Dismissed

M S Hima Aqua Minerals v. Indian Bank

DRT23 Jun 2025SA/567/2024

Case brief

AI extract

What is this about?

Applicants filed a securitization application challenging a Section 14 possession order impugning the唯有 ministerial nature of the power under Section 14 of the SARFAESI Act. The Tribunal held the order was purely executionary and within the jurisdiction of the Chief Metropolitan Magistrate, dismissing the application.

What did the court decide?

Securitization Application No. 567/2024 dismissed as the Section 14 order is non-adjudicatory and within the jurisdiction of the designated Magistrate.

M S Hima Aqua Minerals versus Indian Bank — Execution and Attachment | DRT (2025)

SA No.567/2024

23.06.2025

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

¶5

Dated this the 23^rd day of June, 2025

¶6

Present: SMT. S.V. GOWRAMMA Presiding Officer

¶7

SA No. 567 of 2024

¶8

M/s. Hima Aqua Minerals,

¶9

Rep. by Sole Proprietor,

¶10

Mr. R. Anand,

¶11

No.233/1B, Pappan Kuppam Village,

¶12

Gummidipoondi Taluk,

¶13

Tiruvallur District -601 201.

¶14

Mr. R. Anand, S/o. R. Lakshmikara Reddy, Sree Flat G2, No.1-2, Second Street, Sri Iyyappa Nagar, Kolathur,

¶15

Chennai 600 099.

¶16

Mrs. C.M. Hima Bindu, W/o. R. Anand, Sree Flat G2, No.1-2, Second Street,

¶17

Sri Iyyappa Nagar, Kolathur,

¶18

Chennai 600 099. ….Applicants

¶19

-Vs-

¶20

The Authorised Officer, Indian Bank, Stressed Assets Management Branch, 55, Ethiraj Salai, Zonal Office Building II Floor, Wellington Estate, Egmore, Chennai 600 008.

¶21

M/s. Vasupradha Fixture and Machinery Private Ltd., Rep. by its Director, D.P No.328, SIDCO Womens Industrial Park, Thirumullaivoyal, Thiruvallur 600 062. ….Respondents

¶22

Counsels on record / appeared:

¶23

Counsel for Applicant : M/s. R. Thiagarajan Counsel for respondent : M/s. C. Ramaiah

SA No.567/2024

23.06.2025

ORDER ON SA 567/2024

¶28

The present Securitization Application [SA] is filed on 26.08.2024 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].

¶29

The applicant has impugned S.14 Order dated 16.08.2024 in Crl.M.P. No.1315 of 2024 passed by the Chief Judicial Magistrate, and the outstanding amount due as per Sec.14 order is Rs.1,63,57,421/-

¶30

The 1^st applicant M/s. Hima Aqua Minerals represented by its proprietor the 2^nd Applicant herein. The 3^rd Applicant is the Guarantor to the loan availed by the 1^st Applicant. The 2^nd and 3^rd Applicants have offered their residential property as well as the Agriculture Land measuring an extent of 7.14 Acres as security towards the repayment.

¶31

The Applicants are in the business of packing of drinking water and cans availed MTL-I for Rs.1,20,00,000/- in Loan Account No.6470788422, (2) MTL–II for Rs.1,15,00,000/- in Loan Account No.6470796975 and (3) OD for Rs.20,00,000/- in Loan Account No.6393089873 ie., a total sum of Rs.2,55,00,000/- was sanctioned by the 1^st Respondent Bank.

¶32

Due to COVID 19 and business failure there occurred default in repayment and account was classified as NPA on 18.10.2021. The Bank

SA No.567/2024

23.06.2025

issued demand notice dated 20.10.2021 and 30.11.2021 followed by the possession notice dated 10.02.2022.

¶37

The respondent bank without responding to the Applicants requests for a one time Settlement issued the sale notice on 07.12.2022 but the property was not sold. On receipt of the notice, the bank the Applicant had approached an OTS proposal dated 23.03.2023 along with a cheque of Rs.1,00,000/- as initial payment.

¶38

The bank sanctioned the housing loan of Rs.9,00,000/- on 26.09.2016, which was classified as NPA for an outstanding due of Rs.8,36,363.32/-. The applicants paid the full liability and closed the account and no due certificate was issued by the respondent bank. The applicant also obtained Car Loan vide Vehicle Loan Account No.6628545064 for a sum of Rs.5 Lakhs which is also repaid in full on 12.06.2024 and also obtained No due certificate.

