Dismissed

Varinder Verma and Another v. Hindu Co-Operative Bank Ltd.

DRT13 Mar 2026SA/296/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed a Securitization Application under Section 17 of the SARFAESI Act as time-barred. The court held that the application was filed beyond the 45-day limitation period applicable from the Section 13(4) notice, and no request for condonation of delay was made.

What did the court decide?

Securitization Application No.296/2024 dismissed as filed beyond the stipulated period of 45 days.

Varinder Verma and Another versus Hindu Co-Operative Bank Ltd. — Banking and Recovery | DRT (2026)

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DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

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PRESIDED OVER: SH. MRIDULESH KUMAR SINGH

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SECURITIZATION APPLICATION NO.296/2024

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Date of Institution: 07.08.2024 Date of Decision: 13.03.2026

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Sh. Varinder Verma S/o Sh. Vijay Kumar R/o Mohalla Kashmiri near Amar Palace, Sujanpur, Tehsil and District Pathankot

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Smt. Kamla Devi W/o Sh. Vijay Kumar R/o Mohalla Kashmiri near Amar Palace, Sujanpur, Tehsil and District Pathankot

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--Applicants

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Versus

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Authorised Officer, Hindu Co-operative Bank Ltd., Dalhousie Road, Pathankot

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--Respondent Argued by: Sh. Harinder Pal Singh, Advocate for Applicants Sh. Jatinder Singh, Advocate proxy for Sh. Harjot Singh Bedi, Advocate for Respondent

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FINAL ORDER

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(1) This Securitization Application was filed under Section 17(1) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the Act’ for brevity) to quash the proceedings initiated under the Act by respondent against applicants and the mortgaged property belonging to applicants.

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(2) It was stated in the application that applicant Nos. 1 & 2 are the mother and son; that applicants have availed credit facilities of Rs.25 Lacs from respondent in the year May, 2016 against the security of two commercial shops and one house situated at Mohalla Kashmiri near Amar Palace, Sujanpur, Tehsil and District Pathankot; that applicants were regularly paying the installments but as the respondent started charging inflated rate of interest than the agreed and as such the account of applicants was classified as NPA; that respondent got an ex parte arbitral award dated 11.11.2019 for a total recovery amount of

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Rs.26,75,989/from Sub-Registrar, Co-operative Societies, Pathankot and thereafter, filed Execution Petition No.68/2021 before Civil Judge (Senior Division), Pathankot; that during the pendency of said arbitration, respondent by exercising pressure upon applicants for settlement under One Time Settlement Scheme and assured that if the applicants deposits Rs. 22 Lacs in one go, then the respondent will release the attached properties and also get the remaining amount waived off; that believing their assurances, applicants after lots of efforts got deposited Rs.22 Lacs with respondent; that instead of sending the case of the applicants for OTS, respondent released two properties of the applicants vide letter dated 22.04.2019 and mentioned in the said letter that an amount of Rs.4,76,775/- was due as on 22.04.2019 and orally applicants were told that the said amount as per oral promise shall be got waived off under OTS Scheme but all in vain; that applicants were not even informed about the pending arbitration proceedings rather the respondent illegally got ex parte arbitration award dated 11.11.2019 without disclosing the factum of aforesaid receipt of Rs.22 Lacs and oral settlement between the parties; that applicants had learnt about the execution proceedings later on as the applicants were proceeded ex parte; that applicants had deposited more than Rs.3,03,000/- in the loan account till 01.02.2024; that on 12.02.2024, applicants were asked to orally deposit an amount of Rs. 4,00,000/- against the total outstanding of Rs.4,88,405/- and applicants were again orally assured that balance would be got waived off; that respondent did not process that case for waiving off the balance amount and the applicants also remained under bonafide belief that the respondent will get the balance waived off as per oral promise; that thereafter, in the first week of May, 2024 applicants again approached respondent and they were shocked to know that outstanding amount has been raised to Rs.4,58,930/-; that respondent has not given any reply to the said fact as to how an amount of Rs.88,403/- has been increased to Rs.4,58,930/- in two months and there was no reply qua the rate of interest

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SA/296/2024 VARINDER VERMA AND ANOTHER VS. HINDU CO-OPERATIVE BANK LTD.

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charged by respondent rather respondent threatened to take physical possession of the mortgaged property under the Act and he further gave the copies of demand notice dated 09.03.2020 and notice under Section 13(4) of the Act dated 28.07.2020 & 09.09.2020; that neither any copy of publication of these notices nor photographs regarding affixation were provided by respondent; that applicants were entangled in one false FIR and even the applicant No.1 remained behind the bars from 20.07.2021 till March, 2022; that during this period the respondent misused the position by exploiting the family of the applicant by getting signatures on various blank papers etc.; that on 28.07.2024, respondent has issued fresh letter, wherein it was informed that respondent will take physical possession and applicant should vacate the premises within 15 days; that action of the respondent taken under the Act against the borrower as well as against the property is illegal, arbitrary and in gross contravention of the provisions of the Act and Rules. Therefore, it was prayed that the present SA may be allowed.

