Dismissed

Manikanda Prabhu K v. Jana Small Finance Bank Ltd.

DRT17 Jun 2026SA/296/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed an application filed by a borrower challenging the recovery proceedings of a small finance bank. The Tribunal found that the bank had strictly followed SARFAESI Act procedures, including serving mandatory notices and effecting possession, rejecting claims of procedural violation or non-service.

What did the court decide?

The SA No. 296/2023 stands dismissed with no costs; all pending interim applications are disposed of.

Manikanda Prabhu K versus Jana Small Finance Bank Ltd. — Banking and Recovery | DRT (2026)

¶1

SA No.296/2023

¶2

Fair Order

¶3

IN THE DEBTS RECOVERY TRIBUNAL AT MADURAI

¶4

DATED THIS 17^th DAY OF JUNE, 2026

¶5

PRESENT: SEEMA SINHA

¶6

[PR. DISTRICT & SESSIONS JUDGE - Retd] PRESIDING OFFICER

¶7

SA No. 296/2023

¶8

Mr. K. Manikanda Prabhu, S/o. Kannan, Door No. 8B, Pillaiyar Palayam, Dindigul – 624001. …. Applicant

¶9

¶10

The Authorised Officer, Jana Small Finance Bank Limited, No. 10, Krishnapuram Colony Main Road, Mahatma Gandhi Nagar, Madurai – 625014. …. 1^st Defendant Bank

¶11

The Chief Judicial Magistrate, District Court Premises, Dindigul District …. 2^nd Defendant

¶12

Appearance of Advocates: M/s. K.Hariharan ---Counsel for the Applicant Mr. S.Babu ---- Counsel for the Defendant Bank 2^nd Defendant is none other than the Ld. CJM, Dindigul District

¶13

This SARFAESI Application was heard in the presence of Counsels for the Applicant and the Defendant Bank and fixed for passing final order before me and upon hearing the arguments of both the Counsels and having stood over for consideration till this day, this Tribunal delivered the following:

Page 1 of 14

SA No.296/2023

O R D E R

1 . This Application has been filed under Section 17 of the SARFAESI Act, 2002 by the Applicant praying that this Hon'ble Tribunal may be pleased to set aside the entire SARFAESI proceedings initiated by the 1st Defendant Bank ending up with the order passed by the 2nd Defendant under Section 14 of the Act dated 20.06.2023 made in Cr.M.P. No. 4795 of 2023 appointing an Advocate Commissioner for taking physical possession of the schedule mentioned property.

¶18

2 . The brief averments of the Application filed by the Applicant are as follows:-

¶19

a) The Counsel for the Applicant submitted that, the above Application is filed by the borrower, who is the Applicant herein, challenging the order passed by the 2nd Defendant under Section 14 of the SARFAESI Act dated 20.06.2023 in Cr.M.P. No. 4795 of 2023, appointing an Advocate Commissioner to take physical possession of the schedule-mentioned properties for the alleged dues in respect of the credit facilities availed by the Applicant.

¶20

b) It is further submitted that, the Applicant is a housing loan borrower who availed credit facilities to the tune of Rs. 4,42,705/- from the 1st Defendant Bank on 09.11.2020, and the schedule-mentioned property was mortgaged by the Applicant. The Applicant was prompt in servicing interest and repayment initially. However, due to financial crisis, family circumstances, and a fall in his income, the Applicant was not able to adhere to the repayment schedule of the 1st Defendant Bank.

¶21

c) It is submitted that suddenly, to the shock and surprise of the Applicant, the 1st Defendant Bank classified the loan account of the

¶22

Page 2 of 14

¶23

SA No.296/2023

¶24

Applicant as NPA. The Applicant approached the 1st Defendant Bank and sought restructuring of the loan account; however, the Applicant was not in a position to settle the entire loan amount with the 1st Defendant Bank.

