Dismissed

Smt K Anitha and Another v. Mahaveer Cooperative Urban Bank Ltd.

DRT13 Jul 2026SA/144/2025

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal dismissed an application seeking to set aside a sale notice and consequent auction measures by a bank under the SARFAESI Act. The Tribunal held the application infructuous as the auction failed and the proceedings were the third round of litigation on established findings.

What did the court decide?

Securitization Application dismissed; interlocutory applications pending, if any, closed.

Smt K Anitha and Another versus Mahaveer Cooperative Urban… — Company and Corporate | DRT (2026)

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IN THE DEBTS RECOVERY^{TRIBUNAL_ II AT HYDERABAD}

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DATED THIS THE^{13THDAY OF ]ULY, 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. 144 OF 2025}

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Smt. K. Anitha, W/o.^{K. Kalidas,} Aged 50^years, Occ;^Business, R/o.Flat-504, Sai Towers,^{Narsimha Nagar Colony,} Mallapur, KaPra, HYderabad.

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M/s. Aditya PolYmers,

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Rep. by its Proprietrix Smt.^{K. Anitha,} Plot No.166, in Sy.No.125,^{Mallapur Village,} Uppal Mandal, Medchal-Malkajgiri^Dist.,

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Applicants

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Versus

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Mahaveer Cooperative Urban^{Bank Ltd.,} Rep. by its Authorized Officer, Ameerpet Branch : #7-L-5917, Opp: Indian Bank, Beside^{PlasticWorld,} Ameerpet, Hyderabad '....Respondent

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Counsel for the Applicants :^{M/s. T. Sridhar Reddy} Counsel for Respondent : Sri.^{V. Sethu Madhava Rao}

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-:ORDER:-

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The present Securitization Application^{is filed by the Applicants} u/s.17 of the Securitisation and^{Reconstructionof FinancialAssets} and Enforcement of Security Interest Act,^{2002 ("Act" hereinafterfor} short) to set aside all the measures^{initiated by the respondent} including the sale notice dated t7.03.2025^{fixing the auctionon} 07.04.2025 in respect of the SA Schedule^{Propertyle$ql.It}

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page 2 of 6

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SA No. t40lzD?.s

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2' The averments in the apprication, in brief, are that the Respondent had sanctioned credit facirities of Rs.1,00,00,000/_ under the Term Loan facirity on rg.o7.2oL7 and Rs.g2,50,0oo/- under the cash credit facirity on 14.07.2017. It is averred that the Appricants had been regularly servicing the loan accounts and had paid more than^{Rs'58,00,000/- towards} the outstanding dues, including several substantiar payments made between the years 2o7g and 2023. The Applicants further contend that despite such payments, the Respondent issued a demand notice dated 07.03.2079 under Section 13(2) of the Act, to which they submitted a repry dated 10.05.2079, but the same was not considered, and the Respondent proceeded to rssue a possession notice dated 27.06.201g under section 13(4) of the Act. The Appricants ailege that an earrier sare notice dated 12.03.2023 was chailenged by firing s.A. No.156 of 2023 before DRT_ I, Hyderabad, which came to be dismissed on 03.03.2025, and thereafter the Respondent issued the impugned sate notice dated L7.03.2025 fixing the auction on 07.04.202s. The Applicants contend that the impugned sale notice was not served upon them and that they came to know of the proposed auction only through prospective purchasers visiting the secured asset. It is further alleged that the Respondent fixed the reserve price at Rs.4.25 crores though the market value of the secured asset is stated to be more than Rs.12 crores, and fixed the Earnest Money Deposit at 5% of the reserve price instead of loo/o, in violation of the security Interest (Enforcement) Rules, 2oo2 (hereinafter .,Rules,, for short). The Applicants also atlege non-compliance with Rules B(5), 8(6), B(7) and 9(1) of the Rules, 2oo2 and section 13(g) of the SARFAESI Act, contending that no separate statutory sale notice was served, the mandatory notice period was : not adhered to, the sale notice was not affixed on the secured asset, and publication was not made in accordance with law. The Appricants further contend that the roan ffitrs

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Page 3 of 6

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sA No. 1rr4l2025

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account was wrongly classified as a NPA, the secured asset^was grossly undervalued, and the Respondent acted contrary to the law laid down by the Hon'ble Supreme Court in Mathew Varghese v.^M. Amritha Kumar and Ram Kishun v. State of U.P. On the aforesaid pleadings, the Applicants seek to set aside the sale notice dated 17.03.2025 and all consequential measures initiated by the Respondent under the SARFAESI Act.

