Dismissed

Jikky John v. State Bank of India

DRT27 May 2026SA/323/2025

Case brief

AI extract

What is this about?

The Debt Recovery Tribunal dismissed an application seeking to set aside Relinquishment of Possession proceedings. The court held that the statutory requirements were substantially complied with despite a minor date discrepancy, and the applicants were barred from re-agitating previous contentions and were liable for failing to comply with a Lok Adalath Award.

What did the court decide?

SA No.323/2025 dismissed with no order as to costs.

Jikky John versus State Bank of India — Banking and Recovery | DRT (2026)

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Fair Order

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IN THE DEBTS RECOVERY TRIBUNAL - 1 AT ERNAKULAM

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DATED THIS 27th DAY OF MAY, 2026

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PRESENT: Su. WILLYAHM, B.Sc., M.L. [DISTRICT JUDGE - Retd] PRESIDING OFFICER

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S.A No. 323 of 2025

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Between

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Jikky John, Puthet House, MES School Road, Perinthalmanna P.O. Malappuram – 679 322.

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Thushar V.K., Vellamayil House, Karimba Post, Mannarcaud, Palakkad – 678 597. --- Applicants

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And

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The Authorized Officer, State Bank of India, Palarivattom Branch, Civil Lane Road, Palarivattom, Ernakulam-682 025,

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State Bank of India, Palarivattom Branch, Civil Lane Road, Palarivattom, Ernakulam-682 025,

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Represented by its Branch Manager. --- Defendants

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SA No.323 of 2025

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This Securitization Application coming on 25.03.2026 for final hearing before me in the presence of Mr. P. Shrihari, Counsel for the Applicants and Mr. Tom K. Thomas Counsel for the defendants and upon hearing arguments of learned Counsels for both the parties and upon perusing the material on records, this Tribunal delivered the following:

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O R D E R

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This Securitisation Application was filed on 15.05.2025 seeking to set aside Annexure-A2 application, A3 affidavit, A4 order and A5 notice issued by the Advocate Commissioner and restore possession and to order costs and compensation to the applicants.

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The applicants availed credit facility to the tune of Rs.1.22 Crores from the 2nd defendant bank upon creation of equitable mortgage over the immovable property of the 2nd applicant as described in the letter of confirmation for creation of mortgage by deposit of title deed dated 09.03.2016 and agreement to mortgage dated 21.01.2016, which has been produced by the defendants along with memo in ID No.22234/25.

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Due to default in repayment of the outstanding loan due, the loan account of the applicants came to be classified as Nonperforming Asset. Demand notice and possession notice were issued as evidenced from perusal of Annexure-A1 final order passed by this Tribunal in SA No.136/2021 which was filed by the applicants herein challenging the aforesaid measures. Final order dated 17.01.2024 was passed by this Tribunal dismissing the above SA.

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In the meanwhile, the defendants approached the Chief Judicial Magistrate Court Palakkad and filed Annexure-A2 application and A3 affidavit under Section 14 (1) of the SARFAESI Act, 2002. AnnexureA4 Order dated 22.02.2025 came to be passed in MC No.113/25 appointing Advocate Commissioner for taking physical possession of the secured asset. The Advocate Commissioner issued Annexure-A5 notice dated 02.05.2025 to the applicant and the guarantor informing them that he would take physical possession of the secured asset within 15 days from the date of issuance of the notice. The applicants having aggrieved against the above measures filed this SA seeking for the reliefs stated supra.

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The counsel appearing for the applicants submitted that secured asset is agricultural property and that there is no valid and legally recoverable debt due from the applicants and that no valid security interest has been registered with the Central Registry and that hence issuance of demand notice, possession notice and measures u/s 14 (1) of the SARFAESI Act 2002 are per se illegal.

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Page 2 of 7

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SA No.323 of 2025

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The counsel appearing for the applicants submitted further that application u/s 14 of the SARFAESI Act 2002 can be filed only by the secured creditor in its writing and that such an application shall be supported by an affidavit duly sworn by the Authorized Officer of the secured creditor and that Annexure-A2 application was filed by Beena K., who is said to be the Authorized Officer and that hence AnnexureA2 application and A3 affidavit are illegal. The amounts stated as outstanding in Annexure-A2 and A3 affidavit are not correct. Annexure-A3 is also invalid as there is infraction of Clause (vii) and (viii) to the first proviso to Sec. 14 (1) of the SARFAESI Act 2002 the learned Chief Judicial Magistrate, Palakkad without verifying the veracity of the declarations in Annexure-A3 affidavit and the documents and without satisfying over the same, passed Annexure-A4 order. Hence, Annexure-A2 to A5 are liable to be set aside. Therefore, the S.A may be allowed as prayed for.