¶25

d) It is further submitted that, the 1st Defendant Bank is alleged to have issued a Demand Notice under Section 13(2) of the Act dated 16.07.2022, claiming a sum of Rs. 4,08,604.24 as on 14.07.2022. However, the said Demand Notice was not served on the Applicant, as alleged by the 1st Defendant. The Applicant approached the 1st Defendant Bank and sought renewal/restructuring of the loan account. It is pertinent to point out that due to ill health and the impact of natural calamities, the same were not considered by the 1st Defendant Bank.

¶26

e) It is further submitted that, in the meantime, the 1st Defendant Bank took possession of the property by issuing the Possession Notice under Section 13(4) of the SARFAESI Act, 2002, even before the expiry of the mandatory statutory period of 60 days from the date of service of the Section 13(2) Demand Notice. However, the Possession Notice was not affixed on a conspicuous part of the property, nor was the same issued to the borrower/guarantor as contemplated under the Act and Rules. In the meantime, the 1st Defendant Bank initiated SARFAESI action and attempted to sell the property to a third party, which was not fruitful. The Applicant has only one residential property, which is the mortgaged property. If physical possession is taken, the Applicant and his family members will be put out of the house.

¶27

f) It is further submitted that, in the meantime, the 1st Defendant Bank filed a petition before the 2nd Defendant under Section 14 of the SARFAESI Act seeking assistance for taking physical possession

¶28

Page 3 of 14

¶29

SA No.296/2023

¶30

of the property, and the same was numbered as Cr.M.P. No. 4795 of 2023. The 2nd Defendant, without notice to the Applicant, allowed the said petition vide order dated 20.06.2023 and appointed an Advocate Commissioner for taking physical possession of the property. It is pertinent to point out that the 2nd Defendant Bank had not filed any affidavit disclosing all the material facts along with the Section 14 petition. As a matter of fact, the averments regarding the dates of the alleged notices under Sections 13(2) and 13(4) are contrary to the real facts and do not pertain to the case of the Applicant. Hence, the 2nd Defendant ought to have rejected the petition filed by the 1st Defendant Bank. Because the Demand Notice was not served on the Applicant and the Applicant is residing in the schedule-mentioned property, all these material facts were suppressed by the 1st Defendant, and such actions are unfair on the part of the 1st Defendant. Aggrieved by the above actions of Defendants 1 and 2, the Applicant is filing this Application on the following grounds.

¶31

The order of the 2nd Defendant dated 20.06.2023 made in Cr.M.P. No. 4795 of 2023, passed under Section 14 of the SARFAESI Act, is arbitrary, unreasonable, and not legally sustainable, and is liable to be set aside.

¶32

The Defendants ought to have seen that the classification of the loan account as NPA is not in accordance with the guidelines issued by the RBI, as the account has been wrongly classified as NPA.

¶33

The Defendants 1 & 2 ought to have seen that once the classification of the loan account as NPA is bad in law, the 1st Defendant does not have any legal right to proceed further under the SARFAESI Act, 2002.

¶34

Page 4 of 14

¶35

SA No.296/2023

¶36

The 2nd Defendant ought to have seen that the petition filed under Section 14 of the Act does not contain full details and that the 1st Defendant had suppressed material facts and had not filed any affidavit along with the petition as contemplated under the Act.

¶37

The 2nd Defendant ought to have seen that the averments regarding the dates of the alleged notices under Sections 13(2) and 13(4) are contrary to the real facts and do not pertain to the case of the Applicant. Hence, the 2nd Defendant ought to have rejected the petition filed by the 1st Defendant Bank.

¶38

SCHEDULE OF PROPERTY

¶39

Item No:1

¶40

Dindigul District, Dindigul Registration District, Joint I Dindigul SRO, Dindigul Town, Ward No. 2, Block No. 6, Pillaiyar Palayam Street, T.S. No. 337, in that Plot No. 15, corner of North-West, measuring 343 sq.ft., land with constructed house is bounded on:

¶41

North by	-	East-West lane
East by	-	Item No. 3 & Plot No. 20
South by	-	Item No. 2
West by	-	Saraswathi House

¶42

Within which the land measuring East-West on North side 14 feet, South side 14 feet and North-South on East side 25 feet, West side 24 feet and measuring 343 sq.ft. land with constructed house and all its amenities.

