Dismissed

M S Sri Laxmi Priya Cotex v. Union Bank of India

DRT26 Feb 2025SA/189/2022

Case brief

AI extract

What is this about?

Applicant challenged possession notice dated 29.06.2022 under Section 17 of the SARFAESI Act, claiming violation of procedure. Debt Recovery Tribunal held the notice valid as demand notice was served and rules complied, dismissing the application.

What did the court decide?

Application under Section 17 of the SARFAESI Act is dismissed with no merits found in the challenge to the possession notice.

M S Sri Laxmi Priya Cotex versus Union Bank of India — Banking and Recovery | DRT (2025)

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.IN THE DEBTS RECOVERY TRIBUNAL - 1 AT HYDERABAD

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DATED THIS THE 26*1 DAY OF FEBRUARY , 2C.25

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PRESENT: SRI GUMMADI GoPICHAND, PRESIDING oFFICER

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sA.No. 1A9/2C22

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M/ s Sri LaxmipriyaCotex, 5-.p. 9V^{i,"Prop:Mrs.sunkaraMadhavi,} W/o Sunkara Rama Koteswara Rao, Aged 51 years, Occ:business, R/o H.No .2O-S-124, Contractors Colony, Palvancha, BhadradriKothagudem Dist. _S07 1 15

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... Applicant

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Versus Union Bank of India, (Erstwhile Andhra Bank) Rep. by its Authorized officer Situated at Post Office Road, Palvancha, BhadradriKothagudem Dist. -S07 1 1S ... Respondent Bank Counsel for the Applicants : Si D.Raghauulu Counsel for Respond"ent Bank : Sri M.V.S.Prasad

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ORDER

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L This Application is filed u/s.17of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2OO2 (SARFAESI Act, 2OO2) challenging the action of the Respondent bank in issuing^possession Notice dt.29.O6.2O22 in respect of the schedule property and to declare prll and void.

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The averments -.0" f are as follows: ii The Applican r,",ir6, .r"3,,6t^(fl ,7SS r.o,rj Respondent bank for doing 'espect of the schedule busincss ""\f;r{q"A,-,.,o.,srgr..gp) ;;;rtW

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property. But due to covid- i9, the Applicant could not pay some instalments and So, the loan account was declared as NpA by the Respondent Bank. The Respondent Bank without issuing any demand notice u/s l3(2) of the SARFAEST Act,2oo2, straightaway issued possession notice dt.19.06.2022 to the Applicant and the said possession notice was not affixed on the schedule property nor published in two leading newspapers and SO, the impugned possession notice is null and void. Hence the SA.

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.).

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The Respondent Bank filed their Reply denying all the adverse allegations made in the sA and contendcd that the Applicant after availing loan from the Respondent Bank, committed default in repaying the loan amounts due and so, the Respondent Bank initiated proceedings under the provisions of SARFAESI Act, 2oo2 by crassifying the loan account as NPA and issued demand notice dt.19.04.2022 u/s 13(2) of the Act and the Applicant personalry received the said demand notice. As the Applicant failed to compry with the said demand notice, the Respondent Bank issued possession notice dt.2g.06.2022 to the Applicant and the Applicant received the said notice. The said possession notice was published in Hans India and Namaste Telangana daily newspapers and also affixed on the schedule property. Thus, the Respondent Bank has followed the procedure contemplated under the provisions of SARFAESI Act' 2oo2 and Rules made thereunder in proceeding under Section 13(4) of the SARFAESI Act, 2oo2 for taking possession of the schedule property. Accordingly prayed to dismiss the SA.

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Heard Ld. Counsel for the Applicant and Ld. Counsel for-the Respondent bank and perused the material brought on record.

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Now tion are i. ished anA ualid ground.s for "::::""ffx,':?,"{:i,trtffi ' dt.29.O6.2022 issued bg the ".^t,*r ":l ule property? ^*S, .;, ,'hrHysgai{ffi ".,.It?i;fftiU}.?

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ii. To what relief ?

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Polnt JVo.(if :-

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

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There is no dispute regarding the fact that the Applicant availed loan from Respondent Bank and thereafter committed default in repayment of loan amounts due.

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7 ' The specific contention of the Applicant is that the Respondent Bank without issuing any demand notice, straightway issued possession notice dt'29.06.2022 and the said notice was not affixed on the schedule property and also not published in two leading newspapers and hence the said possession notice is not legal and void. per contra, the Respondent Bank contended that the Bank has scrupulously followed the procedure laid down under the provisions of SARFAEsI Act, 2oo2 and Rules made thereunder in issuing demand notice and possession notice and there are no merits in the SA.

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In support of their contentions, the Respondent Bank filed material documents along with the Repry filed by them. As per the said material documents, it is clear that the Respondent Bank issued demand notice on 19.04.2022 u/s 13(2) of the SARFAESI Act, 2oo2 and the said notice waspersonally received by the Applicant which is evident by her signature on the office copy of the demand notice. Thus there is valid service of demand notice on the Applicant. It is not the case of the Applicant that the Applicant submitted any objections in response to the

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said de

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de the Respondent bank issued possession Notice e 1) of Security Interest (Enforcement) Rules, ic possession of the schedule property. $:,.0n,^{ohF'hryd,fant*} ived the said possession notice. As per the 3 w,

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documents filed by the Respondent Bank, it is clear that the said possession notice was published in Telugu and Engrish dairy newspapers on 07.07.2022 as evidenced by the copies of the paper publication and copy of the said notice was also affixed on the schedule property as depicted in the photographs filed by the Respondent Bank. Hence in the circumstances, it is quite clear that the Respondent Bank has scrupulously followed Rure g(1)&(2) of Security InterestEnforcement)Rules, 2oo2 in taking possession of the secured asset' In the circumstances, it is very clear that the Respondent Bank has duly followed the prescribed procedure contemplated under the provisions of SARFAESI Act, 2oo2 and Rules made thereunder in issuing demand notice and possession notice to the Applicant. Accordingly, this point is answered in favour of the Respondent Bank and against the Applicant.

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Point No.(ii):-

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9 ' so considering all the circumstances, I hold that the possession Notice dt'29.06.2022 issued by the Respondent Bank against the schedule property is perfectly legal and valid and it is binding on the Applicant. Accordingly, sA r9g /2022 is dismissed as there are no merits in the SA.

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10' consequently, the Interlocutory Apprications, pending if any, shall stand dispclsed of. No order as to costs.

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1 1' communicate a copy of this order to the parties concerned.

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(Dictated to t

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courl ort thi sisned and pronounced bs me in the open fffi,"l:r;;{""'"o, 6 * E sd/ - (c. coPr CHANDI PRESIDING OFFICER T RUE CC)PY'' ^(l,e,W'io,. Omnr. PvnLilj1g.

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M S Sri Laxmi Priya Cotex v. Union Bank of India

Case brief

What is this about?

What did the court decide?

M S Sri Laxmi Priya Cotex v. Union Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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