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The counsel appearing for the defendants submitted that the security interest over the secured asset has been registered with the Central Registry as per Annexure-B1 and that valid security interest has been created over the 2nd applicant’s property by deposit of title deeds as per letter of confirmation for creation of mortgage by deposit of title deed dated 09.03.2016 and that this Tribunal has held in its final order Annexure-A1 passed in SA No.136/2021 that secured asset is not agricultural property and that therefore the applicants are estopped from re-agitating the very same issue in this SA.

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The counsel appearing for the defendants submitted further that all the details envisaged u/s 14 (1) of the SARFAESI Act 2002 has been complied with by the defendant in respect of filing of AnnexureA2 application and A3 affidavit and that the learned Chief Judicial Magistrate, Palakkad upon due satisfaction of the statutory requirements and after verification of the affidavit and supporting documents, passed Annexure-A4 order which is perfectly valid and that since the terms of the Award passed in the Lok Adalath held on 19.07.2025 was not complied with by the applicants, they cannot be permitted to invoke the jurisdiction of this Tribunal u/s 17 (1) of the SARFAESI Act 2002 and that therefore, SA may be dismissed with cost to the defendants.

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The applicants filed SA No.136/2021 against the defendants herein challenging Annexure-A1 demand notice and A4 possession notice. The applicants had raised various contentions with regard to the illegality in classification of the loan account as Non-Performing Asset, issuance of demand notice and possession notice. They had also contended that secured asset is an agricultural property and that description of the property in Annexure-A1 demand notice is incorrect. This Tribunal after having heard both sides’ counsels and after having

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Page 3 of 7

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SA No.323 of 2025

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perused the material on record, passed final Annexure-A1 final order dismissing the above S.A. Therefore, the above contentions which has been raised now in the present S.A are untenable.

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The defendants have produced Annexure-B1, copy of Asset ID Based search report. A perusal of the same shows that the security interest over the secured asset was registered with the Central Registry on 15.03.2016.

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Annexure-A2 application has been filed by the 2nd defendant which is the secured creditor through its Authorized Officer by name Ms.Beena K., who has been designated as the Chief Manager of the secured creditor. In the cause title of Annexure-A2 it is clearly stated that the petitioner bank is represented by its Authorized Officer/Chief Manager. Annexure-A3 affidavit has been filed by the same person, namely Ms.Beena K., who is the Authorized Officer of the 2nd defendant, which is the secured creditor. In paragraph 1 of the affidavit, it is clearly stated that she is the Authorized Officer of the petitioner Bank and is competent to swear to this affidavit on behalf of the petitioner.

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There is no dispute that the same person namely Ms. Beena K. has filed Annexure-A2 application and Annexure-A3 affidavit in MC No.113/2025 before the Chief Judicial Magistrate Court, Palakkad. The provision of Sec. 13 (2) of the SARFAESI Act 2002 reads that the rights of a secured creditor under this Act may be exercised by one or more of its officers authorized in its behalf in such manner as may be prescribed. Rule 2 (a) of Security Interest (Enforcement) Rules 2002 defines the Authorized Officer as an Officer not less than a Chief Manager of a Public Sector bank or equivalent as specified by the Board of Directors of Board of Trustees of the secured creditor or any other person or authority exercising powers of Superintendents, direction and control of the business or affairs of the secured creditor, as the case may be, to exercise the rights of a secured creditor under the Act. In the present case on hand, a perusal of Annexure-A2 and A3 shows that the Chief Manager of the 2nd defendant namely, Ms.Beena K. has been duly authorized to act as the Authorized Officer. Therefore, this Tribunal does not find any force in the above submission of the counsel for the applicants and holds that AnnexureA2 application and A3 affidavit are perfectly valid and legal.

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The applicants have not specifically pointed out in the SA as to how the outstanding amount mentioned in Annexure-A2 and A3 is not correct. The applicants having availed credit facilities upon execution of loan documents and creation of the security interest over the immovable property is estopped from contending now that the amount mentioned in Annexure-A2 and A3 are not legally recoverable debt.

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Page 4 of 7

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SA No.323 of 2025

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A perusal of Annexure-A3 affidavit shows that all the statutory requirements contemplated has been complied with except Clause (i) to the first proviso of Sec. 14 (1) of the SARFAESI Act 2002 strictly. The counsel appearing for the applicants submitted that the date of outstanding amount is mentioned as 22.10.2024 in Annexure-A3 affidavit and that but the date of filing of Annexure-A3 is mentioned as 01.11.2024 and that therefore, the above Clause has been violated.

