The Debt Recovery Tribunal dismissed an application under S. 17 of the SARFAESI Act challenging possession proceedings under S. 14. The court held the secured creditor followed proper procedure and barred re-agitation after a prior stay order was dismissed.
Application SA 159/23 dismissed; proceedings u/s 14 of SARFAESI Act for taking physical possession upheld.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE DEBTS RECOVERYTRIBUNAL - I AT HYDERABAD
DATEDTHISTHE 3RD DAYOFJUNE, 2C26
PRESENT: SRI GUMMADI GoPICHAND, PRESIDING oFFICER
sA.No.159,/2e23
Mrs. Gada Uma Lavanya, W/o Mr.Gada Narender, aged 40 years, Occ:business, R/o H.No. l6 .ll.3ZO lA, Isamia Bazar, Moosarambagh, Hyderabad-500 036.
... Applicant
Versus
P.B.No. 1317, Judges colony, Malakpet, Hyderabad-SO0 036.
H.No. 1-9-290 /3136, Vidyanagar, Musheerabad, Hyderabad-S}O O44. ... Respondents
Counsel for tle Applicant Counsel for lst Respondent Respondent No.2
Sri D. Raghauulu Si T. Randhir Singh Exparte Sri Y.Sikanth Reddy
Counsel for
iq.ft - ffi '.0s.2026 Resented o,.t.l Pronounced'o"g$ 06.2026 Uploadedbn rl
ORDER
- This application is frled by the Applicant u/s. 17 of the SARFAESI Act, 2002, challenging the proceedings initiated by the lst Respondent for taking physical possession of the schedule property through Advocate commissioner u/s 14 of the SARFAESI Act, 2002 pursuant to the orders of Ld.VII Addl.CMM, Nampally, Hyderabad in Crl.M.p.No.34Zl23 and to declare the same as illegal and void.
Respondent No.2 availed Term loan-l of Rs. 150 lakhs, Tem loan-2 of Rs.24 lakhs , Term loan-3 of Rs. 16lakhs and CC facility of Rs.300 lakhs and thus a total amount of Rs.490 lakhs for development of business against the primary and collateral securit5r of properties. The Applicant herein mortgaged the schedule property in security to the loan facilities availed by Respondent No.2. Respondent No.2 paid substantial amounts to the credit of the loan account and the account was not NPA as per the guidelines of RBI. lst Respondent bank received a sum of Rs.3,10,15,000/- by selling the commercial property in the name of Mrs.Manchikatala Vindhya Sree pursuant to the auction conducted on 29.12.2016 and challenging the same, 2nd Respondent filed SA 28 l lZ before this Hon'ble Tribunal and the sarne was dismissed. Challenging the said order, 2"d Respondent filed Appeal before the Hon'ble DRAT, Kolkata which is pending for adjudication. While things stood, the l.t Respondent sold the schedule property belonged to the Applicant in favour of Respondent No.3 pursuant to the sale notice dt.L2.O2.2O1g without following the procedure. AII of a sudden, the 1"t Respondent initiated proceedings u/s 14 of the SARFAESI Act, 2002 for taking physical possession of the schedule property through advocate commlssloner orders of Ld.VII Addl.CMM, Hyderabad and so, the'sziid not lega1 and valid. The Applicant is in the schedule property along with to serve demand notice and the impugned possession notice
was not published in two da y newspapers and also nor affixed on the schedule property. Hence the SA.
.)
The lst Respondent liled their Reply denying all the adverse anegations made in the sA and contended that the Applicant is one of the Directors and guarantor of M/s Subhamasthu papers-Respondent No.2 along with her husband and another. Respondent No.2 availed various credit facilities totalling to Rs.4,90,00,000/- and the Applicant mortgaged the schedule property in favour of the 1st Respondent as securit5z to the said loan facilities. Additionally, the borrowers and guarantors of the loan have mortgaged other properties in favour of the Bank. Other mortgaged property was sold in SARFAESI auction and challenging the same, lnd Respondent liled SA 2gl lZ and the said SA was dismissed by this Hon'ble Tribunal. In view of the default committed by the borrower and mortgagors, the loan account was classified as NpA and the Bank issued demand notice dt.30.0 Z .2OlS and possession notice dt' 12.11.2015 by dury following the procedure contemplated under the provisions of SARFAESI Act, 2OO2. Thereafter, the Bank issued auction notice for conducting auction of the schedule property and challenging the same, the Applicant herein filed SA l3g/ l9 before this Hon'ble Tribunar and this Tribunar observed that there is no violation of SARFAESI proceedings initiated by the lst Respondent bank. Thereafter, the Bank conducted auction of the schedule property and the auction purchaser who is Respondent No.3 herein paid the total bid amount and the Bank also issued Sare certificate in his name long back. So, the Bank initiated proceedings u/s 14 of the SARFAESI Act, 2OO2 for taking physical possession of the schedule property by duly following the procedure. Accordingly, lst Respondent prayed to dismiss the SA.
