Dismissed

Srinivasu Alamanda v. Andhra Pradesh Grameena Vikas Bank

DRT9 May 2024SA/97/2023

Case brief

AI extract

What is this about?

The Tribunal dismissed an application filed by a third-party purchaser challenging the bank's auction notice and possession action. The court held the applicant lacked locus standi as he was neither a borrower nor mortgagor under the SARFAESI Act.

What did the court decide?

Application under Section 17 of SARFAESI Act dismissed as it is devoid of merits due to lack of locus standi of the applicant.

Srinivasu Alamanda 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^gTH DAY OF MAY, 2024

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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SA.No.97 /ZOZB

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Sri AlamandaSrinivasu, S/o Late Sanyasi Rao, Aged 38 years, Occ:business, Presently residing at Flat No. 1 1 1, Plot No.2O,2 1 , Panduranga Park View Apartment, Nizampet, Bachupally Mandal, Medchal-Malkajgiri District Permanent address:D.No. l4-3-2O I l, AlamandaVari Street, Old Sanka Market, Jangareddigudem town and Mandal, West Godavari District, A.P..

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..Applicant.

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Versus

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l.Andhra Pradesh GrameenaVikas Bank Rep. by its Authorized Officer RASMECCC(Retail Assets Small & Medium EnterprisesCen tralized Credit Cell Branch, 1st floor, D.No.24-49(A1-B, AIE) Ashok Nagar, Ramachandrapauram, Sangareddy District, Telangana-5O2O32.

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ParupallileelaSat5ravani, D/ o ParupalliSuryanarayana, Aged 29 years, Occ:Dental doctor, C/o Parupalli Ravi Babu, flat No.101, 1"t floor, Plot No.53, ChevellaNarasa Reddy Colony, Kapila Nagar, sun City, Hydershakote, BandlagudaJagir, Hyderabad- 500086.

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Mr. Parupalli Ravi Babu,

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Aged 25 lrears,:9-E;25 lrears,:9-E;lrears,:9-E; c I o PVruegilllnivilo PVruegilllnivilPVruegilllnivil

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Aged 25 lrears,:9-E;25 lrears,:9-E;lrears,:9-E; ployee, c I o PVruegilllnivilo PVruegilllnivilPVruegilllnivil arasa Reddy Colony;,,Kapila Hydershakote, Band lagudaJagir, Fiyderaladi, : os^l'ipJzul

..Respondents.

n r r,,

SA.No.97/2023

Counsel for the Applicant

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Counsel for the T"tRespondent Respondents No.2&3

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Sn R.If. Hemanand S_mt. Tarangini P.

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.:ORDER:-

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This application is filed by the Applicant u/s. 17 of the SARPAESI Act, 2oo2, challenging the Auction Sale Notice dt. 17.o2.2023 issued by the l"tRespondent Bank by fixing the auction of the application schedule property on 27.03.2023 and also the steps taken by the 1st Respondent Bank for taking possession of the schedule property u/s 13(4) of the SARFAESI Act,20o2 and to declare the same is illegal and arbitrary.

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

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The Applicant is ex-husband of Respondent No.2 and Respondent No.3 is the younger brother of Respondent No.2. The Applicant purchased the house flat on 1g.0g.201g in the name of 2'dRespondent for a sale consideration of Rs.55 lakhs vide Regd. Sale Deed No.156ll2o18 registered at Sub Registrar, eutbullapur by obtaining a loan from the lstRespondent Bank and the loan stands in the name of the 2",tRcspondent and 3.,rRespondent stood as a coborrower for the above loan.The Applicant had beenpaying the loan instalments to the 1st Respondent Bank and 2"d Respondent did not contribute any amount to purchase the schedule property. The Applicant and his children are in possession and enjoyment of the schedule property. The Applicant obtained divorce from the2rd Respondent obtaining decree from the principal Senior civil Judge, K t;ai L2tOg.ZOiZZ.,Thg Applicant came to know that the 1t Res {drBank'issuea^{sahe' r.b,i.. dt. tr .o2.2o23for conducting} :, . auction of the sPhddule'pfoperty on 27.o3.2023. The Applicant filed o.S.No.2L6l22 againsr Respondents NC).1&2 for declaring the Regd.

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SA.No.97/202i

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Sale Deed No.156ll2o18 as null and void. The 1st Respondent Bank failed to issue any demand notice, possession notice and auction sale notice to the Applicant. Hence, the SA.

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The l"tRespondent Bankfiled its Reply statement denying all the adverse allegations made in the sA. The contentions of the l"tRespondent Bank are that, the Applicant is neither a borrower nor a guarantor to the loan transaction and he has no locus standi to challenge the proceedings initiated by the lst Respondent Bank against the schedule property by filing sA. Respondents No.2&3 approached the l"tRespondent Bank lor sanction of housing loan and the 1st Respondent bank sanctioned the same and Respondents No.2&3 executed loan documents on or.or.2ol8 and created equitable mortgage in respect of the schedule property. As the Respondents No.2&3 failed to repay the loan instalments, the loan account was classilied as NPA on 25.09.2022 and the 1sr Respondent Bank issued demand notice dt.26.o9.2022 to Respondents No.2&3. since theRespondents No.2&3 did not comply with the said demand notice, the 1"t Respondent Bank issued possession notice dt.28. rl.2022 for taking possession of the schedule property and the said possession notice was published in two newspapers and the said notice was also affixed on the schedule property. Thereafter, the 2"d Respondent handed over the keys of the schedule property to the

