Dismissed

Mrs Dulsierni Lionel v. Smfg India Credit Formerly M S Fullerton India Credit Company Ltd.

DRT21 Aug 2025SA/229/2024

Case brief

AI extract

What is this about?

In this Securitization Application, the applicant challenged the validity of an e-auction sale notice issued by the respondent bank under the SARFAESI Act. The Tribunal held that the bank strictly adhered to all statutory procedures, and dismissed the application, declaring the auction sale valid.

What did the court decide?

The present application was dismissed; the valid notices and successful auction sale were upheld, and the interim order granted by the applicant was vacated.

Mrs Dulsierni Lionel versus Smfg India Credit… — Contract and Commercial Disputes | DRT (2025)

SA No.229/2024

21.08.2025

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

¶5

Dated this the 21^st day of August, 2025

¶6

Present: SMT. S.V. GOWRAMMA

¶7

Presiding Officer

¶8

SA No. 229 of 2024

¶9

Mrs. Dulsierani Lionel, No.3/2, Ramalingam Street, Srinivasa Nagar, Peerkankaranai, Chennai, Tamil Nadu – 600 063. …Applicant

¶10

-Vs-

¶11

The Authorised Officer, M/s. Fullerton India Credit Company Limited, Registered office at Megh Towers, 3^rd Floor, Old No.307, New No.167, P.H.Road, Maduravoyal, Chennai – 600 095.

¶12

…Respondent

¶13

Counsels on record / appeared:

¶14

Counsel for Applicant : M/s. P. Madhavan Counsel for Respondent : M/s. V. Balasubramani

¶15

ORDER ON SA 229 /2024

¶16

The present Securitization Application [SA] is filed under sub section [1] of S.17 of the Securitization And Reconstruction of Financial Asset and Enforcement of Security Interest Act,2002 (for short the ‘Act’) challenging the action and the measure taken by the secured creditor under the Security Interest Enforcement Rules, 2002 [for short the Rules].

SA No.229/2024

21.08.2025

The applicant has challenged the e-auction sale Notice dated 16.04.2024 fixing the sale on 07.05.2024 and the outstanding amount due as per Sale notice is Rs.73,47,045/-

¶21

3. Pleadings of the applicant:

¶22

3.1 The applicant availed a mortgage loan of Rs.80,74,518/- to be repaid in 196 months at the agreed rate of 15.20% of floating of interest from the respondent during the year of 2013 vide agreement of loan dated 24.10.2013 and created a charge on the scheduled mentioned property by deposit of Titles Deeds.

¶23

3.2 Due to Covid-19 pandemic, defaulted in repayments resulted in classification of account as NPA. The applicant decided to settle the account as the bank appropriated amount towards the interest component which is as high as 80% of the principal sum borrowed. Hence approached respondent for a one time settlement of the mortgage loan with the buyers who were ready to buy the property and applicant was also organizing funds from various sources for the purpose of settlement after giving the necessary waiver of interest.

¶24

3.3 However, the respondent has issued demand notice dated 27.05.2020 under Section 13(2) of the SARFAESI Act which was duly received and acknowledged by the applicant. But the Authorized Officer is not a qualified officer authorized to issue Demand notice since his name was not mentioned in the list of authorized officers as submitted by the respondent. The Authorized officer who has signed in the Possession Notice

SA No.229/2024

21.08.2025

is not qualified officer and the name and designations are not mentioned by the defendant.

¶29

3.6 The respondent has failed to issue the Possession notice to the applicant; failed to publish the Possession Notice in two Newspapers, affix the Possession notice in the conspicuous part of the property which is in violation of Section 13(4) SARFAESI Act.

¶30

3.7 Further the statement of accounts clearly reflects that the interest charged is very high against the RBI guidelines and the Terms and Conditions of the Loan agreement. In fact applicant has offered an OTS proposal with the respondent bank dated 04.02.2022.

¶31

3.8 The applicant has filed an SA No.77 of 2022 challenging the Sale notice dated 05.02.2022, this Hon’ble Tribunal stayed the proceedings directing the applicant to pay a sum of Rs.15,00,000/- in pursuant to the conditional order dated 24.02.2022.

