Dismissed

M S Veer Petroleums Private Limited v. Tamilnad Mercantile Bank Limited

DRT10 Sept 2025SA/292/2022

Case brief

AI extract

What is this about?

Application under Section 17 of SARFAESI Act challenging a Possession Notice for non-affixation and non-publication was dismissed as the bank proved service via post and publication in newspapers.

What the court decided

AI extract

M S Veer Petroleums Private Limited versus Tamilnad Mercantile… — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERYTRIBUNAL - 1 AT HYDERABAD

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DATEDTHISTHE 1 OTH DAYOF SEPTEMBER, 2025

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PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER

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SA.No.292/2022

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M/s Veer Petroleums P.Ltd., Administrative office at 615, 6th floor, Babukhan Estate, Basheerbagh, Hyderabad-SO0 001 Rep. by its Director Sri Rajendra Prasad Agarwal.

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. .. Applicant

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Tersus

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Tamilnadu Mercantile Bank Ltd., Rep. by its Authorized officer Hyderabad branch, 15-2-696, 1st floor, Siddiamber Bazar, Kishan Gunj, Hyderabad-S0O O12.

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Reserve Bank of India, Rep. by its Regional Director,

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6- 1-56, Secretariat Road, Saifabad, Hyderabad-S0O 004.

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. .. Respondents

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Counsel for the Applicant ; Sn G.K. Deshpande Counsel for 1.t Respondent : Si K. Raghauendra Rao Respondent No.2

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ORDER

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This Application is filed u/s. 17 of the Securitization and Reconstruction of Financial Assets rcement of Security Interest Act, 2OO2 (SARFAESI A the Possession Notice dt.2O.lO.2O22 issued by t of the schedule properties and to declare the 1O SEP il6SEP il6il6 2. The by thethe brief are as follows:

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1O SEP il6SEP il6il6 2. The by thethe

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The Applicant Company has been incorporated under the Companies Act, 2013 and is registered as a Small Enterprise with the Ministry of Micro, Small & Medium Enterprises. The Applicant company is engaged in the manufacture of various petroleum products and carries out the processes of Petroleum fractionation cum Sulfonation in order to produce blown bitumen and bitumen emulsion. The Applicant availed Term loan of Rs.2.76 crore for construction of factory building and Term loan of Rs.4.56 crores towards purchase of plant and machinery and a Cash Credit loan of Rs.7.35 crores from the 1st Respondent and collateral security was offered and also personal guarantees of Mr.Niranjan Agarwal, Mrs.Uma Devi Agarwal, Mr.Krishna kumar Agarwal and Applicant were given. Subsequently there was a proposal for restructuring of the loan accounts and there is correspondence between the 1st Respondent and the Applicant but re-structuring was not materialized as the Applicant objected regarding the change of interest and personal guarantee and additional collateral security to be given by M/s Platinum Distilleries P.Ltd. The 1st Respondent declared the loan accounts of the Applicant as NPA and issued demand notice dt.07.09.2}19 u/s 13(2) of the SARFAESI Act,2OO2 to the Applicant company and the guarantors to discharge their liabilities. The Applicant issued a legal notice d1.06.09.2019 questioning the categorization of the accounts of the Applicant as NPA. To the said notice, the 1st Respondent issued reply notice dt.2O.O9.2Ol9 denying the allegations of the Applicant. The Applicant issued rejoinder notice dt.oi.10.2019. Thereafter, the lst Respondent issued possession notice dt.20.1O.2022 for taking symbolic possession of the schedule properties. The said notice was not served on the Applicant and not affixed on the schedule properties and the said notice was also not published in two leading newspapers. Hence the SA.

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Reply denying all the adverse allegations m'tne con that the Applicant after availing loan t Bank, committed defqult in repaying the

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loan dues and so, the loan accounts were classified hs NPA by the 1st Respondent on 31.07.2019. Restructuring of the loan accounts was not materialized as the Applicant has not agreed for the terms and conditions of the sanction letter and refused to sign and execute the restructure agreement. Thereafter, the 1.t Respondent issued demand notice dL.O7.O9.2OI9 u/s 13(2) of the SARFAESI Act, 20o2 and the said notice was duly received by the Applicant and the Applicant issued reply dt.26.lO.2Ol9. Thereafter, the 1st Respondent issued possession notice dt.2O.lO.2O22 u/s 13(a) of the SARFAESI Act, 2OO2 and took symbolic possession of the schedule properties. The said notice was affixed on the schedule properties and it was published in The Hindu and Eenadu daily newspapers. Thus, the 1"t Respondent has duly followed the procedure contemplated under the provisions of SARFAESI Act,2OO2 and Rules made thereunder in taking possession of the schedule properties. Accordingly, 1"t Respondent prayed to dismiss the SA.

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Heard Ld. Counsel for the Applicant and Ld. Counsel for the lst Respondent whereas notice not taken against Respondent No.2 and so claim against Respondent No.2 was dismissed. Perused the material brought on record.

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Now the points that arise for consideration are

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uhettter the Applicant has established ang ualid grounds for challenging the Possession Notice dt.20.10.2022 issued bA tLe l.t Respondent against tlrc schedule properties?

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ts, Ld. Counsel for the Applicant and Ld. dent reiterated their respective versions as

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ssrya.stp 2[25

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7 . There is no dispute regarding the fact that the Applicant availed various credit facilities from the lst Respondent and created mortgage in respect of the schedule properties to secure the said loan and thereafter, the Applicant committed default in repayment of loan dues. Subsequent to availment of loan facilities by the Applicant, there was a proposal for re-structure of the loan but the same was not materialized for various reasons. There is also no dispute regarding the fact that the lst Respondent declared the loan accounts of the Applicant as NPA and issued demand notice dt.O7.09.2O19 and the same was received by the Applicant.

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The specilic contention of the Applicant is that the impugned possessron notice dt.20. 1O.2O22 issued by the l.t Respondent was neither affixed on the schedule properties nor published in two leading newspapers and so, the said notice is null and void.

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Per contra, 1"t Respondent contended that they have duly followed the procedure laid down under the provisions of SARFAESI Act, 2OO2 and Rules made thereunder in issuing demand notice and possession notice to the Applicant.

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In order to substantiate their contention, the lst Respondent filed relevant material documents along with the counter filed by them in the stay petition. As per the said documents, it is clear that the lst Respondent issued Possession Notice dt.2O.lO.2O22 and sent the said notice to the lhrough^{Regd. Post and admittedly, the Applicantreceived the} r'fact, the Applicant Iiled copy of the said^possession notice by them. The said possession notice was published

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in English and daily newspapers as evidenced by the copies of by the 1st Respondent and the said notice was also

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pS$ 6uotirySion properties as depicted in the copies of photographs

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filed by the 1st Respondent. Thus, the lst Respondent has scrupulously followed Rule 8(1)&(2) of Security Interest (Enforcement) Rules, 2OO2 in issuing possession notice to the Applicant.

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Hence in the circumstances, it is quite clear that the lst Respondent 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 to the Applicant and there are no violations. So, the said possession notice dt.2O.lO.2O22 issued by the lst Respondent against the schedule properties is perfectly legal and valid. Accordingly, this point is answered in favour of the l"t Respondent and against the Applicant.

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Potnt No.(tl)r

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