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1st Respondent Bank and thus handed over the physical possession of the schedule property to the 1"t Respondent Bank. The l"tRespondentbank issued Sale Notice dt. 17.02.2023 to the Respondents No.2&3 and the same was received by them. Housing loan instalments are paid by the Respondent No.2 but not by the Applicant and z'-,. .$*gspondents ' No.2&3 are the parties to the housing loan sanctiori't-d".Qir' the- , 1", Respondenr Bank and Applicant being a 3rd party, nbt entitled to of4tlenge the proceedings initiated by the lstRespondent Bank,' under:fherp.orisions of SARRFAESI Act, 2oo2 against the s<ihqilufe prbpbrty.' The lstRespondent Bank has followed ,i the procedure laid downunder. the provisions ol SARFAESI Act,2oo2

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SA.No.97/2023

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and Rules thereunder in issuing proceedings against the schedule property and the steps taken by the 1st Respondent Bank are not challenged by the Respondents No.2&3. The Applicant filed the present SA by colluding with Respondents No.2&3. Accordingly, thelstRespondent Bank prayed for the dismissal of the SA.

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Heard both the Ld. Counsel. The claim against Respondents No.2&3 was dismissed as no notice was taken against them.

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Now, the points that arise for consideration are,-

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Whetler the Applicant is entitled to challenge the Auction Sale Notice dt.17.02.2023 issued by the T"tRespondent Bank against the schedule property?

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iil To what relieJ?

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Point No.(i):-

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During the course of arguments, Ld. Counsel for the Applicant and Ld. Counsel for the l"tRespondent Bank reiterated their respective versions as stated supra.

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The undisputed facts of the case are that Respondent No.2 availed housing loan from the lstRespondent Bank by mortgaging the schedule property whereas Respondent No.3 is none other than the co-obligant to the said loan transaction.

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B. The contention of the Applicant is that he purchased the schedule subsequently, he. the 2"d Respondent and so he is entitled to chall 'eeenge nge ' i3..: th ' e ..- st e-pep:^' s uinltiateQ r :/..,t ':', .^., 1 by the 1"t Respondent Bank for conducting aUction of the'schedule :. property pursuant to the Sale :, I iRpgflondiht: eant against the schedule

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Notice issuecl ti -by ' $q l*rtinp;i propcrl.

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SA.No.97/2023

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Admittedly, the Applicant is neither a borrower nor a mortgagor in the loan availed from the 1"r Respondent Bank and that the schedule property is in the name of the 2nd Respondent who availed loan from the lst Respondent Bank whereas Respondent No.3 is the co-obligant. Further, as per the documents filed by the lst Respondent Bank, it is clear that demand notice dt.26.Og.2o22 issued by the lst Respondent Bank to Respondents No.2&3 was duly received by them and thereafter possession notice dt.28. ll.2022 was issued to the Respondents No.2&3 and the same was also received by them. As per the letter dt.oS. 12.2022 addressed by the 2"dRespondent to the l"tRespondent bank, it is clear that she herself, handed over the keys of the schedule property to the lstRespondent bank after vacating the schedule property. So the possession of the schedule property was handed over by the 2"d Respondent to the l"tRespondent Bank but the contention of the Applicant is that he and his two children are in occupation of the scheduleproperty. But no material is placed by him to establish that he is in occupation of the scheduleproperty. Thereafter, thelstRespondent Bank issued Sale Notice dt.17.O2.2O23 and the said notice was duly received by the Respondents No.2&3 and the same was got affixed on the schedule property and also published in two leading newspapers. The material documents filed by the lstRespondent Bank clearly prove that the l"tRespondent Bank has duly followed the procedure laid down under the SARFAESI Act and Rules, 2oo2, while issuing the demand notice, possession notice, and sale notice to Respondents No.2&3 who are the borrowers. When the Applicant is neither a borrowernorgux'ffi,{s.'u.i=noobligationonthepartofthe 1 "t Re spo nd e n t Pd;f.,5fr5-q-,-.+f ' "tdii:^{? *. u n d e r theSA RFA E s r Act,2 o o 2} in respect of ,t.heochedule-property';i-1o],ffr. Applicant. No material is placed by th.e ,:,Applh.1l,,,!ai gf,r1blisfr that he has purchased the schedule properly in'the nam-e- of 2"9,iiespondent and it is he who paid the housinglloan instalments'to-:the 1$ Respondent Bank. ., , ,;^{.ff...,t,,.r'} ..- .' .. . -,., '':;',,.' 1;rf

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_,+r.-i.,-...,,,

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SA.No.97/2023

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10' So, considering all the circumstances, I hold that the Applicant has failed to establish that he is entitled to challenge the proceedings initiated by the l "tRespondent Bank under the SARFAESI Act, 2OO2 against the schedule property. So, the present sA filed by the Applicant is liable to be dismissed as there are no merits. Accordingly, this point is answered against the Applicant and in favour of the 1st Respondent Bank.

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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, shalr stand disposed of. No order as to costs.

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t2. communicate a copy of this order to the parties concerned.

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P'A, transcribed bg her, corrected, signed and pronounced bg me in the open court on this the gh day 'lrfi"yi,"rhTf

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sd/(c. coPrcHANDl PRESIDING OFFICER

Srinivasu Alamanda v. Andhra Pradesh Grameena Vikas Bank

Case brief

What is this about?

What did the court decide?

Srinivasu Alamanda v. Andhra Pradesh Grameena Vikas Bank

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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Case details

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