¶32

3.9 During the pendency of the SA.No.77 of 2022 when Tribunal has taken cognizance the matter on 24.02.2022, suppressed the pendency of interim stay and filed an application on 18.03.2022 before the Hon’ble CJM, Kancheepuram at Chinglepet to take physical possession of the property under Section 13(4) of the Act warrant came to be allowed on the same day.

¶33

3.10 The Hon’ble Tribunal in SA No.77 of 2022 set aside Auction notice vide order dated 27.04.2023, after Order passed by the CJM Kancheepuram, the respondent entered the schedule property when the

SA No.229/2024

21.08.2025

applicant was not there with the help of 15 persons which includes 4 Police Personnel, forced daughter to evict the schedule property and locked the schedule property with all the essentials. Hence the applicant’s family has faced many hardships and the respondent issued Possession Notice dated 14.06.2023.

¶38

3.11 Subsequently the applicant challenged the S.14 order before the CJM Kanchipuram at Chinglepet in Crl.M.P.No.4899 of 2023 which came to be allowed giving liberty to the applicant to move before this Hon’ble Tribunal. Meanwhile the respondent has issued the Sale notice dated 04.07.2023 scheduling the sale to be held on 04.08.2023 with an upset price of Rs.1,14,45,142/- which is clearly different from the respondent’s earlier valuation of the schedule property is Rs.71,00,000/-

¶39

3.12 In pursuance of the order passed by the Ld. CJM, Kanchipuram at Chinglepet, applicant has moved before this Tribunal SA in Diary No.4500 of 2023 dated 27.03.2023 which is still pending. Applicant also filed an SA No.393 of 2023 challenging the Sale Notice dated 04.07.2023 which came to be disposed on 01.12.2023 as infructuous.

¶40

3.13 The respondent has issued yet another Sale Notice dated 16.04.204 scheduling the sale on 07.05.2024. In fact the property was undervalued by 50% of the actual Market value, though the valuation report produced by the respondent in the year 2013 is Rs.1,80,00,000/after 8 years the property was undervalued.

¶41

SA No.229/2024

¶42

5 21.08.2025

¶43

3.14 Though the impugned Sale Notice dated 16.04.2024 has not been published in two Newspapers as mandated under Rule(8) of the SARFAESI Act. Hence prays to set aside the Sale Notice dated 16.04.2024 scheduling the sale on 07.05.2024.

¶44

4. Objections of the respondent bank:

¶45

4.1 The respondent has filed counter inter alia contending that the averments made in the present SA are denied and the applicant has not approached this Tribunal with clean hands. The applicant has availed finance assistance from the respondent for a sum of Rs.80,74,518/- in Loan Account No.173125700000200 dated 23.06.2013 agreeing to the Terms and Conditions of the Loan agreement to repay the said loan amount in 180 EMI for Rs.1,07,554/-

¶46

4.2 In fact the applicant has violated the Terms and Conditions of the agreement and defaulted in the repayment which resulted in classification of the loan account as NPA on 30.12.2019 in accordance with the RBI guidelines. The outstanding due to be paid by the applicant is Rs.73,47,045/- due as on 10.05.2020. After classifying the loan account of the applicant as NPA, respondent has proceeded and issued Section 13(2) Demand Notice dated 27.05.2020 calling upon the applicant to pay the outstanding amount of Rs.73,47,045/- within 60 days from the date of the notice.

¶47

4.3 The said Demand Notice dated 27.05.2020 is also published in two Newspapers, one in “Dinamani” (Tamil) and another in “Business Standard”

SA No.229/2024

21.08.2025

(English) both dated on 17.07.2020. Applicant has failed to liquidate the entire liability within the period of 60 days, respondent has proceeded further and issued the Section 13(4) Possession Notice dated 24.09.2020 and affixed the Possession Notice on conspicuous place of the property. The Possession Notice is also published in two Newspapers, one in “Dinamani” (Tamil) and “The New Indian Express” (English) both dated on 27.09.2020

¶52

4.4 After repeated reminders and request, applicant has failed to liquidate the outstanding amount. Hence the respondent has initiated measures under Section 13(4) of the SARFAESI Act and made out a case before the Hon’ble CJM, Kancheepuram at Chengalpet which was allowed on 18.03.2022 by appointing an Advocate Commissioner to take the Physical Possession of the property on 14.06.2023 and the panchanama and inventories has been taken by the Advocate Commissioner.

