Dismissed

Bhagirath Impex and Others v. Axis Bank Ltd. and Others

DRT9 Jan 2026SA/325/2024

Case brief

AI extract

What is this about?

The Tribunal dismissed an application under Section 17 of the SARFAESI Act filed by borrowers seeking to set aside recovery notices and a magistrate's order enforcing possession. The Tribunal held that the notices were duly served, successive Section 14 applications were permissible, and the applicants failed to show substantial prejudice by refusing to pay the admitted dues.

What did the court decide?

Application under Section 17(1) of the SARFAESI Act was dismissed in favour of respondents. Outstanding dues remain admitted and unpaid.

Bhagirath Impex and Others versus Axis Bank Ltd. and Others — Banking and Recovery | DRT (2026)

¶1

DEBTS RECOVERY TRIBUNAL-III, CHANDIGARH

¶2

PRESIDED OVER: SH. MRIDULESH KUMAR SINGH

¶3

SECURITIZATION APPLICATION NO.325/2024

¶4

Date of Institution: 26.08.2024 Date of Decision: 09.01.2026

¶5

Bhagirath Impex, through its proprietor Sh. Raj Kumra Bhagirath at Unit 2157, Street No.4, Basant Naar, Shivpuri, Ludhiana, Punjab 141008

¶6

2^nd Adress: B/2/111, Basant Nagar, Shivpuri Ludhiana, Punjab141008

¶7

Sh. Raj Kumar Bhagirath S/o Sh. Subhash Chand Bhagirath, R/o House No. 2169, Street No.4, Basant Nagar, Shivpuri, Ludhiana, Punjab-141008

¶8

Smt. Preeti W/o Sh. Raj Kumar Bhagirath, R/o House No. 2169, Street No.4, Basant Nagar, Ludhiana, General Post of Shiv Puri, Ludhiana, Punjab-141008

¶9

--Applicants

¶10

Versus

¶11

Axis Bank Ltd., A banking companies incorporated under the provisions of Companies Act and having its registered office at “Trishul”-3^rd Floor Opposite Samartheswar Temple near Law Garden, Ellisbridge, Amhedabad-380006, Corporate Office at “Axis House” Bombay Dyeing Mills Compound, Pandurang Bhudhkar Marg, Worli, Mumbai 4000 and having its Branch Offices throughout India including one Branch Office at Axis Bank Ltd. 105, The Boulevard Mall Road, Ludhiana through its Authorised Officer

¶12

Chief Judicial Magistrate, District Courts, Near Mini Secretariat Ludhiana

¶13

Collector-cum-District Magistrate, Ludhiana, Mini Secretariat, Ludhiana

¶14

--Respondents

¶15

Argued by: Sh. K.K. Goel, Advocate for Applicant (through VC)

¶16

2 SA/325/2024

¶17

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS Sh. Rahul Garg, Advocate for Respondent No. 1 Respondent Nos. 2 & 3 already ex parte vide order dated 13.09.2024

¶18

FINAL ORDER

¶19

(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 set aside demand notice under Section 13(2) of the Act dated 27.01.2022, notice under Section 13(4) of the Act dated 18.05.2022 and order dated 04.07.2024 passed by respondent No.2 (Chief Judicial Magistrate, Ludhiana) being illegal and arbitrary.

¶20

(2) It was stated in the application that applicant Nos.1 & 2 had availed financial assistances from respondent No.1 i.e., Cash Credit Facility of Rs.02 Crores, Working Capital and ECLGS Term Loan of Rs.30 Lacs on 100% Guarantee of NCGTС by mortgaging their two properties; that due to some unavoidable circumstances, applicant Nos. 1 & 2 were not able to pay the loan amount as the business of the applicants came to a low ebb and the accounts of the applicants were declared as NPA on 29.06.2021; that after declaring the accounts as NPA on 29.06.2021 (Loan against Property) SARFAESI proceedings were initiated by the respondent No.1 against the applicants; that respondent No.1 had issued notice under Section 13(2) of the Act dated 27.01.2022 and notice under Section 13(4) of the Act dated 18.05.2022; that thereafter, respondent No.1 had filed an application before the District Magistrate, Ludhiana under Section 14 of the Act for taking the physical possession of the mortgaged properties and the said application was disposed of by the ADC vide order dated 05.04.2023 due to noninsertion of mandatory points as per the Act in the affidavit filed by the Authorised Officer along with the application under Section 14 of the Act; that after return of the application by the ADC, Ludhiana vide order dated 05.04.2023 the respondent No.1 filed another application in the Court of respondent No.2

