Dismissed

Mr Abdul Raheem Mohd v. Iifl Housing Finance Limited

DRT14 Feb 2025SA/338/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed the applicant's application challenging a possession notice under the SARFAESI Act. The court held that while the respondent failed to prove physical affixation of the notice, valid service via registered post and newspaper publication sufficed, relying on a High Court precedent.

What did the court decide?

Application SA-338/2022 dismissed; pending interlocutory applications stood disposed of.

Mr Abdul Raheem Mohd versus Iifl Housing Finance Limited — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT HYDERABAD DATED THIS TI-IE 14T11 DAY OF FEBRUARY, 2025

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PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER

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SA.No.33A/2022

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Mr. Abdul Raheem Mohd., S/o Mr.Mohd. Abdul Aziz, aged 56 years, Occ:business, R/o 10-2-3181 I lAl 1O, Flat No.301, Block-A, Aziz Heights, Indranagar, Vijay Nagar colony, Plot No. 10& 1 1 , Asif nagar, Ilyderabad-SOO 028.

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... Applicant

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Versus

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IIFL Home Finance Ltd., Rep. by its Authortzed Officer Situated at IIFL House, Sun Infotech park, Road No.16v, Plot No.ll-23, MII)C, Thane Industrial Area, Wagle Estate, Thane-4OO 604 Rep. by its Authorized officer ... Respondent

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Counsel for the Applicant : Sn D. Raghauulu. Counselfor Respondent ; Sn .l[.8. Sudarshan

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ORDER

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This Application is filed u/s.17of the Securitization and Reconstruction of F inancial Asset.s and Llnforccment <lf Security Interest Act,2OO2 (SARFAESI Act, 2OO2) ch Possession notice dt.11 .11.2022 issued by the l?espon schedule property and to declare the same as illggal arrd

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re as follows: rhe averm",,," -"al* *J^$rtffifA r;*j WM

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sA33812022

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The Applicant availed housing loan from the Respondent and created equitable mortgage in respect of the schedule property. Due to Covid-19, the Applicant could not pay some instalments and so the loan account was declared as NPA and thc Respondent initiated proceedings under the provisions of SARFAESI Act,2002. The Respondent without issuing demand notice, directly issued Possession Notice u/s 13(4) of the Act to the Applicant and the said possession notice was not served on the Applicant and the same was not published in two daily newspapers nor affixed on the schedule property as prescribed under Rule 8(1)&(2) of Security Interest (Enforcement) Rules, 2OO2. The Respondent suppressed the proceedings in SA 339/ 22 and obtained orders from the Ld.VI Addl.CMM, Nampally for taking physical possession of the schedule property. I'lcnce the SA.

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The Respondent filed their Reply denying all the adverse allegations made in the SA and contended that in view of the default committed by the Applicant in repayment of loan outstanding dues, the loan account was classified as NPA and the llespondent issued demand notice u/s 13(2) of the SARFAESI Act, 2OO2 on 10.08.2022 and the said notice was sent to the Applicant through regd. post and the said demand notice was also published in Indian Bxpress and Andhra Prabha daily newspapcrs. As the Applicant. failcd Lo repay the loan dues as demanded within 60 days, the Respondent issued Possession Notice u/s 13(4) of the Act dt.11.11.2022 for taking symbolic possession of the schedule property and the said notice was affixed on the schedule property and also published inThe Indian Express and Andhra Prabha daily newspapers on 16. t I .20'22. I3efore granting stay by this^Hon'ble Tribunal in the present SA, the Respondent approached CMM, Nampally No.309/23 and obtained orders u/s 14 of the sARFAESl*n;i, i.g^{physicalpossession of the schedule} property s'flo ,n" ns. Thus, the Resp<>ndent has followed the proced.rry fqryruftccl du.Hder the provisions of SARFAESI Act,

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i:' -.€s .".:.

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sA33812022

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2OO2 and Rules made thereunder in proceeding against the schedule property. AccordinglyRespondent prayed to dismiss the SA.

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Heard both sides. Now the points that arise for consideration are

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uhether the Applicant has established anA ualid ground for challenging the Possession Notice dt.11.11.2022 issued by the Respondent against the schedule property?

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ii.^'l'o uhat relief ?

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Polnt.l\Io.(i|:-

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During the course of arguments, Ld. Counsel for the Applicant and Ld. Counsel for the Respondcnt reitcrated their respective versions as stated supra.