¶53

4.5 Even after taking the physical possession of the property, applicant has not made an attempt to liquidate the liability. Hence the respondent has proceeded further and issued the Sale Notice dated 04.07.2023 fixing the sale on 08.08.2023 which is also published in two Newspapers, one in “Makkal Kural” (Tamil) and “Trinity Mirror” (English) both dated on 06.07.2023 and the same is also affixed on the property. Further the sale did not materialized due to want of bidders.

¶54

4.6 Subsequently the applicant has not liquidated the entire liability, yet again the respondent has proceeded further and issued 2^nd Sale notice dated 16.04.2024 fixing the sale on 07.05.2024. The Sale Notice is

SA No.229/2024

21.08.2025

published in two Newspapers, one in “Dinamani” and another in “The New Indian Express” (English) both dated on 19.04.2024. The Sale notice is also affixed on the conspicuous part of the property. The impugned Sale materialized for the successful bidder and the applicant has approached this Tribunal, obtained an Interim order by undertaking that they will settle the account as full and final.

¶59

4.7 The contentions as raised in the Para 5.1 to 5.3 are made of record and in Para 5.4 to 5.6 are strictly denied and put the application to strict proof, as the loan account of the applicant was classified as NPA on 30.12.2019 which is before the Covid-19 pandemic. The averments made in Para 5.7 to 5.12 are false as the respondent has initiated measures as per the norms and guidelines of the RBI, issued Section 13(2) and 13(4) statutory notices.

¶60

4.8 The applicant has challenged the Sale notice dated 05.02.2022 in SA No.77 of 2022 which came to be dismissed before this Hon’ble Tribunal, therefore the respondent has issued another Sale notice dated 04.07.2023 fixing the sale on 08.08.2023 which is also duly published in two Newspapers, one in “Trinity Mirror” (English) and another in “Makkal Kural” (Tamil) both dated on 06.07.2023 and the same was affixed on the property. At the time of taking physical possession of the property applicant’s husband was there in the property along with her daughter.

¶61

4.9 The averments made in Para 5.17 to 5.19 are baseless, respondent

¶62

has fixed the Reserve price as per the valuation report obtained on

SA No.229/2024

21.08.2025

16.06.2023 and the applicant had not made any attempt to clear the outstanding amount till date. The respondent has given several opportunity to settle the outstanding amount, but the applicant has failed to liquidate the amount. Hence the contention made in Para 5.20 to 5.22 were false and baseless were put the applicant to strict proof.

¶67

4.10 Further the applicant has filed various Securitization application challenging all the measure initiated by the respondent vide SA No.77/2022, SA No.393/2023, SA Diary No.4500/23. Though the applicant only contention is to drag on the proceedings and in spite of several opportunity, applicant failed to repay the entire outstanding amount. Hence the respondent prays for dismissal of the present SA with exemplary cost.

¶68

Heard both sides of the Counsels and perused the records of the case.

¶69

5.1 It is manifest from the records that the applicant is the borrower availed a sum of Rs.80,74,518/- on 23.06.2013 vide Loan Account No.173125700000200 to be repaid within 180 EMIs for Rs.1,07,554/- along with interest at 15.20%. As security towards the credit facility, applicant has created mortgage over the schedule property.

¶70

It is an admitted fact, that the applicant defaulted in repayment due to Covid-19 which resulted in classification of the loan account as NPA on 30.12.2019 and initiated measures under the SARFAESI Act.

SA No.229/2024

21.08.2025

5.2 After classification of account as NPA, the respondent has issued Section 13(2) Demand Notice dated 27.05.2020, calling upon the borrower and co-borrower to repay the total outstanding due of Rs.73,47,045/- as on 10.05.2020 to be repaid within the period of 60 days. The Demand Notice clearly describes; the details of the borrower and co-borrower, nature of the facility availed, description of the property.

