Dismissed

Thilagam v. Canara Bank

DRT3 Sept 2025SA/493/2022

Case brief

AI extract

What is this about?

The Securities Appellate Tribunal dismissed Securitization Application 493/2022 challenging a Section 14 order under the SARFAESI Act. The court held the order is an execution matter not subject to adjudication or judicial review under Section 14(3), and the applicant failed to show any illegality in the bank's compliance procedures.

What did the court decide?

The Securitization Application 493/2022 was dismissed. Pending Interim Orders were vacated.

Thilagam versus Canara Bank — Company and Corporate | DRT (2025)

SA No.493/2022

03.09.2025

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 3^rd day of September, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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SA No. 493 of 2022

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Smt. K. Thilagam, W/o. R. Kiliyappan, No. 1/169, Ambedkar Street, Murugampakkam Village & Post, Madurantakam Taluk, Kancheepuram District – 603 306. ….Applicant

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-Vs-

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The Authorised Officer, Canara Bank, Old No. 152, New No. 80, Car Street, Maduranthakam, Kancheepuram District – 603 306.

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….Respondent

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Counsels on record / appeared:

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Counsel for Applicant : M/s. R.K.M. Suresh Counsel for respondent : M/s. S. Kesavan

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ORDER ON SA 493/2022

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The present Securitization Application [SA] is filed on 16.11.2022 under sub section [1] of S.17 of the Securitization And Reconstruction of Financial Asset and Enforcement of Security Interest Act,2002 (for short the ‘Act’) challenging the action and the measure taken by the secured creditor under the Security Interest Enforcement Rules, 2002 [for short the Rules].

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The applicant has challenged Sec.14 order dated 18.10.2022 in Crl.M.P. No.8243 of 2022 passed by Chief Judicial Magistrate, Chengalpattu and the outstanding amount due as per Sec.14 order is Rs.18,21,200/-

SA No.493/2022

03.09.2025

Pleadings of the applicant:

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The applicant is the borrower and mortgager who had availed a housing loan of Rs.15 lakhs and had mortgaged the immoveable property as security. Applicant was regular in repayment without any default, However due to hill health and heavy business Lose could not repay the installments resulting in the classification of the account as NPA, the bank has issued the demand notice dated 04.10.2018 and possession notice dated 04.01.2019 calling upon the applicant to pay a sum of Rs.18,21,200/as on 04.10.2018. Though the applicant has made a payment of Rs.9 Lakhs, the bank claims due of Rs.11,57,849/- due as on 30.10.2022 as per the statement of account.

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The respondent have obtained S.14 order in Crl.M.P.No.8243 of 2022 passed by the Learned Chief Judicial Magistrate, Chengalpattu, dated 18.10.2022. Being aggrieved by the order, the present SA is filed on the ground that the Chief Metropolitan Magistrate failed to the scope of Sec.14.

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The Ld. CJM ought to have seen that the authorized of the bank has not apprehends obstruct from the applicant to the take the physical possession and the bank is claiming exorbitant high interest in the demand notice against the terms. The Chief Metropolitan Magistrate erred in misdirecting himself and have passed an order which is unsustainable. Hence on this grounds, the applicant prays to set aside the Sec.14 order dated 18.10.2022 passed in Crl.M.P.No.8243 of 2022.

SA No.493/2022

03.09.2025

Objections of the respondent bank:

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The respondent have filed the counter along with the typeset contenting that the applicant availed housing loan of Rs.15,57,677/- under Loan A/c No.4328619000010 and offered the security along with her husband Mr. R. Kiliyappan. The applicant and her husband executed all the loan documents in favour of the bank and had also availed various other loans and executed the loan documents. However they failed to comply with the repayment schedule and hence the account become irregular from July 2017 onwards.

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The bank made a demand to the applicant and her husband who were evading the settlement, hence the bank was constrained to classify the account as NPA on 30.10.2017. The bank has issued the demand notice on 04.10.2018 demanding to clear the entire liability of Rs.18,23,062/within the 60 days. Though the applicant and her husband received the demand notice on 24.10.2018 did not comply with the demand.

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The bank issued the Sec.13(4) possession notice on 04.01.2019 which was sent by RPAD and applicant and her husband have received the possession notice on 07.01.2019. As per the procedure possession notice is published in English and Tamil Newspapers and also affixed on the property. Thus the bank has complied with the rules of the Act by taking symbolic possession of the mortgage property and there is no deviation under the Act. After taking the symbolic possession, the bank has proceeded and obtained the valuation report for bringing the property to

SA No.493/2022

03.09.2025

sale and issued the E-Auction sale notice 02.08.2019 holding the sale on 05.09.2019. The sale notice is duly received by the applicant and her husband. However the sale did not take place for want bidders.

