Dismissed

Mrs K Vinodini v. Indian Bank

DRT26 Mar 2026SA/308/2022

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed the applicant's Securitization Application seeking to set aside auction measures taken by the respondent bank. The court held the applicant failed to establish valid grounds as the bank strictly complied with the Act, auctioned the mortgaged property, and the applicant did not challenge the subsequent sale to a third party.

What did the court decide?

Securitization Application dismissed; verbal interlocutory applications pending closed; no order as to costs.

Mrs K Vinodini versus Indian Bank — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY^{TRIBUNAL_ II AT HYDERABAD}

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DATED THIS THE 26th^{DAY OF MARCH, 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. 308 OF 2022}

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Mrs. K. Vinodin i, W/o.VJCKKumar, Spanda na Towers, Flat No.116, Upparpa lli Road, Behind Mahila University, Tirupathi- 517502

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.......Applicant

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Versus

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Indian Bank

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Rep. by its Authorized Officer 5-7-679, Su ra bhi Arcade, Bank Street, Koti, Hyderabad- 500001

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Indian Bank, Rep. by its Branch Manager, 3-4-A54, Barkatpura Branch, Hydera bad.

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Sri. Maggam Ven katacha lam, S/o. M Polaiah, Aged: Major, R/o. #No.1-1, Panjam(V), Venkatagiri(M), Nellore District, A.P.-524732

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......Respondents

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Counsel for the Applicants : Mr.C. Vikram Chandra Counsel for Respondents 1 & 2: Mr. R.V. Subba Rao Counsel for Respondent No.3: Mr. G. K. Deshpande

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-:o_B_q_E_B:-

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The present Securitization Application is filed by the Applicants u/s.17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002_ ("Act" hereinafter for ffi$,,

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page 2 ot 7

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SA No. 308/2022

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short) to set aside all measures of the respondent bank under section 13(2) & 13(4) of the Act, including sale notice dated 26.70.2022 fixing the auction on 30.77.2022 in respect of the SA schedule property.

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The aveTments of the application, briefly, are that the Applicant is the absolute owner of the SA Schedule property and had deposited the title deeds of the schedule property on 24.11.2077 towards security of loan sanctioned to M/s J.C. Infra only to the extent of Rs.38 lakhs. However, though Rs.38 lakhs was initially sanctioned, the overdraft limit was enhanced to Rs.2.5 crore on 16.03.2018, and the said facility was secured by the property situated in Sy. No.2571t0, 12 and in Sy. No.260, Ward No.11, near Yogi 14allavaram Residential Area, Tiruchanoor Village, Padmavathipuram Gram Panchayat, Tirupati Rural Mandal, Chittoor Distrlct. The said^property is situated about 4 kilometers away from Tirupati Railway Station and Bus Stand, comprises stilt^plus five floors, and market value of it is Rs.7,07,60,000/- as^per the valuation report dated^{23.08.2018.The} Applicant is not a^partner in the^partnership firm^lvl/s. l.C.^Infra.She has made^payments aggregating to Rs.40^lakhs to^Director of^[4/s l.C. Infra Build Company towards^repayment of^loan of^{M/s J.C. Infra} and in turn Rs.80 laks^waspaid to the^{respondentbank. No notice} under Sections 13(2) and 13(4)^{were served. EvenNPA classification} was informed. Respondent Bank also^failed to serve^noticeunder Rule 8(6) of the Security Interest^{(Enforcement)Rules,2002} (hereinafter "Rules" for short). Without initiating^{measuresagainst} the primary security available, the Bank^{hasproceededagainst} property worth of Rs.7,07,60,000/- for realizing entire^outstanding liability of Rs.1.84 crores. The^applicant and^{her husbandwho are} senior citizens would be rendered^{homelessif the sale of the property} is permitted, and that such action amounts to a^violation of^Articles 14 and 300A of the Constitution of India. Hence,the^{Appucant prays}

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Page 3 of7

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SA No. 308/2022

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that the^{present Securitization Applicationbe allowed in the interest} of^justice.