¶75

5.3 The Demand notice was sent to the applicant which is evident from the postal receipts produced at Page No.18 of their typed set. Further the Demand Notice was published in two Newspapers, one in “Business Standard” (English) and another in “Dinamani” (Tamil) both dated on 17.07.2020 and copy of paper publication are produced at Page No.19 and

¶76

20 of typed set. In fact, the Demand Notice is also affixed on the conspicuous part of the property and the photograph of affixture are produced at Page No.21 and 22 of typed set.

¶77

5.4 Additionally, the applicant has admitted the receipt of Demand Notice in Para 5.8 of the SA, and failed to liquidate the entire liability nor made any objections/representation within the period of 60 days as stipulated under the Section 13(2) of the Act. Hence the respondent has proceeded further and issued Section 13(4) Possession Notice dated 24.09.2020 and produced the postal receipts of the Possession Notice which is produced at Page No.25 of typed set.

¶78

5.5 Further the Possession Notice is also published in two Newspapers, one in “The New Sunday Express” (English) and another in “Dinamani”

SA No.229/2024

21.08.2025

(Tamil) both dated on 27.09.2020 as is evident at Page No.26 and 27 of typed set. The Possession Notice is also affixed on the conspicuous part of the property, the photographs of affixture are produced at Page No.28 of typed set.

¶83

5.6 After the issuance of the statutory notices, respondent has proceeded further and obtained an Section 14 order dated 18.03.2022 before the Hon’ble Chief Judicial Magistrate Kancheepuram in Crl.M.P.No.69/2022 where an Advocate commissioner is appointed to take physical possession of the schedule property. Further the respondent has obtained a valuation report before putting the property for e-auction sale from an approved valuer.

¶84

5.7 The valuation report clearly shows the Market value of Rs.1,23,15,480.00/- and Forced sale value of Rs.92,36,610.00. After obtaining valuation report from an approved valuer, respondent has issued 1^st Sale notice dated 04.07.2023 fixing the sale on 08.08.2023 which is sent to applicant and Postal receipts are also produced by the bank. The sale notice was published in two Newspapers, one in “Trinity Mirror” (English) and another in “Makkal Kural” (Tamil) both dated on 06.07.2023 which is evident from the paper publications produced at Page No.42 and 43 of typed set.

¶85

5.8 The Sale Notice dated 04.07.2023 is also affixed on the conspicuous part of the property and photograph of affixture is produced at Page No.44 to 46 of typed set. However, the sale did not materialize due to want of

SA No.229/2024

21.08.2025

bidders. In fact, applicant has filed an SA No.77 of 2022 before this Tribunal and the same came to be dismissed on 27.04.2023. The applicant has complied with the conditional order and made payment of Rs.15,00,000/as per the order passed by this Tribunal dated 24.02.2022

¶90

5.9 The respondent yet again issued another Sale notice dated 16.04.2024 fixing the Auction on 07.05.2024. The Sale notice is also sent to the applicant and the Postal receipts is also produced by the bank. The respondent has published the Sale notice in two Newspapers, one in “The New Indian Express” (English) and another in “Dinamani” (Tamil) both dated on 19.04.2024 which is evident from the paper publications produced at Page No.49 and 50. The Sale notice is also affixed on the conspicuous part of the property and the photograph of affixture is produced at Page No.51 of typed set

¶91

5.10 The contention as raised by the applicant is that the Demand notice and Possession Notice was not signed by an Authorized Officer cannot sustain, as the Demand Notice and Possession Notice were duly signed by the Authorized officer and the same is countered by the respondent by producing list of approved Authorized officer with their Designation, Function, Grade.

¶92

5.11 The another contention raised is that the Possession Notice is neither published in two Newspapers nor affixed on the physical possession of the property, the said contention is countered by respondent by producing a copy paper publications and photograph of affixture which

SA No.229/2024

21.08.2025

reflects that the Possession Notice dated 24.09.2020 is published in two Newspapers, one in “The New Sunday Express” (English) and another in “Dinamani” (Tamil) both dated on 27.09.2020 produced at Page No.26 and 27 of typed set, Possession Notice is also affixed on the conspicuous part of the property which is evident from photograph of affixture produced at Page No.28 of typed set. Thus, it is evident from the records that the respondent bank has complied with all the procedures in issuing the demand notice and possession notice as contemplated under the Act.

