Dismissed

Mr Masood Ahamad Jaleel v. Karnataka Bank Limited

DRT19 Jun 2026SA/187/2025

Case brief

AI extract

What is this about?

The Tribunal dismissed the Securitization Application filed by a debtor challenging Section 14 measures. The applicant contested non-service of notices and non-disclosure of due amount in the accompanying affidavit. The Tribunal held that postal acknowledgment proved service and lack of specific amount disclosure caused no substantial harm.

What did the court decide?

The Securitization Application No. 187 of 2025 was dismissed; all pending interim applications were closed.

Mr Masood Ahamad Jaleel versus Karnataka Bank Limited — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-II, BANGALORE

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Dated this 19^th Day of June, 2026

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PRESENT: SHRI T. RAJESH

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Hon’ble Presiding Officer

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S.A. No. 187 of 2025

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BETWEEN:

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Mr. Masood Ahmad Jaleel S/o. Abdul Jaleel Adam Aged about 55 years Adam Manzil, 76, Badagabettu Kukkikatte, Udupi Taluk, Udupi District-576101

. . . Applicants

Versus

AND:

The Authorised Officer Karnataka Bank Asset Recovery Management Branch Karnataka Bank Building, Kalsanka Ambagilu Road, Ambagilu, Udupi-576105

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. . . Respondent

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Ld. Counsels on record / appeared :-

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Counsel for Applicant :- Sri. Puttaraju Counsel for Respondent :- Sri. Nithin Chandra M

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: - O R D E R - :

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This Securitization Application, SA is filed under section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act; herein after been referred to as SARFAESI Act or the Act, as the case be impugning the measures initiated and continued by the respondent leading to the procurement of section 14 order from the Principal Senior Civil Judge CJM, Udupi in Crl.Misc.No.80/2025.

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SA/187/2025

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The applicant who admits the sanctioning and disbursement of the facility is also admitting the creation of security interest in respect of the measures. It is the case of the applicant that, the demand notice and possession notice is not served on the applicant and the measures leading to the impugned order is obtained by showing exorbitant due in the account that too without following the statute.

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In the grounds to the SA, the applicant is contending that, the order passed by the Ld. Magistrate is bad in law, illegal and enforceable. It is also stated that no demand notice is served on the applicant and the alleged non service of possession notice is also reiterated in the grounds. Apart from the above contentions, the applicant highlights the contention that, the actual due amount as on date of filing of the S.14 application is not mentioned in the affidavit filed in support of the said application and hence the respondent had failed in compliance of the mandate of the statute.

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The next contention taken by the applicant is that, there is no registration of the secured asset with the Central Registry. The applicant also contends that, the possession notice is not published within 7 days of its issuance and hence the measures are vitiated on the above ground also. Hence, on the above contentions, the applicant prays for setting aside the measures leading the procurement of S.14 Order. Along with the SA the applicant had filed the following documents;

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i. Copy of the Order dated 07.05.2025

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SA/187/2025

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ii. Copy of the Petition copy

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iii. Copy of the Affidavit filed by the Chief Manager

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iv. Copy of the Pre-Takeover notice dated 17.06.2025

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The respondents had filed their objections, denying the averments as stated in the SA and submits that, the SA is bad for non-joinder of necessary parties as the borrower who is a partnership is not made a party. The availment of Working Capital facility by the applicant is also reiterated in the objections filed by the respondent. The respondent had specifically denied the contentions of the applicant as to the alleged non registration of the secured interest with the Central Registry. It also contends that, though the applicant utilizes the credit facility, they failed to repay the loan in terms of the agreement, resulting the account being classified as NPA on 05.09.2024. The bank had issued the demand notice on 10.12.2024 calling upon them to pay the due amount of Rs.1,24,66,256.78 with interest from 01.12.2024. it is contended by the respondent that, the demand notice issued by the respondent was duly served on the borrowers. The symbolic possession notice was also issued which according to the respondent is duly served, published and affixed as mandate under the statute.