¶43

Item No:2

¶44

The property in T.S. No. 337, in that Plot No. 19, in which the southern portion measuring 176 sq.ft., land with constructed house is bounded on:

¶45

North by	- Item No.	1 & Item No. 3
East by	- lands of	Nagaraj

¶46

Page 5 of 14

¶47

SA No.296/2023

¶48

South by - Pillaiyar Koil and East-West 6 ft wide pathway on the northern side and East – West Pathway West by - lands of Saraswathi

¶49

Within which the land measuring East-West on North side 15 feet, South side 11 feet and North-South on East side 11 feet, West side 11 feet and measuring 176 sq.ft. land with constructed house and all its amenities.

¶50

Item No:3

¶51

The property in T.S. No. 337, in that Plot No. 20, corner of NorthWest, measuring 50 sq.ft., land is bounded on: North by - East - West lane East by - eastern portion of Plot No. 20 of Nagarajan South by - Item No. 2 West by - Item No. 1

¶52

Within which the land measuring East-West on North side 2 feet, South side 2 feet and North-South on East side 25 feet, West side 25 feet and measuring 50 sq.ft. land.

¶53

Thus, Item Nos. 1, 2 & 3 totally measuring 569 sq.ft., land and rights upon the common pathway. The above said property is within the limits of Dindigul Municipality.

¶54

The Applicant has submitted the following List of documents in support of his claim in the SA :-

¶55

S.No.	Date	Description of Documents
1.	16.07.2022	Demand Notice section l3(2)
2.	09.11.2022	Possession Notice section l3(4)
3.	20.06.2023	Impugned Order passed by the 2^ndDefendant under
		section 14 of the Act.

¶56

Page 6 of 14

¶57

SA No.296/2023

¶58

3 . On the other hand, the Counsel for the 1^st Defendant Bank appeared before this Tribunal and filed a Vakalatnama, Reply Statement, Typed set, in which he has submitted that the Applicant filed this Securitization Application and challenged the order passed by the Hon’ble CJM in Cr.M.P. No. 4795/2023 dated 20.06.2023. The grounds in Paras A to K are denied by the Defendant. The averments and allegations in the Securitization Application are denied as false and amount to factual misrepresentation. It is false to state that the Defendant Bank wrongly classified the account as NPA. The Defendant Bank classified the loan account of the Applicant as NPA as per the RBI norms and guidelines. There was no deviation in classification, and the Applicant is vaguely alleging that the Defendant Bank wrongly classified the account as NPA.

¶59

a) The allegation that the Demand Notice under Section 13(2) of the SARFAESI Act was not served on the Applicant is a cooked-up story, as the same is seen to have been served on the Applicant as per the A/D card dated 19.07.2022. Further, the allegation that the Possession Notice was not affixed on a conspicuous part of the property and that the same was not properly published in the newspaper are all wild imaginations of the Applicant to escape from the liabilities towards this secured creditor. In fact, proof of proper affixing of the Possession Notice and publication has already been produced by the 1st Defendant Bank. It is further submitted that the Hon’ble Chief Judicial Magistrate passed the order after perusing all the documents, petitions, and affidavit, and the allegation that the affidavit was not filed by the 1st Defendant Bank is wrong. The allegation that the Section 13(2) and 13(4) notices are contrary is also wrong, baseless, and the same needs to be proved by the Applicant through valid documentary and oral evidence. Further, the allegation of the Applicant that the Defendant Bank officials did not follow the legal procedure to take possession of the property is denied

¶60

Page 7 of 14

¶61

SA No.296/2023

¶62

by the Defendant Bank and has to be proved by the Applicant through valid documentary and oral evidence.