¶97

5.12 On careful examination of the pleadings, documents produced by both the parties, it is an admitted fact that the applicant has availed the credit facilities of Rs.80,74,518/- and as security towards the repayment, created a mortgage by way of Memorandum of Deposit of Title Deeds dated 31.10.2013 which is registered as Doc.No.6483 of 2013. Further the applicant also admits the default committed which resulted in classification of loan account as NPA on 30.12.2019 as per the RBI Guidelines.

¶98

5.13 After classification of the account as NPA, respondent has proceeded further and issued Section 13(2) Demand Notice dated 27.05.2020 and admittedly received by the applicant. Further the Demand Notice was also published in two Newspapers, affixed on the property as per the Rules made there under. As the applicant neither liquidated the entire liability nor made any representation nor made an objection to the demand made in the Demand Notice, the respondent proceeded further and issued Possession Notice dated 24.09.2020 and the same is; sent to the

SA No.229/2024

21.08.2025

applicant as per the Postal receipts, published in two Newspapers, affixed on conspicuous part of the property.

¶103

5.14 further the respondent has obtained an Order under S.14 of the Ac and took physical possession as per order dated 18.03.2022 passed by Hon’ble CJM Kancheepuram at Chengalpattu in Crl.M.P.No.69/2022. Subsequently the respondent has put the property to auction after obtaining a valuation report from an approved valuer and proceeded further in issuing Sale notice dated 04.07.2023 fixing the sale on 08.08.2023 which did not materialize due to want of bidders.

¶104

5.15 The 2^nd Sale notice dated 16.04.2024 is issued fixing the Sale on 07.05.2024 which is challenged in the instant SA. The respondent as secured creditor has established the prescribed procedures in issuing the sale notice and the sale is successfully held. The contentions in respect of 2^nd e-auction sale Notice dated 16.04.2024 fixing the sale on 07.05.2024 is duly countered by the bank with supporting documents. In fact, applicant admits loan availed, mortgage of property a security. Default in repayment and classification of account as NPA, has failed to make out a case for interference of this Tribunal in the auction sale held and, in the measures taken by the bank under the Act.

¶105

Resultantly the present SA dismissed. The statutory demand notice dated 27.05.2020 and the S.13[4] possession notice dated 24.09.2020 and the sale notice dated 16.04.2024 are held as valid notices issued in accordance with the procedures under the Act and Rules made thereunder.

SA No.229/2024

21.08.2025

Consequently, the sale held on 07.05.2024 is also held as valid auction. Interim Order granted, if any stands vacated, pending IAs are disposed of in terms of this final order. No order as to cost.

¶110

Sd/(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

¶111

(Dictated to Steno (Mogesh), transcribed by him, corrected, signed and pronounced by me on this the 21^st day of August, 2025)

¶112

ANNEXURES

¶113

LIST OF DOCUMENTS PRODUCED BY THE APPLICANT

¶114

Sl. No.	Description of Documents	Document No.
1.	Securitisation application dated 02.05.2023	A-1
2.	Copy of the Demand Notice dated 27.05.2020	A-2
3.	Copy of the Possession Notice dated 24.09.2020	A-3
4.	Copy of the Statement of Accounts dated 23.01.2020	A-4
5.	Copy of the Proposal for One Time Settlement dated 04.02.2022	A-5
6.	Copy of the Initial proceedings of this Hon’ble Tribunal in SA No.77 of 2022 dated 22.02.2022	A-6
7.	Copy of the order passed by Ld. CJM Chinglepet under Section 14 SARFAESI Act in Crl.M.P.No.69/2022 dated 18.03.2022	A-7
8.	Copy of the Final proceedings in S.A No.77 of 2022 dated 27.04.2023	A-8
9.	Copy of physical possession notice issued by defendant dated 14.06.2023	A-9
10.	Copy of the petition in Crl.M.P.No.4899/2023 filed by the applicant before Hon’ble Chief Judicial Magsitrate, Chengalpet. Dated 16.06.2023	A-10

