Dismissed

Mr S Nagendra v. Union Bank of India Limited

DRT7 Aug 2026SA/119/2026

Case brief

AI extract

What is this about?

The Tribunal dismissed a Securitisation Application challenging the bank's possession notice and enforcement actions under the SARFAESI Act. The Court found the bank strictly complied with statutory requirements for demand notice, objections, and possession, treating the applicant's allegations as unproven.

What did the court decide?

The Securitisation Application is dismissed; stay vacated; no order as to costs.

Mr S Nagendra versus Union Bank of India Limited — Company and Corporate | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL - II AT HYDERABAD

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DATED THIS THE 7TH DAY OF AUGUST,2026

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PRESENT: SH. RAMESHWAR KOTHE, B.Com, L.LB. (Hons.), M.A. PRESIDING OFFICER

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Securitization Application No. 119 OF 2026

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Mr. S. Nagendra, S/o J Manikyam Chetty, Aged about 42 years, Occ: Business, R/o H. No. 25-296/A,25th Ward, Bazar Street, New Pet, Palamaneru Town, Palamaneru, Chittoor District - 517408

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... ........Applicant

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Versus

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Union Bank of Ind ia, Rep. by it's Authorized Otficer, Situated at D No. 17-35, Ground Floor, Shahs Plaza, Maremma Gudi Street, Chittoor District - 517 408

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... Respondent

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Counsel for the Applicant : M/s. Raghavulu Devalla Counsel for Respondent : Sri. N. V. Subba Raju

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-:ORDER:-

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The present Securitization Application is filed by the Applicant u/s.17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("Act" hereinafter for short) assailing possession notice dated 07.02.2026 in respect of the SA Schedule Property.

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The averments of the application, in brief, are that the applicant, who is carrying on mobile sales business under the name and style of M/s Selvan Enterprises, had availed an overdraft facility of Rs. 7,00,000/- from the respondent bank in year 2016 by mortgaging SA Schedule Property. The applicant submits that he had ffi's"

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Page 2 of5

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SA No. u9l2026

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been regularly repaying the^{loan and had paid a substantial amount} towards the loan account,^{but due to severefinancial setbackscaused} by the COVID-19^{pandemic,his businesswas closed,resulting in} default of a few instalments.^{It is allegedthat despite his willingness} to regularise the account,^{the respondent bankillegally classified the} loan account as a^{NPA and initiated proceedingsunder the SARFAESI} Act. The applicant further^{contends that neitherthe DemandNotice} under Section 13(2)^{nor the PossessionNoticeunder Section 13(4) of} the Act was duly served^{upon him and that the respondent failed to} comply with the mandatory^{requirementsof Rule 3 and Rules 8(1)} and 8(2) of the Security^{Interest (Enforcement)Rules,2002,} (hereinafter "Rules" for short) by not serving the^{notices, affixing the} Possession Notice on the^{secured asset,or publishlngthe same in two} leading newspapers. On^{thesegrounds,the Applicant seeks setting} aside of the SARFAESI^{measures inltiatedagainstthe S.A. Schedule} Property.

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The Respondent Bank filed^{its reply statement alongwith} supporting documents. The averments^{thereof brieflyare that} applicant had availed an Overdraft^{facility for meeting the working} capital requirements of their^{business and, upon closure of the} business and^persistent default in^{repayment, the loan accountwas} rightly classified as a NPA on^{19.11.2025in accordancewiththeRBI} guidelines. The respondent specifically denies the^{allegation of non-} service of the Demand Notice^{under Section13(2) of the Act and} submits that the Demand^{Notice dated 27.11.2025 was duly served} upon the applicant, who,^{through their counsel, submitted objections} to the said notice, which were duly^{consideredand rejectedby} communication dated 15.12.2025 in^{compliance wlth Section 13(3A)} of the Act. It is further^{contendedthat, upon failure of the applicant} to discharge the outstanding^{dues withinthe statutory period, the}

try\*

PaBe 3 of 5

SA No. 119/2026

respondent took symbolic possession of the secured asset on 07.02.2026 under Section 13(4) of the Act by duly affixing the Possession Notice on the secured asset, serving the same upon the applicant through registered post and publishing it in Sakshi (Telugu) and Hans India (English) in compliance with Rule 8(2) of the Rules, 2002. The respondent further submits that the secured asset was valued by an approved valuer, where after a Sale Notice dated 09.03.2026 providing the mandatory 30 days' notice for the proposed e-auction was issued and duly served and published in accordance with Rules 8(6) and 9(1) of the Rules. Hence, the respondent prays for dismissal of the SA with costs.

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Learned counsel for the applicant reported that orders may be passed based on records. Heard learned counsel for the respondent bank. Perused the material brought on record.

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Learned counsel for the Respondent Bank denied the averments made in the SA and placed reliance upon the documents filed along with the reply statement. It was submitted that the loan account was classified as a NPA in accordance with the RBI guidelines and that the Respondent Bank had strictly complied with the procedure prescribed under the Act and the Rules, 2002 thereunder. Accordingly prayed for dismissal of the SA.

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The points for consideratlon are as follows : -

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i) Whether the Applicant made out any valid ground to quashing of the possession notice dated 07.02.2026 under section 13@) of the Act in respecl of the SA Schedule Property? fu"r* LY 0^{t '}

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ii) To what relieP

Page 4 of 5

sA No. 119/2026

Point No.(i):

The Respondent Bank relied on copies of documents annexed with the reply statement. Pages 08 to 11 of the material paper annexed to the reply statement are the Photostat copies of postal receipts and track reports proving service of demand notice. Likewise, pages 12 to 19 of the typed set comprise photocoples of the reply dated 15.12.2025 issued to the objections raised by the applicant on 08.72.2025, along with photocopies of the postal acknowledgement evidencing service of the said reply upon the applicant, thereby establishing compliance of Section 13(3A) of the Act. Similarly, Pages 20 to 27 are the Photostat copies of possession notice dated 07.02.2026 belng served via registered post, photographs as proof of affixture on secured assets and publication of the same in English and Telugu (vernacular language) newspapers on 12.02.2026. In view of sufficient proof place on record, I find no infraction of section 13(2). 13(34) & 13(a) of the Act and Rules 3, 8(1) & 8(2) of the Rules, 2002. As a secured creditor the Respondent Bank initiated the SARFESI^proceedings, which cannot be categorized as illegal or arbitra ry.

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In view of above observation, it is concluded that the Applicant failed to establish any ground to set aside demand notice, possession notice or action under section 14 of the Act, 2002 to take physical possession of SA Schedule property and accordingly the SA is liable to be dismissed. ((/'6.*o'zA'ltta-'^'r

Page 5 of 5

SA No. 119/2026

Point No.(ii):

In the result, the Securitisation Application fails and is hereby dismissed.

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Consequently, stay granted vide order dated 13.04.2026 in IA.No.1154 of 2026 in the SA stands vacated and Interlocutory Applications pending, if any, shall stand closed.

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No order as to costs.

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Communicate a copy of this order to the^parties concerned^and upload in the official website.

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(Typed to my dictotion by the steno, corrected, signed ond^pronounced by me in the open court on^this the lh day of August,2026).

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VW*"*' SHWAR KOTHE) PRESIDING OFFICER

Mr S Nagendra v. Union Bank of India Limited

Case brief

What is this about?

What did the court decide?

Mr S Nagendra v. Union Bank of India Limited

Case brief

What is this about?

What did the court decide?

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