Dismissed

V. Kavitha v. Indian Bank

DRT17 Jun 2026SA/20/2025

Case brief

AI extract

What is this about?

In this secured assets recovery petition, the applicant challenged a Section 14 order passed by the Chief Judicial Magistrate. The Debts Recovery Tribunal examined compliance with the SARFAESI Act and was unable to find any illegality due to lack of specific allegations and contrary documentary evidence. Consequently, the applicant's petition was dismissed and the impugned order was affirmed.

What did the court decide?

The Section 14 proceedings initiated by the bank are affirmed; the Special Application by the applicant is dismissed.

V. Kavitha versus Indian Bank — Specific Performance | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL – II AT CHENNAI

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Dated this 17^th day of June, 2026

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PRESENT: SHRI SHARANG DHAR UPADHYAY Presiding Officer

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SA No.20 of 2025

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Mrs. V. Kavitha W/o T. Viswanathan 949, Indhira Nagar, Pazhavathankattalai Kumbakonam – 612 401 … Applicant

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Versus

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The Authorised Officer Indian Bank, Kumbakonam Mutt Street Branch No.88, Mutt Street, Kumbakonam – 612 001 … Respondent

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Counsel on Record / Appeared

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Applicant by : M/s C. Geetha, Santosh Muthiah, R. Kamlesh Kumar Respondent by : M/s P.V. Murlidhar, P.M. Surendhar, P. Manivel

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O R D E R

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This petition is filed under Section 17(1) of the SARFAESI Act

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challenging the measures initiated by the respondent bank pursuant to the order of the Learned Chief Judicial Magistrate,Thanjavur @ Kumbakonam in Crl. M.P. No.740 of 2024 dated 24.05.2024.

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The facts leading the impugned order is that the applicant had availed housing loan of Rs.19,00,000/- from the respondent bank by creating equitable mortgage over the schedule mentioned property. The applicant was

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making the remittances without any delay or default, however, due to

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demonetization and COVID-19 pandemic the default had occurred. The applicant filed W.P. (MD) No.24975 of 2024 challenging the Section 14 proceedings initiated by the respondent bank and the Hon’ble High Court by its order dated 22.11.2024 disposed of the same giving liberty to the applicant approach the Tribunal within a period of one month from the date of receipt of the order. The applicant made a payment of Rs.7,50,000/- on 16.11.2024 demonstrating the bonafide intention to resolve the matter expeditiously. The respondent bank has wrongly classified the loan account as NPA. The demand notice alleged to have been issued under Section 13(2) of the SARFAESI Act has not been served on all the borrowers. The applicant is seriously taking steps for settling the dues. The respondent without issuing the demand notice and possession notice in the manner known to law has obtained the order from Ld. CJM. The security interest is not registered with CERSAI and hence the action of the respondent is invalid.

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The applicant along with the SA has filed the order of the Chief Judicial Magistrate, Thanjavur at Kumbakonam in Crl. M.P. No.740 of 2024 dated 24.05.2024, Warrant issued to the Advocate Commissioner dated 19.6.2024 and the Advocate Commissioner Notice dated 28.12.2024.

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The following grounds are urged in the SA: -

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(a) The classification of account as NPA is contrary to the guidelines of RBI.

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(b) The demand notice is not served on all the borrowers thereby depriving the rights of the applicant under Section 13(3-A) of the SARFAESI Act.

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(c) The possession Notice is not served, published in newspapers as contemplated under Rule 8(1) of the Security Interest (Enforcement) Rules, 2002.

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(d) The respondent failed to affix the possession notice as mandated under Rule 8(1) of the Rules.

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Counter by Respondent Bank

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Upon notice, the defendant bank filed its counter denying the averments in the SA and submitted that the SA is liable to be dismissed. It is stated that the applicant had approached the respondent for grant of loan for purchasing the schedule mentioned property and upon sanction created equitable mortgage over the schedule mentioned property. The applicants did not come forward to regularize the loan account despite repeated requests and hence the loan account was classified as NPA on 29.03.2022. As no payment was forthcoming the respondent issued the demand notice under Section 13(2) of the Act and the same was duly served on the applicant but the applicant did not choose to give any reply. Therefore the respondent proceeded further and issued the possession notice under Section 13(4) of the Act on 7.6.2022. The possession notice was duly served, affixed on the secured asset and

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published in newspapers as mandated under law. Further the bank has also issued sale notices on 28.2.2023 and 26.06.2023 and the applicant has not challenged the same.

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The respondent thereafter initiated proceedings under Section 14 and obtained order from the Ld. Chief Judicial Magistrate, Thanjaur at Kumbakonam in Crl. M.P. No.740/2024 and Advocate Commissioner was appointed for taking physical possession of the property. The Advocate Commissioner issued letter dated 16.7.2024 informing the applicant of taking physical possession of the property.

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The mortgaged property is sold in e-auction held on 21.08.2024 for a sum of Rs.25 lakhs and one Mr. Sridhar, S/o Subramaniyan was declared as successful bidder and he has paid the entire sale consideration and the sale certificate is also issued in his favour.

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The Advocate Commissioner again issued notice on 8.10.2024 for taking possession of the property on 25.10.2024 and only therafter the applicant filed writ petition before the Hon’ble High Court of Madras and the Hon’ble High Court was pleased to grant interim stay on payment of Rs.7.5 lakhs on or before 22.11.2024 and made it clear that in the event of failure the stay shall stand automatically vacated. Ultimately, W.P. (MD) No.24975 of 2024 was disposed of on 22.11.2024 with a direction

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to the petitioner therein to hand over the physical possession of the property to the secured creditor within a period of one month from the

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date of receipt of a copy of the order. The petitioner was also given liberty to work out his remedy before the Tribunal.

