Dismissed

Ms General Trading Company v. Jammu and Kashmir Bank Limited

DRT29 Oct 2025SA/286/2025

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal declined to entertain a Securitization Application challenging Section 13 and 14 notices. The Court held the application an abuse of process, as applicants had withdrawn prior writ petitions seeking OTS without reserving rights to challenge notices, thereby abandoning the grounds for this fresh legal proceeding.

What did the court decide?

The present Securitization Application challenging notices under Section 13(2), 13(4) and Section 14 of the SARFAESI Act is dismissed as an abuse of process of law.

Ms General Trading Company versus Jammu and… — Contract and Commercial Disputes | DRT (2025)

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SA No.286/2025

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DEBTS RECOVERY TRIBUNAL-I, CHANDIGARH

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SA/286/2025 M/S GENERAL TRADING COMPANY AND OTHERS Vs. A.O. , JAMMU AND KASHMIR BANK LIMITED

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Dated: 29.10.2025

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Item No. (Supplymentary-2)

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Argued by: Mr. Rohit Sapra, Counsel for the Applicants. Mr. Mayank Mathur, Counsel for Respondent Bank.

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M/s General Trading Company and others (Applicants) have filed this Securitization Application under Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), against the Authorized Officer, Jammu and Kashmir Bank Limited (Respondent).

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Applicant No.1 is a partnership firm comprising Applicant No.2 and 3 as partners. Applicant No.4 is the alleged mortgagor/guarantor. Respondent Bank had sanctioned some credit facilities to Applicant No.1. To secure the loan, Applicants had created security interest in respect of the properties fully detailed in the notice under Section 13(2). As per Bank, Applicant No.2 and 4 are the owners of one of the properties. However, Applicants dispute this fact and state that only Applicant No.2 is the owner of the property (4 Kanals). Applicants could not repay the loan. Accordingly, the Respondent Bank declared the account NPA. On 21/22.11.2023, Bank issued the notice under Section 13(2) demanding a sum of Rs.14.90 Crores and odd sum from the Applicants. The notice was received by the Applicants on 25/26.11.2023. Since, the payment was not made, on 15.03.2024, Bank issued the notice under Section 13(4) of the SARFAESI Act. As per the Applicants, the notice under Section 13(4) was affixed on one of the properties. On 02.04.2024, Applicants filed writ

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petition No.729/2024 challenging the notices under Section 13(2) and 13(4) of the SARFAESI Act and order dated 11.08.2023 passed by the Bank vide which the Bank had rejected the request of the Applicants for extension of OTS which had already been approved by the Bank for Rs.5.10 Crore. Earlier, Applicants had deposited Rs.51 Lacs. During the pendency of the writ petition Applicants also deposited Rs.1.00 Crore. While this writ petition was pending, on 14.03.2025, Bank wrote a letter to the Applicants stating that it is ready to settle the account of the Applicants on the payment of Rs.4.48 Crores by way of OTS. On 27.03.2025, Applicants sought some clarification from the Bank and stated that according to them the account should be settled for Rs.4.00 Crore. On 20.05.2025, Hon’ble the J&K High Court, passed the following order in writ petition No. 729/2024: -

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Learned counsel for the petitioners seeks leave of this Court to withdraw this petition to pursue his request for OTS, which as per petitioner is pending consideration of respondent-Bank. His statement is taken on record.

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This petition is disposed of by providing that in case a request of the petitioner for OTS is pending consideration of the Bank, the same shall be considered and final decision taken thereon within a period of four weeks from the date a copy of this order is served upon the respondent-Bank. The decision shall be taken by the Bank strictly as per OTS scheme in vogue as on date.

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As per the Applicants, on 09.06.2025, they submitted an OTS proposal for Rs.4.00 Crore. However, vide letter dated 16.06.2025, the Bank rejected the same stating that it is not as per the policy guidelines in vogue. Applicant again filed writ petition No.1441/2025 for the direction to the Bank to settle their account by way of OTS as per their letter dated 09.06.2025. However, later on Applicants themselves withdrew their writ petition on 09.07.2025 as the Applicants had not filed on the record the

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order dated 16.06.2025 vide which the Bank had rejected the OTS. Applicants again filed writ petition No.1979/2025 wherein, they challenged the order dated 16.06.2025 and seeking reconsideration of the OTS proposal dated 09.06.2025. This writ petition is still pending in the Hon’ble High Court. Thereafter, the Bank filed an application under Section 14 before the CJM, who vide order dated 01.09.2025 allowed the application. On 12.10.2025 Applicants filed the present SA challenging the notices under Section 13(2) and 13(4) and the order under Section 14.

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Bank, in reply to the application, apart from raising other pleas has raised a plea that this SA is not maintainable as Applicants had earlier filed writ petition No.729/2024, wherein, they had challenged the notices under Section 13(2) and 13(4) along with the rejection of the extension of the OTS by the Bank on 11.08.2023. The case of the Bank is that Applicants had withdrawn the writ petition on 20.05.2025 with a specific plea they would pursue their request for OTS which as per the Applicants were pending consideration with the Respondent Bank. Accordingly, the present SA is not maintainable.