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(3) Reply filed by respondent.

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(4) It was stated in the reply that present SA is hopelessly time barred as the notice under Section 13(2) of the Act was issued on 09.03.2020 and thereafter notice under Section 13(4) of the Act was issued on 28.07.2020; that applicants were free to challenge the said notices within the time stipulated under the Act but the same were never challenged and the limitation was expired; that now the present SA has been filed on 07.08.2024, which is after more than 4 years, therefore the same is liable to be dismissed; that applicants are not approaching this Tribunal with clean hands and are making deliberate misstatement of facts and also concealed material facts from this Tribunal; that applicants have failed to mention under the relief clause as to which order of the Authorized Officer issued under the Act they intend to get it set aside; that applicants in very vague manner had prayed that the proceedings initiated under the Act against the applicants and mortgaged property belonging to the

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applicants be quashed as such the prayer of the applicants being itself defected and not seeking any specific order to be set aside and asking for the entire proceedings initiated under the Act is a vague prayer; that applicants have never maintained financial discipline and have been defaulting in the regular payment of installment as such the account of the applicants when remained in default for continuous period of 90 days, the same was classified as NPA on 31.12.2019 as per Guidelines issued by Reserve Bank of India; that respondent was well within the jurisdiction to initiate arbitration proceeding under Section 55/56 of the Punjab Cooperative Societies Act, 1961; that the arbitrator had issued notice to the applicants but it is the applicants, who refused to appear and as such the arbitrator passed the award against the applicants; that thereafter, Execution Petition was filed before the Civil Court at Pathankot to execute to said award; that at this stage when the applicants found that the Learned Civil Court in the execution proceedings will take coercive steps then the applicants deposited an amount of Rs.22 Lacs with the respondent; that the assertions made by the applicants regarding the OTS, the same were absolutely incorrect and false; that there was no assurance given by any Official of the respondent that any amount will be waived off; that an amount was still outstanding against the applicants and respondent had been requesting the applicants to deposit the same or otherwise they have to carry forward the action already initiated under the Act; that applicants, who had given it in writing that they will deposit the amount of Rs.4 Lacs and they be given three month’s time to pay the upto date amount; that the said writing has already been placed on record by the applicants as Annexure A- 3; that applicants deposited Rs.4 Lacs on 12.03.2024, which was firstly debited with regard to the interest component standing against the applicants and after the said deduction the principal amount which remained pending was Rs.4,58,930/- and out of which the undebited interest was to the tune of Rs.7,432.66p; that no Official of the respondent has ever told the

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SA/296/2024 VARINDER VERMA AND ANOTHER VS. HINDU CO-OPERATIVE BANK LTD.

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applicants that the remaining amount will be waived off; that the said averments made by applicants is absolutely incorrect; that there is not even a difference of a rupee in the calculation and the same is absolutely correct and there is no discrepancy in the same; that respondent after receiving the amount on 12.03.2024 and as per the undertaking given by the applicants, did not initiate any action for 3 months with the hope that the remaining amount will be paid by the applicants in 3 months as given in the undertaking; that when the applicants failed to abide by their own undertaking/statement and did not deposit the remaining amount within 3 months then the respondent issued notice dated 25.07.2024 (Annexure A-7) mentioning that 4 months has been elapsed against the promise and the amount has not been paid to the bank; that through this notice it was informed that the physical possession of the mortgaged property will be taken with the help of Duty Magistrate (Tehsildar) and Police Force and it was asked that the mortgaged property be vacated within 15 days; that applicants have no moral ground to lay challenge to the proceedings initiated by respondent under the Act; that all the notices under the Act were duly delivered to the applicants and there is not even in a single averments in the entire SA that those notices were never served upon the applicants. Therefore, the present SA may kindly be dismissed.

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(5) No replication was filed by applicants to the reply filed by respondent.

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(6) I have heard arguments advanced by Sh. Harinder Pal Singh, Advocate for Applicants and Sh. Jatinder Singh, Advocate for Respondent and gone through the record carefully.

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(7) Sh. Jatinder Singh, Advocate argued that the present SA is not maintainable and liable to be dismissed being time barred. It was further argued that the SA was not filed within 45 days as per the Act. It was further argued that notice under Section 13(2) of the Act was issued on 09.03.2020 and notice under Section 13(4) of the Act was issued on 28.07.2020 but applicants have never challenged the said notices

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within stipulated period. It was further argued that the present SA has been filed on 07.08.2024 i.e., after about 04 years. Therefore, this SA may be dismissed as time barred.

