Dismissed

Sri Lakshmi Narasimha Poultry v. Indian Overseas Bank

DRT23 Apr 2025SA/133/2023

Case brief

AI extract

What is this about?

In Special Application No. 133/2023, the Debt Recovery Tribunal at Hyderabad dismissed the;s申请人的; challenge to a possession notice issued by Indian Overseas Bank under the SARFAESI Act, 2002, finding that the bank duly followed statutory procedures for service and publication.

What did the court decide?

The Special Application No. 133/2023 was dismissed as there are no merits, and pending interlocutory applications were disposed of.

Sri Lakshmi Narasimha Poultry versus Indian Overseas Bank — Insolvency and Bankruptcy | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT HYDERABAD DATED THIS THE 23RD DAY OF APRIL,2C-25

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PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No. 133/2C-23

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1.M/s Sri Lakshmi Narsimha Poultry, Rep. by its Leal heir Mr.BanothRamkotiNayak, S/o BanothMangthyaNaik, aged 55^years, Occ:business, R/o H.No.3-45/3, Sapthagiri colony, Komatipally, Hasanparthi (M), Warangal-506370.

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2 . Mr. BanothRamkotiNayak,

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S/o BanothMangthyaNaik, aged^{55 years,} Occ:business, R/o H.No.3-45/3, Sapthagiri colony, KomatiPallY, Hasanparthi (M), Warangal-506370

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Mrs.BanothAmala,

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W/ o Mr.BanothRamkotiNaYak,

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S/o BanothMangthyaNaik,^{aged 55 years,} Occ:business, R/o H.No.3-45/3, Sapthagiri colony, KomatiPallY, Hasanparthi (M), Warangal-506370 ... Applicants

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Versus

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Indian Overseas Bank, Jangaon branch, 6-2-4 15139 I^A, I-lyderabad Road, Jangaon-506167^. Rep. by it.s Authorized officer

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... Respondent Bank

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: Sn ?. Sridhar?. SridharSridhar

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Counsel for the Applicants : Sn ?. Sridhar?. SridharSridhar Counsel for Respondent Bank : Sri Allui Krishnam Raju

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O RL LB.

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rt:*:-" 1. Securitization and Reconstruction^of rhis Applt"?4iJi;i Financial ol Security Interest Act,^2OO2 the Possession^Notice (SAI?FA :^o?, I Bff?hzs^{cr'artti"gi"g}

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sA 13312023

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dt.31.O1.2023issued by the Respondent Bank in respect of the schedule property and to declare the same as illegal and arbitrary.

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The averments made by the Applicant in brief are as follows:

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The Applicants No.2&3 are the legal heirs of deceased borrower Mr.BanothMangthyaNaik who is Proprietor of Applicant No.1, M/s Sri Lakshmi Narasimha Poultry farm. Applicants No.2&3 stood as guarantors to the loan facilities availed by Applicant No.1 and created mortgage in respect of the schedule property. But due to unfavourable market conditions, the borrower couldnot repay the loan amount due to the Respondent Bank and so, the Respondent bank declared the loan account of the Applicants as NPA. But without issuing any demand notice, the Respondent bank straightaway issued^{possessionnotice} dt.31.O1.2O23 and the said notice was not affixed on the schedule propertyand alsonot published in two leading newspapers. Hence the SA.

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The RespondentBank filed their Reply denying all the adverse allegations made in the SA and contended that in view of the default committed by the Applicants, the loan account has been classified^as NPA on 3 I.Ol.2023 as per the RBI guidelines. Accordingly, Respondent bank proceeded further and issued demand notice dt.18.O7.2022^u/s 13(2) of the SARFAESI Act, 2OO2 and the said notice was duly served^on the Applicants and the same was published in two daily^{newspapersviz.,} Namaste Telangana and Telangana Today daily^newspaperson 07.O9.2022. Thereafter the RespondentBank issued^{possessionnotice} dt.31 .Ot.2023 u/s 13(f) of the SARFABSI Act,2OO2 and the^{said notice} ^':'^-: j: JaI" :^{^} -'--'a :r rough Regd.postand the said notice was was ".,-rt to-."#EffiffiGfrn4.',' "r"L1i. -^{*t +,.",..{.,} received V" bpti..tl:,fl No. 2S )rShe said possession notice was affixed s also published in PrabhathVelugu t] on the "o[,ddfrt. p.oftty ,.,a and The 2BiAffiW6^claii'y,nespaperson 05.02 .2023 and thus

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sA 133/2023

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there are no violations. Accordingly, RespondentBank prayed to dismiss the SA.

