Dismissed

Sunita Soni v. Union Bank of India

DRT15 Oct 2025SA/591/2025

Case brief

AI extract

What is this about?

The Tribunal dismissed an application filed under Section 17(1) of the SARFAESI Act challenging the Securitization Officer's order under Section 14 and the subsequent auction sale. Finding the bank had complied with statutory formalities and noting no evidence of fraud or procedural vitiation, the court refused to interfere.

What did the court decide?

The sale certificate was upheld and the application was dismissed as devoid of merit.

Sunita Soni versus Union Bank of India — Banking and Recovery | DRT (2025)

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S.A. No.591 of 2025

IN THE DEBTS RECOVERY TRIBUNAL, LUCKNOW

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Present: Pravas Kumar Singh, Presiding Officer

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Securitization Application No.591 of 2025

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Dated: 15.10.2025

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Sunita Soni e\ ,Aa\ , Applicant Versus Union Bank of India . . . . Respondents

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Union Bank of India

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Ld. Counsel for the applicant: Mr. Kashi R. Yad.av, Advocate. Ld. Counsel for the respondent-bank : Mr. G.S. Mishra, Advocate. Ld. Counsel for the auction purchaser: Mr. Shashank Singh, Advocate.

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JUDGMENT

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The present securitization Application has been brought by the applicant under section 17(1) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (in short SARFAESI Act) to for setting the order under Section 14 of the Act, Sale Notice dated 20.10.2023, Possession Notice dated 15.02.2020, Demand Notice dated 29.11.2019. By way of amendment sale notice dated 04.9.2024 has been challenged in lieu of which property has been sold on 26.9.2024 and sale certificate has been issued on 20.12.2024.

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It is stated that applicant came to the knowledge of SARFAESI after execution ,fn,ti„ d,t,d 19.5.2025 in Ii,u ,f o,d„ p„„d under Section 14 of the Act.

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3 . Admittedly, applicant had taken loan from the respondent-bank on 19.02.2014 and an amount of Rs.11 lac having 344 monthly EMI amounting to Rs.9928/- was to be paid commencing from September 2014. The House as Part of Khasra No.497 was mortgaged as secured assets.

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S.A.No.591 of 2025

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Further case being that from 2014 to 2019, applicant paid EMI, in the meantime, one of the borrowers Sunita Soni wife of applicant no.2 was diagnosed with Tumor and afterwards they could not maintain financial discipline.

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Further case being that without knowledge of the applicant, the respondent-bank issued demand notice dated 29.11.2019 and possession notice dated 15.02.2020 and further obtained order under Section 14 of the Act on 07.02.2025 and in lieu of the order, execution notice dated 19.5.2025 has been issued. It is alleged that has not rightly accounted interest component of the loan.

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By way of amendment, it is submitted that execution of securitization proceeding, the respondent-bank sold the property on 26.9.2024 in lieu of sale notice dated 04.9.2024 and the sale certificate has been issued on 20.12.2024. It is alleged that respondent-bank has not disclosed the amount for which sale has been made. It is further submitted that mandatory compliances under Section 26D have not been made by the respondent-bank.

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1 find from the record that while hearing on interim relief filed by the applicant, vide order dated 30.7.2025, this Tribunal had directed the respondent-bank to file compliance report of 13(4). In compliance of order, the respondent-bank has filed supplementary affidavit dated 22.9.2025 .

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The auction purchaser has also appeared and moved for early hearing of the case.

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The respondent-bank has filed detail written objection.

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It is stated that demand notice dated 29.11.2019 was issued by the respondent-bank and any representation to the same was not filed. Postal receipts have been enclosed and shown to the Tribunal

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S.A.No.591 of 2025

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11.In supplementary affidavit as per the direction of the Tribunal, the respondent-bank has filed possession notice dated 15.20.2020 which has been personally served upon both the applicants and has not been denied by the applicant. The respondent-bank has also filed Punchnama with the signature of the witness regarding serving of possession notice, affixation at the conspicuous part of the secured assets, copy of newspaper publication have been filed and shown.

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As far as sale is concerned, the respondent-bank has filed valuation report of authorized valuer, sale notice dated 04.9.2024, postal receipt of sending the same, affixation at the secured assets, publication in the newspaper and sale certificate has been filed with earlier written objection. The sale certificate has been annexed, showing the details of the sale price. These annexure were perused by me.

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13.1 have perused all the annexures.

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14.1 find that respondent-bank has complied all the statutory compliances under SARFAESI Act and Rules. I have considered that any relief to the applicant hinges around cancellation of sale certificate and any ground of cancellation of sale certificate has not been pleaded or proved by the applicant.

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15.1 have considered the leading judgment known as judgment passed by the Hon’ble Apex Court known as CELIR LLP Vs. Mr. Sumati Prasad Bafna & ors.

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“The Hon’ble Apex Court has framed a question and laid down ratio, as to the circumstances, when a sale of property by auction or other means under SARFAESI Act may be set aside after its confirmation. Their Lordships have examined a series of judgments pronounced by the Hon’ble Apex Court. It has been said that purpose of an open auction is to get the most enumerative price and it is a duty of the Court to keep openness of the auction so that intending bidder would be free to participate and offer higher value. It is said that once the sale has

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S.A.No.591 of 2025

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been confirmed, it cannot be set aside unless fundamental procedural error occurred or sale certificate has been obtained by misrepresentation or fraud. After discussions of several other judgments their Lordship has propounded the ratio in para 218 of the judgment.”

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' Any sale by auction or other public procurement methods once already confirmed or concluded ought not to be set-aside or interfered with lightly except on grounds that go to the core of such sale process, such as either being coUusive, fraudulent or vitiated by inadequate pricing or underbidding. Mere irregularity or deviation from a rule which does not have any fundamental procedural error does not take away the foundation of authority for such proceeding. In such cases, courts in particular should be mindful to refrain entertaining any ground for challenging an auction which either could have been taken earlier before the sale was conducted and confirmed or where no substantial injury has been caused on account of such irregularity.”

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As far as order under Section 14 of the Act is concerned, any particular fact has not been pleaded regarding any deficiency in the order.

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The Hon’bIc Apex Court in the leading case known as Balkrishna Rama Tarle through LRs vs. Phoenix ARC Private Limited another SLP Petition No.16013 of 2022 has observed:

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*Immediately, after receipt of application is received, the CMM/DM is expected to pass an order after verification of compliance of all formalities by the secured creditor and after being satisfed in that regard, to take possession of the secured assets. It is specWcally observed that any claiming adjudicating that power exercised under Section 14 of the Act are ministerial step and does not involve am adjudicatory process qua points raised by the borrower against the secured creditor taking possession of secured assets.”

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In that view of the matter once all the requirements under Section 14 of the SARFAESI Act are complied with, it is the duty cast upon the 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. It is submitted that at any stage, the District Magistrate is not

S.A.No.591 of 2025

required to adjudicate the dispute between the borrower and the secured creditor and/or between any other third party.

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18.In view of above discussion, I do not find any merit in the SA, accordingly, the present SA is dismissed being devoid of merit. All the other pending IAs are also disposed of.

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Let the file be consigned to record room.

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(Dictat

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G ~'

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(Pravas Kurnbr gngh) Presiding Officer Debts Recovery Tribunal Lucknow

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Judgment signed, sealed, dated and pronounced in the open court on this 15th Day of October, 2025.

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