Dismissed

Edward Stanley v. Reliance Asset Reconstruction Company Limited

DRT29 May 2026SA/163/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed the Securitization Application filed by borrowers challenging possession measures initiated by a secured creditor. The Tribunal found no infraction of the SARFAESI Act or Rules regarding notice issuance and publication, holding the recovery proceedings not illegal.

What the court decided

AI extract

Edward Stanley versus Reliance Asset Reconstruction Company… — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY^TRIBUNAL -^{II AT} HYDERABAD

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DATED THIS THE 29TH DAY OF^MAY, 2026

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PRESENT: SH. RAMESHWAR^{KOTHE, B.Com, L'LB.(Hons.), M.A'}

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PRESIDING OFFICER

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Securitization Application^{No' 163 OF 2022}

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Mr. Edward Stanley,

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S/o. Panjanathan Stanley, Aged about 50 Years,

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Occ: Business,^{R/o. H.No.29-1427} /2/^L, Plot No.130,^(Old No.30-169/130) Kakatiya Nagar, Neredmet, Malkajgiri- 500056,^HYderabad

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Mr. Panjanathan Stanley, S/o. Sri M.V. Panjanathan, Aged about 75 Years Occ: Business, R/o.^H.No.29-1427 /2/7, Plot No.130,^(Old No.30-169/130) Kakatiya Nagar, Neredmet, Malkajgiri- 500056,^HYderabad

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Versus

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Reliance Asset Reconstruction^{Company Ltd.,} Rep. by its authorised^Officer, C/o My Branch Service^{Pvt. Ltd,} 8-2-6112,2nd floor,^{RoadNo' 11,} Banjarahills, Hyderabad-⁵⁰⁰⁰³⁴

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......Respondent

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Counsel for the^APPlicant : Mr. D. Raghavulu Counsel for ResPondent^Co. : Ms. Maanam Sailaja

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-:9.RD-EE:-

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The^present Securitization^{Application is filed by the Applicant} uls.tl of the Securitisation^{and Reconstructionof FinancialAssets} and Enforcement of^{SecurityInterest Act, 2002 ("Act" hereinafter for} short) to set aside^{all the measures initiated by the Respondent} Company including^{taking physicalpossession of the SA Schedule} PropertyviaAdvocateCommissionerNoticedatedl6.05.2023in

(-/,r)ry""+a

Page 2 of 5

sA No. 163/2022

Crl.M.P.No.313 of 2022 & Crl.M.P.No.102 of 2023 on the file of Hon'ble Chief Metropolitan Magistrate, Medchal Malkajgiri District consequent to the possession notice dated 15.02.2023.

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The averments of the application, briefly, are that the Applicants availed a housing loan of Rs.18,00,000/- from the Respondent Company in the year 2008, secured by mortgage of residential house bearing No.29-142712/t (Old No. 30-169/130), Plot No. 130, situated at Kakatiya Nagar, Neredmet, Malkajgiri, Ranga Reddy District, Telangana. Though regular in repayment Initially, but due to unforeseen circumstances and the impact of the COVID-19 pandemic applicants defaulted in payment of certain instalments. The Respondent Company issued demand notices dated 04.08.2021 and 17.12.2O2t, calling upon the Applicant to pay allegedly exorbitant amounts of around Rs.74 lakhs to Rs.86 lakhs, without furnishing proper calculations, detailed interest breakup, or authenticated statements of account. The Applicant raised timely objections and requested clarification regarding the outstanding dues. Despite these objections, the Bank declared the account as a NpA, initiated proceedings under the SARFAESI Act, 2002, and issued a possession notice dated 20.07.2022, allegedly without strict compliance with the mandatory provisions of the Act and the Security Interest (Enforcement) Rules, 2002, (hereinafter "Rules', for short) including proper service of the notices, consideration of objections under Section 13(3A) and due and proper affixation and publication of the possession notice. The Petitioner contends that the Bank,s actions are illegal, arbitrary and in violation of the SARFAESI Act and RBI guidelines, and that parallel arbitration proceedings were already initiated in respect of the same cause of action, which, in his submission, renders the SARFAESI proceedings non-maintainable. ,4)\v.., 1Y'<ff*

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Page 3 of 5

¶22

SA No. 163/2022

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Hence this SA to set aside all the^{measuresagainstthe SA schedule} p ro pe rty.

