A Debt Recovery Tribunal dismissed an application challenging a possession notice under the SARFAESI Act. The court held that non-affixation of the notice on the property did not render it invalid since the borrowers received it via registered post and details were published in newspapers.
Application SA No. 2/12/24 dismissed; no merits found.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE DEBTS RECOVERYTRIBUNAL- I AT HYDERABAD
DATEDTHISTHE 4TH DAYOFDECEMBER,2O2S
PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER
SA.No.2as/2024
. .. Applicants
Versus
.. . Respondents
Counsel for the APPlicants Counsel for Respondents
: Ms.D.Naga Sirisha : Sn N.Raglruueer
:24.10.2O25 : 04.12.2025 : O4.12.2025
ORDER
The Applicant No. 1 who is running a small rice mill, availed loan of Rs.2O lakhs from the Respondent No.l whereas the Applicant No.2 stood as guarantor and created mortgage in respect of the schedule property to secure the said loan. Due to Covid-19, the Applicants could not pay some instalments. The Respondent Bank without any intimation, classified the loan account as NPA and issued demand notice dt.O1.O4.2023 u/s 13(2) of the SARFAESI Act, 2002 which is not served on all the Applicants/ guarantors. Thereafter, the Respondents issued possession notice and the s€une was not served on the Applicants and the impugned possession notice was not affixed on the schedule property and also not published in two leading newspapers as prescribed under Rule S(l)(2) of Security Interest (Enforcement) Rules, 2002 and so, said notice is not legal and valid. Hence the SA.
J.
i* .l
The Respondents filed their Reply denying all the adverse allegations made in the sA and contended that Applicant No.1 availed credit facilities from the Respondent Bank and Applicant No.2 created mortgage against the schedule property. After availing the loan facilities, the Applicants default in repaying the loan dues and so, the Respondents under the provisions of SARFAESI Act, 2OO2 and u/s l3(2) of the SARFAESI Act, 2002 or.Ot.O4.2O23 I tbe SARFAESI Act, 2002 to the Applicants and others. tlterRespondents issued possession notice dt. 15.06.2024 by
duly following the procedure contemplated under the provisions of SARFAESI Act,2OO2 and Rules made thereunder and there are no violations. Thereafter the Respondents also proceeded for taking physical possession of the schedule propert5r. Accordingly prayed to dismiss the SA.
whether the Applicants ltaue established. ang uali.d. grounds for settirLg aside tle Possession Notice dt.15.O6.2O24 issued bg the Respondents agairst tlrc schedule propertA?
Polnt No.lil>
During the course of arguments, ld. Counsel for the Applicants and Ld. counsel for the Respondents reiterated their respective versions as stated supra.
tion of the Applicants is that the Respondents without r,-fterving and possession notice to the Applicants trying to * t"t'4 ohv 'al, possGsion of the schedule property. The impugned posse ss10l ice.was neither affixed on the schedule property nor Urfl6_
,. ::\i
rt,
published in two leading newspapers and so, the said possession notice is not legal and valid.
9 ' In order to prove their contentions, the Respondents filed material documents along with the Reply filed by them. As per the said material documents, it is clear that the Respondents issued demand notice dt'o1.o4.2o23 and the said notice was sent to the Applicants through Regd.Post as evidenced by the postal track reports filed by the Respondents. Thereafter, the Respondents issued possession notice dt.r5.o6-2024 and sent the same to the Applicants through Regd. post as evidenced by the postal track reports filed by the Respondents. In fact, the Applicants filed copy of the said possession notice along with the sA which clearly indicates that the Applicants received the said notice. The said possession notice was published in Telugu and English daily newspapers as evidenced by the copies of the paper publication filed by the Respondents. However, no documents are filed by the Respondents to prove that the said possession notice is affixed on the schedule property. But mere non-affixture of the possession notice on the schedule propert5r particularly when the borrower is having knowledge of the possession notice issued by the Respondent, cannot be a ground to challenge the said notice. when the Applicant received the possession notice and the said notice is also pubrished in two daily newspapers including one in vernacular language, even if the said notice is not affixed on the secured be a ground for the borrower as the affixture is meant public. In this regard, the Hon'ble High Court of M/s Sollthro Prf:vate Llmlted Vs. The Debts ln 2078 SCC Onltne Hgd, 188, has held as follows:
4
,,,_ it . itt
f''5
Point No.(tl)r
(Dictated to the P's, transcribed bg.her, _arrected., signed. and. pronounced. bv me in the open court on this the 4th dag of December, 2025)
sd/(c. coPr CHANDI PRESIDING OFFICER
c.
i
t4oEC,rr75 ;
Aftn%'
t'o,!yi:r J^,
5
2 issues framed by the court
Whether non-physical affixation of the possession notice on the property constitutes a valid ground to set aside the notice when the borrower received the notice and it was published in newspapers.
Whether the Respondent owed the protection of the SARFAESI Act in issuing the possession notice.
Colour shows how this judgement treated each authority
M/s Sollthro Private Limited Vs. The Debts Recovery TribunalReferred¶37
M/s Sollthro Private Limited Vs. The Debts Recovery Tribunal - I, Sec. 32/2078, SCC Online 503 · Who else cites this
2 provisions across 2 enactments
Mohan Babu Amgoth
Mrs. Pushpa Amgoth
Shriram Finance Ltd.
Gummadigopichand
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
