Dismissed

Dsr Rural Farmers Warehouse and Others v. Union Bank of India

DRT24 Sept 2025SA/128/2024

Case brief

AI extract

What is this about?

Applicants sought to declare Section 14 proceedings under SARFAESI Act illegal after defaulting on loan and facing bank-initiated possession of collateral asset. Tribunal dismissed the application.

What did the court decide?

Securitization Application No.128 of 2024 dismissed. Interlocutory applications pending, if any, shall stand closed.

Dsr Rural Farmers Warehouse and Others versus Union Bank of… — Banking and Recovery | DRT (2025)

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iN THE DEBTS RECOVERY^{TRIBUNAL_ II AT HYDERABAD}

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DATED THIS THE 24TH^{DAYOF SEPTEMBER, 2025}

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PRESENT: SH. RAMESHWAR^{KOTHE, B.Com,L LB. (Hons.), l'1.A.}

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PRESIDING OFFICER

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Securitization Application No.128^{OF 2024}

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M/s DSR Rural^{Farmer's Warehousea} Partnership firm having^{its office at SurveyNo.} 77/7, Dondlavagu Village,^{Lingala14andal} YSR District, Andhra^Pradesh Rep by its Managing^{PartnerSmt.DevireddySreelatha}

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Mrs. Devireddy Sreelatha W/o Devireddy Sanjeeva^Reddy Female, Aged 43^years, Occ;Agriculture R/o Plot No.601, Hill^{ToP Avenue} Survey No.11/31,^{Khanamet Village} Serilingampally, Hyderabad-500081

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Mr.Devireddy Sanjeeva^Reddy S/o Rama Su bba Reddy lvlale, Occ: Business R/o Plot No.601, Hill ToP^Avenue Survey No.11l31,^{Khanametvillage} Seriling a^{m pa} lly,^{Hyderabad-500081}

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....APPlica nts.

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Versus

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Union Bank of^India Pu livendu la Branch D.No.3-5-37, Main^Road Pulivendula, KadaPa^District Andhra Pradesh - 516³⁹⁰ Rep by lts chief Manager

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...Respondent

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Counsel for the Applicant^{: Mr.RameshAnand M G'} Counset for Respondent^{Bank : Mr.V. Sethu MadhavaRao}

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-: O-B-g-E-B:-

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The Applicants filed^{the present Securitisation Applicationu/s} 17 of the Securitization and^{Reconstructionof Financial Assetsand} Atl .^,*. r" -1\1''

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Page 2 of4

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SA No,128/2024

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Enforcement of Security Interest Act, 2002^(hereinafter referred to as "the Act") to declare the^proceedings under Sec.14 of the Act,²⁰⁰² vide Crl MP No.79/2024 on the file of learned CN4M, RR District, Hyderabad wherein advocate commissioner was appointed for taking physical possession of the application schedule property, as illegal void and arbitrary.

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The case of the applicants, in brief, is that 1"t applicant is a firm represented by its partners availed term loan of Rs.2.10 crores, the 3'd applicant gave his immovable property as collateral security. Due to fire accldent entire godown was destroyed and insurance claim of Rs.26 crores is under process with the United India Insurance Company. Without granting any time, respondent bank declared the account as NPA and initiated SARFAESI proceedings by issuing demand notice. The applicants challenged the auction sale notice dated 02.03.2020 by filing WP No.6576 of 2020 which came for hearing on 03.04.2020 and Hon'ble High Court disposed of the WP on 24.02.2022 granting liberty to approach the Tribunal. Accordingly SA No.94 of 2022 was filed before the Tribunal which was disposed on 22.77.2023 and Appeal was filed vide Dy.No.131 of 2024 befote Hon'ble DRAT, Kolkata. l,leanwhile respondent bank obtained Warrant in Crl.MP No.79/20?4 for taking physical possession of the schedule property. Hence the SA.

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Respondent bank filed reply statement denying the adverse averments of the application and stating that in spite of dismissal of the SA No.9412022 applicant have not delivered the physical possession of the property and hence respondent bank approached the learned CMM by filing Ctl.MP No.79/2024 u/s t4 of the Act for appointment of advocate commissioner. Respondent bank also filed

K.l*to

Page 3 of4

sA No.72812024

OA No.224/2027 for recovery of Rs.4,55,10,352/- and also filed various OAs against applicants and borrowers besides civil suits. No vital information was concealed in the Sec.14 application. SA is liable to be dismissed.

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The right of applicants advancing arguments was forfeited vide docket order dated 07.08.2025 after affording ample opportunity. Heard learned counsel for the respondent bank and perused the material documents.

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During the course of arguments, the learned counsel for the respondent bank reiterated the contents of the reply statement and sought for dismissal of the application.

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The points for consideration are as follows : -

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i) Whether the applicant made out any valid ground to quash the action of the respondent bank in taking physical possession of the SA schedule property as prayed for?

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ii) To what relief?

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Point No.(i ):

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Admittedly the applicants defaulted in repayment. They already challenged the Securitization proceedings by filing SA No.9a/2022. Though it is stated that the applicants filed Appeal against the dismissal order in SA, no order appears to have been passed in the Appeal with regard to disposal order in SA. Hence it is to be inferred that the SA order is final as on date. The respondent bank being secured creditor is entitled to proceed under Sec.14 of the Act, 2OO2 to make an application before the learned CMM/DM for appointment of advocate commissioner for taking physical possession of the secured asset. Hence such action undertaken by the respondent bank cannot be treated as illegal. The applicants have fa!.!ed to make out

'Ssr'rq

PaEe 4 of 4

5A No.128/2024

any valid^{ground to declarethe actionof respondent bankas void or} arbitrary. Accordingly^{SA is llable to be dismissed'}

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Point No.(ii):

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In the result, the^{Securitization Applicationfails and is hereby} dismissed.

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Consequently,^{InterlocutoryApplicationspending, if any'shall} stand closed.^{No orderas to costs.}

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Communicate^{a copyof this order to the partiesconcernedand} upload in the^{officialwebsite.}

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(Typed to ny dictotion^{by thePs, corrected'signedond pronounced by fie in the opencouttonthis} the 24'h^{doyol se\tember,2025).}

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(RAMESHWAR KOTHE) PRESIDING^OFFICER

Dsr Rural Farmers Warehouse and Others v. Union Bank of India

Case brief

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Dsr Rural Farmers Warehouse and Others v. Union Bank of India

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