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As the applicant and her husband did not come forward to settle the entire liability the bank has issued the second sale notice on 20.06.2022 fixing the E-auction on 25.07.2022. As per the notice the reserve price was fixed at Rs.56,20,000/- based on the valuation report, published in the newspaper and also affixed on the property and thus the bank has followed all the procedures including the sale on the property.

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Applicant has filed SA.331 of 2022 without any valid and substantial reasons and only to protract the proceedings. However the sale did not take place and the SA become infructuous. As both the counsels prayed for passing necessary orders. SA.No.331 of 2022 was dismissed as infructuous on 22.02.2023.

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Subsequently the bank has filed sec.14 application before the Chief Judicial Magistrate, Chengalpattu to take the physical possession of the property and the Hon’ble CJM after perusing the documents passed the order on 18.10.2022 appointing one Mr. S. Munusamy as advocate commissioner to take the possession. Aggrieved by the same the present SA is filed challenging the Sec.14 order without any valid and substantial reasons and the applicants specific prayer is to set aside the proceedings pending before the sec.14 is not maintainable and the applicant has not come with clean hands.

SA No.493/2022

03.09.2025

The applicant along with her husband had availed agriculture loan of Rs.20 Lakhs on execution of various loan documents and have failed to comply with the repayment on so. Further the applicant availed another term loan under KCCS scheme to the extent of Rs.18.39 lakhs and have executed the loan documents. The conduct and attitude of the applicant clearly shows that they are willful defaulters and not eligible to claim any remedy from this Tribunal. Hence prays to dismiss the SA.493.2022.

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Heard both sides of the Counsels and perused the records of the

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case

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The applicant admittedly is the borrower who had availed the housing loan of Rs.15,57,677/- on 26.11.2015 and had mortgaged the property as collateral security towards the credit facility. Thought the applicant have challenged the sec.14 order they are no averments pinpointing any illegality in the measures taken by the respondent bank. The counsel for the applicant during the course of the argument submitted that the housing loan account is settled and nothing survives for adjudication in the present SA.

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It seen from the records that the applicant along with her husband availed other loans which is not the subject matter of the present SA. Admittedly the present SA challenging the sec.14 order dated 18.10.2022 pertaining’s to the housing loan and the mortgage property is also housing loan property which is all that piece and parcel of land & building thereon in Murugambakkam Village within the limit of Madurantagam Panchayat

SA No.493/2022

03.09.2025

union No.169, consisting of Sy. No.199/1 and Sy. No.199/2 with total area of 2616 sq.ft., within the Registration sub-district of Madurantakam and District Kanchipuram.

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Thought the applicant submits that the housing loan account is closed has not produced any documents to evidence the closure of the loan account nor the bank have filed any document intimating about the closure of housing loan account in their counter. However the applicant has challenged the sec.14 order.

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It is an admitted fact that the applicant had availed the loan and had mortgaged the property as collateral security. Due to default in the repayment the account is classified as NPA on 30.10.2017 as per RBI guidelines and the bank has issued the Sec.13(2) demand notice on 04.10.2018 which is received by the applicant on 24.10.2018 and by her husband Mr. R. Kiliyappan on 24.10.2018. Even after the receipt of the Sec.13(2), the applicant did not liquated the entire liability within the period of 60 days as required under the Act nor raised any objections to the demand made.

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Hence the bank has issued the possession notice dated 04.01.2019 which is duly received by the applicant and her husband on 07.01.2019 as evident from the acknowledgement card produced by the respondent at pg. 8 to 9 of the typeset. As per the procedure the possession notice is published in Tamil and English daily newspapers both dated 09.01.2019. As the applicant and her husband did not liquated the entire liability bank

SA No.493/2022

03.09.2025

has also attempted to put the property to E-auction to sale vide sale notice dated 02.08.2019 and 21.06.2022 by sending it by RPAD, affixture on the secured assert and the paper publication of the sale notice in the two newspapers has mandated under the Act.

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Further the bank has also obtaining the valuation report which is produced at pg.21 to 34 from their approved valuer and have proceeded to sell the secured asset. However the sale not materialize for want of bidders. Though the applicant has challenged the sec.14 order has not made out any case of any illegality in the Sec.14 application or in the affidavit filed by the secured creditor.

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The L.d CJM, Chengalpattu after due verification of the S.14 petitions, affidavit supported by the documents have considered and has allowed the Sec.14 order dated 18.10.2022 by appointing the advocate commissioner Ms. S. Munusamy.

