Dismissed

M Abdul Malik v. Bajaj Housing Finance Limited

DRT21 Jan 2025SA/366/2022

Case brief

AI extract

What is this about?

The Deuts Recovery Tribunal dismissed a securitisation application filed by borrowers against a secured creditor. The court held that the borrower failed to prove prior notice violation and remained a defaulter, thus the recovery proceedings were lawful.

What did the court decide?

The securitisation application was dismissed and interlocutory applications were closed.

M Abdul Malik versus Bajaj Housing Finance Limited — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL - II AT HYDERABAD

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DATED THIS THE 21ST DAY OF JANUARY,²⁰²⁵

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PRESENT: SH. RAMESHWAR KOTHE, B.COM.,^{L.LB. (HONS.), M.A.} PRESIDING OFFICER

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SECURITISATION APPLICATION^NO. 366^{OF 2022}

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Between:

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M. Abdul Malik S/o Abdul Suban Sab Age: 4 years, Occ: Business H. No. 11/178 Chamankatta Street Near Ganesh Circle Adoni - 518 301.

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Maniyar Mohammed Riyaz S/o Maniyar Abdul Suban Age: 60 years, Occ: Business H. No. 11/178 Chamankatta Street Near Ganesh Circle .".APPlicants. Adoni - 518 301.

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And

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Bajaj Housing Finance^Limited Rep by is Authorised Officer Corporate Office Cereburm IT Park 82 Buitding, 5th Floor Ka lya n i, PIJ ne,^{Ma ha rashtra'5 1 1 0 14.}

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Also at: Branch Office, 7't Floor lJsma n Plaza, No.² 1/ 143/70/^B Opp: Royal Function^Hall SKD Colony, Adoni Andhra Pradesh 518 302. .. . ffi'*..Respondent.

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5A 366/2022

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Counsel for the Applicants : Mr. G.L. Prasada Rao. Counsel for the Respondent : M/s. V. Santosh.

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-:91_DEB:-

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The Applicant filed the present Securitisation Application u/s.17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as "SARFAESI Act 2002") assailing the proceedings of the respondent inltiated under sections 13(4) and 14 of the Act.

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The case of the applicants as per the averments of the SA, in brief, is that the applicants are the borrowers and availed a business loan of Rs.21,99,050/- against the mortgage of SA schedule property, to be repayable in 120 EMIS. Applicants paid Rs.9 lakhs towards the loan account. However, without there being any prior notice, respondent is trying to take the possession of the mortgaged property under the guise of the provisions of SARFAESI Act and the Rules by issuing possession notice u/s 13(4), followed by Advocate Commissioner notice dated 01.04.2023 pursuant to the orders obtained in Crl.M.p.30 of 2022.

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Respondent company filed reply statement. The submissions in the reply statement in brief, are that since the applicants failed to repay the loan, the loan account became NpA on 01.07.2022, and accordingly it issued demand notice dated Og.Og.2022. With no payment came forward, notice u/s 13(4) of the Act has been issued on 03.17.2022. Applicants are chronic defaulters and the cheque issued by them was bounced starting from September

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sA 366/ 2022

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The demand notice and the possession notice were duly served on the applicants as per the postal track reports. Respondent published both the demand notice and the possession notice in newspapers. Therefore, there is no irregularity in the compliance of the provisions of the Act and the Rules. Respondent relies on the judgement in the case ofTom. Thomas vs. State Bank of India 2017 (2) DRTC 668 wherein it was held that defaulters do not have any legal or even moral right to object to mode of recovery chosen by the secured creditor in accordance with law. Accordingly, respondent prays for dismissing the SA.

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Heard learned counsel appearing for the applicants. Learned counsel appearing for the respondent reported no oral arguments. Perused the written arguments filed by the respondent and the material placed on record.

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Learned counsel appearing for applicants, while reiterating the averments in the SA, prayed for allowing the SA in the interest of^justice.

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As per the written arguments filed by the respondent, since the recovery proceedings have been initiated by the secured creditor after due compliance of the^provisions of the SARFAESI Act and the Rules thereunder, the applicants being the defaulters cannot interdict the recovery measures for realisation of outstanding dues as^per law.

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a Te: - Now the points that arise for adjudication ery."

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sA 366/2022

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Whether the APPlicants made out , any valid ground for^quashingthe measures taken by the respondent u/s l3(4) and 14 against the^SA schedule property under^the provisions of Securitisation Act?

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iil What Relie/?

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Point No.(i):

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B. The basic grievance of the applicants in the SA is^{that the} respondent company has not issued any^{prior notice before} issuance of possession notice dated 03.1L.2022. To counter^the allegation, respondent company^placed on^{record Photostat} copies of demand notice,^postal receipts,^postal track^report, publication of demand notice in The Financial Express and Andhra Prabha vide material^papers at^pages from 29 to 33 annexed to the reply statement. Hence the allegation over violation of Section 13(2) of the SARFAESI Act is not^proved. Similarly, respondent filed^proof of serving^{possessionnotice} vide material papers at^pages from 35 to 39 annexed to the reply statement. It is not the case of the applicants that they were regular in repayment of loan amount. Applicants have not disputed bouncing of cheque issued by them towards the EMI of the loan amount. Under these facts and circumstances, the secured credit is entitled to take steps uls 14 of the SARFAESI Act for taking physical possession of the secured asset.

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In view of the above position, applicants have failed to make out any valid ground to interdict the measures under Sections 13(4) and L4 of the Securitisation Act initiated by the respondent 1fuv

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sA36612022

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company for recovery of its dues. Accordingly, the SA is liable to be dismissed.

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Point No.(ii):

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