Dismissed

Nakkala Ilaya Yadav and Others v. Iifl Home Finance Limited

DRT6 Jul 2026SA/180/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed an application challenging the non-banking financial company's measures under the SARFAESI Act. The Court found the bank complied with statutory notice requirements and held that consumer forum directions on interest did not invalidate the recovery proceedings.

What did the court decide?

The security application filed under Section 17 of the SARFAESI Act was dismissed, and the Respondent Bank's measures were upheld.

Nakkala Ilaya Yadav and Others versus Iifl Home Finance Limited — Banking and Recovery | DRT (2026)

¶1

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

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DATED THIS THE O6TH DAY OF^JULY,2026

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PRESENT: SH. MMESHWAR^{KOTHE,B.COM, L.LB' (HONS.). M.A.} PRESIDING OFFICER

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Securitization Application^{No. 180 OF 2024}

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Nakkala llaya Yadav,^{S/o Sattaiah,} Aged: 75^yrs, Occ: Retd.^Service

¶6

Sulochana Yadav,^{W/o.Ilaya Yadav,} Aged: 59^years, Occ:^Housewife

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Nakkala Arjun^{Yadav,S/o' IlayaYadav,} Agedi 47^years, Occ:^Service

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(All R/o,H.No.6-3 -83L/ClL, Shanti^Nagar, nmeerpet, Hyderabad-34)

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"" " 'Applicants

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Versus

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IIFL HOME Finance^limited Rep. by its Authorized^Officer, Situated at D.No^{5-9-2218/501, 5th Floor,} My Home Sarovar^{Plaza,SecretariatRoad,} xyderabad - 5OOOO4

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Respondent

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Counsel for^the Applicants^{: Mr' G' V' Krishnam Raju} Counsel for Respondent^{: Mr. P. Ramachandran}

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-: o-ul-B:-

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The^{present Securitization Application is filed by the Appllcants} u/s.17 of the^{Securitisationand Reconstructionof FinancialAssets} and Enforcement^{of SecurityInterest Act, 2002C'Act"hereinafterfor} short) to set aside^{all the measuresinitiatedby the RespondentBank} under the Act,^{including the action of takingphysical possession of} the SA Schedule^{Propertyvia advocate commissionernotice dated} /,,.)w,'|'-.- -, U,'^' 6i.'\ ""

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Page 2 of6

¶17

SA No. 180/2024

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03.70.2024 as^per orders in Crl.M.P.No.3104 of 2024 on the file of X Additional Chief Judicial Magistrate Court, Secunderabad.

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The averments of the application, briefly, are that the Applicants availed housing loan of Rs.14,84,944l-, however failed to adhere to repayment schedule of the loan due to covid-19 pandemic consequently the account was classified as NPA which applicant claim to be against the NPA guidelines. The applicant avers of approaching the District Consumer Commission in CC 576 of 2022 which was dismissed due to which applicants preferred revision petition before State Consumer Commission in R.p.No.48 of 2023 where forum directed the respondent bank to follow the RBI guidelines while charging the interest rate. However the respondent bank has failed to adhere with the direction of the State Consumer forum and subsequently issued an advocate commissioner not,ce dated 08.04.2024 to take physical possession of the SA Schedule property in pursuance of the possession notice dated 10.!1.2022 under section 13(4) of the Act. The applicants alleges the respondent bank has failed to issue demand notice under section 13(2), possession notice under section 13(4) and sale notice under Rule g(6) of the Security Interest (Enforcement) Rules, 2002 (hereinafter^..Rules,, for short). Applicant further contended that said notices were neither affix over the secured assets nor was published in two leading newspaper as required under prescribed provision of the Rules, 2002. With these contentions applicants pray for setting aside all the measures initiated by the respondent bank against the SA Schedule property.

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The Respondent Bank filed its reply statement along with supporting documents. It is contended that the Applicant is a chronic defaulter who has adopted dilatory tactics by initiating multiple proceedings to stall recovery. The Respondent points out that the Applicant's earlier challenge to the SARFAESI measures in S.A. No.

ffiaa\

Page 3 of6

SA No. 180/2024

333 of 2022 was dismissed^{by this Tribunalon 13.11.2023, following} which an order under Section^{14 of the SARFAESIAct was obtained in} Crl.M.P, No. 592 of^{2OZ4 for taking physical possession of the secured} asset. The Respondent^{admits sanction of the housing loansecured} by mortgage of the^{S.A. ScheduleProperty but deniesthe allegations} of illegal enhancement of^{interest, procedural irregularityand} violation of the SARFAESI^Act. It^{is contendedthat the Applicant} committed^persistent defaults,^{resultingin classification of the loan} account as NPA,^{and that all statutorymeasures,includingissuance} of the demand notice,^{possession notice and proceedingsunder} Section 14 of the Act, were^{undertaken strictly in accordance with} law. The Respondent^{furthersubmits that the Applicant had} simultaneously sought a^{One Time Settlement(OTS) while pursuing} the present^{proceedings, thereby suppressingmaterialfacts'} Accordingly, the^{Respondent Bank praysfor dismissalof the S.A'}