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All the contentions raised by the applicant is countered by the respondent bank with all supporting documents to establish the due compliance of measures in issuing the Sec.13(2) demand notice dated 04.10.2018 and Sec.13(4) Possession notice dated 04.01.2019. Hence the Tribunal hold the Sec.13(2) and Sec.13(4) as valid notices issued under the Act. Thought the applicant has challenging the sec.14 order has failed to make out a case for interference of this Tribunal in the Sec.14 order which is passed under S.14 of the Act after due compliance of the procedures as required under Sec.14 of the Act.

SA No.493/2022

03.09.2025

Additionally, Section 14(3) of the SARFAESI Act statuses that no action taken by the Chief Metropolitan Magistrate or District Magistrate (or any officer authorized by them) under S.14 can be challenged in court or before any other authority. This provision ensures that the authority of these officials in enforcing security interests is final and not subject to

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further review.

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22. T hus, the Sec.14 order dated 18.10.2022 passed by the Ld. CJM, Chengalpattu is after due consideration of the application, affidavit in support of compliance of procedures along with documents is an execution Order issued where no adjudication is required. The Order is passed considering the due compliance of the provisions of the S. 14 [i-ix].

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For the foregoing reasons, the present SA is dismissed. Interim Order granted, if any stands vacated, pending IAs are disposed of in terms of this final order. No order as to cost.

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Sd/-

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(S.V. GOWRAMMA) PRESIDING OFFICER, DRT-III, CHENNAI

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( Dictated to Steno (Suriya), transcribed by him, corrected, signed and pronounced by me on this the 3^rd day of September, 2025)

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ANNEXURES

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LIST OF DOCUMENTS PRODUCED BY THE APPLICANT

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Sl.	Description of Documents	Documents
No.		No.
1.	Statement of account	A-1
2.	Impugned order passed by the Chief Judicial	A-2
	Magistrate, Chengalpattu in Crl.M.P.No.8243 of
	2022 dated 18.10.2022.

SA No.493/2022

03.09.2025

LIST OF DOCUMENTS PRODUCED BY THE RESPONDENT

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Sl. No.	Description of Documents	Documents No.
1.	Demand notice under Sec. 13(2) of the SARFAESI Act by the Respondent to the Applicant dated 04.10.2018.	R-1
2.	Acknowledgement card of the Applicant dated 24.10.2018.	R-2
3.	Acknowledgement card of Mr. R. Kiliyappan dated 24.10.2018.	R-3
4.	Possession notice under Sec.13(4) of the SARFAESI Act by the Respondent to the Applicant dated 04.01.2019.	R-4
5.	Acknowledgement card of the Applicant dated 07.01.2019.	R-5
6.	Acknowledgement card of Mr.R.Kiliyappan dated 07.01.2019.	R-6
7.	Possession notice publication in Tamil daily dated 09.01.2019.	R-7
8.	Possession notice publication in English daily dated 09.01.2019.	R-8
9.	E-Auction sale notice intimation letter together with sale notice issued by the Respondent to the Applicant dated 02.08.2019.	R-9
10.	Postal Registration slip dated 03.08.2019.	R-10
11.	Acknowledgement card of the Applicant and Mr.R.Kiliyappan	R-11
12.	E-Auction sale notice publication in English daily dated 02.08.2019.	R-12
13.	E-Auction sale notice publication in Tamil daily dated 02.08.2019.	R-13
14.	Valuation report dated 14.03.2022.	R-14
15.	E-Auction sale notice intimation letter together with sale notice issued by the Respondent to the Applicant dated 20.06.2022.	R-15
16.	E-Auction sale notice affixture dated 21.06.2022.	R-16
17.	E-Auction sale notice publication English daily dated 23.06.2022.	R-17
18.	E-Auction sale notice publication Tamil daily dated 23.06.2022.	R-18

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SCHEDULE OF PROPERTY

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All that part and parcel of Land & Building comprising in Sy. No. 199/1, and Sy.No. 199/2, Land measuring 2616 sq.ft., with building

SA No.493/2022

03.09.2025

thereon measuring 1060 sq.ft., Registered with in the registration subdistrict Maduranthakam and District Kanchipuram. Bounded: Sy.No. 199/1: On the North By: Road, on the south By: Eari Channel, In the East By: Road, On the West By: S.No. 199/2, Sy.No.199/2: On the North By: Road, On the South By: Eari Channel, On the East By: S.No.199/1, On the West By: S.No.199/3, Property owned by : Mrs.K.Thilagam, W/o R.Kiliyappan.

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PRESIDING OFFICER, DRT-III, CHENNAI

Thilagam v. Canara Bank

Case brief

What is this about?

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Thilagam v. Canara Bank

Case brief

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