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Heard Ld. Counsel for the Applicants and Ld. Counsel for the Respondent Bank and perused the material brought on record.

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Now the points that arise for consideration are

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i. uhether tlrc Applicants haue established ana ualid groundsfor challenging the Possession Notice dt.31.01.2023 issued by the Respondent against the schedule property?

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ii. To what relief ?

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Point lVo.(if :-

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During the course of arguments, Ld. Counsel for the Applicants and Ld. Counsel for the Respondent Bank reiterated their respective versions as stated supra.

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The undisputed facts of the case are that the l"t Applicant company availed loan from the Respondent Bank and Applicants No.2&3 stood as guarantors to the said loan transaction and subsequently, the proprietor of the Applicant No.l died and the Applicants committed delault in repaying the loan dues and so, the loan account was classified as NPA by the Rcspondent Bank.

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The specific contention of the Applicants is that without issuing dema spondcnt bank straightaway issued possession noti "*i,ir,p'aqrscssion t.;" $^{notice wasneither affixed on the} ty noriipr:tfulished in two newspapers and So, the 1

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iqnpugne$ B."fffrWfi noti.ce,is not legal and valid.

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sA t33/2023

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Per contra,Respondent Bank contended that they have duly followed the procedure laid down under the provisions of SARFAESI Act,2002 and Rules made thereunder in proceeding against the secured asset under the provisions of SARFAESI Act, 2OO2 byissuing demand notice and possession notice.

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To substantiate their version, the Respondent Bank has filed relevant material documents along with the Reply filed by them. As per the said documents, it is clear that the Respondent Bank issued demand notice u/s 13(2) of the SARFAESI Act, 2OO2 on 18.07.2022 and sent the said notice to the Applicants through Regd. Post and the said notice was returned unserved with endorsement 'addressee left without instructions'and so, the Respondent Bank published the said demand notice in Namaste Telangana and Telangana Today daily newspapers and so, it can be deemed that there is valid service of demand notice on the Applicants. Thereafter, the RespondentBank issued possession notice u/s 13(a) of the SARFAESI Act,2OO2 on 31.O1.2023. Admittedly, the Applicants received the said possession notice and the bank also filed copies of acknowledgements for establishing that the Applicants personally received the said notice. As per the copies of paper publication filed by the Respondent bank, it is clear that the Respondent Bank published the said possession notice in English and Telugu daily newspapers on O5.O2.2O23 and the said notice was also aflixed on the schedule property as depicted in the photographs filed by the bank. Thus, the Bank has scrupulously followed Rule 8(1)&(2) of Security Interest (Enforcement) Rules, 2OO2 in taking possession of the schcdule property.

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a^t'''

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IIence'i.n the circumstanccs, it is quite clear that the Respondent Bank 'i 'procedure laid down under the provisions

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sA 1.3312023

of SARFAESI Act, 2OO2 and Rules made thereunder in issuing demand notice and possession notice to the Applicantsand there are no violations. Accordingly, this point is answered in favour of the Respondent Bank and against the Applicants.

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Point No.(ii):-

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In the result, SA 13312023 is dismissed as there are no merits. 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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(Dictated to the P.S, transcribed by her, corrected, signed and pronounced bg me in the open court on this the 23dday of Apil, 2025).

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sd/ - (G. GOPr CHAND) PRESIDING OFFICER

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Sri Lakshmi Narasimha Poultry v. Indian Overseas Bank

Case brief

What is this about?

What did the court decide?

Sri Lakshmi Narasimha Poultry v. Indian Overseas 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

Coram

Case details

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