¶21

¶22

SA/325/2024

¶23

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS under Section 14 of the Act for providing police assistance for taking physical possession of the mortgaged properties of the borrower/mortgager/ guarantor; that Chief Judicial Magistrate again returned the application vide Order dated 21.02.2024, stating therein that since the directions given by ADC, Ludhiana has not been complied with and as there were deficiencies in the application as well as in the affidavit the same cannot be entertained; that after passing of the order dated 21.02.2024 (Annexure A-6) another application was filed under Section 14 of the Act before respondent No.2 by respondent No.1 and this application was allowed by the Chief Judicial Magistrate directing the respondent No.3 to handover the physical possession of the mortgaged properties on or before 18.09.2024; that the action of respondent No.1 in issuance of notices under Section 13(2) & 13(4) of the Act as well as the Order 04.07.2024 passed by respondent No.2 directing the respondent No.3 to hand over the physical possession of the mortgaged properties to the Authorised Officer of the respondent No.1 on or before 18.09.2024 are illegal, arbitrary, malafide and against the provisions of Security Interest (Enforcement) Rules, 2002 (hereinafter referred to as ‘the Rules’ for brevity). Therefore, it was prayed that the present securitization application may kindly be allowed.

¶24

(3) After service of notices upon respondents, respondent No.1 was appeared through counsel and filed reply to SA.

¶25

(4) None was appeared on behalf of respondent Nos. 2 & 3 and no reply was filed on behalf of them. Therefore, respondent Nos. 2 & 3 were proceeded ex parte vide order dated 13.09.2024.

¶26

(5) Reply filed by respondent No.1.

¶27

(6) It was stated in the reply that no cause of action alleged to have been accrued so as to file the present application, therefore applicants does not have any locus standi to file the present application; that applicants had availed financial facilities from respondent No.1 and they were not adhered to pay the loan amount, therefore loan accounts of applicants were classified as NPA in strict compliance of the Rules;

¶28

¶29

SA/325/2024

¶30

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS

¶31

that thereafter, notice under Section 13(2) of the Act dated 27.01.2022 and notice under Section 13(4) of the Act dated 18.05.2022 were issued by respondent No.1 and thereafter, respondent No.1 has moved an application under Section 14 of the Act before District Magistrate and order dated 04.07.2024 was passed by the Chief Judicial Magistrate on the said application; that all the notices under the Act issued by respondent No.1 were served upon applicants as per the provisions of the Act and the Rules. Therefore, the present SA may kindly be dismissed being devoid of any merits. (7) No replication was filed by applicants to the reply filed by respondent No.1.

¶32

(8) I have heard arguments advanced by Sh. K.K. Goel, Advocate for Applicants, who appeared through Video Conferencing and Sh. Rahul Garg, Advocate for Respondent No.1 and gone through the record carefully.

¶33

(9) It was not argued by learned counsel for applicants that notices under Section 13(2) & 13(4) of the Act were not served upon applicants. It was admitted by applicants that they were not able to pay the loan amount as the business of the applicants came to a low ebb, therefore loan accounts of applicants were classified as NPA on 29.06.2021.

¶34

(10) Sh. K.K. Goel, Advocate argued that Chief Judicial Magistrate, while accepting the application under Section 14 of the Act along with affidavit filed by respondent No.1 has given a finding that the respondent No.1 has sought assistance of this Court for taking possession of immovable property at Ludhiana, so this Court has jurisdiction to entertain the present application forgetting that in the affidavit filed along with the application filed under Section 14 of the Act, the jurisdiction has been mentioned for the borrower is at Delhi. It was further argued that respondent No.1 cannot have the jurisdiction unilaterally for filing the application under Section 14 of the Act by stating that the borrower is having jurisdiction at Delhi, whereas, jurisdiction for the bank for initiation of any type of SARFAESI proceeding is at Ludhiana.

