Dismissed

M S Indiramma Enterprises v. Indian Bank

DRT1 Aug 2025SA/325/2022

Case brief

AI extract

What is this about?

This is an application under Section 17 of the SARFAESI Act challenging the validity of sale notices and enforcement proceedings. The Debts Recovery Tribunal held that since the highest bidder withdrew from the subsequent auction, the relief claimed became infructuous. The court dismissed the application but directed the bank to proceed afresh by issuing a fresh sale notice following statutory pro

What did the court decide?

Application dismissed. Respondent bank directed to proceed afresh for conducting sale of the schedule property by issuing a fresh sale notice by following the provisions of SARFAESI Act, 2002 and Rule

M S Indiramma Enterprises versus Indian Bank — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERYTRIBUNAL-1 AT HYDERABAD DATED THIS THE 1 ST DAY OFAUGUST, 2c.25

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PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No.325,/2022

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M/s Indiramma Enterprises Rep. by its Proprietor T.Jagadish, S/o T.Anjaiah, aged 40 years, Occ:business, Plot No.A-2O / I / pS, Road No. 1, TSIIC, IDA, Nacharam, Uppal Mandal, Medchal-Malkaj giriDistict..

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... Applicant

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Versus

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Indian Bank, Rep. by its Authorized officer Liberty Plaza, Himayath Nagar, Hyderabad-500 029.

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... Respondent Bank

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Counsel for the Applicant : Si D. Raghauulu Counsel for Respondent bank : Si Hemanth Kumar Vemui

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ORDER

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This Application is filed u/s. 17of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2OO2 (SARFAESI Act,2oo2l challenging the e Auction Sale Notice dt.16.1o.2022 and subsequent Auction Sale Notice dt. 1g.07.2023issued by the Respondent Bankfor conducting auction of the schedule properqr and to

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plicant in brief are as follows: 01 rlj0 2tr6

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The Applicant availed MSME Term loan from the Respondent bank by creating mortgage in respect of the schedule propert5r. Due to Covid_19, the Applicant could not pay the loan dues and so, the Respondent Bank initiated proceedings under the provisions of SARFAESI Act, 2002. The Respondent bank without issuing demand notice and possession notice, trying to take physical possession of the secured asset. The impugned possession notice was not published in daily newspapers and it was not affixed on the schedure property. The Respondent bank fa,ed to issue notice u/r 8(6) of security Interest (Enforcement) Rules, 2oo2 and failed to publish the Auction Sale Notice d,t.O6.lO.2O22 in two leading newspapers and affix the same on the schedule property. Subsequently, the Respondent bank issued fresh Auction Notice dt.18.O7.2023 for conducting auction on 23.0g.2023 without obtaining valuation report and the said notice was not served on the Applicant and it was not affixed on the schedule property. Hence the SA.

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The Respondent Bank filed their Reply denying all the adverse allegations made in the SA and contended that in view of the defaurt committed by the Applicant in repaying the loan dues, the Respondent Bank initiated proceedings under the provisions of SARFAES r Act, 2oo2 and issued demand notice d.t.t7 .06.2022 demanding the Applicant to repay the entire loan dues.As there was no response from the Applicant, the Respondent issued possession notice dt.0g.0g.2022 u/s l3(4) of the Act,2OO2 and took possession of the schedule propert5r. Thereafter, the Respondent issued sale Notice dt.06. 10.2022 but sare was not conducted in pursuance of the said sale notice. Thereafter the bank issued fresh Sale Notice dt.l8.OZ.2O23 for conducting auction of the schedule The Respondent Bank has served notice u/r by duly following the procedure contemplated AESI,Act,20O2 and Rules made thereunder. it posed could not take place and so, the SA _'i**8',^{fl)io?m *}

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becomes infructuous. Accordingly, Respondent Bank prayed to dismiss the SA.

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Heard Ld. Counsel for the Applicant and Ld. Counsel for the Respondent Bank and perused the material brought on record.

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During the course of arguments, Ld.counsel for the Respondent Bank filed a memo stating that even though auction was conducted on 23.08.2023, the same was not confirmed in favour of the highest bidder and subsequently, the highest bidder has withdrawn from the auction.

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Now the points that arise for consideration are

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i. uhether the relief claimed in the sA becomes infntctuous?

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ii. To uhat relief ?

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Point No.i :

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7 - The undisputed facts of the case are that the Applicant availed loan from the Respondent Bank by creating mortgage against the schedule property and thereafter committed default in repaying the loan dues and so, the Respondent Bank initiated proceedings under the provisions of SARFAESI Act, 2oo2 and issued notices to the Appricant.

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The present SA is filed by the--lA.pplicant challenging the validity of the O.2O22 and I8.O7.2023 issued by the Respondent of the schedule property. No auction was

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in pursuance of the impugned sale notice auction was conducted by the Bank in

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.-'1 6'tfr'zo2fro u - *'#"

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pQfsuance dt.18.07.2023, the said auction was not

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confirmed in favour of highest bidder and subsequently, the highest bidder has withdrawn from the auction proceedings. So, the said auction was not materialized in pursuance of the sale Notice dt. 1g.07.2023 and. so, the relief claimed by the Applicant in the SA becomes infructuous. Hence, I am of the opinion that the relief claimed by the Applicant in the present SA becomes infructuous and the SA is liable to be dismissed. Suffice, if a direction is given to the Respondent bank to proceed afresh for conducting sale of the schedule property by issuing fresh sale notice by duly following the provisions of sARFAESI Act, 2002 and Rures made thereunder.

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So in the circumstances, the impugned sare notice becomes infructuous and nothing survives in thesA for adjudication as there is no need to decide the validity or otherwise of the impugned sale Notice dt.18.o7.2023. The Respondent is directed to proceed afresh for conducting sale of the schedule property by issuing fresh sale notice by duly following the provisions of SARFAESI Act, 2OO2 and Rules made thereunder.

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Potnt No.(tl)t

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1 1 . In the result, SA 325 122 is dismissed as there are no merits. Consequently, the Interlocutory Applications, pending if any, shall stand disposed of. No order as to costs.

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l2.Communicate a copy of this order to the parties concerned.

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corrected, signed and pronounced bg me in tlrc open

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sd/(G. coPr CHANDI PRESIDING OFFICER

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01ru07m

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M S Indiramma Enterprises v. Indian Bank

Case brief

What is this about?

What did the court decide?

M S Indiramma Enterprises v. Indian 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

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