Allowed

Chintalapati Saidulu v. State Bank of India

DRT10 Feb 2025SA/505/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the applicant's section 17 application challenging the bank's auction and physical possession measures under the SARFAESI Act. Due to the bank's failure to justify actions or produce documents, the auction was set aside, possession was quashed, and the applicant was directed to recover dues strictly following the Act.

What did the court decide?

The impugned auction is set aside; possession measures under Section 14 are quashed; the bank is directed to hand over the property within one month.

Chintalapati Saidulu versus State Bank of India — Banking and Recovery | DRT (2025)

¶1

IN THE DEBTS RECOVERY TRIBUNAL - I AT HYDERABAD

¶2

DATED THIS HE 1 O^T DAY OF FEBRUARY. 2025

¶3

PRESENT: SRI GUMMADI GoPICHAND, PRESIDING OFFICER

¶4

sA.No.5c5/2024

¶5

ChintalapatiSaidulu, S/o Narsimha Rao, Aged 40 years, Huzurnagar Town & Mandal, Suryapet District-So9 2O4. ... Applicant

¶6

Versus

¶7

State Bank of India, OId Bus Stand Road branch, Huzurnagar, Suryapet District. ... Respondent Bank

¶8

Counsel for the Applicant : Sn S. Srikanth Respondent Bank : Exparte

¶9

ORDER

¶10

The Applicant filed the present Securitisation Application u/s.17 of the Securitization and Reconstruction of Financial Assets and Enforcement of security Interest Act, 2oo2 (SARFAESI Act, 2oo2) challenging the auction conducted by the Respondent Bank in respect of the schedule property on 05.12.2024 pursuant to the e Auction Sale Notice dt.02.11.2024 and also the measures taken by the Respondent Bank for taking physical possession of the schedule property purs :. orders. of C.IM, Suryapetand to set aside the

¶11

in brief, are that, the

¶12

sA s05/2024

¶13

executed certain loan documents in favour of the Bank. It is submitted that due to financial crunch, the Applicant could not pay some instalments and the loan account has been classified as NpA. The Respondent bank without issuing demand notice, possession notice and sale notice on the Applicant, directly published the Auction sale Notice dt.o2.ll.2o24 in newspapers. The Bank has also proceeded u/s 14 of the SARFAESI Act, 2oo2 and taken physical possession of the schedule property without taking inventory and panchanama which is illegal. Hence the SA.

¶14

¶15

The Respondent Bank in spite of service of notice, called absent and there was no representation even after giving several opportunities and hence the Respondent Bank was set exparte.

¶16

Heard Ld. Counsel for the Applicant.

¶17

Now the points that arise for consideration is

¶18

whether the Applicant has established ana uatid ground for challenging the auction conducted by the Respondent Bank in respect of the schedule property pursuant to the Auction sale Notice dt.02.1 1.2024

¶19

ii) whether tlrc Applicant has established ana uolid ground for challenging the measures initiated bg the Bank u/ s la of ttrc Act, 2002 fo, taking phgsical possession of the schedule propertg?

¶20

ii) To what relief?

¶21

Je"".r, SA challenging the proceedings initiated 6Y ,r," ffiSponaenii ila"t under the SARFAESI Act againsr the appl-r.catiopfssfqqipropertv. But, the Respondent bank who invokedi''0he SARITAESI proceedinss against the sched urul e po ro po ertv '. #:-rRITAESI^{lF.,iT'..;ings}

¶22

sA s0s/2024

¶23

failed to^justify their action by filing^{Reply and producenecessary} material documents to^prove that the^{Bank has strictly followedthe} provisions of SARFAESI Act and Rules framed^{thereunderin issuing} the e Auction Sale Notice dt.O2.ll.2o24^{and for takingphysical} possession of the schedule property. The^{Bank has not evinced any} interest in contesting the matter even after^{giving several} opportunities and failed to file their^{Replyand materialdocumentsto} disprove the allegations of the Applicant.^{In the absence of any} material evidence to show that the^{RespondentBank has duly} complied with the mandated^{provisions of SARFAESI Act and Rules,} 2OO2 for conducing auction^{of the scheduleproperty on 05.12.2024,I} hold that the Applicant has made^{a case for quashing the measures} initiated by the Respondent^{Bankagainst the SA schedule property} under the provisions of the^{SARFAESIAct and Rules thereunder and} as such, the SA is liable to be^allowed.

¶24

Point No.(iii):-

¶25

In the result, SA 505/24 is allowed.

¶26

Accordingly, the impugned auction^{conducted by the Respondent} Bank on 05.12.2O24in respect^{of the schedulepropertypursuantto} the e Auction Sale Notice dt.02.11.2024^{is hereby set aside and also} the measures initiated by the^{Respondent Bank for takingphysical} possession of the secured asset under^{Section14 of the SARFAESI} Act, 2OO2 pursuant to the^{orders of cJM, Suryapet are hereby} quashed. The Respondent bank is^{herebydirected tohandoverthe} physical possession ple property to the Applicant^within one month fro SftBorder. However, the^Respondent Bank is at li afresh against the SA schedule^property I a- to recover th q$ues by duly following the^{provisionsof SARFAESI} Act, 2OO2 an Rt^{t." A',9'.tf,8d;.-..} l

¶27

sA s0s/2024

¶28

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

¶29

Communicate a copy of this order to the parties concerned.

¶30

(Dictated to tle Priuate Secretary, transcibed bg her, conected, signed and pronounced by me in the open court on this the 10t daA of February, 2025).

¶31

sd/-

¶32

(G. GOPTCHANDI PRESIDING OFFICER

¶33

WcoPw
.,' .:l

¶34

Chintalapati Saidulu v. State Bank of India

Case brief

What is this about?

What did the court decide?

Chintalapati Saidulu v. State Bank of India

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

Similar cases

Smt. Sandya Joshi versus Idbi Bank

Canara Bank versus M/S. Rise Automobiles

S T Bharanikanth versus Indian Overseas Bank

State Bank of India versus v. Business Enterprises LLP

State Bank of India versus Sri. Dayanand Dasram

State Bank of India versus M/S. Js Upvc and Glass Solutions