Dismissed

Nebu K Kurian v. State Bank of India

DRT25 Mar 2025SA/640/2024

Case brief

AI extract

What is this about?

Debts Recovery Tribunal dismissed a securitization application challenging SARFAESI Act measures. The tribunal found no illegality in the proceedings, citing prior acceptance of a restructuring scheme and deemed knowledge of account details, upholding the bank's right to recover dues.

What did the court decide?

Securitization application dismissed with costs of Rs.20,000/- to the defendant bank.

Nebu K Kurian versus State Bank of India — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated this the 25^th day of March, 2025

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SECURITIZATION APPLICATION No.640/2024

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Between

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Nebu K Kurian, Aged 56 years, S/o. K.K.Korah, Kattathara House, Kattippadi, Kanjirathumood, Puthupally P.O., Kottayam -686 011.

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Aleayamma Korah, Aged 82 years, W/o. K.K.Korah, Kattathara House, Kattippadi, Kanjirathumood, Puthupally P.O., Kottayam -686011. …Applicants

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And

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The Authorised Officer, State Bank of India, Stressed Assets Recovery Branch-II, RS Building, M.G.Road, Ernakulam District, PIN 682 011. …Defendant

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This Securitization Application having been heard on 20.03.2025

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in the presence of Advocates M/s.Abu Mathew & Aju Mathew for the applicants and Advocate M/s.Thankom Mukundakrishnan for the defendant and stood over to this day for consideration, the Tribunal delivered the following:

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SA 640/2024

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F I N A L O R D E R

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Challenging the securitization proceedings initiated by the defendant under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the SARFAESI Act’), the applicants/borrowers has filed this SA under S.17(1) of the SARFAESI Act seeking relief to set aside the measure under section13(4) of the SARFAESI Act and the notice issued by the advocate commissioner to take physical possession of the secured asset.

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Brief

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In the SA the applicants claimed that they availed housing loan in the year 2008. But the defendant, without considering the repayment, issued a demand notice on 08.05.2024 under Section 13(2) of the SARFAESI Act calling the applicants to pay a sum of Rs.19,17,634/-. On receipt of this notice, the applicants submitted reply and requested the defendant to provide details of the loan document and the outstanding. The defendant replied to the notice, but did not furnish any details of the same. Without following the statutory requirements, the defendant issued notice on 02.08.2024 under Section 13(4) of the SARFAESI Act to take possession of the secured asset. After that notice, the applicants approached the defendant bank to furnish the statement of accounts and other details. But the defendant did not provide the same. Accordingly, the applicants filed this SA in challenging the measure taken by the defendant under the provisions of SARFAESI Act. During pendency of the SA, the applicants amended the SA in challenging the order passed by the Chief Judicial Magistrate, Kottayam, in

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SA 640/2024

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M.C. No.677/2024 in a proceeding under Section 14 of the SARFAESI Act and the notice issued by the Advocate Commissioner to take possession of the secured asset claiming relief to set aside the entire securitization proceeding including the measure taken under Section 14 of the SARFAESI Act.

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The defendants filed written statement and additional written statement denying the averments in the application and claimed inter alia that due to default committed by the applicants in repaying the housing loan, the loan turned in to NPA. The defendants filed O.A. No.176/2018 before this Tribunal for recovery of the outstanding amount. All the relevant documents, memorandum of deposit of title deeds and statement of accounts were submitted in the said case, which were provided to the applicants. After initiation of the securitization proceeding all the statutory requirements are duly followed. The security interest over the schedule property was also duly registered in the CERSAI Portal. In the absence of any illegality, the applicants have no right to challenge the order of the Chief Judicial Magistrate, Kottayam and the steps taken by the commissioner to take possession of the secured asset and hence the SA may be dismissed.

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From the respective contentions of both sides, the following points are emerged for adjudication in this case:

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(i) Whether the securitization proceeding initiated by the defendant suffer from any illegality or irregularity to intervene with the same?

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(ii) Whether the applicants are entitled to get any relief in this case?

