Dismissed

Sasikala Productions v. Indian Bank

DRT3 Apr 2025MA/144/2025

Case brief

AI extract

What is this about?

The Tribunal dismissed a Miscellaneous Application seeking condonation of 80 days delay in filing a Second Appeal under Section 17 of the SARFAESI Act, holding that the statutory 45-day limit is mandatory and no power to condone exists.

What did the court decide?

Application for condonation of delay dismissed; Second Appeal consequentially dismissed.

Sasikala Productions versus Indian Bank — Banking and Recovery | DRT (2025)

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MA 144/25 in SA No.229/2025

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03.04.2025

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IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 03^rd day of April, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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M.A. No.144 of 2025 in S.A. No.229 of 2025

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Mr. Mohammed Saleem KB’s Pavithram Flat No.F-2, First Floor Plot No.154, Madurai Meenakshi Nagar Rajaji Avenue, Main Road, Valasaravakkam Chennai – 600 087

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….Applicant

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-Vs-

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1. The Authorised Officer

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Indian Bank

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PT School Junction, New No.11, Old No.5 First Street, Sait Colony, 2^nd Street Egmore, Chennai – 600 008

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Mr. S. Anbu Murugan S/o Mr. Samuthiram No.29, VVS Koil Street Mylapore, Chennai – 600 004 …..Respondent

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Counsels on record / appeared:

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Counsel for Applicant : M/s R. Krishna Kumar

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Counsel for Respondent : Mr. P. Britto

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: - ORDER ON MA NO.144 OF 2025- :

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The present MA is filed by applicant praying to condone delay of 80

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days in filing the above SA No.229/2025, challenging the Section 14 order dated 19.10.2024 passed by Ld. Chief Judicial Magistrate at Thiruvallur in

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MA 144/25 in SA No.229/2025

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03.04.2025

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C.M.P. No.9528 of 2024, pursuant to SARFAESI measures initiated by

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respondent bank for recovery of a sum of Rs.74,48,181/-

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Admittedly, there is a delay of 80 days in filing the SA and hence the applicant had filed MA No.144/25 to condone the delay in filing the SA.

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In the affidavit filed along with MA, it is contended that applicant is a tenant in the schedule mentioned property and after the warrant issued by Advocate Commissioner issued warrant pursuant to order of Ld. CJM Thiruvallur in CMP No.9528 of 2024, the applicant had contacted the 2^nd respondent, for which 2^nd respondent informed the applicant that he is in negotiation with 1^st respondent for one time settlement but on 14.02.2025 only after the intimation given by the Advocate Commissioner, the applicant came to know that 1^st respondent is going to take physical possession of the property. Hence there was a delay of 80 days in filing this SA challenging the Section 14 order.

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Respondent bank was on caveat and applicant served copy of SA to counsel for caveator. Counsel for respondent bank filed objection memo submitting therein that respondent bank had sanctioned credit facility to the tune of Rs.72 lakhs to second respondent, who is borrower, on 29.03.2022. Due to default in repayment, account slipped into NPA on 08.09.2023 as per RBI guidelines. Respondent bank had issued Section 13(2) Demand Notice dated 03.10.2023, Section 13(4) Possession Notice

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MA 144/25 in SA No.229/2025

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03.04.2025

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dated 15.12.2023 followed by Sale Notice dated 27.01.2025, fixing the date of sale on 14.02.2025. The sale was conducted as scheduled and was successful. As on 02.04.2025, there is an outstanding of Rs.88,90,587/-. In order to hand over physical possession to the auction purchaser, respondent bank had approached Ld. CJM, Tiruvallur in Crl.M.P. No.9528/2024, which was ordered in favour of respondent bank on 19.10.2024 and Advocate Commissioner has been appointed to take over the possession of the property. Hence it is prayed not to grant any stay and permit respondent bank to proceed with their SARFAESI actions.

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Heard counsel for applicant and perused records of the case.

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Admittedly, there is no dispute with regard to the availing of the credit facility and mortgage created for the loan. The only contention raised by the applicant in the MA to condone the delay is that he is a tenant and was not served with the CJM order dated 19.10.2024 and that only when he received the Advocate Commissioner’s notice dated 14.02.2025, the applicant came to know about the CJM order dated 19.10.2024.

