Dismissed

State Bank of India v. Thilagaraj Agency

DRT25 Feb 2026OA/255/2025

Case brief

AI extract

What is this about?

The Applicant sought an order for attachment before judgment to prevent disposal of property by Respondents. The Tribunal noted the necessity of proving valid claims and immediate risk of asset alienation under the RDB Act and CPC. The application was dismissed for lack of sufficient evidence regarding malafide intent.

What did the court decide?

Attachment before judgment application dismissed. No costs.

State Bank of India versus Thilagaraj Agency — Banking and Recovery | DRT (2026)

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BEFORE THE DEBTS RECOVERY TRIBUNAL –II AT CHENNAI

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Dated this 25^th day of February, 2026

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PRESENT: SHRI SHARANG DHAR UPADHYAY PRESIDING OFFICER

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IA No.1110 of 2025 In

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OA No.255 of 2025

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State Bank of India Stressed Assets Recovery Branch (SARB) Red Cross Building, 2^nd Floor No.32, Red Cross Road Egmore, Chennai – 600 008 Represented by its City Case Officer Mrs. Haritha Ravi

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…Petitioner / Applicant

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Versus

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Thilagaraj Agency

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Represented by its Partners

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Mr. Jayaraj Natesan and Mrs. Thilagavathi Annamalai Melapanangattangudi, Koothanallur Thiruvarur – 614 101

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Mr. Jayaraj Natesan A/42, New Housing Unit Mannargudi, Thiruvarur – 614 001

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Mrs. Thilagavathi Annamalai W/o Jayaraj Natesan

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A/42, New Housing Unit

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Mannargudi, Thiruvarur – 614 001 …Respondents / Defendants

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ORDER

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This application is filed by the Petitioner / Applicant praying to pass an

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order of Attachment Before Judgment with regard to the schedule mentioned properties in this application.

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It is the case of the Petitioner / Applicant that the above OA has been filed for recovery of a sum of Rs.36,82,435/- together with further interest @9.75% per annum with monthly rests from the defendants. It is stated that the loan is not secured by mortgage of any immovable property or hypothecation of assets. It is also stated that on verification the applicant bank has identified unencumbered more fully described in the schedule to this IA. It is further stated that the defendants are taking serious steps to alienate the properties morefully described in the schedule to this IA with an intent to defraud the applicant bank. Hence it is just and necessary that this Hon’ble Tribunal attach the schedule mentioned properties before the judgment, in the interest of justice. It is stated that by attachment of properties no prejudice will be caused to the respondents, whereas, if attachment is not effected, it will cause great hardship to the Petitioner / Applicant Bank.

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Despite service of notice on the Respondents / Defendants by way of

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paper publication, there is no representation for the Respondents / Defendants. They remained absent.

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Heard the Ld. Counsel for the applicant.

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The point that arises for consideration is:

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Whether the present application is liable to be allowed and whether an order of attachment before judgment is to be passed?

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Answer to the Point for consideration

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At the very outset it will be not out of place to mention here that it is generally just and proper for a DRT to pass an order for Attachment of a borrower’s immovable property before a final judgment; but only under the specific circumstances; and for this a bank must demonstrate a credible and immediate risk that borrower will dispose of the property to frustrate the bank’s ability to recover the debt latter. This is a protective measure to prevent the borrower from making the final recovery of the debt fruitless. The process is governed by the RDB Act, 1993, which empowers the DRT to secure a bank’s interest.

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It is also pertinent to mention that the power of a DRT to order an interim attachment is derived from the Principles of Order XXXVIII Rule 5 of the Code of Civil Procedure, 1908, which are applied to DRT proceedings. The bank’s application for Pre-Judgment attachment is a drastic and extraordinary remedy, and the Tribunal must exercise this power with great caution under following considerations: -

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(a) The bank must first prove that it has a valid and legitimate claim for recovery of debt.

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(b) The bank must show a credible evidence that the borrower

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intents to dispose of or remove the property to obstruct or delay the execution of any decree that may be passed against them.

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(c) The bank must provide specific details regarding the borrower’s fraudulent intent, rather than making vague and general allegations.

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The above conditions for Pre-Judgment attachment is so necessary having more importance so that “A bank cannot use this provision to pressure the borrower in to an early settlement. The purpose is strictly to prevent assets from being disposed of and not to convert an unsecured debt into a secured one”.

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Accordingly, it is very much clear that for an order of Pre-Judgment attachment the bank must present sufficient evidence to the Tribunal to show why an attachment is necessary. The bank needs to demonstrate a credit risk that without attachment the borrower will abscond, move the property or otherwise render eventual recovery of the debt impossible.

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Thus from the above factums it is clear that the applicant bank in this instant petition of Attachment Before Judgment nowhere furnished any strong evidence that reflects the malafide intention and

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defendant’s to alienate the property given in the schedule of IA.

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Accordingly, the application in IA No.1110 of 2025 has no merits and is liable to be dismissed. Hence, the following:

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ORDER

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IA No.1110 of 2025 is dismissed. No costs.

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Sd/(SHARANG DHAR UPADHYAY ) PRESIDING OFFICER DRT-II, CHENNAI

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(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 25^th day of February, 2026)

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State Bank of India v. Thilagaraj Agency

Case brief

What is this about?

What did the court decide?

State Bank of India v. Thilagaraj Agency

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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