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It is further contended by the respondent that, since the borrower had cause obstruction in taking physical possession, the S.14 measures had been resorted to, resulting the Ld. Magistrate issuing the Order which is sought to be impugned in the SA.

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SA/187/2025

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Apart from the above, the respondent had given point to point rebuttal of the contentions as taken in the SA. Along with the objections the respondent had produced the following documents:

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i. True copy of the loan sanction order dated 06.06.2024

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ii. True copy of the Take Delivery letter and on Demand Promissory Note dated 28.06.2024

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iii. True copy of the Ack. Of Debt dated 28.06.2024

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iv. True copy of the Memorandum of Deposit of Title Deed dated 07.03.2023

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v. True copy of the Registration of Security Interest Acknowledgment Report dated 15.03.2023, (downloaded copy) issued from CERSAI w.r.t PSOD A/c.No.8187000600000701 w.r.t. Item No.1 of the SA schedule property.

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vi. True copy of the Registration of Security Interest acknowledgment report dated 15.03.2023, (download copy) issued from CERSAI w.r.t PSOD A/c.No.8187000600000701 w.r.t Item No.2 of the SA schedule property.

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vii. True copies of the demand notice dated 10.12.2024, postal receipts (4 No’s), Duly served postal acknowledgment/s (4 in No’s)

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viii. True copy/s of the possession notice dated 20.02.2025, postal receipts (4 in No’s); Duly served postal acknowledgments (3 No’s) and Photographs (4 Nos’s) evidencing is having affixed the possession notice on the conspicuous part of the mortgaged secured asset

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ix. True copy of the paper publication in English newspaper

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x. True copy of the paper publication in Kannada news paper

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xi. True copy of the petition filed in Crl.Misc. bearing No.80/2025

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SA/187/2025

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xii. True copy of the affidavit in the form of Declaration Duly affirmed by the Authorised Officer of the respondent bank

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Heard the submissions of both sides and perused the available records.

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The only issue that is gone into with regard to the measures leading to the procurement of impugned S.14 Order.

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The applicant though has no dispute as to the availment of credit facility and creation of security interest. The respondent had produced the proof as the sanctioning, disbursement and acceptance of terms and conditions by the applicant. The loan documents including the sanction ticket, take delivery letter and Memorandum of Deposit of Title Deeds are produced by the respondent. There is no challenge as to the creation of security interest, though the applicant contends that the security interest is not registered with the Central Registry. In response to the above contention, the respondent produced the copy of the registration with the CERSAI which itself disproves the contention of the applicant in the above regard. In reply to the next contention is taken by the applicant is as to the non-service of demand notice, the respondent had produced he demands notice along with the postal receipts and acknowledgment card evidencing the receipt of the demand notice by the borrowers, the said documents are not in dispute and hence can safely concluded that, there is due compliance of the Rule 3 of the Security Interest (Enforcement)

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SA/187/2025

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Rules and hence contention of the applicant as to the alleged non service of the demand notice is to be rejected.

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Though, the applicant had taken a contention that, the possession notice is not duly served and also that the possession notice is not published within 7 days of its issuance, which according to the applicant vitiates the legality in issuance of symbolic possession notice, this Tribunal is not enticed to accept the said contention, as the issuance of symbolic possession notice is not ‘sine quanone’ for initiation of S.14 measures. It is already settled that, the issuance of symbolic possession notice is contemplated by Rules8(1) and (2) of Security Interest (Enforcement) Rules, whereas the measures under S.13(4) constitute a measures under Rule 8(3) of the Security Interest (Enforcement) Rules. On the above reason even assume that there is a procedural flaws in the issuance of symbolic possession notice, which makes the symbolic possession notice in valid, the same will not stand in way of the secured creditor resorting to S.14 and obtain the order thereon after due compliance of Rule 3.