¶35

(11) Per contra , Sh. Rahul Garg, Advocate argued that the dispute of jurisdiction has already been put to

¶36

¶37

SA/325/2024

¶38

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS

¶39

rest by Hon’ble Punjab and Haryana High Court vide judgment dated 13.08.2024 (Annexure A-1). Therefore, there is no need to adjudicate the same again.

¶40

(12) Copy of order dated 13.08.2024 is annexed along with SA as Annexure A-1, which shows that applicants had filed CWP before the Hon’ble High Court challenging the finding given by Chief Judicial Magistrate on the application filed by respondent No.1 under Section 14 of the Act. It further reveals from the said order that after hearing the arguments, Hon’ble High Court has directed the applicants to file application under Section 17 of the Act before this Tribunal. (13) Sh. K.K. Goel, Advocate further argued that respondent No.1 had filed application under Section 14 of the Act along with false and improper affidavit and order was passed without recording the satisfaction about the contents of the affidavit.

¶41

(14) Per contra , Sh. Rahul Garg, Advocate argued that proper and complete affidavit has been filed by respondent No.1 along with the application under Section 14 of the Act before District Magistrate concerned. It was further argued that applicants have failed to show any illegality in affidavit filed before CJM, Ludhiana and have fired a blind shot in the air. Therefore, the averments made by the applicants in this regard are without any basis and rationale. (15) Perusal of the order dated 04.07.2024 passed by CJM, Ludhiana (Annexure A-8) shows that the said order is running into 08 pages and a detailed order was passed by the CJM, Ludhiana considering the facts and contents of the application as well as affidavit. It was not argued by learned counsel for applicants that which contention was not recorded by the CJM, Ludhiana. There is nothing on record which can show that the CJM, Ludhiana has not recorded the satisfaction of the contents of the affidavit. Therefore, there is no force in the above argument of Sh. K.K. Goel, Advocate.

¶42

(16) Sh. K.K. Goel, Advocate further argued that Chief Judicial Magistrate, Ludhiana cannot entertain the second and third application under Section 14 of the Act by the respondent No.1 as earlier application was filed by respondent No.1 in the Court of District Magistrate, Ludhiana and the same was returned by the

¶43

6 SA/325/2024

¶44

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS District Magistrate, Ludhiana vide order dated 05.04.2023. It was further argued that in fact, respondent No.1 had filed second and third application under Section 14 of the Act before Chief Judicial Magistrate, Ludhiana instead of District Magistrate, Ludhiana, therefore Chief Judicial Magistrate was required to dismiss the second application straight away by directing the respondent No.1 to file the same before District Magistrate, Ludhiana.

¶45

(17) Per contra , Sh. Rahul Garg, Advocate argued that as per settled law, there is no bar to prefer the application under Section 14 of the Act before the Court of District Magistrate or Chief Judicial Magistrate and it is only prerogative of the financial institution to file the application before either of the two. It was further argued that since, District Magistrate is also to perform other administrative functions, the application under Section 14 of the Act is usually filed before CJM in order to avoid delay in disposal of the same.

¶46

(18) Admittedly, there is no bar to prefer the applications under Section 14 of the Act filed by bank before District Magistrate or Chief Judicial Magistrate. Except it, there is no bar to file successive applications under Section 14 of the Act.

¶47

(19) Sh. K.K. Goel, Advocate further argued that in the application filed by respondent No.1, notice was also issued to Preeti (applicant No.3), who is the guarantor only to the loan/Cash Credit Facility to the tune of Rs. 02 Crores and not for the loan to the tune of Rs. 30 Lacs and in the demand notice under Section 13(2) of the Act aggregate amount includes Rs. 30 Lacs for which the guarantor Preeti is not liable to pay the same as she is neither a signatory nor a privy to the link documents cum amendment agreement.