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The respondents^{1 & 2 ("respondentbank") filed reply and} additional reply^{statements along with list of documentsThe} averments thereof,^{briefly, are that the Appticant initially filed Writ} Petition No.578/2022^{before the Hon'ble High Courtof Telangana'} assailing the^{wrong descriptionof the Scheduleproperty The Writ} Petition was disposed^{of with the direction to the Applicantto} approach the^{approprlateDebt RecoveryTribunaland directed to} deposit of^{15o/o of the outstanding dues withRespondent No 1 within} a^period of^{30 days.Althoughthe Applicant approached theDRT} within the stipulated^{30 days, she failed to make the deposlt as} directed by^{the Hon'ble High Court The RespondentBank averred} that the Applicant^{is a guarantor in respect of the sald loan} transaction^{and that she had depositedthe title deedsof the SA} Schedule^{property in favour of the Respondent BankThe said loan} limitwasenhancedtoRS.2'5crore,andtheprimarysecuritiesConsist of an^{EM propertybelonging to Smt' K Vinodini Devi' situated at} Door No.23-11-262,^{S'V Nagar, Tirupati' and anotherEMproperty} belonging^{to Sri. TNarasaiah,situated at D'No1O-128-3'V'V'} Nagar, Tiruchanur^{Road, TiruchanurGram Panchayat'TirupatiThe} borrower,^{M/s. l.C. Infra,continued to remainin default' in} consequence^{whereof the RespondentBank lnitiatedSARFAESI} proceedings by^{issuing a demand notice dated 18'082021under} Section^{13(2)of the SARFAESIAct As the notice was not received by} the concerned^{partythrough post, the RespondentBankpublished} the same^{in Mana Telangana(Ielrgu daily) and Eusiness} Standard^{(English daily) on 20'08'2021'On the Applicant'scontinued} failure to^{repay the dues, the Bank took possessionof the secured} asset and^{issued a noticeunder Rule 8(1) of the Security Interest} (Enforcement)^{Rules,2002,darcd r4'12'202L*p6pOuUtitn"a}

(// 6'o

Page 4 of7

sA No.308/2022

in Mana Telangana (Telugu daily) and Business Standard (English daily) on 16.72.2021. Thereafter, the respondent bank issued a sale notice dated 26.70.2022, fixing the auction for 30.tt.2O2Z. Respondent bank issued fresh sale notice on 27.02.2023 fixing auction on 24-O3.2023. Auction was successfully conducted. Consequent to failure of applicant to comply the conditional order, respondent bank confirmed the auction and sale certificate was issued and registered vide Doc.No.3556 of 2023 dated 03.O7.2023. The Respondent Bank afflrms that it has strictly complied with the provisions of the SARFAESI Act and the Rules and accordingly prays for dismissal of the present Securitization Application.

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The respondent no.3 filed reply statement along with list of documents. R3 reiterated the averments made in the reply statement of the Respondent bank that, the borrower, M/s. J.C. Infra, defaulted in repayment, as a result recovery proceedings were initiated against the borrower and its guarantor, j.e., the Applicant. R3 further avers that the Applicant has lost the right of redemption with publication of auction sale notice. As the certificate of sale has been issued in favour of R3 and the same has been duly registered vide Doc. No.3558/2023 dated 03.07.2023, R3 accrued rights over the property. Subsequenuy R3 demolished the house and sold the vacant site to one T. Srinivasulu Reddy vide Doc. No.15976/20 24 dated 27.02.2024. At this stage if auction is set aside great prejudice woutd be caused. Hence the present Securitisation Application is liable to be dismissed with costs.

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Learned counsel for the applicants reported order may be passed based on record. Learned counsel for respondent bank reported no oral arguments but filed written arguments. Heard the arguments of the learned counsel for the 3.d respqndent. perused the /ffi,-a

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Page 5 of 7

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SA No.308/2022

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written arguments filed by^{the respondentbank and perused the} material brought on^record.

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During the course of arguments,^{the learned counselfor the 3'd} respondent auction^{purchaser reiteratedthe version set out in the} reply statement and further^{contended that the applicantfailed to} comply the conditional^{orderspassed by the Tribunal. Thereupon, the} respondent bank confirmed^{the sale and registered sale certificatein} favour of 3'd respondent-auction^{purchaser. Subsequently, 3'd} respondent demolished the^{existing constructionand sold the vacant} site to a third^{party through a registeredsale deed. At this stage, the} applicant is not^{entitledto any reliefand no prejudicecan be caused} to the 3'd respondent and^{subsequent purchaser of the application} schedule^property. with^{these contentions,learned counselsought for} dismissal of the SA^{as devoid of any merits.}

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The points for consideration^{are as follows :} -

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i) Whether the applicant^{made out any valid ground t.o} quash the measures initiated by the^{respondentbank,} inctuding the e-auction^{sale of the applicationschedule} propertY, as PraYed for?

