Dismissed

Alakuntla Yellaiah v. Smfg India Home Finance Company Limited

DRT21 Nov 2025SA/449/2024

Case brief

AI extract

What is this about?

Under Section 17 of the SARFAESI Act, the applicant challenged the Respondent's steps to take possession of mortgaged property. The Tribunal examined whether mandatory demand and possession notices were duly served and published. Finding that statutory procedures were completed, it dismissed the application.

What did the court decide?

The Setting Application was dismissed with no order as to costs; pending interlocutory applications were disposed of.

Alakuntla Yellaiah versus Smfg India Home Finance Company… — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERYTRIBUNAL - I AT HYDERABAD

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DATED THIS THE 2OTH DAY OF NOVEMBER, 2025

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No.449/2024

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Alakuntla Yellaiah, S/o Lakshmaiah Alakuntla, Occ:business, H.No.30-2-986 New 2-381, Hanamkonda Madikonda, Nehru nagar Back SBI Bank, Warangal-506003.

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... Applicant

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And

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SMFG India Home Finance Company Ltd. Branch oflice at 4tr, floor, Brij Tarang Building, Beside White House, Green lands, Begumpet, Hyderabad-SoO 0 16. Rep. by its AuthorLed officer

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... Respondent

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Counsel for the Applicant Sn K. Srzresh Counsel for the Respondent Si Veera Shiua Kumar Reserued on 23.10.2025 Pronounced on 20.1 1 .2025 Uploaded on 21.1 1.2025

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.:ORDER:.

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l This application is Iiled by the Applicant u/s. 17 of the SARFAESI Act, 2002, challenging the steps initiated by the Respondent for taking on of the schedule property through Advocate pursuant to the orders in Crl.M.P.No .IOl 124 on the lile CJM nda and to declare the same as illegal and void. {"ffirt zffi {(. 21^o,o, verrn in the application, in brief, are that: -lt ...,t 'fu,s"-

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The Applicant availed housing loan from the Respondent to a tune of Rs.35 lakhs. Due to health issues, the Applicant could not pay some instalments. The Respondent without serving demand notice and possession notice to the Applicant, trying to take physical possession of the schedule property under Section 14 of the SARFAESI Act,2OO2 through advocate commissioner and so the said proceedings are not legal. The impugned possession notice was not published in two leading newspapers and the same was not affixed on the schedule property. Hence the SA.

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The Respondent filed their Reply denying all the adverse allegations made in the SA and contended that the Applicant along with his wife Alakuntla Sammakka as co-borrower availed loan from the Respondent and created mortgage against the schedule property. After availing loan from the Respondent, the Applicant committed default in repaying the loan dues and so, the loan account was classified as NPA on24.O3.2O2L as per the guidelines of RBI. The Respondent issued demand notice dt.Ol.O4.2O2l and sent the same to the Applicant and co-borrower through Regd. Post. And the same was returned as refused and the said notice was published in Telugu and English daily newspapers. When the Applicant failed to comply with the demand notice, the Respondent issued possession notice dt.lg.O8.2O2l and sent the said notice to the Applicant and co-borrower through Regd. Post and the said notice was published in Nava Telangana and Business Standard newspapers and also affixed on the schedule property. Thus the Respondent has followed the procedure contemplated under the^provisions of SARFAESI Act, 2OO2 and Rules made thereunder in issuing demand notice and tice to the Applicant and co-borrower. Thereafter, the /e""fir€it"Y+S u/s 14 of the SARFAESI Act,2002 for taking il * pn$"r p"!* n of the schedule property through advocate ': : Zz^cp1gf?trer FtflrYlitr*'^{* ,$o, there are no violations and accordingly, the} Respondent pr,qygd to dismiss the SA. ..2..,:,l --'1r. , -...: 't.i-,..z :--' .,-;^j 1.. -,';r::"

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Heard Ld. Counsel for the Applicant and Ld. Counsel for the

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Respondent and perused the material brought on record.

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Now the points that arise for consideration are

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i. ulwther the Applicant has established ang ualid grounds for challenging tte proceedings initiated bg tlw Respondent for taking physical possession of tte scledule propertA tlvough aduocate commi.ssioner?