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(8) Per contra , Sh. Harinder Pal Singh, Advocate argued that the present SA has been filed by applicants on 07.08.2024 challenging the letter dated 25.07.2024 (Annexure A-7). It was further argued that therefore, the present SA has been filed within 45 days from the date of said letter.

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(9) In the SA, applicants have calculated the period of limitation from the letter dated 25.07.2024 issued by Authorized Officer, Hindu Co-operative Bank Ltd., Pathankot ( Annexure A-7 ). In the said letter it was mentioned that Bank had already issued demand notice dated 09.03.2020 asking for the payment of dues as on 31.01.2020 plus interest and other expenses. It was also mentioned that as per your commitment letter dated 13.03.2024, applicants have agreed to pay the outstanding amount of the account within 03 months. It was also mentioned that it was agreed by applicants that in case they fail to pay the amount outstanding within the period of 03 months then Bank’s Authorised Officer shall authorise to take legal action. It was also mentioned that since already 04 months has been elapsed the applicants have not paid the due amount, therefore Bank will take physical possession of the property with the help of Duty Magistrate and Police Force.

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(10) Admittedly, applicants have not compiled with to this letter.

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(11) In fact, any person aggrieved by any of the measures referred to in sub-Section (4) of the Section 13 taken by the secured creditor or his Authorised Officer under this Chapter, may make an application along with such fee, to the Debts Recovery Tribunal having jurisdiction in the matter within 45 days from the date on which such measure had been taken. In sub-Section (4) of the Section 13 nowhere it is provided that a letter issued by Authorized Officer is a measure. In fact, perusal of the said letter shows that this letter is an information for taking the physical possession of

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the secured asset, if the applicants will not pay back the amount, which was availed from the respondent. Therefore, limitation to file SA cannot be counted from date of this letter.

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(12) It was not argued by Sh. Harinder Pal Singh, Advocate that any date of possession was ever fixed by Bank or Tehsildar concerned. It was also not argued by Sh. Harinder Pal Singh, Advocate that as to whether the respondent has moved an application under Section 14 of the Act for taking physical possession of the secured asset and District Magistrate has passed any order on such application. Therefore, the limitation should be counted for filing of the SA from the notice under Section 13(4) of the Act dated 28.07.2020.

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(13) Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 provides, the time limit of 45 days of filing application under this Section from the date on which a measure had been taken referred to in sub-section (4) of Section 13 taken by the secured creditor or his Authorised Officer. Therefore, this SA was to be filed within 45 days from the date of measure referred to in subSection (4) of Section 13 or sale notice.

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(14) This shows that this SA was filed beyond the stipulated period of 45 days.

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(15) No application was filed by applicants for condonation of delay in filing the present Securitization Application rather Sh. Harinder Pal Singh, Advocate has argued that there is no delay in filing the present Securitization Application and there is no necessary to pray for condonation of delay.

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(16) As discussed above, applicants have calculated the time of limitation from the wrong date and in fact, this SA was filed beyond limitation period and in fact after more than 04 years delay.

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(17) The reason for providing a time limit of 45 days for filing an application under Section 17 can easily be inferred from the purpose and object of the enactment. Hon’ble Supreme Court in Transcore Vs. Union of India and Another (2008) 1 SCC 125

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has held that the SARFAESI Act is enacted for quick enforcement of the security.

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(18) In light of above facts and circumstances, this SA was filed beyond the period of limitation. No reason whatsoever explained for non-filing of SA within the limitation period. No formal application or oral prayer was made to condone the delay in filing the present Securitization Application.

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(19) It reveals from record that notices under Section 13(2) & 13(4) of the Act were not challenged by applicants in the SA. In fact, in whole of the application it was not pleaded by applicants that the said notices were never served upon applicants. Therefore, adjudication on the said notices were not required.

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(20) In the SA specific reliefs were not prayed rather a vague relief was prayed that proceedings initiated under the Act against applicants and the mortgaged property be quashed.

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(21) No other point was argued/pressed. (22) After considering the arguments of both the parties and evidence on record, this Tribunal is of the opinion that present SA was filed beyond the stipulated period of 45 days and no explanation is on record for condoning the delay. In the SA specific reliefs were not claimed. Therefore, this SA is liable to be dismissed. (23) Accordingly, this SA is dismissed. Record be consigned to record room after due compliance.

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Date: 13.03.2026

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Pronounced by me in the open Tribunal.

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(MRIDULESH KUMAR SINGH) Presiding Officer, DRT-III, Chandigarh

Varinder Verma and Another v. Hindu Co-Operative Bank Ltd.

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Varinder Verma and Another v. Hindu Co-Operative Bank Ltd.

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