Allowed

D Vijay v. Tirupati urban cooperative bank Ltd.

DRT17 Jul 2026SA/306/2023

Case brief

AI extract

What is this about?

The Tribunal allowed a securitization application against a demand and possession notice. Although the demand notice was served, the Tribunal held the possession notice was failed to be published in an English daily as mandated. Consequently, the possession notice was set aside.

What did the court decide?

The possession notice dated 04.07.2023 in respect of the SA Schedule Property is set aside.

D Vijay versus Tirupati urban cooperative bank Ltd. — Banking and Recovery | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL^_ II AT HYDERABAD

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DATED THIS THE 17TH DAY OF JULY, 2026

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PRESENT: SH. RAMESHWAR KOTHE, B.Com, L.LB. (Hons.), M.A. PRESIDING OFFICER

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Securitization Application No. 306 OF 2023

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D.VIJAY, S/o. Sri covindaiah Aged: 35^years, Occ: Business H.No.22-2- 726 / 7, Harija navada, Thimminayudupalem, TIRUPATI-517 507, ANDHRA PRADESH

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... ...... .Applica nt

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Versus

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The Authorlzed Officer

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THE TIRUPATI CO-OPEMTIVE URBAN BANK LIMITED Registered Office No.23, G. Car Street TIRUPATI-517 501, ANDHM PRADESH

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.....Respondent

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Counsel for the Applicant : Sri. T. Nagender Counsel for Respondent : Mr. V. Pramod Kumar

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-:ORDER:-

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The present Securitization Application is filed by the Applicant uls.77 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("Act" hereinafter for short) assailing demand notice dated 03.05.023 under section 13(2) and^possession notice dated 04.07.2023 under section 13(4) of the Act in respect of the SA Schedule Property.

¶14

The averments of the application, briefly, are that the Respondent Bank had sanctioned the Ioan in yeat 2Ol7 and claim to be regular in repayment till year 2023 but the Respondent Bank failed to furnish periodic statements of account, charged interest contrary

O"ry'{#

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sA No. 306/2023

to the agreed terms and^{RBI guidelines,and classifiedtheloan} account as a NPA without^{priornotice. It is further allegedthat the} Respondent Bank failed to^{complywith the mandatoryprovisions of} Section 13(2) and^{Section 13(4) of the SARFAESIAct, 2002 read with} Rules 8(1) and 8(2) of the^{SecurityInterest(Enforcement)Rules,} 2002,^{(hereinafter "Rules" for short)inasmuchas no valid demand} notice was served, the^{possessionnotice dated 04.07.2023was} issued without allowing^{the statutoryperiod of sixty days fromthe} demand notice dated 03.05.2023,^{and the possessionnotice was} neither duly served^{nor publishedin the mannerprescribedunder the} Rules. The Applicants further^{contend that the securedasset,beinga} residential house situated^{on Grama Kanthamland, is not amenable} to^proceedings under the^{SARFAESI Act and allege that the} Respondent Bank obtained^{theirsignatureson blank documentsand} is attempting to take^{physicalpossessionwithout following due} process of law. Hence, Applicant^{praysfor settingaside the measures} initiated by the respondent^{againstthe SA Schedule Properties'}

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The Respondent Bank^filed a^{counter in I.A. No 2150 of 2023} along with supporting^{documents and adoptedthe said counteras its} reply statement in the^{main SA. The avermentsthereof, brlefly,are} that Applicant after availinq a^{mortgageloan of ?6,00,000/-} sanctioned in^{year 2018 secured via mortgage of the SA Schedule} Property. Owing to^{continuous default, the loan account was classifled} as a NPA, consequently^{respondent issueda demand noticeunder} Section 13(2) followed by^{the possession noticedated04'07 '2023} under Section 13(4) after^{due compliance with the provisionsof the} Act and Rules, 2002.^{The Respondentspecifically deniesthe} allegations that^{signatureswereobtainedon blankdocuments,or} that the interest charged^{wascontrary to the RBI guidelines' It is} further contended that all^{mandatorystatutory requirementsrelatlng} to service of notices, srant^{of the statutorv} ml;:::i'""ton l'-/ \t'

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Page 3 of4

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SA No.306/2023

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13(2), and publication of the possession notice were duly complied with. The Respondent also denies the Applicant's contention that the secured asset is exempt from the purview of the SARFAESI Act, asserting that the mortgaged property is a valid secured asset over which it is entitled to enforce its security interest. Accordingly, the Respondent prays for dismissal of the SA.

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Both learned counsel for the applicant and respondent reported that orders may be^passed based on records. Perused the material brought on record.

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The points for consideration are as follows : -

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i) Whether the applicant made out any valid ground to quash any of the measures initiated by the respondent against the SA schedule properties as^prayed for?

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ii) To what relief?

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Point No.(i):

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Admittedly, applicant availed credit facility against mortgage of schedule property and failed to make payment as per repayment schedule. Hence the action of the Respondent Bank in classification of account as NPA and initiating the SARFESI^proceedings cannot be termed as illegal or irregular as contended by the applicants.

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The Respondent Bank has relied upon the documents annexed to the Adoption Memo dated 15.12.2023. A^perusal of the photocopies of the postal receipt and postal acknowledgement establishes that the demand notice was duly served upon the Applicant. Likewise, the Respondent has^placed on record the photocopies of the newspaper pubrication of rhe ,"

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SA No.306/2023

the vernacular language,^{i.e., Telugu, the photographsevidencing} affixture of the^{possession noticeat a conspicuouspart of the secured} asset, and the^{photocopiesof the postal receiptsevidencing service of} the^possession notice^{upon the Applicant. However, it is noticed that} the Respondent has failed to^{place on record the newspaper} publication of the possession notice in an^{English daily, as mandated} under Rule B(2) of^{Rules, 2002. In the absence of anymaterial} evidencing compliance^{with the mandatory requirementof publication} in an English newspaper,^{this Tribunalis constrained to hold that the} Respondent has failed to^{establishdue compliance with Rule B(2) of} the Rules, 2002. Consequently, the^{possessionnoticedated} 04.07.2023 is vitiated for^{non-compliancewith the mandatory} statutory requirement and^{is, therefore, liable to be set aside.}

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Point No,(ii):

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B. In the result, the Securitisation^{Application is allowed by setting} aside the^{possession notice} dated^{04.07'2023 in respect of the SA} Schedule Property.

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Consequently, Interlocutory^{Applicationspending, if any,shall} stand closed.

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No order as to costs.

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Communicate a copy of^{this orderto the partiesconcernedand} upload in the official website.

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(Typed to my dictotion by the Steno., corrected, signed and^{pronounced by me} the open court on this the 7lh ddy of Juty, 2026). lQfl.rtrt ESHWAR KOTHE) PRESIDING OFFICER

D Vijay v. Tirupati urban cooperative bank Ltd.

Case brief

What is this about?

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D Vijay v. Tirupati urban cooperative bank Ltd.

Case brief

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