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The Respondent Company^{filed reply statementin the SA' The} averments contained therein^{are, in brief, that the Applicant availed a} loan facility from the^{Respondent Companyand mortgagedcertain} properties as security. The said loan^{account subsequentlyturned} into a NPA. The debt^{with underlying security interest was later} assigned to the Respondent^{Company. An arbitral award in} Arbitration No.88 of^{2010 was passedupholding the existenceof the} debt and the validity of^{the mortgagein favour of the Respondent} Company. The Respondent^{Company issueda demand notice dated} 17.t2.202t^{(aftbr cancellationof earlier notice), which was duly} served upon the Applicant.^{As the Applicant failed to make any} representation under Section^{13(3A) of the SARFAESIAct or to repay} the dues, the Respondent^{proceededto issue a PossessionNotice} dated 20.07.2022 which^{was affixed on the securedpropertyand} published in two leading newspapers,^{in compliancewith the} statutory requirements.^{Respondentvehemently deniedthe material} allegations, and asserted^{that the secured debt is legally established} by the arbitral award^{and the assignment documents,and that all} formalities under the^{SARFAESIAct and Rules, 2002, were strictly} complied with.^{Further,the Respondent has challengedthe grounds} raised by the Applicant^{as baselessand legally untenable,stating that} no specific violation of any^{order passed by the Tribunal hasbeen} demonstrated on^{record.It is also submitted that the merependency} oftheSAdoesnotmandatesuspensionofrecoveryproceedings under Section 14 of^{the SARFAESI Act, and that the Respondent} remains entitled to^{proceed in accordancewith the statutoryscheme.} TheRespondentfurtherSubmitsthattheApplicanthasneitherpaid anysubstantialduesaftertheissueofthe'demandnoticenor

1/:5;c'

Page 4 of 5

SA No. 163/2022

approached the Respondent for any OTS facility, On these^grounds, 1?.19sp-9nq"-1!PreveqJha!^{the sA be dismissedwith costs'}

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The Learned Counsel for the Applicant reported that order may be passed based on record. Heard the learned counsel appearing for the Respondent Company. Perused the material brought on record.

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Learned Counsel for the Respondent Company while reiterating the contents of the reply statement, denied adverse contentions of the Applicants. While placing reliance upon the material papers annexed with reply statement learned counsel submitted that the applicants' account was classified as an NPA as per RBI guidelines and the Respondent Company has strictly followed the due procedure prescribed under the Act, 2002 and the Rules thereunder, hence the SA is liable to be dismissed.

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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 Company against the SA Schedule Propefties, as prayed for?

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ii) To what relief?

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Point No.(i):

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The contentions of the applicants are non-compliance of Sections 13(2) & 13(4) of the Act and Rules 3, 8(1) & B(2) of the Rules, 2002. The Respondent Company relied on copies of documents annexed with the reply statement. Pages 1 to 19 of the material papers annexed to the reply statement are the photostat copies of postal receipts, and paper publication of the same in English and Telugu (Vernacular Language) newspaper on 21.^12.2021, proving

/$ux

Page 5 of 5

SA No. 163/2022

service of demand notice. Similarly,^{Pages 20 to 40 are the Photostat} copies of^postal receipts as^proof of^{sending possessionnotice} through registered^{post, photographs as proof of affixture on secured} assets and^publication of the^{same in Englishand Telugu (vernacular} language) newspapers on 22.07.2022.^{fhe documents placed on} record by the Respondent^{Companyremain undisputed.In view of} sufficient^{proof place} on^{record, I find no infraction of section 13(2) &} 13(4) of the Act and^Rules 3, 8(1)^{& 8(2) of the Rules, 2002. Asa} secured creditor the^{Respondent Companyinitiatedthe SARFESI} proceedings including Sec.14^{proceedingswhich cannotbe} categorized as illegal or arbitrary.

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In the view of above^{obseivations, it is concluded that the} applicants have failed to^make out^{any valid ground to set aside the} measures of the Respondent Company^{under the Act, 2002 against} the SA schedule^{properties and accordingly SA is liable to be} dismissed.

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&!.tttNo.(!i.L -

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In the result, the Securitisation^{Applicationfails and is hereby} dismissed.

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Consequently, Interlocutory^{Applications pending,if any, shall} stand closed. No order as to^{costs. 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 Ps" corrected, signed^{ond pronouncedby mein the open court on this the} 2gth doy ol Moy, 2026).

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thtrl

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ESHWAR KOTHE) PRESIDING OFFICER

Edward Stanley v. Reliance Asset Reconstruction Company Limited

Case brief

What is this about?

What the court decided

Edward Stanley v. Reliance Asset Reconstruction Company Limited

Case brief

What is this about?

What the court decided

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