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There is no dispute regarding fact that the Applicant availed housing loan from the Respondent against the mortgage of schedule property and therealter committcd default in repaying the loan dues.

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The specific contention of thc Applicant is that the Respondent failed to serve demand notice and possession notice on the Applicant and the said notice was neither affixed on the schedule property nor published in two newspapers and so, the said possession notice is not valid. Per contra, Respondent contended that they have duly followed the procedure laid down under the provisions of SARFAESI Act,2002 and Rules made thereunder in issuing demand notice and possession notice.

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To =.ru"..rriffi "r,",.rffir$^{r,.i r ffi=i."l} espondent has filed relevant material documenp$ rnro"s witHs the liled by them. As per the said ao.r..fu it I hf68 ffi *]t n""pondent issued demand notice

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'
\iit
A, I
'hv-'' i'a J
_1.

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sA 338/2022

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dt.10.08.2o22 and sent the said notice to the correct address of the Applicant and others through regd. Post as evidenced from the postal track reports filed by the Respondent. The Respondent also published the said demand notice in Indian Express and Andhra prabha daily newspapers and SO, it can bc deemcd that there is valid service of demand notice on the Applicant. As the Applicant failed to pay the outstanding dues within 60 days as demanded, the Respondent issued possession notice dt.11.11.2022 to the Applicant and the said notice was sent to the Applicant through regd.post and the same was served on the Applicant. As per the copics of paper publication filed by the Respondent, it is clear that the Respondent published the said possession notice in two daily newspapers on 16.11.2022. Though the Respondent submitted that they have affixed the possession notice on the secured asset, no documcnts are fired by the Respondent to prove the same. But mere non-affixture of the possession notice on the schedule property particularly when the Applicant is having knowledge of the possession notice issued by the Respondent, cannot be a ground to challenge the said notice. Particularly when the Applicant received the possession notice and the said notice is also published in two daily newspapers including onc in vernacular language and even if the said notice is not affixed on the secured asset, it cannot be a ground for the borrower as the affixture is meant only for the general public. In this regard, the Hon'ble High coura of Andhra pradesh ln M/s sottthro Private Limited vs. The Debts recouery Tribunal-l, reported in 2olg scc online Hgd788,has held in paragraph 17, which is as follows:

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this regard, it may be noted that Rule B(1) of tLrc Rutes of 2002 the authorised o_fficer of the secured creditor to notice, prepared as nearlg as posslble in of 2002, to the borrower and by affixing conspicuous place of the property. It is I r company receiued the possession complaint was that it had not been

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sA33812022

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affrxed on the SA schedule property. Affrxture o,f such possession notice on the outer door or at a conspicuous place of the propertg is notice to the public at large. This is clear from the contents of the statutory format of the possession notice in Append.ix-IV to the Rules of 2O02. Thereunder, the borrower in particular and tle public in general are cautioned not to deal uith tte propertg. In such a situation, it is not open to the borrower compang, hauing alreadg receiued fhe possession notice dated 04.08.2O12, to complain of failure on the part of ING Vysga Bank Limited in affaing the notice on the premises of the seanred assefs. If at all, such a gieuance could be projected bg a member of the general public utho dealt utith the seanred assefs in ignorance of tLe possesslon notice. Such is not the case presently.

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Hence in thc circumstances and i. view of the ratio laid down by in the Hon'ble High Court of Andhra Pradesh in the decision referred supra, it is quite clear that the Respondent has scrupulously followed the procedure laid down under the provisions of SARFAESI Act, 2002 and Rules madc thercr-rndcr in issulng demand notice and possession notice and there are no violations. Accordingly, this point is answered in favour of the Respondent and against the Applicant.

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Polnt No,(ll):-

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In the result, sA 338/202 is dismissed. consequently, the Interlocutory Applications, pcnding il any, shall stand disposed of. No order as to costs.

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

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(Dictated to the P.s, transcibed ba her, corrected, signed and- pronounced. by me in the open court on this the 14t,dag of l;ebruary, 2025).

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sd/-

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G. GOPI CHAND) COPY PRESIDING OFFICER 1 [ FFB^7il25 (-.,"\ r , .El-(rto, ' " ryfffsJfs'^l-'"*^'

Mr Abdul Raheem Mohd v. Iifl Housing Finance Limited

Case brief

What is this about?

What did the court decide?

Mr Abdul Raheem Mohd v. Iifl Housing Finance Limited

Case brief

What is this about?

What did the court decide?

What the court decided

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