¶63

b) It is further submitted that the Applicant has approached the Defendant Bank and availed a loan under Loan Account No. 46019630000012 for an amount of Rs. 4,42,705/-, and the Applicant has agreed to repay the said loan on demand to the Defendant Bank together with the agreed interest.

¶64

c) It is further submitted that the Applicant and other co-applicant have executed the necessary loan documents in favour of the Defendant Bank, clearly agreeing to abide by the terms of the sanction of the financial assistance. The Applicants have secured the repayment of the loan by creating an equitable mortgage and depositing their original documents, and the guarantor has executed a Memorandum of Deposit of Title Deeds regarding the secured asset in favour of Jana Small Finance Bank through a registered Memorandum of Deposit of Title Deeds by Document No. 3029/2020 dated 10.11.2020. At the time of borrowing the loan, the Applicant promised the Defendant Bank that they would repay the legitimate dues of the Defendant Bank without any default and accepted the terms and conditions contained in the loan agreement. As such, the Defendant Bank has become a secured creditor, the Applicants have become secured debtors, and the schedule property has become the secured asset.

¶65

d) It is further submitted that, as the Applicant failed to adhere to the repayment schedule, the Defendant Bank repeatedly called upon him to repay the dues, but the Applicant failed to do so. Therefore, the loan facility extended to the Applicant was classified as a “NonPerforming Asset” on 02.07.2022 within the meaning of Section 2(o)

¶66

Page 8 of 14

¶67

SA No.296/2023

¶68

of the Act, in accordance with the directions/guidelines issued by the Reserve Bank of India.

¶69

e) The Defendant Bank had caused notice to the Applicant for payment of the pending interest amount. The Applicant had received the notice, but was not inclined to pay the pending interest amount with an intention to evade payment due to the Bank. Further, the representatives and staff of the Bank had approached the Applicant requesting repayment of the loan and interest; however, the Applicant was not inclined to pay the pending interest and loan amount. Hence, the Defendant issued a statutory notice under Section 13(2) of the Act on 16.07.2022, calling upon the Applicant to discharge their liabilities in full within 60 days from the date of the statutory notice (demand notice), and the same was received by the Applicant for himself and on behalf of his wife (co-applicant). However, the Applicant failed to pay the outstanding loan amount. Hence, the Defendant Bank took symbolic possession on 09.11.2022, and the notice was duly affixed on the said property and also delivered to the Applicants’ address through RPAD, and the acknowledgment cards are filed herewith. The paper publication effecting symbolic possession was made in daily Tamil and daily English newspapers and was published on 15.11.2022.

¶70

f) It is further submitted that the Applicant, despite knowledge of the statutory notice and being fully aware of the consequences and his statutory obligations, failed to discharge his liability within the statutory period.

¶71

g) It is further submitted that, being a secured creditor, upon default by the borrower after issuance of the statutory notice under Section 13(2) of the Act, it is entitled to proceed against the borrower under Section 13(4) of the Act to take possession of the secured asset.

¶72

Page 9 of 14

¶73

SA No.296/2023

¶74

h) It is further submitted that, as per Section 14 of the Act, where possession of any secured asset is required to be taken by the secured creditor, and if such secured asset is required to be sold or transferred under the provisions of the Act, the secured creditor may, for the purpose of taking possession and control of any such secured asset, request in writing to the Chief Judicial Magistrate or the District Magistrate within whose jurisdiction such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Judicial Magistrate.

¶75

i) It is further submitted that the filing of this appeal itself is against law and not maintainable either in law or on facts, and is liable to be dismissed in limine. The Applicant is not entitled to any relief as he has approached this Hon’ble Tribunal without clean hands. The Applicant has raised various vague grounds, which are not tenable in the eye of law. The Defendant Bank has scrupulously followed all the guidelines of the RBI. The notices were properly served on the Applicant. Further, the Applicant, after admitting the loan liability, is questioning the authority of the Defendant Bank in invoking the SARFAESI Act, which is untenable. The present stay application and the main SARFAESI application are not maintainable and are liable to be dismissed in limine. The Applicant cannot escape from his legal liability as he is a borrower as per Section 2(f) of the SARFAESI Act, 2002, and the Applicant’s property is a secured asset within the meaning of Section 2(zc) of the SARFAESI Act, 2002.

