Dismissed

Patha Chandra Mohan v. Punjab National Bank

DRT29 May 2025SA/247/2023

Case brief

AI extract

What is this about?

In this application under Section 17 of the SARFAESI Act, 2002, the applicant challenged the bank's auction notice and possession steps alleging procedural violations. The tribunal dismissed the application, noting the auction had already been conducted and sold to a third party due to lack of bidder, making the case incomplete without the purchaser.

What did the court decide?

The application was dismissed. An apparent surplus of Rs 57 Lakhs was noted as having been transferred to the applicant via a subsequent letter.

Patha Chandra Mohan versus Punjab National Bank — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL. I AT HYDERABAD

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DATED THIS THE 29TA DAY OF MAY, 2025

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No.2 47 /2023

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Sri Patha Chandra Mohan, S/o Rajaiah, Aged 51 years, Occ:business, R/o H.No.6-8- t89l 1,, Namdevwada, Nizamabad, Nizamabad District-s03 002

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... Applicant

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And

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Punjab National Bank, Situated at Circle Sastra, Circle Offi ce- Secunderabad And also at 2nd Floor, Maharshi House, Road No.3, Banjara Hi11s, Hyderabad-SOO 034. Rep.by its Authorized oflicer

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.... Respondent Bank

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Counsel for tLrc Applicant Si D.Raghauulu Counselfor the Respondent Bank Ms.Sangeetalaiswal

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:ORDER.

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This application is filed by the Applicant u/s.17 of the SARFAESI Act, 2002, challenging the Auction Sale Notice dt.23.06.2023 issued by the Respondent Bank for conducting auction of the schedule property and aiso the steps initiated 6y the bank for taking physical possession of through advocate commissioner u/s 14 of the

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and to declare the same as illegal and void.

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in the application, in brief, are that:
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sAz47l23

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The Applicant availed loan from the Respondent Bank and created mortgage in respect of the schedule property. But due to Covid-l9, the Applicant could not repay the loan amounts due. On 15.07.2023, the Applicant came to know that the Respondent bank is trying to sell the schedule property in pursuance of the Sale Notice dt.23.O6.2O23 but no demand notice and possession notice were served by the Respondent and the said possession notice was neither affixed on the schedule property nor published in two newspapers. Similariy, the impugned sale notice was neither published in two leading newspapers nor affixed on the schedule property. The Respondent Bank is trying to take physical possession of the schedule property through advocate commissioner pursuant to the orders of Ld.CJM, Nizamabad. Hence the SA.

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The Respondent Bank filedReply by denying all the adverse allegations made in the SA. It is contended that the Applicantavailed loan from the Respondent Bank by creating mortgage in respect of the schedule property and thereafter committed default in paying the outstanding dues and so, the loan account was classified as NPA. The Respondent Bank issued Sale Notice dt.18.O5.2O22 and sent the said notice to the Applicant through Regd.Post and later issued another Sale Notice dt.22.O6.2O22 but the said auctions could not be conducted due to lack of bidders. Thereafter the Respondent bank issued fresh Auction Sale Notice dt.23.O6.2O23 fixing the date of auction on 20.O7.2023 and the said notice was published in Business Standard and Mana Telangana newspapers and also affixed on the schedule property. Accordingly, auction was conducted on 20.O7.2023 and sale was confirmed in favour of the highest bidder Sri Kapuka {e . REspqdent bank has followed the due procedure in ,rfr{alr* rutev.Ifit r',otices to the Applicant and in conducting ffi^{,,,r"1"n.jiffurperty.Hence there are no merits in the SA} the SA is liable to 2 I^qlY:i-rtJ -!.

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sA 247 /23

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Heard Ld. Counsel for the Applicant and Ld. Counsel for 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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Whether the Applicant has established. ang ualid. grounds for challenging the auction conducted bg the Respondent Bank in respect of the schedule property pursuant to the Sale Notice dt.23.06.2023 and also the steps initiated bg the Bank for taking phgsical possession of the schedule property?

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ii) To what relieJ?

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Point No.l :-

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During the course of arguments, Ld. Counsel for the Applicant and Ld. Counsel for theRespondent 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 the Respondent Bank and thereafter committed default in repaying the loan dues. But the specific contention of the Applicant is that prior to issuance of the sale notice, the Respondent bank has not served any notice and the impugned sale notice was not affixed on the schedule property and the said notice was also not published in daily newspapers. Similarly, the impugned possession notice was also not published in two daily newspapers.

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Per contra, the Respondent Bank contended that the Bank has strictly followed th ure contemplated under the provisions of SARF Rules made thereunder in issuing all the rel [cant^{and also in conducting auction of the} ..,}

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ed property. 2 I^','u zm:

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sA 247 /23

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To substantiate their contentions, the Respondent Bank hled material documents along with the Reply filed by them. As per the said documents, it is clear that Respondent Bank issued fresh Sale Notice dt.23.O6.2O23 and the said sale notice was affixed on the scheduleproperty and it was also published in two daily newspapers. After filing of the SA, auction was conducted by the Respondentbank in respect of the schedule property and sale was confirmed in favour of the highest bidder but the Applicant has not taken any steps for impleading the auction purchaser as Respondent in the present SA. During the course of arguments, Ld. Counsel for the Respondent Bank filed a memo stating that the schedule property was sold in the public auction conducted by the Respondent Bank and thereafter, theloan dues were adjusted out of the sale proceeds o[ the schedule property and the surplus sale proceeds are received by the Applicant by addressing a letter to the Respondent Bank. The Respondent bank fi1ed a letter dt.19.12.2o24 addressed by the Applicant and his wife stating that the sale proceeds are appropriated towards loan dues and there is surplus amount ol Rs.57,24,728.30 ps. and the said amount maybe transferred to the accountof the Appticant herein. The Applicant has also made a request in the said letter to theRespondent to return the household articles which are lying in the schedule property. So by accepting the auction conducted by the Respondent Bank in respect of the schedule propert5z and also the measures taken by the Bank for taking physical possession of the schedule property u/s 14 of the SARFAESI Ac!,2002, the Applicant addressed the said letter fi nt of the surplus amount into his account and see Bank to take household articles from the sch

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So in of the Applicant at present, is not erbsted in^prosecution same, the AS , r. ., Respondent in tffi-Silr. -tfien ",_r-. auction has aiready been conducted by 4

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sA247123

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the Respondent bank^{in respect of the schedule property, the validity} or otherwise of the^{impugned auction conducted by the Respondent} Bank, cannot be^{decided in the absence of the auctionpurchaser} who is the bonafidepurchaser^{and ultimate suffererinthe} proceedings sought to be^{set aside by the Appiicant. So considering} all the circumstances,^{I am of the opinion that there are no merits in} the SAand the SA is^{liable to be dismissed.}

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Point No.(ii):-

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In the result, sA247 12023^{is dismissed as devoid of merits.}

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t2. 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 partiesconcerned.}

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(Dctated to the^p.S transcribed^{by her,corected,signed and pronouncedby me in the open courton this the29h} dag ofMay,2O25).

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sdl - (G. GOPI CHAND) PRESIDING OFFICER

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?. 9 \tl

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ffijwAss{. R*fistrar oRT'r, HYDFll'4t1^o,

Patha Chandra Mohan v. Punjab National Bank

Case brief

What is this about?

What did the court decide?

Patha Chandra Mohan v. Punjab National 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

All orders in this case

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