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I have heard Mr.Sapra, counsel for the Applicants and Mr.Mayank Mathur, counsel for the Respondent Bank.

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Mr.Sapra, counsel for the Applicants has argued that the circumstance that Applicants had filed writ petition No. 729/2024 and withdrawn the same does not debar them from filing the present SA. He has argued that DRT is the competent authority to adjudicate the validity of the notices under Section 13(2) and 13(4). Mr.Sapra has placed reliance upon the judgment passed by the Hon’ble Supreme Court in Civil Appeal No. 11752-11753/2025, titled Satheesh V.K. versus The Federal Bank Limited,

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decided on 23.09.2025 . Mr.Sapra further argued that the Bank has obtained the order under Section 14 of the SARFAESI Act. Whereas, the application under Section 14 was signed by the counsel for the Bank; the affidavit was signed by the authorized officer. As per Section 14 of the Act, the application should be signed by the authorized officer and not by anybody else. Mr.Sapra submitted that he would argue the remaining issues after the disposal of the issue regarding the maintainability of the present SA.

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Per contra , Mr.Mathur, counsel for the Respondent Bank has argued that Applicants had earlier filed writ petition No. 729/2024 wherein they had challenged the notices under Section 13(2) and 13(4) of the SARFAESI Act. However, Applicants themselves, on 20.05.2025, withdrew writ petition No. 729/2024 with the specific plea that they would pursue their OTS. Mr.Mathur argued that in fact Applicants themselves abandoned their grounds to challenge the notices under Section 13(2) and 13(4). Applicants again filed writ petition No. 1441/2025 and 1979/2025 before the Hon’ble J&K High Court. However, in both the writ petitions, Applicants did not challenge the notices under Section 13(2) and 13(4). Mr.Mathur argued that the Hon’ble J&K High Court has held that a borrower can file the writ petition in the Hon’ble Court in case he wants to challenge the notices under Section 13(2) and 13(4). Since, any writ petition at the instance of the Applicants as on date is barred, the right of the Applicants to file the SA is also barred. Mr.Mathur further argued that since the Applicants are debarred from challenging the notice under Section 13(4), they are also debarred from challenging the order passed under Section 14. Mr.Mathur argued that the order under Section 14 is nothing more than the implementation of the notice under Section 13(4). Mr.Mathur also placed

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reliance upon the judgment passed by the Hon’ble Supreme Court of India in Satheesh V.K. versus The Federal Bank Limited, decided on 23.09.2025 .

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I have considered the rival contentions.

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I am of the considered view that this SA is an abuse of the process of law. On 02.04.2024, Applicants had filed writ petition No. 729/2024 wherein they had challenged the notices under Section 13(2) and 13(4) as well as the order dated 11.08.2023 passed by the Bank whereby it rejected the request of the Applicants for extension of the OTS. On 20.05.2025, Applicants themselves had withdrawn writ petition No. 729/2024 with the request that they would pursue with their OTS. Applicants never sought liberty to challenge the notices under Section 13(2) and 13(4) of the SARFAESI Act. Applicants again filed two writ petitions i.e. writ petition No.1441/2025 and 1979/2025 wherein they did not challenge the notices under Section 13(2) and 13(4). The SARFAESI Act has been enacted with the avowed object to realize the dues of the Bank expeditiously. The Act gives strict guidelines within which the challenge to the notices be made. The Act provides specific timelines within which the court should dispose of the SAs. In the case in hand, Applicants had challenged the notices under Section 13(2) and 13(4). However, they themselves had withdrawn their writ petition. Applicants again filed two writ petitions. However, in the same they did not challenge the notices under Section 13(2) and 13(4) of the SARFAESI Act.

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I am of the considered view that Applicants themselves abandoned their grounds to challenge the notices under Section 13(2) and 13(4). As far as challenge to the order under Section 14 is concerned, I am of the

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considered view that the order under Section 14 is nothing more than implementation of the notice under Section 13(4).

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I am of the considered view that Applicants have made a crude attempt to sabotage the recovery by the Bank. Applicants are debarred from filing the present SA challenging the notices under Section 13(2) and 13(4) as well as order under Section 14 of the SARFAESI Act. Accordingly, the present SA is hereby dismissed .

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All the pending IAs, if any are also stand disposed of accordingly.

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Registrar is directed to send a copy of this order to all the parties, as per rule. File be consigned to record room after due compliance.

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(A S Narang) Presiding Officer DRT-I, Chandigarh

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Pronounced in open court Dated: 29.10.2025 Manoj

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Ms General Trading Company v. Jammu and Kashmir Bank Limited

Case brief

What is this about?

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Ms General Trading Company v. Jammu and Kashmir Bank Limited

Case brief

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