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Now, considering the delay application MA No.144/25, the Tribunal is posed with the question whether the Tribunal can condone the delay under S.17 of the SARFAESI Act?

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For appreciation of the facts S.17(1) is extracted as under: -

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MA 144/25 in SA No.229/2025

03.04.2025

Section 17(1):

Application against measures to recover secured debts (1) Any person (including borrower), aggrieved by any of the measures referred to in sub-section (4) of section 13 taken by the secured creditor or his authorized officer under this Chapter, [may make an application along with such fee, as may be prescribed,] to the Debts Recovery Tribunal having jurisdiction in the matter within forty-five days from the date on which such measures had been taken:

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[Provided that different fees may be prescribed for making the application by the borrower and the person other than the borrower.]

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[Explanation.- For the removal of doubts, it is hereby declared that the communication of the reasons to the borrower by the secured creditor for not having accepted his representation or objection or the likely action of the secured creditor at the stage of communication of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under this sub-section(1) of section.17.]

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A reading of the above provision is clear that any person aggrieved by any measures under Section 13[4] is required to approach the Tribunal under S.17 within 45 days from the date of the measure. Evidently, the present MA is filed for condonation of delay of 80 days in preferring the SA.

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It is a settled legal proposition that law of limitation may harshly affect a particular party, but it must be applied with all its rigour when the statute so prescribes. The Tribunal has no power to extend the period of limitation on equitable grounds and has no power to ignore that provision to relieve what it considers a distress resulting from its operation as per

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MA 144/25 in SA No.229/2025

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03.04.2025

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the Judgement of Hon’ble Supreme Court in the matter of P.K. Ramachandran vs. State of Kerala, reported in (1997) 7 SCC 556, the Hon’ble Supreme Court has held thus:-

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"Law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes and the courts have no power to extend the period of limitation on equitable grounds".

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Hence, the legal maxim “dura lex sed lex” which means “the law is hard but it is the law”, stands attracted in such a situation.

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The question whether the Debt Recovery Tribunal can entertain an application under S.17 of the Act after 45 days of measure referred to in sub section [4] of S.13 is no more res integra.

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The Hon'ble Division Bench of Hon’ble High Court of Kerala in Writ Appeal No.1797 of 2009 in W.P.(C) No.22192 of 2007 in the case titled

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K.PJayan vs. Hong Kong & Shanghai Banking Corporation Ltd and

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others decided on 31.08.2015 had categorically held that the power to condone delay in entertaining an application under Section 17 of the SARFAESI Act is not conferred on the Debts Recovery Tribunal. It further held that the Debts Recovery Tribunal cannot consider an application for condonation of delay under Section 5 of the Limitation Act in an application under Section 17 of the SARFAESI Act. The relevant paras are extracted as under:

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MA 144/25 in SA No.229/2025

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03.04.2025

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“7. Referring to these provisions the contention urged before us is that since section 24 of the RDB Act makes Limitation Act applicable and as the DRT constituted under the RDB Act is conferred with jurisdiction under section 17, Limitation Act governs applications made in a proceedings under section 17 also. We are unable to accept this contention. Both the RDB Act and the SARFAESI Act are independent enactments, although certain provisions of the RDB Act are made applicable in respect of the proceedings under the SARFAESI Act also. However, that does not mean that every provision of the RDB Act would apply to every proceedings initiated under the SARFAESI Act. In so far as this case is concerned, proceedings were initiated under SARFAESI Act and in view of the provisions contained in section 17 conferring jurisdiction on the DRT constituted under RDB Act application is made by the appellant before the DRT. That does not mean that provisions of section 24 of the RDB Act governing the proceedings taken thereunder would get automatically attracted to such proceedings before the DRT. Therefore, the contention raised relying on section 24 in so far as this case is concerned is only to be rejected and we do so. This is further clear from section 36 of the SARFAESI Act, which confines the applicability of the Limitation Act to measures under section 13(4) of the said Act.”

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Further, the Hon’ble High Court of Kerala has also considered the

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issue in the case titled The Authorised Officer, Indian Bank Vs. K.J. George, order dated 02.11.2020 has placed reliance on K.P. Jayan V.

