Dismissed

Kumar Ready Made v. Hdfc Bank

DRT13 Oct 2025SA/601/2023

Case brief

AI extract

What is this about?

The Appellate Court dismissed the Securitization Application filed by a borrower challenging the bank's issuance of a Section 13(2) Demand Notice and a Section 13(4) Possession Notice under the SARFAESI Act. The court held that the bank had duly complied with statutory requirements, including notice publication and affixation, and upheld the validity of the notices.

What did the court decide?

Securitization Application dismissed; Section 13(2) Demand Notice and Section 13(4) Possession Notice upheld as valid.

Kumar Ready Made versus Hdfc Bank — Banking and Recovery | DRT (2025)

SA No.601/2023

13.10.2025

IN THE DEBTS RECOVERY TRIBUNAL-III, CHENNAI

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Dated this the 13^th day of October, 2025

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Present: SMT. S.V. GOWRAMMA Presiding Officer

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SA No. 601 of 2023

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M/s. Kumar Ready Made, Rep. by its Managing Partner Mr. K.N. Kumar Rao, No.11-A, 1^st Floor, B.S.S. Koil Street, Vellore Fort, Vellore – 632 004 ….Applicant

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-Vs-

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The Authorised Officer, HDFC Bank Ltd., No.16, Shree Complex, 45 Feet Road, Vallalar Salar Extn., Venkateswara Nagar, Saram Post, Pondicherry – 605 013 …Defendant

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Counsels on record / appeared:

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Counsel for Applicant : M/s. R. Baskar Counsel for Respondent : Mr. T K M Sai Krishnan

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ORDER ON SA No.601/2023

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The present Securitization Application [SA] is filed 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 the Possession Notice dated 25.10.2023 and the outstanding amount due as per Possession notice is Rs.2,26,85,600.52/-

SA No.601/2023

13.10.2025

3. Pleadings of the applicant:

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3.1 The applicant has availed various credit facilities for its business

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which are follows:

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S.No.	Loan A/c No.	Facility	Amount Financed
1.	502000379002904	BB Drop Line OD	Rs. 1,21,00,000/-
2.	454503241	Commercial Property Loan	Rs. 8,35,509/-
3.	8258694	Lap Mortgage GECL	Rs. 21,00,000/-
4.	50200037903031	BB Drop Line OD	Rs. 1,01,00,000/-
5.	45403250	Commercial Property Loan	Rs. 6,89,668/-
6.	8258688	Lap Mortgage GECL	Rs. 17,93,000/-
7.	50200037902802	BB Drop Line OD	Rs. 50,00,000/-
8.	8258678	Lap Mortgage GECL	Rs. 8,88,000/-

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Due to default in the repayments, the bank has classified the loan

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account as NPA without issuing any information and issued Section 13(2)

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Demand Notice dated 22.09.2023 claiming an amount of Rs.2,26,85,600/- due as on 22.08.2023 is received by the Applicant on 25.08.2023. The applicant has approached the Bank seeking for regularization and to pay an outstanding due amount if any.

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3.2 The bank have issued the Possession Notice dated 25.10.2023 under Section 13(4) without giving any opportunity. It is contented that the measures taken by the Authorized Officer is in violation of law and is not prescribed under the SARFAESI Act. After 60 days of the demand notice, bank has proceeded further issuing the possession Notice, which is not published in both regional and English Newspapers, nor affixed nor served on the applicant. Hence, the applicant prays to set aside of the

SA No.601/2023

13.10.2025

said of all further proceedings under the Section 13 (4) Possession Notice on 25.10.2023.

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4. Objections of the respondent bank:

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4.1 The Respondent has filed their counter and submitted that the applicant had availed various credit facilities and executed the loan document which is admitted by the applicant in para 5(1) of the present SA.

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4.2 In order to secure the loan availed Applicant had created Mortgage by Deposit of Title Deeds with respect to the property which is registered in its respective SRO.