¶39

Now the bank sold the property pursuant to sale notice dated 04.03.2023 scheduling the property for sale on 24.03.2023. The 2^nd respondent had been declared as the highest bidder in auction held on 24.03.2023 for a paltry sum of Rs.49,75,000/-.

¶40

Aggrieved by the sale notice dated 04.03.2023 applicant has filed SA.No.208 of 2023 which is pending consideration. Applicant has also sent an OTS proposal with upfront payment of Rs. 50 Lakhs to be paid in three installments and bank also issued a compromise settlement dated 23.05.2023. However the applicant vide letter dated 31.05.2023 and

SA No.567/2024

23.06.2025

18.08.2023 sought for extension of time to comply with the compromise settlement dated 23.05.2023. Subsequently the applicant issued fresh OTS and challenge the sale notice dated 30.08.2023 as property is an Agricultural land in SA.No.478 of 2023 and paid an amount or Rs.25 Lakhs and the same is pending consideration.

¶45

The respondent bank filed two OA.No.156 of 2024 and 183 of 2024 which is pending adjudication and the respondent proceeded under section 14 to take possession of the dwelling unit for the outstanding amount of Rs.1,63,57,421/-. Hence the present SA is filed on the grounds that respondent not followed the procedures and have not given explanation about the classification of NPA and has eagerly proceed it to take it possession of the property.

¶46

Though The applicants raised Sec.13(3-A) respondent bank not replied and Learned Chief Judicial Magistrate has proceeded to pass the Order to take the physical possession. As the applicant has challenged the sale applican’s right of redemption is not lost. Hence prays for dismissal of SA by setting aside of 14 Order.

¶47

The respondent has filed detailed counter inter alia contenting that the 1^st applicant M/s. Hima Aqua Minerals, represented by its sole proprietor, Mr. R. Anand availed facility from the respondent bank, failed to repay the outstanding amount. Hence the demand notice dated 30.11.2021 was issued for the recovery amount of Rs.1,84,51,762/-. As the applicant failed to repay the amount along with interest, cost and other

SA No.567/2024

23.06.2025

chargers, the respondent issued the possession notice dated 10.02.2022 in compliance of the legal formalities as required under section 13(4) of the Act.

¶52

The bank issued the 1^st sale notice dated 19.03.2022, the 2^nd sale notice on 03.11.2022, and 3^rd sale notice on 07.12.2022 for recovery an amount of RS.2,16,92,069/- with further interest costs. However all the three sale notices did not materialize for want of bidders.

¶53

The applicant did not repay the amount even after symbolic possession and bank issued the sale notice dated 04.03.2023 fixing the sale on 24.03.2023. The sale was conducted on 24.03.2023 and the successful bidders namely M/s. Vasupradha Fixture and Machinery Pvt Ltd was declared as highest bidder and the sale also confirmed in its favour.

¶54

The Auction purchaser have paid the entire sale proceedings of Rs.49,75,000/-, hence the bank issued the sale certificate on 31.03.2023. The earlier sale notice was challenged SA.208/2023 conducted on 24.03.2023 pursuant to sale notice dated 04.03.2023 which is pending for arguments. As the property is sold the respondent filed an application under section 14 in Crl MP.No.1315/2024 to handover the physical possession to the Auction purchaser, which came to to be allowed on 16.08.2024 to take the physical possession of the property.

¶55

The respondent have issued the demand notice on 30.11.2021, demanding an amount of Rs.1,84,51,762/- due as on 01.12.2021 which is

SA No.567/2024

23.06.2025

admittedly received by the applicant on 03.12.2021 and same is also endorsed in Sec.13(2) demand notice.

¶60

As the applicant failed to repay the amount within the period of 60 days. The respondent have issued possession notice on 10.02.2022, the affixed on the property, published in the two newspapers the “New Indian Express”-English and “Dinamani”- Tamil on 16.02.2022. However the applicants have not challenged the possession notice not paid the amount due. Hence the bank subjected that the property to sale on 04.03.2023.

¶61

Though the Home Loan of Account Mr. R. Anand, loan account 6473339246 is closed, but the charge on the mortgage asset continues till all the other related loan of the borrowers is recovered. The bank has complained with all the sub rule (3) (4) of rule 9 of the security interest rules under the Act.

