Dismissed

G Vannurappa k Gangabhavani j Anvesh v. Shriram Finance Limited

DRT29 Jul 2025SA/151/2024

Case brief

AI extract

What is this about?

In a securitization application under the SARFAESI Act, 2002, the SCT (Debts Recovery Tribunal II, Hyderabad) dismissed the challenge filed by borrowers against Shriram Finance Limited. The court held that the respondents strictly complied with Sections 13(2) and 13(4) of the Act regarding notice service and publication before seeking physical possession under Section 14.

What did the court decide?

The Securitization Application was dismissed, pending interlocutory applications were closed, and no order as to costs was passed.

G Vannurappa k Gangabhavani j Anvesh versus Shriram Finance… — Banking and Recovery | DRT (2025)

¶1

IN THE DEBTS RECOVERY TRIBUNAL^{_ II AT HYDERABAD}

¶2

DATED THIS THE 29TH DAY^{OF JULY, 2025}

¶3

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

¶4

PRESIDING OFFICER

¶5

Securitization Application^{No.151 OF 2024}

¶6

G. VannurapPa S/o G. VeeraPPa Aged about 43 Years R/at D. No.31257, Illuru Ananthapuramu Dist,-51561¹

¶7

K. Ganga Bhavani W/o G. VannuraPPa Aged about 40 Years R/at D. No.3/257, IIluru Ananthapuramu Dist.-5^{1561 1}

¶8

J. Anvesh

¶9

S/o l. AppaswamY Aged about 30 Years R/at OC colony, GantaPuram Anantapuram Dist-s15 661

¶10

. . . . . . .Applicants.

¶11

Versus

¶12

M/s Shriram Finance Limited "shriram City Union Finance Limited"^(claimant) Anathapur, Having Corporate^{Office at Chennai} Among other^places at AnantaPUr Branch Office:Upstairs Vishnu^{Priya Complex} Subhash Road, AnantaPuram-515⁰⁰¹ Rep by its authorized officer

¶13

....Respondent.

¶14

Counsel for the Applicant^{: Mr. S. Srikanth} Counsel for Respondent^{: Mr.M. Indrasen}

¶15

.:ORDER:.

¶16

The Applicants filed the^{present Securitisation Applicationu/s} L7 of the Securitization and^{Reconstructionof Financial Assetsand} Enforcement of Security Interest^{Act, 2002 (hereinafter refprredto as} *i{,hta j .l} - '^' ril"'"

PaCe 2 ot 4

sA No.15U2024

"the Act") to set aside all the measures of the respondent under the Act, 2002 including action of respondent for taking physical possession of application schedule property pursuant to advocate commissioner notice dated 19.03.2024 in pursuance of Warrant in Crl.MP No.09 of 2024 on the file of learned Principal Senior Civil Judge, Assistant Sessions Judge-cum-Chief Judicial magistrate, Ananthapuram District under Sec.14 of the Act.

¶21

The case of the applicants. in brief, is that they availed business loan of Rs.50 lakhs in 2020. Though regular in payment, they committed default in payment of some instalment due to financial crunch. Without serving demand notice, the respondent issued possession notice u/s 13(4) and approached the learned CJpl for physical possession of the property. The account was not NpA at all. The respondent failed to follow Secs.13(2), 13(4) of the Act, 2002 and Rules 8(1) and 8(2) of the Security Interest (Enforcement) Rules, 2002 (hereinafter "Rules"). Hence this SA to quash the action of the respondent.

¶22

The respondent bank filed reply statement along with documents. The submissions, briefly, are that due to continuous default the loan account of applicants became NPA on 70.04.2022 in accordance with RBI guidelines. The demand notice dated 13.02,2023 sent by registered post was delivered as per postal tract reports. As no payment was made/ symbolic possession of secured asset was taken vide notice dated 26.05.2023 by sending notice to applicants by registered post and the same was published in Telugu and English newspapers and affixed on the secured asset. The applicant being parties to the documents executed cannot escape liability as per decision of Hon'ble A.P. High Court reported in 1996(4) ALD 1035 dated 07.02.1996. Respondent did not violate any of_the provisions of //W..orl^" (,,.'

¶23

Pate 3 of4

¶24

SA No'15U2024

¶25

the Act or Rules framed thereunder while^proceeding against^the secured asset for recovery of legitimate dues.^{Hence SA is liableto be} dismissed.

¶26

Representative of the learned counsel for the^applicants reported orders may be^passed based on record.^{Learned counselfor} the respondent reported no oral arguments but he filed^written arguments. Perused the same and also the material brought^on record.

¶27

Now, the points for consideration are as follows : -

¶28

i) Whether the applicant made out any valid^ground to quash any of the measures initiated by the respondent against the SA schedule^property?

¶29

ii) To what relief?

¶30

Point No.(i'l:

¶31

The applicants admittedly availed business loan of Rs.50^lakhs from respondent and defaulted in^payment. The statement of account also reflects the irregularity in^payment. Hence no blame can^be thrown on the respondent for categorizing the account as NPA. The application schedule property is the secured asset and there is no dispute on it. Service of demand notice dated 13.02.2023^issued under Sec.13(2) of the Act is evident from documents at^pages 34-39 of the material papers annexed to the reply statement. The^1't applicant acknowledged receipt of^possession notice on behalf of himself and the 2nd applicant vide postal acknowledgment cards placed at page-44 whereas cover sent to the correct address of the 3d applicant was returned and the same is filed at pages 44-45. The possession notice was published in English and Telugu newspapers and also affixed on property vide proof placed at pages 45-47 of the documents placed on record by the respondent. I find lgviolatioJl of Vffiltty (_/

¶32

Page 4 of 4

¶33

SA No.15U2024

¶34

Secs.13(2), 13(a) of the Act or Rules B(1) and B(2) of the Rules of 2002. The respondent being secured creditor is entitled under Sec.14 of the Act, 2002 to approach learned CMM/DM for orders on taking the physical possession of the secured asset and hence there is no illegality in such action.

¶35

In view of the above observations, I find that the applicants failed to make out any valid ground to set aside any of the measures of the respondent against the SA schedule property. Accordingly SA is liable to be dismissed.

¶36

Point No.(ii):

¶37

B. In the result, the Securitization Application fails and is hereby dismissed.

¶38