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The Respondent Bank filed reply statement along with documents. The averments thereof, briefly, are that at the request of the Applicants, the Respondent had sanctioned a Term Loan of Rs.1,00,00,000/- and an Overdraft facility of Rs.45,00,000/-. Upon persistent defaults committed by the Applicants, the loan account was classified as a NPA, and a demand notice dated 07.03.2019 under Section 13(2) of the Act. Subsequently respondent issued, a possession notice dated 27.06.20L9 under Section 13(a) of the Act. The Respondent further contends that the Applicants had earlier challenged the demand notice and^possession notice by filing S.A. No.228 of 2019, which was dismissed on 13.02.2023, and the restoration application in M.A. No.15 of 2023 was also dismissed on 17,04.2023. It is further averred that thereafter a Rule 8(6)^notice dated 22.02.2023 was duly served upon the Applicants,^followedby the sale notice dated 12.03.2023, which was challenged in^S.A. No.156 of 2023, and though interim stay was^granted subject to deposit of Rs.40,00,000/-, the said S.A. ultimately came to be dismissed on 03.03.2025, The Respondent submits that, thereafter,^a fresh valuation report dated 10.03.2025 was obtained from the approved valuer, the reserve^price was fixed accordingly, and^the impugned sale notice dated 17.03.2025 was issued after due compliance with Rules 8(6) and 9(1) of Rules, 2002 by^effecting personal service, registered post, affixture *ffi;,;,

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page 4 of 6

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SA No. L44lz02S

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publication. Placing reliance upon the judgments in s. Karthik v. N. subhash chand Jain and vinakya sfee/s Ltd. v. om vishnu pipes pvt. Ltd., the Respondent contends that issuance of a fresh 30-day notice under Rule 8(6) was not required in the facts of the present case. Accordingly, the Respondent Bank prays for dismissal of the s.A.

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The right of Applicants to advance orat arguments was forfeited vide order dated 19.06.2026, despite affording sufficient opportunities. Heard the learned counsel for the Respondent. perused the written arguments filed on behalf of the Respondent and the material available on record.

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I. Learned counsel appearing for the Respondent Bank reiterated the content of its reply and denied the averments made by the Applicants and relied upon the material papers filed along with the reply statement. It was submitted that the loan account was classified as a NPA strictly in accordance with the RBI guidelines and that all measures under the SARFAESI Act, 2ooz and the Rules framed thereunder were initiated after due compliance with the statutory requirements. Learned counsel contended that the present sA constitutes the third round of litigation initiated by the Applicants and has become infructuous as the proposed auction scheduled on 07.04.2025 did not materialize. The learned counsel also contended that no fresh 30-day notice under Rure 8(6) was required as the impugned sale was only a continuation of the earlier sale process, placing reliance upon the judgments in s. Karthik v. N. subhash chand Jain, vinakya sfee/s Ltd. v. om vishnu pipes pvt. Ltd., and M. Rajendran v. oils &^proteins India pvt. Ltd.. It was further argued that the Applicants failed to comply with the conditional interim ,order dated 04.04.202s directing deposit of Rs.60,00,000/and, , placing reliance -,--"':, '-"dtrce up on on vresuge Ughts prestige Lights Ltd. t v. ttr&W::{,r, i.,

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Page 5 of 6

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SA No. L4412O25

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submitted that they are not entitled to any equitable relief. On these grounds, the learned counsel prayed for dismissal of the SA.

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The points for consideration are as follows : -

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i) Whether the Applicants made out any valid ground for quashing any of the measures initiated by the respondent bank including the sale notice dated 17.03.2025, fixing the auction on 07.04.2025 in respect of the SA Schedule Property?

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ii) To what relief?

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Point No.(i):

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During the course of proceedings it was reported that the auction scheduled on 07.04.2025 pursuant to sale notice dated L7.03.2025 was not successful due to conditional order^:in force. Under such circumstances, the contention of non-compliance of Rule B(5), 8(6) 8(7) & 9(1) of the Rules pertaining to the impugned auction need no consideration and SA has become infructuous to that extent.

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It is an admitted matter of record that the Applicants had earlier approached DRT-I by filing S.A. No. 228 of 20L9 and S.A. No. 156 of 2023 challenging the demand notice dated 07.03.2019 and the possession notice dated 27.06.2019. The said S.A. came to be dismissed upon a finding that no irregularity or illegality^was established in the SARFAESI measures initiated by the^Respondent Bank. A perusal of the order^passed in S.A. No. 156 of^{2023 reveals} that this Tribunal had already recorded a finding that^the requirements under Rules 3, B(1) and B(2) of tfiRules,^{2002 were} : duty comptied with by the Respondent Bank. ft$t':d,

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page 6 of 6

sA No. L44l2O2s

In the absence of any fresh grounds or subsequent material demonstrating non-compliance, the Applicants cannot be permitted to reiterate the very same issues which have already attained finality. Even otherwise, the Respondent Bank has placed on record sufficient material in the present proceedings to establish compliance with the statutory requirements. Further, the sale notice dated L7.03.2025, which forms the subject matter of challenge in the present s.A., has admittedly become infructuous. consequenUy, no surviving cause of action remains for adjudication by this Tribunal. Accordingly, the S.A. is liable to be dismissed.

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Point No.(ii):

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