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The main grounds on this the applicant attacks the measures is that, in the affidavit filed by the Authorised Officer before the Ld. Magistrate, the due amount as mandated under S.14 (1) proviso (i) is not full filled Section 14 (1) reads as follows:-

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14. Chief Metropolitan Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset.

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(1) Where the possession of any secured asset is required to be taken by the secured creditor or if any of the secured asset is required to be sold or

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SA/187/2025

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transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured asset, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or, as the case may be, the District Magistrate shall, on such request being made to him

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(a) take possession of such asset and documents relating thereto; and

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(b) forward such asset and documents to the secured creditor.

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[Provided that any application by the secured creditor shall be accompanied by an affidavit duly affirmed by the authorised officer of the secured creditor, declaring that-

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(i) the aggregate amount of financial assistance granted and the total claim of the Bank as on the date of filing the application;

(ii)xxxxxxxxx;

(iii)xxxxxxxxxx.

(iv)xxxxxxxxx;

(v)xxxxxxxxxxx;

(vi)xxxxxxxxxxxxxxxx

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(viii)xxxxxxxxxxxx;

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(ix)xxxxxxxxxxxxxxx:

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Hence, it is not in dispute that, the S.14 mandates the Authorised Officer

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to file an affidavit duly affirming the aggregated amount of financial assistance granted and total claim of the bank as on date of filing of the application (Emphasis applied).

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In the case in hand, the affidavit filed by the Authorised Officer before the Magistrate does not specified the amount due as on date of filing of the application, which leads the Tribunal to go into the question

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SA/187/2025

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whether non mentioning of the amount is fatal so as to hold that the S.14 measures are not maintainable, in answering this issue, this Tribunal has to consider the ambit and the purpose of this enactment which empower the secured creditor to securitize the mortgage property. Apart from harping on the technical ground, the due amount as on the date of filing of S.14 application is not mention in the affidavit, the applicant is not putting forth a case that, any substantial injury is caused to the applicant because of non-mentioning of the amount. The applicant is not even contending that, they are ready to pay off the liability and the amount being mentioned in the affidavit in support of the application. The Hon’ble Apex Court L&T Housing Finance Limited Vs. Trishul Developers and Anr. held in Para 11 as follows:

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11. In the facts and circumstances, when the action has been taken by the competent authority as per the procedure prescribed by law and the person affected has a knowledge leaving no ambiguity or confusion in initiating proceedings under the provisions of the SARFAESI Act by the secured creditor, in our considered view, such action taken thereof cannot be held to be bad in law merely on raising a trivial objection which has no legs to stand unless the person is able to show any substantial prejudice being caused on account of the procedural lapse as prescribed under the Act or the rules framed thereunder still with a caveat that it always depends upon the facts of each case to decipher the nature of the procedural lapse being complained of and the resultant prejudiced if any, being caused and there cannot be a straitjacket formula which can be uniformly followed in all the transactions.

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Taking into the view of the above scenario even though this Tribunal

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is of the view that, the actual due amount as mandated as per provision

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9 SA/187/2025

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of the S.14 of the Act is not mentioned in the affidavit, the same cannot be a ground to hold the entire measures in valid as no substantial injury is proven to be caused to be applicant on the above regard.

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Taking view of the above, discussions as held and conclusion arrived therein, this Tribunal is of the view that, the applicant had not made out any substantial ground to interfere with the measures initiated and continued by the respondent.

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In the result, SA.No.187/2025 is dismissed. All pending IAs stand closed. The parties to bear their respective costs. Copy of this order be communicated to the parties concerned.

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(Dictated to the Stenographer (PR), after her transcription and necessary corrections, signed and Order passed on this 19^th day of June 2026)

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(T. RAJESH) PRESIDING OFFICER

Mr Masood Ahamad Jaleel v. Karnataka Bank Limited

Case brief

What is this about?

What did the court decide?

Mr Masood Ahamad Jaleel v. Karnataka Bank Limited

Case brief

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What did the court decide?

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