¶76

j) It is further submitted that, on perusal of the loan account statement of the Applicant, it can be clearly understood that the Applicant is a chronic defaulter and is not keen to repay his outstanding dues towards the 1st Defendant Bank.

¶77

Page 10 of 14

¶78

SA No.296/2023

¶79

Hence, it is therefore prayed that this Hon'ble Tribunal may be pleased to dismiss the above Application with exemplary cost and thus render justice.

¶80

Typed set of Papers filed by the 1^st Defendant Bank on 08.08.2025

¶81

S.No.	Date	P	articulars
1.	16.10.2020	Loan Application
2.	09.11.2020	Sanction letter
3.	10.11.2020	Loan Agreement
4.	15.10.2007	Registered Gift deed favour of his Gran document no.2742/2	executed by Guruvammal in dson K.Manikandaprabhu in 007 dated 15.10.2007.
5.	10.11.2020	Mr.K.Manikandaprab Memorandum of Dep Jana Small Finance registered Memorand document no.3029/2	hu had executed a osit of Title Deeds in favour of Bank Limited Through a um of Deposit of Title Deeds in 020
6.	16.07.2022	Demand Notice Acknowledgement car	Postal Receipts and ds
7.	09.11.2022	Possession Notice
8.	10.11.2022	Possession Notice Acknowledgement car	Postal Receipts and ds with affixed Photo Copies
9.	15.11.2022	Business Standard Possession Notice	Newspaper published in
10.	15.11.2022	Dhinakaran Tamil Possession Notice	Newspaper Published in
11.	05.08.2025	Account Statement
12.	31.03.2025	Authorization Letter

¶82

4. ON THE BASIS OF ABOVE PLEADINGS THE POINT WHICH ARISES FOR CONSIDERATION IS:-

¶83

I. Whether the Applicant has been able to prove his case in his favour?

¶84

II. Whether the Applicant is entitled to get the reliefs as prayed for?

¶85

5 . Having heard the parties and after going through the entire documents available on record, this Tribunal finds that there is no dispute

¶86

Page 11 of 14

¶87

SA No.296/2023

¶88

with regard to the availment of housing loan facilities by creating an equitable mortgage over the property for a sum of Rs. 4,42,705/- (Rupees Four Lakh Forty-Two Thousand Seven Hundred and Five only) . Since the Applicant failed to repay the loan amount, the loan account was classified as NPA. It is the contention of the counsel for the Defendant Bank that the Applicant, after availing the above-said loan facility and depositing the original documents, and the guarantor executed a Memorandum of Deposit of Title Deeds regarding the secured asset in favour of Jana Small Finance Bank through a registered Memorandum of Deposit of Title Deeds vide Document No. 3029/2020 dated 10.11.2020, have failed to repay the outstanding loan dues. The Applicant stated in the S.A. that due to severe financial problems and fall in income, he was unable to pay the loan dues in time. I also find that thereafter, the Defendant Bank classified the loan account as NPA on 02.07.2022.

¶89

Thereafter, the 1st Defendant Bank issued a Demand Notice under Section 13(2) of the SARFAESI Act on 16.07.2022 demanding a sum of Rs.4,08,604.24p (Rupees Four Lakh Eight Thousand Six Hundred and Four and Paise Twenty-Four only) as on 14.07.2022 through registered post with acknowledgement due. The Defendant Bank has produced a copy of the said Demand Notice along with postal acknowledgements (AD cards) as proof of service which are placed at pages 55 to 62 of the Bank’s typed set of papers. The Applicant has contended that he did not receive the said notice. However, on perusal of records, the original Demand Notice is found enclosed in the S.A. file at pages 11 to 15. and the AD cards produced by the Bank establish that the notice was duly served on the Applicant. Hence, this Tribunal finds that the Demand Notice was duly served. But, the Applicant did not submit any representation or objection under Section 13(3A) of the SARFAESI Act within the prescribed time.