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Learned Counsel for the^{applicantfiled written arguments while} learned counsel for the^{respondent bank reportedthat orders may be} passed based on records. Perused the written^{argumentsfiled by the} applicant and also^{perusedthe material brought on record'}

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Learned counsel for the^{applicantsreiteratedthe content of its} application and would^{submitthat they took a housingloan of} Rs.14,84,g44/- but could^{not keep up repayments due to the COVID-} 19^pandemic. after^{which the account was classifiedas NPA, which} they say was contrary to^{RBI normsThey also state that they had} earlier approached the^{District Consumer Commissionin CC No'576} of 2022, and after^{dismissal filed R.P.No.48 of 2023 before the State} Consumer Commission,^{whichdirected the Bank to followRBI} guldelines while charging interesu^{despite that, the Bankallegedly} proceeded with SARFAESI action and^{issued an Advocate} Commlssioner's notice^{dated 08.04.2024for physrii!lpossession} ow*

)

Pate 4 of6

SA No. 180/2024

pursuant to the possession notice dated to,LL.2022, on that basis, they contend that the Bank failed to properly issue and serve the statutory notices under Sections 13(2) and 13(4) and Rule 8(6), and also did not affix or publish the notices in the manner required under the Rules, so they seek to set aside all measures taken against the SA schedule^property.

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6. The points for consideration are as follows : -

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i) Whether the Applicants made out any valid ground for quashing the action of the Respondent Bank from taking the^{physicalpossession} of the SA schedule property through Advocate Commissioner appointed under the provision of the Section 14 of the SARFESI Act?

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ii) To what relief?

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Point No.(i):

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It is pertinent to note that the Applicants had earlier questioned the very same SARFAESI measures by filing S.A.No.333 of 2022 before this Tribunal. Though the said application came to be dismissed ex parte, this Tribunal had recorded a finding that the Applicants failed to establish any non-compliance of Sections 13(2) and 13(4) of the Act. Therefore, this Tribunal is not treating the earlier order as an absolute bar to the present proceedings. However/ in the present proceedings, the Respondent Bank has produced the complete documentary record evidencing compliance with the statutory provisions, thereby independently establishing the legality of the measures initiated under the Act.

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The contention of the Applicants that the Respondent Bank acted contrary to the directions issued by the State Consumer Commission regarding charging of interest also does not advance their case, The proceedings before the ConsumeJJorum relate to the ffi''t

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PaEe 5 of5

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sA No' 180/2024

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contractual dispute^{concerninginterest charged by the Bank and do} not render invatid the^{statutory measurestakenunder theSARFAESI} Act. The Applicants have^{not placed any materialto show that the} Respondent was^{restrained by any competentforumfromproceeding} under the^{provisions of the Act.}

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9, The other contention^{being raised by the applicants is non} service of demand^{notice under section 13(2) and possession notice} under section^{13(4) of the Act' The respondentbank hasfield} material annexed to^{the reply statement to prove the complianceof} the SARFESI Act and^{Rules, thereunder' Pages 22 to 32 are the} Photostat copies of^{postal receipts and publicationof the samein} English and Telugu^{(vernacular language)newspaperson} 06,05.2022,^{proving service of demand notice' Similarly,Pages33 to} 44, are the^{Photostat copiesof possession notice being servedvia} registered^{post, photographsas proof of affixture on securedassets} and publication of^{the same in English and Telugu(vernacular} Ianguage) newspapers^{on !4.LL.2022.The documents placed on} record by the^{RespondentBank remain undlsputed' 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^{ResPondentCompanyinitiatedthe SARFESI} proceedings, which cannot^{be categorized as illegal or arbitrary'}

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In view of above^{observations.itis concludedthat the} applicants failed^{to establish any ground to set aside the measure} from taking^{physical possession by the RespondentBank under the} Act, 2OO2 against^{the SA scheduleproperty and accordingly the SA is} riabre o be dismissed. ,/)ry<.tY L___-^.-0\N'

Page 6 of 6

sA No. 180/2024

Point No,(ii):

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

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Consequently, 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 dictation W the Steno, corrected, signed ond pronounced by me in the open court on this the 06h day ol tuly,2O2;).

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/(/ff*'* R*MESHWAR KoTHE) PRESIDING OFFICER

Nakkala Ilaya Yadav and Others v. Iifl Home Finance Limited

Case brief

What is this about?

What did the court decide?

Nakkala Ilaya Yadav and Others v. Iifl Home Finance Limited

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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