Dismissed

Syed Sadiq Hussain and another v. State Bank of India

DRT26 Feb 2025SA/80/2023

Case brief

AI extract

What is this about?

Applicants challenged an auction sale notice under section 17 of the SARFAESI Act, alleging procedural lapses. The Bank countered that the notice was due to loan default and was duly served and published. Noting the sale date had already been cancelled by the Tribunal, the Court dismissed the application as infructuous and directed the Bank to follow proper procedure for a fresh auction.

What did the court decide?

Application dismissed as influctuous; Bank directed to follow SARFAESI Act procedure for fresh auction.

Syed Sadiq Hussain and another versus State Bank of India — Banking and Recovery | DRT (2025)

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IN THE DEBTS RECOVERY TRIBUNAL - I AT HYDERABAD DA-T'ED THIS THE 261\I DAY OF FEBRUARY, 2025

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PRESENT: GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No.8C/2C23

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1 . Mr. SyedSadiqHussain, S/o Syed Munawar Hussain, Aged 44 years, Occ:business, R/o H.No.1-6- tt3l | /A, Adarshnagar, Zaheerabad, Medak- SO222O.

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Smt. Meharunnisa Begum, W/o Syed Munavar Hussain, Aged 67years, Occ:house wife R/o H.No.1-6-It3lt/A, Adarshnagar,

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Zaheerabad, Medak- SO222O. ... Applicants

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And

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State Bank of Baroda, SARB, Koti, Hyderabad. Rep. by its Authorized, officer

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Respondent Bank

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Counsel for the Applicants Sri T.Vijag Kumar

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Counsel for the Respond.ent Bank Sn P. V. SatganaraAana

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This application is filed by the Applicants u/s.17 of the SARFAESI Act,
2OO2, challenging the e
1ge dt.31.o1.2023 fixing the
auction of the sch
023 and to declare the
same as illegal and
2. The averments made'U..rEin".."nnlinarin-,- i',r i, ,k 2 6 FtB mus ^-*Ji";iare that:

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The Applicants availed housing loan to a tune of Rs.25 lakhs in the year 2015 and a top up loan of Rs.6.5 lakhs in 2076 from the Respondent Bank. Due to covid-19, the Applicants could not pay some instalments so, the loan account was classified as NpA by the Respondent Bank and the Bank issued demand notice 16.06.2022 to the Applicants' Thereafter without issuing possession notice u/s 13(a) of the SARFAESI Act, 2OO2, the Respondent Bank straightaway issued Sale Notice dt.31.o1.2023 for conducting auction of the schedule property and the said sale notice was not served on the Applicants nor published in two daily newspapers. Hence the SA.

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3' The Respondent Bank filed their Reply Statement denying all the adverse allegations made in the SA. It is contended that the Applicants having availed housing loan from the Respondent Bank, committed default in making repayment of loan amounts due and so, the loan account was classified as NPA and the Bank issued demand notice dt.16.06.2022 uls r3(2) of the SARFAESI Act, 2oo2 and the said notice was received by the Applicants. Thereafter the Respondent Bank issued possession notice dt.05. 11.2022 to the Applicants and the said notice was duly served on the Applicants and the said possession notice was published in Tclugu and F)nglish daily newspapers and it was also affixed on the schedule property. Thereafter on 31.01 .2023, the Respondent Bank issued sale notice fixing the date of auction of the schedule property on 15.03.2023 and the said notice was duly served on the Applicants and also published in two leading newspapers and the same was also affixed on the schedule property. But in view of the stay granted by this Tribunal, the proposed auction has been cancelled and so the relief claimed in the SA becomes

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infructuous. Acco

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ndent Bank prayed to dismiss the

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SA.

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w 4. Heard Ld. Ld. Counsel for Respondent '$'i^tr 6^?fr?iffiants*?} Bank and on record. P#r:o":h.^{material broAE{i't} i'-l$. .$.Silc

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Now, the points that arise lor consideration are,

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i) whether the Applicants haue established" any ualid ground.s for challenging the Auction sare Notice d"t.31.01.2023 issued. by the Respondent Bank in respect of the sched.ule propertg?

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ii) To uthat relieft

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Point No.(i):-

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During the course of arguments, Ld. counsel for the Applicants and Ld. counsel for the Respondent Bank reiterated their respective

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versions as stated supra.

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There is no dispute regarding the fact that the Applicantsavailed housing loan and top up loan from the Respondent Bank and thereafter committed default in repaying the loan dues. There is also no dispute regarding the fact that the Respondent Bank issued demand notice to the Applicants and the same was received by the Applicants.

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The specific contention of the Applicants is that the Respondent Bank without issuing possession notice, straightaway issued e Auction sale Notice dt.31 .o1.2o23 and so, the said sale notice is not valid and liable to be set aside.

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9 ' As per the Reply filed by the Bank, it is clear that the auction as proposed by the Respondent Bank on 15.03.2023 in pursuance of the e Aucti ige^{dt.3l.Ol.2023 was cancelled by the Bank} in vtew this Tribunal. In view of the cancellation of tn. plrmr'].a t nducted on 15.03.2023, the Respondent i,:d bank^.is expected to take steps for conducting auction of the -_,-_tt,^{I b FtQlnrr} schedlle pf"g.fdI rfj,ll,t a direction is given to the Respondent

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Bank to follow the prescribed procedure laid down under the SARFAESI Act, 2OO2 and Rules made thereunder in taking fresh steps for conducting auction of the schedule property. So, in the circumstances, I am of the opinion that the SA is liable to be dismissed as the relief claimed in the SA becomes infructuous.

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Point No.(il):-

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In the result, the present Securitization Application is dismissed as there are no merits. In the circumstances, the Respondent Bank is directed to follow the prescribed procedure as laid down under the provisions of SARFAESI Act, 2OO2 and Rules made thereunder in taking fresh steps for conducting auction of the schedule propert5r.

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

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t2. Communicate a copy of this order to the parties concerned.

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(Dictated to the P.S transcibed bg her, corrected, signed and pronounced bg me in the open court on this the 26h dag of Februarg, 2025).

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sd/(G. GOPr CHANDI PRESIDING OFFICER

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j:).f;,

Syed Sadiq Hussain and another v. State Bank of India

Case brief

What is this about?

What did the court decide?

Syed Sadiq Hussain and another v. State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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