¶48

(20) Per contra , Sh. Rahul Garg, Advocate argued that ECLGS Facility of Rs. 30 Lacs had only been the extension of the earlier loan facility due to the directions of Finance Ministry during the Covid-19 Pandemic and the said facility had only been granted as a relief package for business units suffering due to the Pandemic. It was further argued that although Central Government had stood as guarantor to repay the said loan facility in the event of default, yet, it does not lie

¶49

¶50

SA/325/2024

¶51

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS in the mouth of the applicants that the same are not liable to pay the said outstanding amount.

¶52

(21) This Tribunal founds force in the above argument of Sh. Rahul Garg, Advocate.

¶53

(22) Sh. K.K. Goel, Advocate further argued that by entertaining the second application filed by respondent No.1 under Section 14 of the Act, tantamounts of reviewing/recalling/modifying the order passed by ADC vide order dated 05.04.2023, while disposing of the application filed under Section 14 of the Act, directions were given for the removal of the deficiencies and for filing the fresh application under Section 14 of the Act but instead of filing the application before the Court of District Magistrate, Ludhiana the respondent No.1 chosen to file second and third application before the Chief Judicial Magistrate, Ludhiana.

¶54

(23) Per contra , Sh. Rahul Garg, Advocate argued that passing of order dated 04.07.2024 by Chief Judicial Magistrate, Ludhiana does not amount to review of order passed by District Magistrate, Ludhiana as the earlier application had not been decided but the same had only been returned with liberty to move afresh after clearing the objections. Therefore, the averments made by the applicants in this regard render hollow and false.

¶55

(24) In the considered opinion of this Tribunal, there is no bar for filing successive applications under Section 14 of the Act and the successive applications may be filed as and when required.

¶56

(25) Sh. K.K. Goel, Advocate further argued that no date and place has been mentioned in the affidavit filed by the Authorised Officer of the respondent No.1 along with the application under Section 14 of the Act. (26) Per contra , Sh. Rahul Garg, Advocate argued that the bare perusal of affidavit filed by respondent No.1 before Chief Judicial Magistrate annexed as Annexure A-7 by the applicants themselves alongwith the present SA would clearly show that the date and place had been duly mentioned in the said affidavit.

¶57

(27) Perusal of the affidavit filed along with application shows that affidavit bears the date “20.05.2024” and place as “Ludhiana” and was duly

¶58

¶59

SA/325/2024

¶60

BHAGIRATH IMPEX AND OTHERS VS. AXIS BANK LTD. AND OTHERS

¶61

signed and attested. Therefore, it is incorrect to say that no date and place was mentioned in the affidavit. No other defect was pointed out in the affidavit, which was filed along with the application under Section 14 of the Act.

¶62

(28) In the SARFAESI Act nowhere it is provided that applicants have any right not to deposit his/her/its outstanding dues i.e., valuable public money.

¶63

(29) Notices under Section 13(2) & 13(4) of the Act were duly served upon applicants as per the above discussion and evidence available on the record. No irregularity or illegality shown in the proceedings initiated under the Act.

¶64

(30) Applicants could not established any substantial prejudice caused to them by the initiation of SARFAESI proceedings. Admittedly, there is outstanding in the loan accounts of applicants and admittedly, they have not deposited the same. It appears that applicants have filed this SA just to create hinderance in the recovery proceedings.

¶65

(31) Considering above facts and circumstances, in the considered opinion of this Tribunal, no case is made out by applicants in their favour. Resultantly, this SA is liable to be dismissed.

¶66

SA is dismissed.

¶67

Record be consigned to record room after due compliance.

¶68

Date: 09.01.2026

¶69

Pronounced by me in the open Tribunal.

¶70

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

Bhagirath Impex and Others v. Axis Bank Ltd. and Others

Case brief

What is this about?

What did the court decide?

Bhagirath Impex and Others v. Axis Bank Ltd. and Others

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

Indusind Bank Limited versus Sh. Mahipal Singh and Others

State Bank of India versus Messrs Khushal Agro Chemicals and Another

Punjab National Bank versus Sh. Harjinder Singh and Another

Union Bank of India versus Sh. Sarabjeet Singh

State Bank of India versus M/S Modish Fashion Wears and Another

State Bank of India versus Messrs Kohinoor Sales and Another