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ii) To what relief?

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Point No.(i):

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Admittedly, the^{Applicant is aguarantor who willingly} mortgaged the Schedule^{property as security, and the present} proceedings have been initiated due to^{the borrower'sfailure to make} payments as per repayment schedule.^{Hence,the action of the} Respondent Bank in^{initiating the SARFAESIproceedingscannotbe} considered as^{illegal or irregular.}

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g.ononehandtheapplicantaverredthatshedidnotreceivethe demand notice,^{and on the otherhand, she stated at page 6 of the} SA pleadings that^{,'Ihe present marketvalue of the DrimarvsecuritY,}

0%,,*

Page 6 of 7

SA No. 308/2022

which is described in the demand notice u/s.13(2) of the SARFAESI Act,2002, is Rs.7,07,60,000/- as per the valuation repoft submitted by the approved panel engineers of the Respondent Bank in Ex.A3 & 44, clearly shows the total liability of the borrowers can be recovered by auctioning the said primary security." The respondent bank got the demand notice published in English and Telugu dailies also. Hence contention of non-service of demand notice cannot be accepted.

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Similarly, applicant averred of non-service of possession notice, however, in the Writ Petition filed by her before the Hon'ble High Court of Telangana challenging the possession notice, the applicant contended that there was a wrong description of the SA Schedule property and that the possession notice was not properly published. However, the Respondent Bank has placed on record^photostat copies of^publication as at page nos.65 and 66 which are not disputed by the applicant. However, Hon'ble High Court gave liberty to the respondent bank to take such steps as is permissible in law for recovery of dues if there is default on the part of the applicant either in filing the securitization application or in making the deposit. The applicant did not comply the conditional order of Hon'ble High Court and hence it proceeded further pursuant to possession notice dated 74.72.2021.

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It is settled principle that the secured creditor has the right to proceed against any property mortgaged in its favour. There is no order of priority or restriction to enforce the primary security first unless there is express contract between the parties. Hence the contention is not acceptable.

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Subsequent to filing the SA challenging the auction sale notice dated 30.09.2022, except impleading the auction purchaser the applicant did not make amendments pertaining to the auction conducted on 24.03.2023 pursuant to sale noticelated 27.02.2023. /,b<rr-r (.r/{*" -

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Page 7 ot 7

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SA No.308/2022

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In the said auction, the 3'd^{respondent emerged as successful bidder,} sale certificate was issued and^{registered in his favour, construction} in the^property was demolished^{and the vacantsite has been sold to} another third^party. At this^{belatedstage, setting aside a successful} auction without there being^{pleadingsand arguments, would not only} be detrimental to the rights^{accrued to the third party, but also} against the due^{procedureof the Court proceedings.Under such} circumstances, it is to be inferred^{that there is no challengelaid} against auction sale conducted^{on 24.03.2023 pursuantto sale notice} dated 27.02.2023.

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In the view of above^{observations,it is held that the applicant} failed to establish^{validgroundsto set aside any of the measures of} the respondent bank^{againstthe SA schedule property including the} possession notice and auction^{proceedingsdated 24'03'2023'} Accordingly SA is^liable to^{be dismissed'}

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Point No.(ii):

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In the result, the^{Securitisation Applicationfails and is hereby} dismissed.

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Consequently, Interlocutory^{Applicationspending,if any, shall} stand closed. No order as to^{costs. communicatea copy of this order} to the^parties concerned^{and upload in the official website'}

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(Typed to my dictation by the^Ps, corrected,^{signed ond pronouncedby me in the opencourt on this the} 26'h doyof Morch,2o26).

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/W,rr\ U/<Y*"\c* (RAMESHWAR KOTHE) PRESIDING OFFICER

Mrs K Vinodini v. Indian Bank

Case brief

What is this about?

What did the court decide?

Mrs K Vinodini v. Indian Bank

Case brief

What is this about?

What did the court decide?

What the court decided

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