Dismissed

Sunilkumar v. Indian Bank

DRT9 Jun 2026SA/200/2026

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed a securitization application challenging the initiation of measures under Section 13(4) of the SARFAESI Act and a possession notice. The Tribunal held that the application lacked merit as applicants failed to raise objections to the demand notice and argued only the quantum of claim, which falls outside the Tribunal's scope.

What did the court decide?

The Securitization Application was dismissed on merits without costs.

Sunilkumar versus Indian Bank — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated this the 9^th day of June, 2026

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SECURITIZATION APPLICATION No.200/2026

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Between

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Sunilkumar, S/o.Kumaran, Aycattu House, Kakkudumon P.O., Athikkayam, Ranni, Pathanamthitta District, Pin – 689 711. now residing at Aycattu House, Uthimoodu P.O., Ranni, Pathanamthitta, Pin – 689 672. 2. Smitha Sunil, W/o.Sunilkumar, Aycattu House, Kakkudumon P.O., Athikkayam, Ranni, Pathanamthitta District, Pin – 689 672.

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Sredha Enterprises, VI/6170, Mampara, Uthimoodu P.O., Pathanamthitta, represented by its

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SA 200/2026

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Managing Partner, Sunilkumar, Aycattu House, Uthimoodu P.O., Ranni, Pathanamthitta, Pin – 689 672.

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And

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Indian Bank, NRI, Ranni Branch, Represented by its Authorized Officer, Madappallil Building, College Road, Pazhavangadi P.O., Ranni, Pin – 689 673. …Defendant

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This Securitization Application having been heard on 18.05.2026 in the presence of Advocate Mr.P.K. Muraleedharan for the applicants and Advocate Mr. Sasidharan Nair M.N. for the defendant and stood over to this day for consideration, the Tribunal delivered the following:

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F I N A L O R D E R

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Challenging the securitization proceedings initiated by the defendants under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the SARFAESI Act’),

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SA 200/2026

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the applicants/borrowers have filed this SA under S.17(1) of the SARFAESI Act seeking relief to set aside all the securitization proceeding including the M.C.No.3/2026 filed before the CJM, Pathanamthitta and notice issued by the Advocate Commissioner.

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Brief facts of the case :

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2.1 The applicants availed various loans from the defendant. Initially a housing loan was availed by the 2^nd applicant of an amount of ₹10,80,000/- on 22.08.2019. Subsequently, the applicant availed business loan with the limit of ₹26,00,000/- on 18.11.2019 also. The applicant availed Covid Repo loan, extension loan, FITL loan etc., in total five loans by mortgaging the immovable property of the 2^nd applicant. Due to default in repayment, a demand notice u/s.13(2) of the SARFAESI Act was served to the applicants, requiring repayment of the outstanding amounts in respect of the five loans. The applicants claimed that clubbing of all loans together in the demand notice on 12.12.2023 is illegal and not sustainable.

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2.2 The applicants claim that they approached the defendant repeatedly and submitted representation for regularization of the loan, but the defendant did not consider the

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SA 200/2026

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same and proceeded with the securitization measures by issuing possession notice on 28.02.2024.

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2.3 The applicants filed WP(C)No.16767/2024 before the Hon’ble High Court of Kerala, which was disposed by a judgment dated 03.05.2024, directing the applicants to repay the overdue amount in 12 equal monthly installments. In pursuance to the said judgment, the applicants claim to have closed loan accounts partially but the defendant proceeded to initiate O.A.No.410/2025 for recovery of the outstanding amount and also proceeded with the securitization proceeding by filing M.C.No.3/2026 before the CJM Court, Pathanamthitta to take possession of the secured asset. Based on the order passed by the CJM, an Advocate Commissioner issued notice dated 18.01.2026 to take possession of the secured asset. The applicants challenged the same before the Hon’ble High Court of Kerala in WP(C)No.4551/2026 which was disposed vide judgment dated 06.03.2026 permitting the applicants to avail statutory remedy. Hence the SA is filed to declare that all the securitization proceeding including the M.C.No.3/2026 filed before the CJM, Pathanamthitta and notice issued by the Advocate Commissioner are illegal with prayer to set aside the same.