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Hong Kong & Shanghai Banking Corporation and has held that DRT has no power to condone the delay u/s.17 of the Act.

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The Tribunal places reliance on the recent judgement of the Hon’ble

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Supreme Court in the case titled Bank Of Baroda vs Parasaadilal Tursiram Sheetgrah Pvt. Ltd., where it observed that a time limit of 45 days for filing an application under Section 17 of SARFAESI Act is provided for quick enforcement of the security.

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MA 144/25 in SA No.229/2025

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03.04.2025

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As per Section 17 of the SARFAESI Act, an application against measures to recover secured debts, has to be filed before the Debts Recovery Tribunal within forty-five days from the date on which such measure had been taken. It further observed that "The reason for providing a time limit of 45 days for filing an application under Section held that the SARFAESI Act is enacted for quick enforcement of the security, which can easily be inferred from the purpose and object of the enactment. In Transcore v. Union of India and Anr, this Court held that the SARFAESI Act is enacted for quick enforcement of the security.

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Further the delay cannot be condoned on equitable grounds and the Tribunal places reliance on the Judgement of Hon’ble Supreme Court in the case titled Lingeswaran Vs. Thirunagalingam where it is observed that an application for condonation of delay has to be dismissed if it is found that the delay is not properly explained and that the period of limitation cannot be extended on equitable ground. Otherwise, it would be giving a premium to a person who fails to explain the delay and who is guilty of delay and laches. The court also observed "The Court has no power to extend the period of limitation on equitable grounds. The statutory provision may cause hardship or inconvenience to a particular party but the Court has no choice but to enforce it giving full effect to the same.

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MA 144/25 in SA No.229/2025

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03.04.2025

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The Hon’ble Apex Court also noted the following observations made in Maniben Devraj Shah v. Municipal Corporation of Brihan Mumbai , (2012) 5 SCC 157, while dismissing the SLP:

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"The law of limitation is founded on public policy. The limitation Act, 1963 has not been enacted with the object of destroying the rights of the parties but to ensure that they approach the court for vindication of their rights without unreasonable delay. The idea underlying the concept of limitation is that every remedy should remain alive only till the expiry of the period fixed by the legislature. At the same time, the courts are empowered to condone the delay provided that sufficient cause is shown by the applicant for not availing the remedy within the prescribed period of limitation."

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It is significant to refer that the securitization Act is for quick enforcement of the security interest created favouring the respondent bank for the recovery of the amount due.

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16. The Hon’ble Supreme Court in Bank of Baroda –vs- Parasaadilal Tursiram Sheetgrah Pvt. Ltd., was of the view that the DRT does not

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have jurisdiction to condone the delay in filing an SA. In other words, the Statutory time period of 45 days provided under Section 17(1) of the SARFEASI Act is mandatory and no discretion has been conferred upon the DRT to extend such period. The provisions of the Act and Rules (9) framed thereunder cast upon the secured creditor an obligation to strictly

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MA 144/25 in SA No.229/2025

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03.04.2025

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comply with the said provisions and the rules and serve upon the borrowers’ notices in advance before taking measures under Section 13(4) of the Act read with Rule 8 and 9, thus giving the borrowers ample of time and opportunities to assail measure within a period of 45 days. In other words, the provisions of the Act and Rules framed thereunder ensure that the borrowers have advance notice of the proposed measure to be taken by the secured creditor, and for this reason, also the DRT does not have jurisdiction to condone the delay in filing an SA. The judgement of the Hon’ble Supreme Court in Parasaadilal Tursiram (supra) has given a quietus to the conundrum which existed hitherto on the power of the DRT to condone the delay in filing an SA after the statutory period of 45 days provided under Section 17(1) of the SARFEASI Act.

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The Tribunal placing reliance of the above judgments comes to inevitable conclusion that in absence of any enabling provision to condone the delay, this Tribunal has no power to condone the delay in filing the petition for restoration of SA.

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For the foregoing reasons, the MA.No.144/2025 a petition to condone the delay of 80 days stands dismissed. Consequently, SA No.229/2025 also stands dismissed.

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MA 144/25 in SA No.229/2025

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03.04.2025

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