Dismissed

Smt Kade Jyothi and another v. Karnataka Bank Limited

DRT20 May 2025SA/171/2023

Case brief

AI extract

What is this about?

Applicants challenged a sale notice issued under the SARFAESI Act alleging procedural violations including failure to publish notices. The Tribunal found the auction was not conducted due to lack of bidders, rendering the sale notice infructuous and dismissing the application.

What did the court decide?

Application dismissed as infructuous since auction not conducted; Bank directed to issue fresh sale notice following SARFAESI provisions.

Smt Kade Jyothi and another versus Karnataka Bank Limited — Banking and Recovery | DRT (2025)

¶1

IN THE DEBTS RECOVERYTRIBUNAL - IAT HYDERABAD

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DATED THIS THE 2OIH DAY OF MAY, 2025

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No. 171/2c23

¶5

l.Smt.Kade Jyothi, W/o K.PraveenKumar,

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Aged 37 years, Occ:house wife,

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Kade Praveen Kumar, S/o K.narasimha,

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Aged 43 years, Occ:business, Both R/o flat No.302, Sri Raghavendra Towers, 3-2-TZ /3O2, Ramanihapur, Hyderabad.

¶9

. .. Applicants

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And

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Karnataka Bank Ltd., Dilsukhnagar Branch, Hyderabad and also ARMB, Srinagar, Hyderabad Rep.by its Authorized officer

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.... Respondent Bank

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Counsel for the Applicants

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Counselfor tle Respondent Bank

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SriT. SridharReddy Sri N.Rama Rao

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:ORDER:-

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1.
This application is filed by the Applicants u/s. 17 of the SARFAESI
Act, 2OO2, challenging the Sale
Notice dt.23.03.2023 issued by the
Respondent Bank for
ion of the schedule property on
17.05.2023 and to
and void.
2. The averments
5- 9:rt**?mp''* f, are that:
..0.
- 5
qk-=fi9

¶18

sA 171123

¶19

The Applicants ava,ed housing loan from the Respondent Bank but due to Covid-l9, the Applicants could not repay the loan amounts due. So, the Respondent Bank initiated proceedings under the provisions of SARFAESI Act, 2OO2 and issued Sale notice d't.23.O3.2023 by fixing the date of auction on17.o5.2023. prior to issuing the said sale notice, no notice was issued by the Respondent Bank u/r 8(6) of Security Interest (enforcement) Rules, 2002. The impugned Sale notice was neither published in two leading newspapers nor affixed on the schedule property and the reserve price fixed by the Bank is very low compared to the market varue. The Respondent Bank also failed to issue possession notice and the said notice was not publishedin two newspapers. Hence the SA.

¶20

¶21

The Respondent Bank firedRepry by denying arl the adverse alregations made in the SA. It is contended that the Applicants having availed loan from the Respondent Bank, failed to pay the outstanding dues and so, the loan account was classified as NpA. The Respondent Bank issued sale Notice d,t.23.o3.2023 fixing the date of auction on77.O5.2O23 by giving 52 days time for the Applicants and thus there are no violations. The Respondent bank issued possession notice dt. 16.03.2023 and the said notice was sent to the Appricants through Regd. post and the said notice were retuned unserved. The Bank published the said possessionnotice in Mana Telangana and Business Standard daily newspapers on 17.03.2023 and the said notice was also affixed on the schedule property. However, the proposed auction in pursuance of the sale notice dt.23.03.2023 was not conducted for want of bidders. Hence there are no merits in the SA and the SA is liable to be dismissed. -

¶22

Heard Ld. and Ld. Counsel for Respondent Bank and t on record.

¶23

Now, the g::ru.lItHF"",; tion are,W,--#

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sA17Ll23

¶25

Wtetter the Applicants haue establislrcd. any ualid. grounds for challenging the Sale Notice dt.23.O3.2023issued. bg the Respondent Bank for conducting auction of the schedule propertg? ii) To uhat relieJ?

¶26

Polnt No.ll):-

¶27

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

¶28

There is no dispute regarding the fact that the Applicants availed housing loan from the Respondent Bank and thereafter committed default in repaying the loan dues. The Applicants are not disputing the receipt of demand notice and possession notice issued by the Bank. But the specific contention of the Applicants is that prior to issuance of Auction Sale Notice, the Respondent Bank has not issued pre-sale notice and the said Auction sare notice was not affixed on the schedule property and also not published in daily newspapers. Similarly, the impugned possession notice was also not published in two daily newspapers.

¶29

B. Per contra, the Respondent Bank contended that the Bank has strictly followed the procedure contemplated under the provisions of SARFAESI Act, 2OO2 and Rules made thereunder in issuing various notices to the Applicanrs.

¶30

To substan tions, the Respondent Bank {iled material docume ly Iiled by them. As per the said d r,itisr ndent Bank issued demand notice u/s "?'t' .2OO2 on 23.11.2022 and the said noti sent to through Regd.post but however, the

¶31

sA 171./23

¶32

notice sent to the Applicants was returned unserved and so,the said demand notice was published in newspapers. However, the Applicants are not disputing the service of demand notice. subsequently, the Respondent Bank issued possession notice dt. 16.03.2023 and the said notice was sent to the Applicants though Regd' Post but the Applicants got returned the said notice but there is no dispute regarding the fact that the said notice was addressed to the correct address of the Applicants and thus there is deemed service of possession notice on the Applicants. The said possession notice was published in two daily newspapers as evidenced by the copies of paper publication filed by the Bank and the said notice was also affixed on the schedule property as depicted in the photographs filed by the Bank. After issuing the possession notice, the Respondent bank issued the impugned sale Notice dt.2o.o3.2o23but however no auction was conducted by the Respondent Bank in pursuance of the said sale notice. So the said sale notice becomes infructuous and nothing survives in the SA for adjudication as there is no need to decide the validity or otherwise of the impugned Sale Notice dt.23.O3.2O23. Hence, I am of the opinion that the relief claimed by the Applicants in the present sA becomes infructuous and the SA is liable to be dismissed. The Respondent Bank is directed to proceed afresh for conducting sale of the schedule property by issuing fresh sale notice by duly following the provisions of SARFAESI Act, 2002 and Rules made thereunder.

¶33

Polnt No,llt)i

¶34

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¶35

sA77Ll23

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1 1. 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 bg her, corrected., signed. and. pronounced bg me in the open court on this the 2oh day of Mag, 2025).

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sdl(c. coPr CHANDI PRESIDING OFFICER

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¶41

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¶42

Smt Kade Jyothi and another v. Karnataka Bank Limited

Case brief

What is this about?

What did the court decide?

Smt Kade Jyothi and another v. Karnataka Bank Limited

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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