¶90

Thereafter, the Defendant Bank issued and filed a copy of the Possession Notice dated 09.11.2022 under Section 13(4) of the SARFAESI

¶91

Page 12 of 14

¶92

SA No.296/2023

¶93

Act for a sum of Rs.4,08,604.24p (Rupees Four Lakh Eight Thousand Six Hundred and Four and Paise Twenty-Four only) as on 14.07.2022, along with copies of AD cards as proof of service on the borrower/guarantor. I also find that the Bank has produced xerox copies of the paper publication of the Possession Notice in two newspapers, one in English and the other in Tamil, which are annexed at pages 69 and 70 of the Bank’s typed set of papers. The Bank has also filed photographs (xerox copies) at page 68 of the Bank’s typed set of papers as evidence of having affixed the Possession Notice on a conspicuous part of the property. On the other hand, the Applicant contended that neither proper publication nor affixture of the Possession Notice on a conspicuous part of the property was carried out, and that the said notice was not served. However, on careful scrutiny of the records filed by the Applicant in the S.A., the original Possession Notice is found enclosed at pages 16 and 17. Further, the AD cards produced by the Bank establish that the notice was duly dispatched to the Applicant. Hence, this Tribunal finds that the Possession Notice was duly served on the Applicant. Thus, I find that the 1st Defendant Bank has strictly followed the SARFAESI procedures while issuing the Possession Notice to the Applicant.

¶94

Subsequently, the 1st Defendant Bank obtained an order dated 20.06.2023 from the Chief Judicial Magistrate in Cr.M.P. No. 4795/2023 for taking physical possession of the secured asset. The Applicant contended that the said order was passed without notice to him. Since an order passed by the Chief Judicial Magistrate under Section 14 of the SARFAESI Act is only an administrative order for assisting the secured creditor in taking physical possession of the secured asset, issuance of notice to the borrower is not required. Therefore, this Tribunal finds that the 1st Defendant Bank has complied with the provisions of Section 14 of the SARFAESI Act.

¶95

Page 13 of 14

¶96

SA No.296/2023

¶97

I also find that during the pendency of the case, this Tribunal passed a conditional stay order dated 27.07.2023, directing the Applicant to deposit a sum of Rs.1,24,000/- (Rupees One Lakh Twenty Four thousand Only) in two equal instalments. The Applicant has complied with the terms of the conditional order and thereby demonstrated his bona-fides.

¶98

Under the above facts and circumstances of the case, this Tribunal is of the considered view that the Applicant has failed to establish any procedural irregularity or violation of the SARFAESI Act, whereas the 1st Defendant Bank has followed the due process of law for recovery of the loan amount. As such, this Tribunal does not find any merit in the S.A. Application. Accordingly, the Application is liable to be dismissed.

¶99

In the result, the SA No.296/2023 stands dismissed with no costs. Consequently, all pending IAs (if any) are also disposed of.

¶100

Dictated to LDC (KK), taken down, transcribed typed by him, corrected and pronounced by me in the Open Court in this the 17^th June, 2026.

¶101

Sd/- (SEEMA SINHA)

¶102

PRESIDING OFFICER

¶103

Uploaded on 02.07.2026

¶104

Page 14 of 14

Manikanda Prabhu K v. Jana Small Finance Bank Ltd.

Case brief

What is this about?

What did the court decide?

Manikanda Prabhu K v. Jana Small Finance Bank Ltd.

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

Similar cases

Raja Mohamed S a versus Bank of Baroda

Punjab National Bank versus Sujatha

A Veeralakshmi versus Indian Overseas Bank

Rafeek Raja versus Sundaram home finance Ltd.

Dhanalakshmi Timbers versus Karur Vysya Bank

State Bank of India versus Sivanarayanan