¶62

The sale was conducted on 24.03.2023, and the successful bidders namely M/s. Vasupradha Fixture and Machinery Pvt Ltd. After the sale was completed, during the pendency of the SA 208/2023 the applicant have approached for the one time settlement vide letter dated 12.05.2023 and promised to pay a sum of Rs.4,32,00,000/- and also vide letter dated 15.05.2023 giving consent to hand over the physical possession of the property, which was accepted by the bank vide sanction ticked dated 23.05.2023, on condition that the applicant should pay a sum of Rs.50 Lakhs as forefront amount for accepting the settlement.

SA No.567/2024

23.06.2025

The applicant vide letter dated 15.05.2023, agreed to hand over the possession of the property, hence nothing survives for further adjudication in the impugned Order. Now considering the challenge to S.14 Order, it is appropriate to mention the declaration of The Hon’ble Supreme Court and various Hon’ble High Courts in various judgments has held that the power of Designated Court under Section 14 SARFAESI Act, 2002 is ministerial and non- adjudicatory in nature and the process to be followed under Section 14 does not involve any element of quasi-judicial function nor it requires any application of mind

¶67

21.1 Furthermore, the Hon’ble Supreme Court in the matter of Kotak Mahindra Bank vs Girnar Corrugators Pvt. Ltd. & Others , held that while exercising power under Section 14 of the SARFAESI Act, even the District Magistrate has no jurisdiction and/or District Magistrate and/or even the Chief Metropolitan Magistrate has no jurisdiction to adjudicate the dispute between secured creditor and debtor.”

¶68

21.2 The Hon’ble Bombay High Court in the matter of Phoenix ARC Pvt. Ltd. Vs. The State of Maharashtra has held that Court is only required to verify the affidavit of Secured Creditor filed in pursuance of the proviso to Section 14 and nothing more. The above Bombay High Court judgment has since been confirmed by the Hon’ble Supreme Court by its judgment dated 26.09.2022 in the matter of Balakrishna Ram Tarle v.

¶69

Phoenix ARC (P) Ltd. as under:

¶70

“Thus, the powers exercisable by CMM/DM Under Section 14 of the SARFAESI Act are ministerial step and Section 14 does not involve any

SA No.567/2024

23.06.2025

adjudicatory process qua points raised by the borrowers against the secured creditor taking possession of the secured assets. In that view of the matter once all the requirements Under Section 14 of the SARFAESI Act are complied with/satisfied by the secured creditor, it is the duty cast upon the CMM/DM to assist the secured creditor in obtaining the possession as well as the documents related to the secured assets even with the help of any officer subordinate to him and/or with the help of an advocate appointed as Advocate Commissioner. At that stage, the CMM/DM is not required to adjudicate the dispute between the borrower and the secured creditor and/or between any other third party and the secured creditor with respect to the secured assets and the aggrieved party to be relegated to raise objections in the proceedings Under Section 17 of the SARFAESI Act, before Debts Recovery Tribunal”.

¶75

21.3 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

¶76

before any other authority. This provision ensures that the authority of these officials in enforcing security interests is final and not subject to further review.

¶77

21.4 T hus, the S. 14 order passed by the Ld. Section 14 order dated 16.08.2024 in Crl.M.P. No.1415/2024 passed by CMM, Thiruvallur after due consideration and is only an execution order where no adjudication is required. The Order is passed considering the compliance of the provisions of the S. 14 [i-ix].

¶78

For the foregoing reasons, the Tribunal is not inclined to interfere in the S.14 Order as it is passed after due consideration of the application, followed by Affidavit and the documents in compliance of the procedures has considered and allowed the application which does not requires any intervention from this Tribunal.

SA No.567/2024

23.06.2025

As the applicant did not comply with the OTS, the bank has proceeded for the sale of the property, and has followed all the procedures as required under Acts and Rules.

