavit frled by the Assistant General Manager & Authorized Officer of the 1st Petitioner/ Respondent Bank, it is averred that in view of the default committed by the borrower dent No. 10 in which, the Appiicants and Respo in repayment of loan outstanding dues, the AESI proceedings and issued demand notice lt^msert,ii""" der the provisions of idl \i ,\d, * -O^i'--, W;mryz"'

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SARFAESI Act, 2oo2 and also issued sale notice dt.0r.1 r.2or9 by fixing the date of auction on 17.r2.2o19 and in pursuance of the said auction notice, the Petitioners herein have sord Item No.3,4&5 properties described in SA schedule of properties. Thereafter the petitioners issued another Sale Notice dt'10.01.2020 fixing the auction on 26.o2.2020 in respect of Item Nos. 1&2 of SA schedule properties. Thereafter, the petitioners herein issued sa-le certificates and delivered physical possession of the said properties to the auction purchasers, Respondents NO.6&7. After sale of the saidproperties, the Applicants in sA, filed w.p.No.4682T /2022 before the Hon,rcle High court of relangana at Hyderabad and the said wp was tagged along with writ Petition No.269a9 /2019 fired by the Respondent No.4 herein which is rrred chailenging the auction conducted on 17.12.2019 and the said writ petitions are disposed of by the Hon'ble High court vide common order dt.O1.02.2023. It is further submitted that only in wp.No.269g9/ 19 filed by the Respondent No.4 herein, an observation was mad.e by the Hon'ble High Court regarding the limitation but no such observation is made in wp.No.4682T /22 fired, by the Applicants in sA 87 12023. Thus, the SA filed by the Appricants therein is barred by limitation as they are challenging the sale of some of schedure properties conducted on 27.r2.2or9. No observation is made by the Hon,bre High court in wP.No.46827 122 regarding the exclusion of the period spent before the Hon'ble High court but the Applicants in SA took false plea as if an observation is made in the writ petition filed by them regarding excluding the period of limitation and hence, sA 87 /2023 fired by the Applicants in sA is barred by limitation and so, liabie to be dismissed. Hence the petition. Respondents No.l& 2 are the Applicants in the SA and filed their counter by contending that the Bank has issued Auction Sale Notice dt.01.11.2019 and the said notice was not served on the Applicants in the sA. In the said sA, theApplicants challenged place consequent to the Sale consequent to the Sale to the Sale the Sale Sale notice dt.O1.11.2019 and limi from the date of the date of date of of issuance of thethe

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place consequent to the Sale consequent to the Sale to the Sale the Sale Sale notice from the date of the date of date of of issuance of thethe .87 123 is within the time since

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the SA is filed on 74.03.2023. Moreover, the limitation starts onry from the date of the knowledge of the execution of the sale certificates as mandated in Articles 59 and 137 of the Limitation Act. Limitation is a mixed question of law and fact and no case can be rejected on the sole ground of limitation. Heard both the Ld. Counsel and perused the material brought on record.

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Now the point for consideration is ,.thether the petitioners rwue established. ang ualid ground for rejecting SA 87/ 2023 ?

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During the course of arguments, Ld. counsel for the petitioners and Id. counsel for the Respondents reiterated their respective versions as stated supra.

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sA87 12023 is hled byRespondents No. 1&2 in the present I.A chalenging the sale conducted by the Respondents No.1&2 in the sA on lz.l2.2ol9 and for restoration of the possession of the application schedule properties and the said SA is filed on 74.03.2023. In para No.4 of the said SA, which is dealing with limitation, it is mentioned as follows:

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"The Application is utell utithin thelimitation as per the d.irections made on 01.02.2023 and a certified copy has been obtained on o6.03.2o23 in wp Nos.26989/2O19 and 46822/2022 and" during pend encg of those uit petitions, the Applicant the Respondent herein has conducted. auction on 17'12,2019 and as obserued at para No.13 of ord.er dt.ol.02.2023, the peiod to exclude the peiod from date of filing ,trit petition that is o4. 12.2o19 to tiil the date and further period of 6 taeeks from tod.ag that is o1.02.2023 tou.tards computation of period of rimitation as and tthen in J ing apptication to cond_one the delag in approaching the Tribunal"