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SA 200/2026

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3.1 The defendant filed written statement denying all the averments in the SA and claimed that the applicants availed the following credit facilities by mortgaging the subject matter property;

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Sl.No.	Facility -/ - Date of Sanction	Limit (₹)
1	Home Loan – Sunil Kumar – (22/08/2019)	1080000.00
2	Over Draft – M/s. Sredha Enterprises (For Contract business – (18/11/2019)	2600000.00
3	IND-GECLS (04/06/2020)	520000.00
4	FITL(11/06/2021)	163000.00
5	GECLS EXTN – REPO MSME loan (08.07.2022)	260000.00

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After availing the loan, the repayments were not regular. Consequently, the loan turned to NPA on 13.08.2023.

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3.2 A demand notice u/s.13(2) of the SARFAESI Act was issued on 12.12.2023 calling the applicants to repay the outstanding in the loan account. No objection was raised by the applicants on receipt of such demand notice. The applicants did not comply with the order passed by the Hon’ble High Court and failed to repay the loans in installments. All the statutory measures are duly followed. In absence of any illegality, interference with the

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SA 200/2026

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securitization proceeding is not at all warranted. Hence the defendants claim for dismissal of the SA.

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From the respective case of the applicants and

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defendant, the following points emerged for adjudication in this case:

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(i) Whether the securitization proceedings initiated by the defendant suffer from any illegality to intervene with the same?

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(ii) Whether the applicants are entitled to get any relief in this case?

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FINDINGS:

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Point Nos.(i) & (ii):

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Admittedly applicants availed various loans from the defendant by creating security interest over the subject matter property and due to default the securitization proceeding was initiated. In this SA the applicants challenged the proceeding initiated by the defendant u/s.14 of the SARFAESI Act in M.C.No.3/2026 filed before the CJM Court, Pathanamthitta marked as Annexure-A6 and the notice issued by the Advocate Commissioner including the demand notice. After receipt of the demand notice, the applicants did not raise any objection or

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SA 200/2026

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submitted any representation challenging the demand. After issuance of the possession notice on 28.02.2024 the applicants submitted a letter marked as annexure A3 requesting the defendant to allow them to pay the loan in installments by regularizing the loan accounts. The applicants have also filed WP(C)No.16767 of 2024 before the Hon’ble High Court of Kerala, which was disposed by the judgment dated 03.05.2024 marked as Annexure-A4. The applicants were permitted to repay the loan in installments. Admittedly the entire amount is not repaid. The applicants filed another WP(C)No.4551/2026 before the Hon’ble High Court of Kerala which was disposed by the judgment dated 06.03.2026 permitting the applicants to avail statutory remedy. Accordingly, the present SA is filed.

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During argument in the SA the learned counsel for the applicants claim that the applicants remitted considerable amount and the receipts are produced as Annexure-A11(series). There is mismatching of the amount claimed in the OA and in the affidavit of the authorized officer filed before the CJM in the proceeding u/s.14 of the SARFAESI Act. Due to such discrepancy, the defendant cannot proceed with the securitization proceeding.

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SA 200/2026

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On the other hand, the learned counsel for the defendant would contend that the applicants availed five loans as described in details in the written statement. The amount repaid by the applicants are taken into consideration and adjusted in the loan accounts which can be referred in the statement of account produced in case marked as Annexure-B1, B2, B3 and B4. No illegality in the securitization proceeding is established by the applicants to interdict. The claim of the applicants in disputing the outstanding amount is not sustainable as they had not raised any objection at any point of time even after receipt of the demand notice. Hence the SA, being devoid of any merit, may be dismissed.

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During argument stage, the learned counsel did not point out any illegality in the securitization proceeding except disputing the claim amount. Admittedly the applicants have not raised any objection or representation after receipt of the demand notice under section 13(3-A) of the SARFAESI Act. They submitted a letter after issuance of the possession notice seeking indulgence

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to pay the loans in installments. In such letter they had not disputed the claim amount. Hence, the contrary stand taken by them in this SA is not legally sustainable.

