Dismissed

M S Nandini Industries India Pvt. Ltd. v. State Bank of India

DRT7 Jul 2026SA/279/2022

Case brief

AI extract

What is this about?

Single Bench Debts Recovery Tribunal dismissed an application challenging a bank's Sale Notice and auction proceedings under the SARFAESI Act. The court held the previous possession notice decision finalized by the DRT, and with the auction later stayed, the current application had no merits.

What did the court decide?

Sale Notice dt. 14.10.2022 and auction proceedings dismissed as infructuous and lacking merits. No direction for fresh sale notice granted.

M S Nandini Industries India Pvt. Ltd. versus State Bank… — Execution and Attachment | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT HYDERABAD

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DATED THIS THE 7TH DAY OF JULY,2026

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PRESENT: SRI GUMMADI GOPICHAND, PRESIDING OFFICER

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sA.No.279/2c22

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1.M/s Nandini Industries India P.Ltd., (formerly known as TSS projects & Industries P.Ltd.) Regd.office at 7- 1-58, 1- 103,

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1"t floor, Divya Shakti Complex, Green lands, Ameerpet, Hyderabad-SOO 016. Rep. by its Managing Director H.Ramesh

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Sri Haridass Ramesh, S/o Haridass, aged 56 years, Plot No.1016lA, Road No.46, Jubilee Hills, Hyderabad-soo O33

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Smt. Urvashi Ramesh, W/o Haridass Ramesh, Aged 51 years, Plot No.1016lA, Road No.46, Jubilee Hills, Hyderabad-SOO O33 ... Applicants

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Versus

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State Bank of India, Stressed Assets Management branch, Rep. by its Authorized offt Sec.bad, 5-9-76,2na Prabhat Towers, ri';\ opp.SBI Amaravatni f[$l Chapel Hyderbad-sOO Road, Gunfotid'dry,001 ;i r.r * ... Respondent 0 7 ,!1!i. 2026 ., t-! i\ '':'*i::1 s Counsel for the ApplicQrt $ftfl V. Sethumadhaua Rao Counsel for tlrc ry','qt;$$,S Allui Kishnam Raju Reserued on : 15.05.2026 Pronounced on :07.07.2026 Uploaded to the website on : 08.07.2026

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ORDER

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This Application is filed u/ s. 17 of the Securittzation and Reconstruction of Financial Assets and Enforcement of Security Interest Act,2OO2 (SARFAESI Act,2OO2\ challenging the Sale Notice dt. 1 4. lO.2022 issued by the Respondent Bank for conducting auction of the schedule^property on 25.11.2022 and to declare the same as null and void and also the claim of Rs.276,26,98,2O8.75 p. as on 3O.O9.2022 made by the Respondentⁱⁿ the sale notice dt. 14. lO.2O22 is untenable and unstainable in^{view of the} counter claim made by the Applicant against the Respondentⁱⁿ o.A.t475l2Or7.

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The averments made by the Applicant in brief are as follows:

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Applicant No. 1 is originally incorporated under Companies Act, 1956 as CVD Discs India P.Ltd. and subsequently, changed its name as^TSS projects and Industries P.Ltd (TPIPL). Subsequently, the name of TPIPL is changed as Nandini Industries India P.Ltd. Applicant No.1 is in the^line of activity of International trading in Sodium Methoxide (SMO) and taking up projects on turnkey basis. Applicant No.l Group in the^pasthas successfully executed Project export orders in^joint venture and in association with its^joint venture partners is all set to emerge as the largest producer of SMO solutions in the world by setting the projects in most of the major Methonal producing countries. The Applicant No. t has acquired a defaulted company by name M/s Shanti^{pharmaceuticals} Ltd. with Respondent's Nacharam branch for Rs. 1.19 crores under OTS and the Commercial _bran_ch of the Respondent bank sanctioned various credit 67 crores in 2010-11. The loan accounts of the NPA in December, 2Ol2 and thereafter, the ional credit facilities to a tune of Rs. 18 crores id all the interest and overdues in the e part of the Respondent bank in presenting e protest for non-payment on due date, the

