Dismissed

Sebastian Mathew v. State Bank of India

DRT27 Jun 2025SA/42/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed the applicant's challenge to the respondents' securitization proceedings under the SARFAESI Act. The Tribunal found no illegality in issuing the demand or possession notices, rejecting claims of procedural defects, and held the applicant was not entitled to relief.

What did the court decide?

The application was dismissed. The secured creditor was not directed to grant breathing time or allow repayment through instalments.

Sebastian Mathew versus State Bank of India — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated this the 27^th day of June, 2025

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SECURITIZATION APPLICATION No.42/2024

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Between

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Sebastian Mathew, Aged 58 years, S/o. K.V. Mathew, Karimattathil House, Vellayamkudi P.O., Kattappana, Idukki District. …Applicant

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And

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The State Bank of India, State Bank Building, Kattappana, Idukki District, PIN – 685 515. Represented by its Branch Manager.

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The Authorised Officer, State Bank of India, RACC, Kattappana, Idukki District, PIN–685 515. …Defendants

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This Securitization Application having been heard on 17.06.2025 in the presence of Advocates M/s. A.C. Devasia &

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Mathew Devasia for the applicant and Advocate Smt.Thankom

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SA 42/2024

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Mukundakrishnan for the defendants and stood over to this day for consideration, the Tribunal delivered the following:

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F I N A L O R D E R

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Challenging the securitization proceedings initiated by the defendants under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the SARFAESI Act’), the applicant/borrower has filed this SA under S.17(1) of the SARFAESI Act.

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Brief facts of the case :

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2.1 The applicant has claimed in the SA that he availed loans from the defendant bank by mortgaging the subject matter properties described in the SA. Due to default in repayment of the loan, the 2^nd defendant issued notice under Section 13(2) of the SARFAESI Act calling him to pay the outstanding amount of Rs.44,17,938/- within a period of 60 days. The applicant filed a detailed reply to the said demand notice. Without giving any reply to the objection the defendant bank issued a possession notice under section 13(4) of the SARFAESI Act which is illegal due to non-compliance of the statutory requirement.

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SA 42/2024

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2.2 is further averred in the SA that loan is availed by the applicant under PMFMETL loan Scheme for conducting agricultural business like cardamom hydro steam distillation unit and also for extracting cardamom oil. The securitization proceeding is not maintainable for the same. During pendency of the SA, the Advocate Commissioner has issued notice to take possession of the secured asset, which was challenged in this proceeding by the amendment and the applicant claims the relief for setting aside the demand notice, possession notice, including the notice issued by the Advocate Commissioner, as the same are illegal.

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3.1 The defendants filed written statement denying the averments and claimed that the applicant availed credit facility of Rs.20.64 lakhs under the PMFME Scheme. A subsidy amount of Rs.3,43,346/- was kept as fixed deposit for 3 years in the name of business unit of the applicant. After availing the loan, the applicant has only remitted Rs.36,000/- in the loan account and he did not take any interest in repaying balance outstanding in the loan account.

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3.2. Due to default committed by the applicant, the loan was classified as ‘NPA’ as per RBI guidelines and the securitization proceeding was initiated and the demand notice followed by

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SA 42/2024

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possession notice was issued. The applicant has never raised any objection against the demand notice after receipt of same. All the statutory measures are duly followed in the securitization proceeding. The defendants filed M.C. No.271/2024 before the Chief Judicial Magistrate Court, Thodupuzha under Section 14 of the SARFAESI Act to take physical possession of the secured asset. An Advocate Commissioner is appointed by Chief Judicial Magistrate to take possession of the secured asset. There is no illegality or defect in any of the proceedings taken under the provision of the SARFAESI Act. Hence the SA, being devoid of any merit, may be dismissed.

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From the respective contentions of both sides, the

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following points are emerged for adjudication in this case:

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(i) Whether the securitization proceeding initiated by the defendants suffers from any illegality or irregularity to intervene with the same?

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(ii) Whether the applicant is entitled to get any relief in this case?

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FINDINGS:

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Point Nos.(i) & (ii):

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Admittedly the applicant availed the loan from the defendant bank by mortgaging the subject matter properties. Due

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SA 42/2024

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to default in repayment, securitization measure was initiated by the defendants. Receipt of the demand notice is not disputed by the applicant. No material is placed by the applicant in submission of objection under Section 13(3-A) of the SARFAESI Act against such demand notice. In absence of any material, the contention raised by the learned counsel in the SA on this aspect is not acceptable.

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The defendant has produced all the relevant documents regarding compliance of the statutory requirement. CERSAI certificate is also produced showing registration of the security interest in the CERSAI Portal.

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During argument stage, the learned counsel for the applicant fairly conceded that there is no illegality in the securitization proceeding and breathing time may be given to the applicant to repay the loan.

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As per the provision contained under Section 17 of the SARFAESI Act, this Tribunal is only empowered to adjudicate the dispute whether any of the measure taken by the defendant is in accordance with the provision of the Act and the Rules made thereunder or not. This Tribunal cannot direct the secured creditor to give breathing time to the applicant in repaying the loan. The applicant may approach the bank by submitting proposal for

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SA 42/2024

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repayment of the loan within a reasonable period in writing. In case of such proposal, if any, the secured creditor bank may consider the same in accordance with the law. But the Tribunal cannot issue any direction to the defendant bank to allow the application to repay the loan by any suitable instalments. In absence of any illegality or defect in the securitization proceeding, the applicant is not entitled to get any relief and hence both the points are answered against the applicant.

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Hence it is ordered:-

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ORDER

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In view of the foregoing reasons, this SA, being devoid of any merit, is hereby dismissed. But in the circumstances, without costs.

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(Dictated to my PA, corrected and pronounced by me in the open Tribunal on this the 27^th day of June, 2025).

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[SOVAN KUMAR DASH] PRESIDING OFFICER

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SA 42/2024

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Documents on the part of the applicant

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Annexures	Date	Particulars of documents
Annexure-A1	12.07.2023	True copy of the mortgaged schedule property issued by the 1^stdefendant bank.
Annexure-A2	12.07.2023	True copy of the notice issued by the 2^nddefendant to the petitioner.
Annexure-A3		True copy of the nature of facility schedule of loan taken by the applicant issued by the 2^nddefendant showing the outstanding balance as on 12.07.2023.
Annexure-A4	28.11.2023	True copy of the possession notice by the 2^nddefendant.

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Documents on the part of the defendants

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Annexure-B1	Photograph evidencing affixture of possession notice.
Annexure-B2 03.12.2023	Publication of possession notice in the Hindu Daily.
Annexure-B3 03.12.2023	Publication in the Deepika Daily.
Annexure-B4	Registration document with Central Registry.

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PRESIDING OFFICER

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated the 27^th June, 2025

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SA No.42/2024

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Between

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Sebastian Mathew, Aged 58 years, S/o. K.V. Mathew, Karimattathil House, Velyamkudy P.O., Kattappana, Idukki District …Applicant

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And

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The State Bank of India, State Bank Building, Kattappana, Idukki District, PIN – 685 515. Represented by its Branch Manager. & Another. …Defendants

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F I N A L O R D E R

Sebastian Mathew v. State Bank of India

Case brief

What is this about?

What did the court decide?

Sebastian Mathew v. State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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