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Indisputably, in paragraph 2 of Annexure-A3 it is mentioned as “the amount due as on 20.10.2024 ……” But the date of filing of Annexure-A3 is mentioned as the first day of November, 2024. In Tulsi Rocks Pvt. Ltd. and ors. Vs. Bank of India, [MANU/TL/0034/2019] the Hon'ble High Court of State of Telungana has held as follows:

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“While reiterating our finding that all the ingredients of Clauses (i) to (ix) of the first proviso to Section 14 (1) of the Act find a place in the affidavit of the authorized officer filed in support of the application under Section 14 of the Act, we would also add that in case of this nature, a substantial compliance would be sufficient. As pointed out by the Supreme Court in Commissioner of Central Excise V. Mrs.Harichand Shri Gopal MANU/SC /0955/2010: 2010 (260) ELT 3 (SC), the Courts have always invoked the doctrine of ‘substantial compliance’, to avoid hardship in cases where a party does all that can reasonably be expected of it, but failed or faulted in some minor or inconsequent aspects which cannot be described as the essence or the substance of the requirements. The Supreme Court pointed out in the said case that the Court should determine whether the Statute has been followed sufficiently so as to carry out the intent for which the statute was enacted and not a mirror image type of strict compliance.

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“wherever this Court finds that the parameters indicated in Clauses (i) to (ix) of the first proviso to Section 14 (1) of the Act are broadly complied with, the Court is bound to invoke the doctrine of ‘substantial compliance.’ It must be remembered that Clauses (i) to (ix) of the first proviso to Section 14 (1) of the Act merely provide the form in which the essential averments for an application under Section 14 of the Act are to be made. Therefore, what is important, is the substance and not the form.”

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The applicants have not pleaded in the S.A as to what prejudice was caused to them due to mentioning two different dates with regard to amount due and filing of affidavit. The learned Chief Judicial Magistrate, Palakkad while perusing Annexure-A3 would have noticed the above discrepancy. Yet he passed order on compliance of Clauses

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Page 5 of 7

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SA No.323 of 2025

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(i) to (ix) to the provisions of Section 14 (1) of the SARFAESI Act 2002. In the light of the dictum laid down in the above cited judgment, this Tribunal holds that since there is substantial compliance of the statutory requirements contemplated under Clauses (i) to (ix) to the provisions of Section 14 (1) of the SARFAESI Act 2002, the mere mentioning of the two different dates in respect of outstanding amount and filing of Annexure-A3 affidavit would not render Annexure-A3 invalid. A perusal of Annexure-A4 order shows that the learned Chief Judicial Magistrate Court, Palakkad after having perused the contents of the affidavit and the documents filed in support of the affidavit and having satisfied over the same, passed order appointing Advocate Commissioner to take physical possession of the secured asset. This Tribunal does not find any infirmity or procedural irregularity in the above order.

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Above all, the applicants failed to comply with the terms of the Award passed in the Lok Adalath held on 19.07.2025. Copy of the Award has been produced by the defendants along with ID No.21424/25. The applicants have agreed to pay a sum of Rs.2,85,00,000/- to the 2nd respondent bank on or before 30.08.2025 and the balance amount of Rs.2,28,00,000/- on or before 19.10.2025. The applicants have also agreed for sale of the properties in case they failed to comply with the above terms of the Award. On this ground alone, the SA is liable to be dismissed.

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In any event, the applicants have failed to prove their case so as to get the reliefs sought for in the SA. In view of the foregoing reasons, this Tribunal holds that the applicants are not entitled to get the reliefs sought for in this SA.

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Resultantly, S.A No.323/2025 stands dismissed. However, there shall be no order as to costs.

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Dictated to Steno, taken down, transcribed, typed by him, corrected and pronounced by me in the open court on this the 27^th day of May, 2026.

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(Su. WILLYAHM) PRESIDING OFFICER

Mj/

Page 6 of 7

SA No.323 of 2025

List of documents filed by the Applicants along with the S.A.

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Sl. No.	Date	Particulars
1.	17.01.2024	True copy of the final order in SA No.136/2021.	Annexure-A1
2.	01.11.2024	True copy of application numbered as MC No.113/2025 on the file of CJM Palakkad.	Annexure-A2
3.	01.11.2024	True copy of affidavit numbered as MC No.113/2025 on the file of CJM Palakkad.	Annexure-A3
4.	22.02.2025	True copy of the order in MC No.113/2025 on the file of CJM Palakkad.	Annexure-A4
5.	02.05.2025	True copy of notice issued by Advocate Commissioner	Annexure-A5
6.	17.04.2021	True copy of certificate issued by the Agricultural Officer, Krishi Bhavan, Karimbavillage.	Annexure-A6

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List of documents filed by the defendants along with the written statement

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Sl.	Date	Particulars
No.
1.	---	True copy of the registration certificate issued by the Central Registry.	Annexure-B1
2.	21.01.2025	True copy of letter of arrangement duly signed by the defendants.	Annexure-B2

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(Su. WILLYAHM) PRESIDING OFFICER

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Mj/

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Page 7 of 7

Jikky John v. State Bank of India

Case brief

What is this about?

What did the court decide?

Jikky John v. State Bank of India

Case brief

What is this about?

What did the court decide?

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