SA 640/2024

FINDINGS:

For the sake of convenience, both the points, being interlinked with each other, are taken up together for adjudication. Admittedly the applicants availed housing loan from the defendant and due to non-repayment, the securitization proceeding was initiated. During argument, the learned counsel for the applicants contended that the reply given by the defendant to the objection under Section 13(3)-A of the SARFAESI Act is vague, which vitiates the securitization proceeding. It is also claimed that, in spite of repeated requests, account statement was not furnished and calculation of the interest is wrong. Hence the securitization proceeding is not sustainable. The learned counsel did not raise any procedural defect in the measure taken under Section 14 of the SARFAESI Act initiated before the Chief Judicial Magistrate, Kottayam.

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The learned counsel for the defendant would contend that the loan was classified as NPA in the year 2017 and the OA was filed in the year 2018 to recover the outstanding amount from the applicants. In that case, the applicants filed written statement. The account statement is also filed in that case. Now the applicants cannot deny that they have no knowledge about the interest charged in the loan account. It is further submitted that OTS under “Rinn Samadhan Scheme” submitted by the applicants was accepted and they made part payment. Thereafter they did not comply the terms and conditions and hence OTS was cancelled. Hence the applicants are not entitled to get any relief in this case.

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SA 640/2024

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On evaluation of the contentions of both sides, no material dispute is raised by the applicants challenging the measure taken by the defendant under the provisions of SARFAESI Act. The defendant has produced all relevant documents including the CERSAI registration certificate. The sole contentions of the learned counsel for the applicants is that the applicants were not provided with statement showing details of the interest charged in the loan account. Hence the securitization proceeding is vitiated. It appears from the record that, in the OA the applicants appeared and filed written statement. The account statement was filed in that case. Now they cannot dispute that they have no knowledge about the interest charged in the loan account. Besides the same, once the OTS was submitted by the applicants which was accepted and they complied the terms and conditions of the OTS by depositing the agreed amount in part. As the applicants did not comply the terms and conditions of the OTS, the same was cancelled. Now they are legally debarred to raise dispute the claim amount by the defendants as erroneous in view of the judgment of the Hon'ble Apex Court, reported in (2022) 2 SCC 221 in the case titled Arce Polymers Private Limited v. Alphine Pharmaceuticals Private Limited and others.

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The defendants produced all relevant documents regarding compliance of all the statutory requirements. No illegality is found in the securitization proceeding to interfere with the measure taken by the defendant and hence the applicants are not entitled to get any relief in this case. Both the points are found against the applicants. Hence it is ordered:-

SA 640/2024

ORDER

In view of the foregoing reasons, this SA, being devoid of any merit, is hereby dismissed with costs. As the applicants caused unnecessary delay in the securitization proceeding without any valid ground, they are liable to pay costs of Rs.20,000/- (Rupees twenty thousand only) to the defendant bank.

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(Dictated to my PA, corrected and pronounced by me in the open Tribunal on this the 25^th day of March, 2025)

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[SOVAN KUMAR DASH] PRESIDING OFFICER

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SA 640/2024

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Documents on the part of the applicants

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Annexures	Date	Particulars of documents
Annexure-A1	08.05.2024	True copy of Section 13(2) notice issued the defendant to the applicants.	by
Annexure-A2	04.06.2024	True copy of reply letter submitted by applicants before the defendant.	the
Annexure-A3	19.06.2024	True copy of reply letter issued by defendant to the applicants.	the
Annexure-A4	02.08.2024	True copy of Section 13(4) notice issued the defendant to the applicants.	by
Annexure-A5 D	01.11.2024 ocuments on	True copy of the Commission Notice iss by the Advocate Commissioner to applicants. the part of the defendant	ued the
Annexure-B1		Photograph evidencing affixture possession of notice.	of
Annexure-B2	05.08.2024	Publication of possession notice Businessline.	in
Annexure-B3	05.08.2024	Publication in Mangalam Daily.
Annexure-B4		Registration document with Ce Registry.	ntral

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PRESIDING OFFICER

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated the 25^th March, 2025

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SA No.640/2024

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Between

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Nebu K Kurian, Aged 56 years, S/o. K.K.Korah, Kattathara House, Kattippadi, Kanjirathumood, Puthupally P.O., Kottayam-686 011 & Another …Applicants

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And

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The Authorised Officer, State Bank of India, Stressed Assets Recovery Branch-II, RS Building, M.G.Road, Ernakulam District, PIN 682 011. …Defendant

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F I N A L O R D E R

Nebu K Kurian v. State Bank of India

Case brief

What is this about?

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Nebu K Kurian v. State Bank of India

Case brief

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