¶83

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

¶84

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

¶85

( Dictated to Steno (Suriya), transcribed by him, corrected, signed and pronounced by me on this the 23^rd day of June, 2025)

¶86

ANNEXURES

¶87

LIST OF DOCUMENTS PRODUCED BY THE APPLICANT

¶88

Sl. No.	Description of Documents	Documents No.
1.	Sale Notice issued by the Respondent Bank dated 04.03.2023.	A-1
2.	No Due Certificate issued by the Respondent Bank Pursuant to the Home Loan dated 17.03.2023.	A-2
3.	OTS Proposal enclosed along with Rs.1,00,000/- Cheque leaf dated 23.03.2023.	A-3
4.	Compromise Settlement issued by the Respondent Bank dated 23.05.2023.	A-4

SA No.567/2024

23.06.2025

5.	Letter sent by the 2^ndApplicant to the Respondent Bank requesting extension of time dated 31.05.2023.	A-5
6.	Letter sent by the 2^ndApplicant to the Respondent Bank requesting extension of time dated 18.08.2023.	A-6
7.	Cancellation of OTS dated 24.08.2023.	A-7
8.	Sale Notice issued by the Respondent Bank pursuant to Agriculture land dated 30.08.2023.	A-8
9.	Lawyer Notice issued by the Applicants dated 30.08.2023.	A-9
10.	Reply Notice issued by the Respondent Bank for notice dated 30.08.2023 dated 07.09.2023.	A-10
11.	Remittance of Rs.25,00,000/- dated 22.09.2023.	A-11
12.	No due certificate issued by the Respondent	A-12
	Bank pursuant to Vehicle Loan dated 20.07.2024.
13.	Petition in Crl.M.P.No.1315 of 2024 dated 18.03.2024.	A-13
14.	Impugned Order made in Crl.M.P.No.1315 of 2024 dated 16.08.2024.	A-14
15.	Notice affixed by the Advocate Commissioner dated 21.08.2024.	A-15
16.	GST Certificate of the 1^stApplicant.	A-16
17.	Aadhar Card of the 2^ndApplicant.	A-17
18.	Aadhar Card of the 3^rdApplicant.	A-18
19.	Fact Sheet.	A-19

¶93

LIST OF DOCUMENTS PRODUCED BY THE RESPONDNET

¶94

Sl. No.	Description of Documents	Documents No.
1.	Demand Notice dated 30.11.2021.	R-1
2.	Acknowledgement cards dated 03.12.2021.	R-2
3.	Possession Notice dated 10.02.2022.	R-3
4.	Acknowledgement cards dated 17.02.2022	R-4
5.	Publication of Possession Notice-English dated 16.02.2022.	R-5
6.	Publication of Possession Notice-Tamil dated 16.02.2022.	R-6
7.	Affixture of Possession Notice-Photo dated 14.02.2022.	R-7
8.	Sale Notice dated 04.03.2023.	R-8

SA No.567/2024

23.06.2025

9.	Sale certificate dated 31.03.2023.	R-9
10.	Letter by applicant to respondent to handover the possession of the property dated 15.05.2023.	R-10
11.	OTS sanction letter dated 23.05.2023.	R-11
12.	Memo filed by respondent in SA.No.208/2023- DRT-3 dated 20.08.2024.	R-12
13.	OTS Cancellation Letter dated 24.08.2024.	R-13

¶99

SCHEDULE OF THE PROPERTY

¶100

All that piece and parcel of vacant land bearing Plot No.A measuring 2364 Sq.ft and Plot No.B measuring 2008 Sq.ft. in all total measuring an extent of 4372 Sq.ft., comprised in Old Survey No.49, New Survey No.49/1 A part and TS No.18/2, Block No.23, Ward No.E, Sri Iyappa Nagar, 2^nd Street, Korattur village, Ambattur Taluk, Thiruvallur District, within the Registration District of Central Chennai and Sub-Registration District of Villivakkam and bounded on the North by: TS No.14 & TS No.13, South by 24 feet road in TS No.20. East by: Remaining Portion of Plot No.B, West by: TS No.18/2 part.

¶101

SCHEDULE B PROPERTY: 666 Sq.ft., of undivided share of land from and out of the land described in Schedule A.

¶102

SCHEDULE C PROPERTY: 1278 Sq.ft., plinth area of flat including common area in Ground Floor in Schedule A bearing Flat No.G2.

¶103

Sd/- PRESIDING OFFICER, DRT-III, CHENNAI

¶104

(S.V. GOWRAMMA)

M S Hima Aqua Minerals v. Indian Bank

Case brief

What is this about?

What did the court decide?

M S Hima Aqua Minerals v. Indian Bank

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Indian Bank versus Viivaan Foods

Indian Overseas Bank versus Sri Alumalai Ayyan Traders and Another

Sri Laxmi Balaji Enterprise and Two Others versus Indian Overseas Bank

Indian Overseas Bank versus Jupiter Business Excellence

Bank of Baroda versus Krishnan

Jaya Brothers Interial Decorators versus Indian Bank