i counseL fo,r.{lgRggno t No.3 filed his Reply contending that he i" tt . ...otiurrnoli]'.-*r, lii i, ' :Jt' '' SA schedule property. He participated in the ai%-tion ald+I with oi ders and paid the total bid amount th.e- t$ $dlpJm$%rreanit dnd sale certificate was also issued in :" his long back. physical possession of the schedule
property was not handed over till today due to liling of previous SA 138/ l9 and present SA and the Applicant is enjoying the possession of the schedule property. Accordingly, prayed to dismiss the SA. Heard Ld.Counsel for the Applicant, Ld.Counsel for the lst Respondent Bank and Ld. counsel for Respondent No.3 whereas Respondent No.2 reamined exparte. Perused the material brought on record.
Now the points that arise for consideration are
ii. To what relief ?
Polnt No.lil:,-
- During the course of arguments, ld. Counsel for the Applicant, ld. counsel for the lst Respondent and Respondent No.3 reiterated their respective versions as stated supra.
The specific contention of the Applicant is that the 1st Respondent without ..-- -_r:.<t</sup> rssurng any prror.DoFi#ilanffiirhout . 'i1 following Rule 8(l)(2) of Rules, 2002, straightaway, idhia for taking physical possession of the -'tr' schedule prdi:erty commissioner u/ s 14 of the ! i:i SARFAESI ect, fip, JUllhA,Zd the procedure and so, the said
10
proceedings initiated by the 1st Respondent against the schedule property are null and void.
1 1' The Applicant filed copy of the said order dt.07.l 2.2022 along with the sA filed by her. A perusal of the said order makes it clear that the said SA was filed by the Applicant challenging the auction conducted by thg 1"t Respondent on 26.03.2019 in respect of the schedule property. After elaborate enquiry, the said SA was dismissed by this Tribunal holding that the lst Respondent has scrupurously followed the procedure in issuing demand notice, possession notice and also in conducting auction of the schedule property. so, when the earlier SA filed by the Applicant challenging the measures initiated by the lst Respondent including the possession notice which is in challenge in the present sA is dismissed on merits, the Applicant is not entitled to re-agitate the non-receipt of demand notice n notice in the present SA as per the principles of As per the SARFAESI Act, 2002, after issuance of SARFAESI Act, 2OO2, the secured creditor Judicial
vtQ'r)_;r
the instant case, after issuing demand notice and possession notice to the Applicant and others and after conducting auction of the schedule property by duly following the procedure, the lst Respondent being secured creditor, proceeded u/ s 14 of the sARFAESI Act, for appointment of advocate commissioner for taking physical possession of the schedure property and to hand over the same to the auction purchaser. Ld.vII Addl.CMM, Nampally, Hyderabad, after considering the material on record, appointed advocate commissioner for taking physical possession of the schedule propert5r and the said advocate commissioner issued notice to the Applicant to vacate the schedule property and the said notice was admittedly served on the Applicant. so, the said proceedings initiated by the 1"t Respondent for taking physical possession of the schedure property are perfectly legal and valid.
Potnt No.(ti):-
(Dictated to court on bed. June, 2026)bg _her,,.corrected, signed. and. pronounced. bg me in the open
sd/-
(c. coPr cHAr{Dl
PRESIDING OFFICER
JUN W8
TRUV.COP
9.'u^4
lr rDEffA8,,tO
A-..-$y
3 issues framed by the court
Whether the applicant has established valid grounds for challenging proceedings to take physical possession of schedule property u/s 14 of the SARFAESI Act, 2002.
What relief is the applicant entitled to.
Whether the applicant is entitled to re-agitate issues of notice receipt after a previous stay application was dismissed.
2 provisions across 1 enactments
Mrs. Gada Uma Lavanya
Bank of India
M/s Subhamasthu Papers P. Ltd.
Rallabandi Vikram
SRI GUMMADI GOPICHAND
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