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SA 200/2026

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Further the scope of adjudication of this Tribunal is limited. It cannot adjudicate the controversy raised against the claim amount. In Civil Appeal No.1876 of 2016 in the case of Central Bank of India & Anr. Versus Smt.Prabha Jain & Ors. dated 9^th January 2025, the Hon’ble Apex Court held in paragraph 38 that “ ……….Sub-sections (3) and (4) of Section 17 respectively are instructive to the level of examination that the DRT can undertake, and the same is limited to the validity of the measures under sub-section (4) of section 13………”. So also in the Full Bench judgement of the Hon'ble Madras High Court in the case of M/s.Lakshmi Shankar Mills (P) Ltd. & others vs. The Authorised Officer/Chief Manager, Indian

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Bank & others [judgement dated 15.04.2008 in W.P.Nos.37148 & 37534/2007] , at paragraph 21 it is held as follows:

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“21. …………. However, we hasten to add that while considering the question of validity of the action of the bank, it is not necessary for the Tribunal to adjudicate the exact amount due to the secured creditors. In other words, the purpose of an application under Section 17 is not the determination of the quantum of claim per se as the Tribunal is concerned with the issue of the validity of the measures taken by the banks/financial institutions under Section 13(4). In our opinion, the judgment of the Division Bench in Mison Leathers Ltd., lays down the law correctly and does not require any reconsideration .”

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In view of this ratio decided by the Hon’ble Apex Court, the Tribunal is only concerned with adjudication of the dispute regarding validity

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SA 200/2026

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of the measures taken by banks or financial institutions under S.13(4) of the SARFAESI Act. It cannot adjudicate the discrepancy or excessive claim of any loan account in this SA which may be raised in the event of filing of OA or other forum. Hence the present claim of the applicants, having legally not valid, they are not entitled to get any relief in this case and both the points are answered against them.

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Hence it is ordered:-

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ORDER

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In view of the foregoing reasons and with the above

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observation, the SA, being devoid of any merit, is hereby dismissed but in the circumstances without costs.

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(Dictated to my Steno, corrected and pronounced by me in the open Tribunal on this the 9^th day of June, 2026)

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[SOVAN KUMAR DASH] PRESIDING OFFICER

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SA 200/2026

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Documents on the part of the applicant

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Annexures	Date	Particulars of documents
A1	12.12.2023	True copy of the Section 13(2) notice under the SARFAESI Act issued by the defendant bank to the applicants.
A2	28.02.2024	True copy of the possession notice for immovable property issued by the bank.
A3	11.03.2024	True copy of the representation made by the applicants to the bank.
A4	03.05.2024	True copy of the Judgment in WP(C) No.16767/2024.
A5	09.01.2025	True copy of the O.A.No.410/2025 filed before the Hon’ble Debts Recovery Tribunal, Ernakulam.
A6	12.11.2025	True copy of the M.C.No.3/2026 filed before the Chief Judicial Magistrate Court, Pathanamthitta.
A7	01.01.2026	True copy of the Order in M.C.No.3/2026 of the CJM Court, Pathanamthitta.
A8	18.01.2026	True copy of the Advocate Commission Notice issued by the Advocate Commissioner.
A9	24.01.2026	True copy of the postal cover addressed to the first applicant.
A10	06.03.2026	True copy of the judgment in WP(C) No.4551/2026.
A11(series) (a1 to a15) (b1 to b9) (c1 to c15)(d1 to d15) (e1 to e14)	31.05.2024 to 02.05.2025	True copy of the pay-in-slips in all the five loan accounts.

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SA 200/2026

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Documents on the part of the defendants

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Annexure	Date	Particulars of documents
B1	04.04.2026	Statement of Account of Home Loan account No.6794886272
B2	04.04.2026	Statement of Account of OVERDRAFT account No.6520083595
B3	04.04.2026	Statement of Account of FITL Account No. 7027366205
B4	04.04.2026	Statement of Account of MSME – GECLS Account No.7247844716

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PRESIDING OFFICER

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IN THE DEBTS RECOVERY TRIBUNAL-2, KERALA AT ERNAKULAM

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PRESENT: SRI.SOVAN KUMAR DASH PRESIDING OFFICER

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Dated the 9^th June, 2026

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SA No.200/2026

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Between

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Sunilkumar, S/o.Kumaran, Aycattu House, Kakkudumon P.O., Athikkayam, Ranni, Pathanamthitta District, Pin – 689 711. Now residing at Aycattu House, Uthimoodu P.O., Ranni, Pathanamthitta, Pin – 689 672 And Others …Applicants

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And

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Indian Bank, NRI, Ranni Branch, Represented by its Authorized Officer, Madappallil Building, College Road, Pazhavangadi P.O., Ranni, Pin – 689 673. …Defendant

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F I N A L O R D E R

Sunilkumar v. Indian Bank

Case brief

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Sunilkumar v. Indian Bank

Case brief

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