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4.3 The applicant failed to repay the EMI amount on scheduled dates and failed to adhere to the terms and conditions of the agreement. Hence the Respondent have classified the account as NPA in accordance with the Section 2(o) of the Act and declared the loan account as NPA on 06.07.2023. The Respondent have issued the Demand Notice dated 22.08.2023 under the Section 13(2) of the Act calling upon the applicant to pay the amount of Rs.2,26,85,600.52/- due as on 22.08.2023.

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4.4 The applicant admitted the issuance of the Demand Notice, however, the applicant neither made any representation nor tried to settle the loan account nor come forward for the amicable settlement. Hence, the bank has issued the Section 13(4) Possession Notice on 25.10.2023 which is dispatched to the applicant and the borrowers on 25.10.2023.

SA No.601/2023

13.10.2025

4.5 The Possession Notice is affixed and the same is also published on 31.10.2023 in two leading news papers one in Tamil and another in English. Thus the bank has followed all the procedures as admitted under the Act and Rules 8(1) & (2) Security Interest (Enforcement) Rules 2002.

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4.6 The applicant having admitted the issuance of the Demand Notice have not cleared the loan account and the payments made is reflected in the statement of loan account and the applicant is making false allegation against the Respondent Bank.

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4.7 The Respondent Bank has relied on the Hon’ble High Court of Madras in order dated 11.10.2017 in W.A.No-367 of 2017 M. Lilly Vs District Collector to content the settled principle of law that any party to approach the court with misleading facts with an intention to mislead the Court should not be given any relief. The applicant has made violates the grounds in the present SA which is to be dismissed.

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

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5.1 The applicant is a Managing Partner and Mr. Kumar Ready Made is a partnership represented by its managing partner Mr. K.N. Kumar Roa. It is seen that the applicant along with Mrs. Thara Silks had availed various credit facilities and had executed the loan documents on 15.03.2019, 25.08.2022, 20.06.2020, 15.03.2019, 25.08.2022, 20.06.2020, 15.03.2019, 20.06.2020 as per the Section 13(2) Demand Notice. The applicant had availed various credit facilities of BB Dropline OD vide A/c No.50200037902904 of Rs.1,21,00,000/-, Commercial Property Loan vide

SA No.601/2023

13.10.2025

A/c No.454503241 of Rs.8,35,809/-, Lap Mortgage GECL vide A/c No.8258694 of Rs.21,00,000/-, BB Dropline OD vide A/c No.50200037903031 of Rs. 1,01,00,000/-, Commercial Property Loan vide A/c No.454503250 of Rs.6,89,668/-, Lap Mortgage GECL vide A/c No.8258688 of Rs.17,93,000/-, BB Dropline OD vide A/c No.50200037902802 of Rs.50,00,000/-, Lap Mortgage GECL vide A/c No.8258678 of Rs.8,88,000/-. And the loan was secured by mortgage of 2 items of property.

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5.2 In fact, the applicant does not dispute availing all the credit facilities and the mortgaged of the property as security. Due to the default in the repayment, the loan account was classified as NPA on 06.07.2023. The Section 2(o) classification of the account NPA, the Respondent Bank have issued the Section 13(2) Demand Notice dated 22.08.2023 which is not disputed by the applicant herein. As the Applicant did not liquidated the entire liabilities and also admitted the issuance of Section 13(2) Demand Notice.

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5.3 The Section 13(2) Demand Notice clearly reflected the nature of the loan availed by the applicant along with the other borrowers and the amount financed by the bank. The classification of the account as NPA, and the total outstanding due is Rs.2,26,85,600.52/- as on 22.08.2023.

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5.4 In spite of the receipt of the Section 13(2) Demand Notice, as the applicant did not liquidated the entire liabilities, the bank has proceed further and issued the Section 13(4) Possession Notice on 25.10.2023.

SA No.601/2023

13.10.2025

The Possession Notice is sent by RPAD and same received by the applicant along with other Co-borrowers as per the acknowledgement card is produced at Page No.18 and 19.

