Allowed

Challa Venkateswara Rao v. State Bank of India

DRT21 Apr 2025SA/482/2024

Case brief

AI extract

What is this about?

The Tribunal allowed the securitisation application challenging the bank's possession notice under the SARFAESI Act. The bank was absent, failing to prove compliance with the Act and Rules, leading to the quashing of the notice with liberty to proceed afresh.

What did the court decide?

The possession Notice dated 02.12.2024 issued by the Respondent Bank against the schedule property is quashed. The Bank is at liberty to proceed afresh to recover dues.

Challa Venkateswara Rao versus State Bank of India — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL -- 1 AT HYDERABAD DATED THIS THE 21ST DAY OF APRIL,2C.25

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PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No.4A2/2C24

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Sri ChallaVenkateswara Rao, S/o Anjaneyulu, H.No. 7_3SS, Behind Govt.Hospital, Mellacheru village, Mellacheru Mandal, Suryapet District-5 0g246.

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... Applicant

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Versus

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State bank of India Rep. by its Authorized Officer GP Complex branch, Kodad town, Suryapet District.

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... Respondent Bank

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Counsel for the Applicant : Sn R.Rajendra prasad Respondent Bank : Exparte

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ORDER

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1' The Applicant fired the present Securitisation Application u/s. 17 0f the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2oo2 (SARFAEsI Act, 2oo2) chalrenging the possession Notice d,t.o2.12.2024 issued by the Respondent Bank against the schedule property and to set aside the same as illegal and void.

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The averments made in the application, in brief, are that, the Applicantis a Civil Conrractor and4y3iled credit facilities from the Respondent Bank to a tune.otRiiT6iJ}k ,., :.! :. , against the mortgage of schedule properties. It is ,i, submitrcd r ii,v. to Covid-19, the ,' .^+.'] Applicant could not repay the l#.I ar.. jfi he Respondent Bank

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sA 482124

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issued demand notice u/s 13(2) of the SARFAESI Act, 2oo2 on 27.09.2024. on receipt of the said demand notice, the Applicant raised certain objections vide letter dt.16.04.2024. But the Bank without giving any reply to the said objections u/s 13(3)(A) of the Act, proceeded further and issued possession Notice dt.o2.12.2o24 u/s 13(4) of the SARFAESI Act, 2OO2 and as such, the said possession notice is not legal and valid. The Respondent Bank failed to folrow Rule 8(1)&(2) of Security Interest (Enforcement) Rules, 2OO2 in taking possession of the schedule property. Hence the SA.

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The Respondent Bank called absent and there was no representation even after giving several opportunities and hence the Respondent Bank was set exparte.

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

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Now the points that arise for consideration is

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i) Whether the Applicant has established anA ualid. ground. for

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setting aside the posse.ssion Notice dt.O2.12.2024 issued. by the

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Respondent Bank against the scheciule property?

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iil To what relief?

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Point No.lit

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The Applicant filed the present sA challenging the proceedings initiated by the Respondent Bank under Section 13(4) of the - SARFAESI Act, 2oo2 for taking possession of the apprication lcleaute^Pffith" Respoirdent bank who invoked the : RFAEq,.%dffitr{fisa??-i\ -", irl \ the schedule property, lJrvHvr LJ, d.rlE(r r ailed to LtJ Justllyjustir. epty'dp'.q^tfu roduce necessary material documen ts that 1 ;_-, :nt.^11*^{,-qrrr\ rrcr} _ natt,-' - ,strictlv^{rrlr luLly} f^I o^tt ll owed t he he p rovisions of :o -oto"

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sA R FAEsr acl I J"a' RPlr&,t'iramsd.1,., .i.. "."r n0..,", ""r,ng the po sse s sion

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I .i.. h\ '/:\ .^{ri"' "' .2} .,-^''i.'.,. .. ,"" '-,:. i, ,,0, ,i,, .,,

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sA 482124

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notice dt.o2.12.2024 for taking possession of the secured asset. The Bank has not evinced any interest in contesting the matter even after giving several opportunities and failed to file their Reply and material documents to disprove the allegations of the Applicant. In the absence of any material evidence to show that the Respondent Bank has duly complied with the mandated provisions of SARFAESI Act and Rures, 2oo2 in issuing the possession Notice dt.02. 12.2024,I hold that the Applicant has made a case for quashing the measures initiated by the Respondent Bank against the sA schedule property under the provisions of the SARFAESI Act and Rules thereunder and as such, the SA is liable to be allowed.

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Point No.(iil:-

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In the result, SA 4g2 /2024 is allowed.

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Accordingly, the impugned possession Notice dt.o2.12.2024 issued by the Respondent bank against the schedure property is hereby quashed. However, the Respondent Bank is at liberty to proceed afresh against the sA schedure property to recover their dues by dury following the provisions of .ARFAESI Act, 2oo2 and Rures thereunder.

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The Interlocutory Applications, pending if any, shall stand disposed of. No order as to costs.

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Communicate a copy of this order to the parties concerned.

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(Dictated to the court priuateon Secretary, transcribed. bg her, corrected, signed. and pronounced by this the 2l"tdag of eprit,2b2S1.'

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:" ' sd/(c. coPrcHANDl RUE,COPX, !4^4#zPRESIDING^OFFICER esStf,eg,ki DRT-I, nmiqie-a,s.

Challa Venkateswara Rao v. State Bank of India

Case brief

What is this about?

What did the court decide?

Challa Venkateswara Rao 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

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