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Applicants had lost the valuable right to make a claim^{as per the provisions} of Article 38 of German Code on Bill of^{Exchange to obtain quickrelief} against M / s Desatec. To cover up the^{lapseson the part of the Respondent} Bank in acting as a negotiating bank^{and also beneltciary underthe Bill,} the Bank has classilied the^{accountas NPA and issuedRecallnotice} dt.3o.05.2014 in a hurried manner.^{Thereafter legal proceedings have} been initiated against M/s^{Desatecand a sum of Rs.34,11,32,924} l-^was received by the Respondent Bank^{on 09.04.2015as against the balance} claim of Rs.61.23 crores^{against M/s Desatec.Due to the lapseand} negligence on the^{partof the Respondent, the Applicant No. 1 suffered huge} loss and the Respondent^{withoutwritten consentof the Applicant No' 1} has relinquished the ECGC.^{Therefore the demand noticeas well as the} possession notice in respect of^{FBDclaim of Rs.61.23 crores and interest} charged/debited thereon^{is to be deductedfrom the total claimof Rs.96.62} crores made in the^{demand notice.The Authorized officer of the Bank} failed to consider the^{objections dt.25.10.2014 raised by the Applicant} No. 1 to the demand^{notice dt.06.09.2014. The RespondentBank failed to} publish the possession notice^{and affix the said notice on the secured} asset as contemplated^{u/r 8(1)(2) of Security Interest(Enforcement) Rules,} 2002. Thereafter, the^{Authorized ofhcerof the Bank issued salenotice} dt.l4.lo.2022^{hxing the date of auction on 25.11.2022. The Bank failed} to see that the^{ApplicantNo. 1 ishaving counter claim of} Rs.101,52,35,148/-inO.A.l4TsllTliledbytheRespondentBankagainst the Applicants.^{The Bank has received substantial amount of Rs.93.44} croresandaftertakingintoconsiderationthelosssustainedbythe applicantNo.lonaccountofthenegligenceoftheBank,thebalance amount if any due^{is less than 2oo/o of the principal and interestthereon} and as such, the^{proceedings initiated by the Bank are hit by section} 31fi) of the t,2OO2. The Respondent^{bankfailedto disclose} the pen "4tf$s,le$ ed by the Applicant^{No.1 before he Hon'lcle} DRAT hst thg,$rders by the Hon'ble DRT-ll^{in SA 441ll7} : the sald^notice by the Bank.^{The bank failed to follow} B⁷ iIL^202[

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Rule 8(5)(6)(7)&9(1) of Security Interest (Enforcement) Rules,2002. Hence ., the SA.

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The Respondent Bank filed their Reply denying all the adverse allegations made in the SA and contended that the loan accounts of the Applicant No.I were classified as NPA on 30.03.2014 and so, the Bank issued demand notice dt.06.09.2014. After rejecting the objections raised by the Applicant No.3 to the said demand notice, the Bank issued possession notice dt.29.09.2015. Challenging the said possession notice, the Applicants filed TSA 441 lt7 (old SA 51S/1S) on the file of DRT_il, Hyderabad with regard to the secured assets which includes the schedule property of the present sA. The Applicant No.l raised various contentions in the said sA and the said SA was dismissed vide order dt.0g.04.2019 by rejecting all the contentions raised by the Applicants. The Applicants filed writ petition questioning the said order passed in TSA 441/ 17 and the Hon'ble High court for the State of rerangana, Hyderabad dismissed the said writ petition giving liberty to prefer an appeal u/s 1g of the SARFAESI Act,2oo2. Applicants No.1 to 3 herein preferred an appeal before Honble DRAT, Kolkata vide appeal No.2ol22 against the order dt.0g.04.20r9 and the same was dismissed vide order dt.27.o4.2023 as the Applicants failed to deposit 50% of the due amount. Thereafter, the bank issued the present sale Notice dt.14.1o.2022 u/r g(6) of Rules, 2002 ar,d, the said notice was duly served on the Applicants by Regd. post and the said notice was published in Eenadu and rhe Hindu daily newspapers and the said notice was also affixed on the secured asset. The reserve price of the schedule property was fixed basing on the valuation report dt.31.05.2022 submitted by the approved valuer of the Bank.