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ii. To ruhat relief?

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Potnt IVo.(t):-

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

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7 . There is no dispute regarding the fact that the Applicant along with his wife availed loan from the Respondent and created mortgage in respect of the schedule property towards security for the said loan and thereafter, the Applicant committed default in repaying the loan dues and the loan account was classified as NPA.

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The specific contention of the Applicant is that without serving demand n notice to the Applicant and without complying with

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Security Intere st (Enforcement) Rules 2OO2, t}re

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t dtfiightaway, initiated proceedings for taking physical

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il j I .r"r iP ELt, 7 * posses3ion of the schedule property through advocate commissioner u/s la 3f ilU dffiree$t ect, 2oo2 and. so, the said^proceedings are not legal

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,i ; i! r-'1 i,1.,.$ 4nd valid. S, .t. 'i.;" .4$>+ z rivec$%'' 3

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Wry'

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Rules made thereunder in issuing all the statutory notices to the Applicant and also in initiating steps for taking physical possession of the schedule property u/s 14 ofthe SARFAESI Act, 2002.

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In order to substantiate their contention, the Respondent enclosed relevant material documents along with the Reply filed by them. As per the said material documents, it is clear that the Respondent issued demand notice dt.Ol .O4.2O2L and sent the same to the Applicant and co-borrower through Regd. Post as evidenced by the postal track reports filed by the Respondent and the said notice was published in Telugu and English daily newspapers as evidenced by the copies of paper publication filed by the Respondent. When there is no response from the Applicant to the said demand notice, the Respondent issued possession notice dt.19.08.2021 u/s 13(4) of the Act, 2OO2 and the sent tJle same to the Applicant and coborrower through Regd. Post as evidenced by the^postal track reports filed by the Respondent. The said possession notice was^published in Telugu and English daily newspapers as evidenced by the copies of^paper publication filed by the Respondent and the said notice was also affixed on the schedule property as depicted in the copies of^photographs filed by the Respondent. Thus the Respondent has duly followed Rule 8(1)&(2) of Security Interest (Enforcement) Rules, 2OO2 in issuing^possession notice to the Applicant.

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As per the provisions of Section 14 of SARFAESI Act, 2O02, after^issuance of possession notice u/s 13(4) of the SARFAESI^{Act, 2OO2, tt,.esecured} creditor is at liberty to approach the^{concernedDistrictMagistrate or Chief} trate for taking physical possession of the secured asset.

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d.^{fh'dq;ip.Jtdeglse,after issuing demand notice and possessionnotice to}

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F p t^h. n. dfirucant, ?the Respondent being secured creditor, approached ,qclffiI, ffiamkonda,^{u/s 14 of the SARFAESIAct, 2002 bv liling} brt.tvt.p.trto. tO t lQ+ for appointment^{of advocatecommissionerfor taking} of the schedule^property. Ld.CJM,^{Hanamkonda, after} on record, appointed advocate commissioner^and 4

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the said advocate commissioner visited the schedule property and issued notice dt.21.1t.2O24 to the Applicant for vacating ttre schedule property and the Applicant liled copy of the said notice along with the SA. So the proceedings initiated by the Respondent for taking physical possession of the schedule property u/s 14 of the SARFAESI Act, 2OO2 are perfectly legal and valid.

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So, considering all the circumstances, I am of the opinion that the Applicant is not entitled to any relief. So, I see no ground warranting interference of this Tribunal with the proceedings initiated by the Respondent for taking physical possession ofthe schedule property u/s 14 of the SARFAESI Act,2002. Accordingly, this point is answered in favour of the Respondent and against the Applicant.

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Potnt No.(ii)r

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In the result, SA 449 124 is dismissed as there are no merits.

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Consequently, the Interlocutory Applications, pending if any, sha1l stand disposed of. No order as to costs.

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(G. GOPr CHANDI
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{igYf7 PRESIDING OFFICER

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Alakuntla Yellaiah v. Smfg India Home Finance Company Limited

Case brief

What is this about?

What did the court decide?

Alakuntla Yellaiah v. Smfg India Home Finance Company Limited

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

All orders in this case

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