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5.5 In fact, the applicant does not dispute issuance of the Section 13(4) Possession Notice. However, contented that the Possession Notice is not affixed and published to the two news papers as required under the Act is countered by the bank on production of publication of possession in English “The New Indian Express” and Tamil “Dinamani” daily dated 31.10.2023 at Page 20 to 23 and also the affixed the Possession Notice on the property as admitted by applicant in para 5(6) of the present SA.

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5.6 Thus, the Respondent Bank have established the due compliance of the procedures in issuing the Section 13(2) Demand Notice dated 22.09.2023 and Section 13(4) Possession Notice dated 25.10.2023. The applicant admitted the availing of the credit facilities, the default in the repayment and failed to liquidate the entire liabilities in spite of the statutory notice. The Respondent Bank have produced the documents in support of the measures taken as required under the Act. In view of the measures taken by the respondent bank as prescribed under the Act and Rules, the present SA fails.

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5.7 Accordingly, SA 601/2023 stands dismissed upholding in the Section 13(2) dated 22.09.2023 and Section 13(4) Possession Notice dated 25.10.2023 as valid notices issued under the Act.

SA No.601/2023

13.10.2025

Resultantly the present SA 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 (Deepika), transcribed by him, corrected, signed and pronounced by me on this the 13^th day of October, 2025)

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ANNEXURES

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LIST OF DOCUMENTS PRODUCED BY THE APPLICANT

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Sl. No.	Description of Documents	Document No.
1.	Grounds of Appeal dated 07.11.2023.	A-1
2.	Notice Under Section 13(2) SARFAESI Act dated 22.08.2023.	A-2
3.	Impugned Possession Notice U/S 13(4) of SARFAESI Act dated 25.10.2023.	A-3
4.	Vakalat dated 07.11.2023.	A-4

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LIST OF DOCUMENTS PRODUCED BY THE RESPONDENTS

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Sl. No.	Description of Documents	Document No.
1.	Counter Affidavit filed by the Respondent Bank dated 09.03.2024.	R-1
2.	Copy of the Demand Notice issued U/s. 13(2) of SARFAESI Act dated 22.08.2023.	R-2
3.	Copy of the Possession Notice issued U/s. 13(4) of SARFAESI Act along with its despatch proof, service proof and Paper Publications dated 25.10.2023.	R-3

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SCHEDULE “A” PROPERTY

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All that piece and parcel of land situated at Vellore Beighbourhood Scheme, Phase II Area, bearing Plot No.36 and Door No.36, Survey No.468 Part, 469/1 Part and bounded Sathuvacheri Village and Registration District of Vellore.

SA No.601/2023

13.10.2025

On the North by : Plot No.18, 19 On the East by : Plot No.37 On the South by : 15 Meters Road and On the West by : Plot No.35

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Measuring on the North by : 13.70 Meter, East by : 24.40 Meter, South by : 13.70 Meter West by : 24.40 Meter

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And in all Measuring 334.28 Sq. Meter (3600 Sq.Ft) land and building constructed thereon with all appurtenances situated with the Sub Registration District of Vellore.

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SCHEDULE-B

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Vellore District, Vellore Registration District Vellore Sub District and Taluk Vellore Town North Vellore, Revenue Ward No.3, Municipal Ward No.14 Beri Subramaniya Swami Koil Street, (BSS Koil Street) Land and Bilding constructed thereon bearing Door No.79 (Old No.11)

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Bounded on the:

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East by : Beri Subramaniya Swami Koil Street, North by : Jains Dharmasala

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West by : Dharmalingam Chetty, Maligai Kuppusamy Chetty House South by : M.T.G. Shanmuga Chettiar Building

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1^st Measuring East to West 47 feet and North to South including both walls 30 feet totaling 1410 Sq.Ft., 2^nd Measuring East to West 10 feet and North to South 17 ½ feet totaling 175 Sq.Ft. altogether 1585 Sq.Ft land and building constructed thereon with all appurtenance.

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

Kumar Ready Made v. Hdfc Bank

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Kumar Ready Made v. Hdfc Bank

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