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So, even though the sale was conducted on 17.r2.2Ot9, SA 87 /2023 the premise that the Honble High Court of the Applicants in SA, made observation for exclu sia in the High Court .:^{1 s sEP ,rrr} : ,-\ hl &*.#

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for prosecuting the writ petition filed by them. Along with the SA, the Applicants filed copy of the common order dt.01.02.2o23 passed by the Honble High Court in W.P.Nos.26989l2Ol9 and, 46827 12022. As per the said common order, it is clear that WP.No.26989l19 was filed by G.Sreenivas Reddy, Respondent No.4 in the sA whereas wp. No.46822 /22 is filed, by the Applicants in the SA.

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The result portion in WP.No.26989/2Ot9 as mentioned in Para No.13 is as follows;

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"Hauing regard to the fact that WP.No.26989/ 19 is pending consid.eration from the year 2019 till date, ue request the Tribunal to exclud.e the period. from d.ate of filing of the urit petition i.e. 04.12.2019 to tilt dqte and. for a further period of six uteeks from todag towards computation of period. of limitation as qnd" tahen petitioners file applications to condone the delay in approaching the Tribunal. Horaeuer, the Petitioners shall appraoach the Tribunal taithin six weeks from todag".

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Whereas the result portion in WP.No.46827/22 as mentioned in para No.14 is as follows:

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"In so far as WP.No.46827/2022 is concerned., on 01.11.2019, auction notice ruas lssued proposing to conduct auction of Item /[os.6 to 16 on 27.12.2019. court is informed that in uiew of the orders of this court, no auction u)as conducted on the scheduled date. Since no auction was conducted on the scheduled date, question of conducting fresh auction based. on said. notice, d.oes not aise. If at all Respondent Bank want to conduct fresh auction, the same shall be undertaking by taking recourse to Rules, 202. As and. when such a course of auction is initioted by the Respond-ent Bank, it is open to petitioners to auail the remedy under Section 18 of lQ2Act and. seek appropriate directions from^{the Debts Recouery} Tibunal

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A perusal of the common order passed in WP.Nos.2 6989 /2019 and 46827 l2O22clearly indicates that only in W.P.No.26989/2019 filed by Respondent No.4 in SA, a specil-rc hnding is made to the effect that the time spent by the Petitioner therein from the date of the hling of W.p. till the date of order and for a further period of six weeks shall be excluded for computation of period of limitation for hling any applications by the petitioner before this Tribunal. But in W.P.No.46827 122 filed by the Applicants in the SA, no such directionis given by the Hon,ble High Court But in Para No.4 of the SA which deals with the limitation, the Applicants have taken a plea that the SA filed by them is within the limitation in view of the direction given by the Honble High Court of Telangana but it is pertinent to note that no such direction is given by the Hon'bie High court in WP.No.46827l22 wt:ich is filed by the Applicants in the SA.

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Further, there is no dispute regarding the fact that as per the provisions of Section 17 of SARFAESI Act, an aggrieved person can file an application u/s 17 of the SARFAESI Act within forty five days from the date of cause of action. Even though, in the present case, sale was conducted and sale certificates are issued in favour of the auction purchasers in the year 2O2O, tlne present SA 87 /2023 is filed on 14.03.2023 and so, SA 87 /2023 filed by the Applicants is hopelessly barred by limitation. The contention of the Applicants in SA that they are entitled to frle Securitization Application within three years from the date of issuance of sale certificates in favour of the auction purchasers is not at all tenable. When SA 87 /2023 filed by the Applicants is hopelessly barred by limitation, there is no need to conduct any separate enquiry in the SA.

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In view of the above facts and circumstances, I am of the opinion that SA 87 /2023 filed by the is liable to be rejected as it is barred by limitation.

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In the result l.A.lO39 /23 is allowed by rejecting sA 87 /2023 filed by the Applicants as the same is barred by limitation.

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Consequently, SA87 12023 is rejected. No costs.

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sd/-

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Presiding Officer

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T Subba Reddy v. State Bank of India

Case brief

What is this about?

What did the court decide?

T Subba Reddy v. State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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Parties & counsel

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