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The applicant wantonly did not disclose the above facts before this Tribunal and the applicant has approached this Tribunal with unclean hands. The SA is therefore liable to be dismissed.

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Documents filed by Respondent Bank

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The respondent bank filed documents viz., demand notice dated 04.04.2022 along with postal acknowledgements, Possession Notice dated 7.6.2022, Paper publication of the Possession Notice in “The New Indian Express” and “Daily Thanthi” and photograph evidencing affixture of possession notice and order of the Hon’ble High Court of Madras dated 22.11.2024 in W.P. (MD) No.24975 of 2024. The respondent also filed a memo vide Dy No.3016 dated 6.5.2026 enclosing therewith document to prove the registration of the secured asset with CERSAI.

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11 The matter is heard. In the wake of available material on record, the following points arise for consideration in the present SA:

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“Whether the impugned order of Ld. Chief Judicial Magistrate, Thanjavur at Kumbakonam dated 24.05.2024 in Crl. M.P. No.740/2024 suffers from any illegality or impropriety rendering it void in law?”

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Answers to Point for Consideration

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It is to be noted that the Hon'ble Supreme Court in “ NKGSB Cooperative Bank Limited Vs. Suber Chakravarty” and “ R.D. Jain and Company Vs. Capital First Limited CA 1755 of 2022 dated 27.07.2022 ” ruled that no adjudicatory powers are vested while deciding the application under Section 14. In the matter of “Indian Bank Vs. Vishalakshi and Another CA 6295/2015 dated 23.09.2019” , the Hon'ble Supreme Court had further held that the proceedings under Section 14 is a procedural step and purely an administrative order and there is no adjudicatory process involved. Keeping in mind the above rulings, this Tribunal can only examine whether there was compliance of the provisions by the defendant bank before the Learned CMM as mandated under Section 14(1) of the SARFAESI Act.

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As per Section 14(1) of the SARFAESI Act, on a request being made by the by the secured creditor, the Chief Metropolitan Magistrate or the District Magistrate as the case be take possession of such asset and documents relating thereto and forward such assets and documents to the secured creditor. The financial institutions are to declare under the affidavit the aggregate sum of financial assistance and dues payable as on the date of the application. It should be averred that the borrower / guarantor having created security interest over the property and that the borrower had committed default; upon such default the account must

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have been classified as NPA. It is also mandatory to aver in the affidavit regarding the issuance of demand notice, the reply thereof and the response of the secured creditor and that the borrower had not made any repayment and therefore entitled to take possession and that the other provisions of the Act have been complied.

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This Tribunal is aware of the Ruling of the Hon’ble Supreme Court in “Authorised Officer, Indian Bank Vs. Vishalakshi and another CA No.6295/2015 disposed on 23.09.2019” holding that the spirit of Section 14 of the SARFAESI Act is only a procedural step. It is purely an administrative order and no adjudication is involved. The orders of the Ld. CMM / DM is only an aid to the proceedings initiated u/s.13(4) of the Act.

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It is only to be looked into whether the provision of section 14(1) of the Act is complied or not. From the impugned order it is seen the necessary details to be furnished u/s.14(1) of the Act has been complied.

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However, this Tribunal has also considered the documents filed by the defendant. This includes the documents produced at S. No. 2 and 3 which is the demand notice dated 04.04.2022 and the postal acknowledgement, the same clearly reveals that the demand notice is duly served on the applicant.

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As regards the contention of the applicants that the respondent has failed to comply with the Rule 8 (1) and 8(2) of the Security Interest (Enforcement) Rules, 2002 is concerned the respondent has filed the possession notice dated 07.06.2022 at Sl. No.4 (Pages 11), the proof of affixture of the possession notice at Sl. No.7 (Page 14) and the proof of publication of the possession notice in two newspapers viz., Daily Thanthi and The Indian Express at Sl. No. 5 (Page 12 & 13) which clearly evidence that the possession notice has been served, published and affixed on the secured asset. Therefore, this ground of the applicants fall to the ground.

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Further, the applicants have not urged any grounds with regard to noncompliance of provisions under Section 14(1) of the SARFAESI Act by the secured creditor.

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Therefore, in the absence of any allegations regarding non-compliance of the provisions of Section 14(1) of the Act and documentary evidence produced by the defendant bank, this Tribunal is unable to find any illegality, impropriety or otherwise to set aside the impugned order. Hence the following:

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ORDER

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(i) The SA stands dismissed. The orders of the Ld. Chief Judicial Magistrate, Thanjavur at Kumbakonam dated 24.05.2024 in Crl. M.P.

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No.740 of 2024 is hereby affirmed. All other pending IAs thus stand disposed of. Parties to bear their own costs.

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(ii) A copy of this order be communicated to the parties concerned.

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Sd/(SHARANG DHAR UPADHYAY) PRESIDING OFFICER DRT-II, CHENNAI

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(Dictated to PS, who typed in the system directly, corrected, signed and pronounced by me in Open Court, on this 17^th day of June, 2026)

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V. Kavitha v. Indian Bank

Case brief

What is this about?

What did the court decide?

V. Kavitha v. Indian Bank

Case brief

What is this about?

What did the court decide?

What the court decided

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