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,r. -;.JS.&:f$dN o.A.sss/15 which is renumbered as oA 147f.[L7 rna dilt. "dib,r,. Applicant No.l made a counter claim ""d..:"tffo7^{tffi! tLtv} "fi$i.,.a^{loss and damages to a tune of} Rs.f${,52,35,1481- and pl+y.Fd rhat the amounr claimed by the bank be '. -/: ., Z:t--l{ '''. '..:t.,'', --r .jr . -.tfi.#'.,i''..---:..'-1f 4 r';.'.',.: ,-r.,-^.. ,;;:1t.; r' ..;i;i ..,,'.. - . ..:..";..

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set off and the said O.A. is pending for adjudication before the Hon'ble Tribunal. In fact, the Applicants admitted the Bank's claim against them in the said O.A. and as such they have no right to contend that^their liabitity as claimed by the Bank in the demand notice,^{possession notice} and also in the sale notice issued by the Bank^{is not correct. The interest} rates relating to export finance are^{governedby RBI guidelinesfrom time} to time and the interest rate charged in^{the loan account of the Applicant} No. 1 is as per RBI^{guidelines. The classihcationof the loan accounts of the} Applicant No.l as NPA is already^{upheld by the Hon'ble Tribunal in the} earlier SA frled by the^{Applicants. Accordingly,Ld. counsel prayedto} dismiss the SA.

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Heard Ld. counsel for^{the Applicants and Ld. counsel for the Respondent} Bank and perused the^{material brought on record'}

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Now the^points that^{arise for considerationare}

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ii. whether the Applicants^{haue estabtishedang ualid ground for} challenging the impugned^{Sole Noticedt'14'10'2022 issued bg the} Respondent Bank^{against ttrc schedulepropertA?}

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iii. To what relief^?

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Point llo'(tf :-

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6.Duringthecourseofarguments,Ld.CounselfortheApplicantsandLd. counsel for the^{Respondentreiterated their respectiveversions as stated} supra.

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The undisputed^{factsof thb case are that the ApplicantNo'l availed} from the Respondent^{and created mortgage against} one of security^{for the repaymentof saidloan} Applicant No.1 committed^{default in repaying} ins the loan accounts^{of the Applicant No. 1 as}

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'-J

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NPA on 30.03.2014, the Respondent initiated action under the provisions of SARFAESI Act,2OO2 to recover their dues. Earlier the Applicants filed TSA 441117 on the file of DRT-ll, Hyderabad challenging the possession notice dt.29.09.2015 and the said SA was dismissed by the Tribunal and thereafter, the Respondent bank proceeded further and issued the present sale notice for conducting auction of the schedule property.

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The specific contention of the Appticants is that the Respondent Bank issued the impugned Sale Notice dt.l4.lo.2022 for conducting auction of the schedule property without following the procedure contemplated under the provisions of SARFAESI Act,2oo2 and Rules made thereunder and so, the said sale notice is not legal and valid and liable to be set aside and another contention is that they raised counter claim in o.A.lr4s/17 filed by the Respondent Bank herein against the Applicants and during the pendency of such counter claim, the Bank cannot proceed against the secured asset.

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But the Respondent contended that they have issued all the statutory notices to the Applicants under the provisions of SARFAESI Act,2oo2 and, Rules made thereunder.