SA No.229/2024

21.08.2025

11.	Copy of the counter affidavit filed by the defendant dated 28.06.2023	A-11
12.	Copy of the Auction cum Sale Notice issued by the Defendant dated 04.07.2023	A-12
13.	Copy of the order passed by Chief Judicial Magistrate, Kancheepuram at Chinglepet in Crl.M.P.No.69/2022 dated 25.07.2023	A-13
14.	Copy of the order passed by Hon’ble Tribunal DRT-3 at Chennai in SA No.393 of 2023 dated 10.01.2024	A-14
15.	Copy of the impugned auction – cum sale notice dated 16.04.2024	A-15
16.	Vakalat dated 02.05.2024	A-16

¶119

LIST OF DOCUMENTS PRODUCED BY THE RESPONDENTS

¶120

Sl. No.	Description of Documents	Document No.
1.	Counter copy filed by the respondent	R-1
2.	Copy of Memorandum of Deposit of Title Deeds in Doc.No.6483 of 2013 dated 31.10.2013	R-2
3.	Copy of Demand notice issued under Section 13(2) of SARFAESI Act along with postal receipt and acknowledgement cards dated 27.05.2020	R-3
4.	Copy of demand notice paper publication (English – The New Indian Express) dated 17.07.2020	R-4
5.	Copy of demand notice paper publication (Tamil -Dinamani) dated 17.07.2020	R-5
6.	Copy of affixture	R-6
7.	Copy of Possession Notice under Section 13(4) with postal receipts and Acknowledgement cards dated 24.09.2020	R-7
8.	Copy of possession notice paper publication (English – The New Indian Express) dated 27.09.2020	R-8
9.	Copy of possession notice paper publication (Tamil–Dinamani) dated 27.09.2020	R-9
10.	Copy of Possession Notice affixture photos	R-10
11.	Copy of Section 14 order obtained from the CJM, Kancheepuram at Chengalpattu dated 18.03.2022	R-11
12.	Copy of Physical Possession photographs	R-12
13.	Copy of valuation report	R-13
14.	Copy of 1^stSale notice dated 04.07.2023	R-14

SA No.229/2024

21.08.2025

15.	Copy of sale notice paper publication (English – Trinity Mirror) dated 06.07.2023	R-15
16.	Copy of sale notice paper publication (Tamil– Makkal Kural) dated 06.07.2023	R-16
17.	Copy of sale notice affixture photos	R-17
18.	Copy of 2^ndsale notice dated 16.04.2024	R-18
19.	Copy of sale notice paper publication (English – The New Indian Express) dated 19.04.2024	R-19
20.	Copy of sale notice paper publication (Tamil – Dinamani) dated 19.04.2024	R-20
21.	Copy of sale notice affixture photos	R-21
22.	Copy of statement of accounts dated 04.06.2024	R-22
23.	Copy of letter of Authorization of the respondent’s representative dated 07.02.2024	R-23

¶125

SCHEDULE OF PROPERTY

¶126

All that piece and parcel of property in house site with building measuring extent of 3270 Sq.ft (75 Cents) comprised in survey No.74/2, as per patta, New Survey Number 74/8, Situated at old no.169, New Number 30, Peerkankaranai Village, Tambaram Taluk, Kancheepuram District, Tamilnadu and bounded on the

¶127

North by	:	Gayathri Street
South by	:	Land of Mrs.Helen Mary Jayakumari
East by	:	Ramalingam Street
West by	:	Vardan Iyyengar House and House Site

¶128

Sd/(S.V.GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

Mrs Dulsierni Lionel v. Smfg India Credit Formerly M S Fullerton India Credit Company Ltd.

Case brief

What is this about?

What did the court decide?

Mrs Dulsierni Lionel v. Smfg India Credit Formerly M S Fullerton India Credit Company Ltd.

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

Similar cases

Punjab National Bank versus Mohamed Ghouse

Bank of Baroda versus Mrs G Anuradha

Tamilnadu Industrial Investment Corporation Ltd. versus Mr C Bethuraj And Other

J Rathiga versus Ms Shriram Transport Finance Co. Ltd.

Dena Bank versus Babu

Bank of Baroda versus Ramesh Ramaswamy