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1o. To substantiate their contention, the Respondent liled material documents along with the Reply filed by them. Along with the said documents, the Bank filed copy of the order passed in TSA 441/rz fired, by the Applicants. A perusal of the said order makes it clear that the Applicants filed the said SA. chalrenging the possession notice dt.29.09. by the Bank against the schedule property by ralsl Riens as raised in the present SA including the allegedly committed by the bank in

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and the said SA was dismissed by DRT-

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order dt.09.04.2}19 upholding the said

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possession notice dt.29.O9.201S issued by the bank. Challenging the said order, the Applicants filed writ petition before the Hon,ble High Court for the State of Telangana and the said writ petition was dismissed. Thereafter, the Applicants preferred appeal before the Hon,ble DRAT, Kolkata and the said appeal was dismissed for non-payment of required deposit of fee and so, the order dt.08.04.2}19 passed by Ld.DRT-ll, Hyderabad in TSA 441I 17 attained hnality. The findings in the said SA are binding on the Applicants and also the Bank and so, the Applicants cannot agitate the same issues and also the impugned possession notice dt.29.09.2015 in the present SA as the same is barred by the principle of Res-judicata. Thereafter, the Respondent Bank proceeded further and issued the impugned Sale Notice dt.14.1O.2022 for conducting auction of the schedule property on 25. 11.2022. Before issuing the said notice, the bank obtained valuation report dt.31.05.2022 from their approved valuer and basing on the said valuation, fixed the reserve price against the schedule property. As per the material documents filed by the Bank, it is clear that the said sale notice was duly served on the Applicants, published in Telugu and English daily newspapers and the said notice was affixed on the schedule property. Challenging the impugned Sale Notice dt. 14.1O.2O22, the Applicants hled the present SA.

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However, Ld. counsel for the Respondent Bank submitted that in pursuance of the impugned Sale Notice dt. 14. 1O.2O22, auction as scheduled by the Respondent Bank in respect of the schedule property was not materialized in view of the stay granted by this Tribunal. As the auction in respect of the schedule property in pursuance of the impugned Sale Notice dt.l4.l}.2o22 was not materialized, the relief claimed bv the Applicants i L thgjiA becomes infructuous and nothing survives in the ":.--....-:5on and there is no need to decide the validitv or ol'"P?-frql oth-dnrise of ffiffiimpd[frpi\Fale ii notice. The other issues such as rate of . i/',.,"- ilii stsd' t chargEi&'by the Baplfro irregularities in the conduct of the Bank in tinq l?a4[pffifrnts *BL]ld also the counter-claim raised by the

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Applicants in O.A.l7 45 I 17 are already^{decided in the earlier TSA 445} I¹⁷ vide order dt.09.O4.2O19^{passedby DRT-ll,Hyderabad'Hence,I am of} the opinion that the^{relief claimed by the Applicantsin the present SA} becomes infructuous^{and the SA is liableto be dismissed.Sufl-rce, if a} direction is^{given to the RespondentBankto issue fresh sale noticefor} conducting auction of^{the schedule propertyby stiictlyfollowingthe} procedure contemplated under^{the provisionsof SARFAESIAct,2002 and} Rules made thereunder.

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Potnt No.(tl)r

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t2. In the result, SA^27g 122^{is dismissedas there are no merits'} Consequently, the^{Interlocutory Applications, pending if any, shall stand} disposed of. No order as^{to costs.}

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1a Communicate a copy^{of this order to the partiesconcerned'}

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(Dictated to the P.S, transcibed. by^{her, conected, signed and pronounced bg me in the open} court on this the Vt' daA of^Julg,2026).

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sd/(G. GOPI cHAIrDl PRESIDING OTFICER

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trw-

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ont-t, iviitn^:8A0.

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M S Nandini Industries India Pvt. Ltd. v. State Bank of India

Case brief

What is this about?

What did the court decide?

M S Nandini Industries India Pvt. Ltd. v. State Bank of India

Case brief

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