Dismissed

Mrs. Saroj Verma v. the Baghat Urban Co. Operative Bank Ltd.

DRT27 Jan 2026SA/356/2025

Case brief

AI extract

What is this about?

This judgment dismisses a Securitization Application challenging a possession notice under the SARFAESI Act. The court upheld the Bank's action, ruling that documents established the Applicant as a surety with a security interest in the property, validating the enforcement proceedings.

What did the court decide?

Securitization Application dismissed as the Bank was entitled to enforce the security interest on the property.

Mrs. Saroj Verma versus the Baghat Urban Co. Operative Bank Ltd. — Banking and Recovery | DRT (2026)

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SA No.356/2025

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DEBTS RECOVERY TRIBUNAL-I, CHANDIGARH

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SA/356/2025 MRS. SAROJ VERMA

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Vs.

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THE BAGHAT URBAN CO-OPERATIVE BANK LIMITED AND ANOTHER

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27.01.2026

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Supplementary Item No.2

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Argued by: Mr. I.P. Singh, Counsel for the Applicant.

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Mr. Yogesh Jain, Counsel for respondent No.1/Bank along with Mr. Ajay Thakur, Authorized Officer of Bank/in person. None for respondent No.2.

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Mrs. Saroj Verma (Applicant) has filed this Securitization Application under Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), against The Baghat Urban Co-operative Bank Limited and another (Respondents).

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Vide sanction letter dated 23.05.2013, the Bank had sanctioned a C.C. limit of Rs.40.00 lacs to Surinder Singh Verma. Applicant, who is the mother of Surinder Singh Verma, had stood surety for the same. Again, on 11.12.2018, the Bank had sanctioned a Term Loan of Rs.35.00 lacs to Surinder Singh Verma (respondent No.2). For both these loans, the Applicant had stood surety and had created a security interest in respect of land and building measuring 180 sq. mtrs., comprised in Khata/Khatauni No.249, Min/460 Khasra No.1877/497, situated at Mohal 100104 Ser, Hadbast No.45, Tehsil and District Solan, Himachal Pradesh . Surinder Singh Verma had also executed a letter dated 01.06.2013, stating that the Bank may keep the securities in its possession. It appears that the Applicant and respondent No.2 made defaults and the Bank wrote a letter to the Applicant and respondent No.2, which was received by them on

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SA No.356/2025

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07.08.2013, stating that a sum of Rs.40,63,570/- was due in the C.C. limit of Rs.40.00 lacs. Again, a letter was written on 25.11.2013, to the Applicant and respondent No.2 stating that a sum of Rs.1,80,277/- was the overdue amount. On 27.01.2014, the Bank, through its counsel, issued a notice stating that a sum of Rs.42,77,870/- was due from the Applicant and respondent No.2 along with interest. On 05.12.2019, again a demand notice was issued in respect of the loan account of Rs.40.00 lacs and on 31.05.2019, a demand notice in respect of the loan account of Rs.35.00 lacs was issued. On 20.07.2019, again a notice was issued. On 15.09.2021, the Bank issued a notice to the Applicant and respondent No.2 in respect of the loan of Rs.35.00 lacs. The Applicant had earlier filed SA No.127 of 2022. However, the Applicant had withdrawn the same on 16.10.2024, as the counsel for the respondent Bank had made a statement at the Bar that the Bank would reinitiate the SARFAESI action in this case.

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With this background, I come to the present SA i.e. SA No.356 of 2025, which was filed on 27.11.2025. Applicant in the present SA has challenged the notice dated 28.10.2025 issued by the Bank under Section 13(4) on the basis of the order dated 14.10.2025 passed by the D.M. under Section 14. The Applicant has again challenged the notice dated 17.11.2025 issued by the Tehsildar to take the physical possession on 01.12.2025. The Applicant has alleged that the Bank had earlier initiated SARFAESI action and had obtained the order dated 06.09.2021 from the D.M., Solan under Section 14. The Applicant had filed SA No.127 of 2022, which was disposed of vide order dated 16.10.2024, as the counsel for the Bank stated that it would initiate fresh SARFAESI action. It is alleged that on 02.01.2025, the Bank had issued the notice under Section 13(2). On 03.03.2025, the Applicant had filed objections. On 10.03.2025, the Bank

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SA No.356/2025

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had sent a reply to the objections through Mr. Yogesh Jain, Advocate. As a rule, the objections should have been decided by the authorized officer. In fact, the Applicant had never created any security interest in respect of any loan taken by respondent No.2. Further, respondent No.1 (Bank) had filed an affidavit under Section 14 for police help. The averments in the said application and the affidavit are false. In fact, respondent No.1 falsely alleged in the application under Section 14 that the Applicant had not filed any objections to the notice under Section 13(2). The Applicant has alleged that she had filed objections before the District Magistrate pointing out the false averments in the application under Section 14. The District Magistrate had sought an explanation from the Bank. On 30.06.2025, the Bank had filed a reply before the District Magistrate along with the affidavit of Raj Kumar dated 01.07.2025. The Bank admitted that the Applicant had submitted objections on 03.03.2025. However, on 14.10.2025, the District Magistrate passed the order under Section 14. The Bank has produced on record a mortgage deed dated 29.05.2013. However, the mortgage deed dated 29.05.2013 does not pertain to the loan given by the Bank to respondent No.2. In fact, the Applicant had never created any security interest in favour of the Bank. Accordingly, the D.M. could not have passed any order under Section 14. In fact, the mortgage deed dated 29.05.2013 was registered in the office of the Sub Registrar, Solan on 31.05.2013. This mortgage-deed pertains to the loan of Rs.40.00 lacs granted by the Bank to Mrs. Saroj Verma. However, the Bank did not produce on record any mortgage deed in respect of the loan of Rs.40.00 lacs to the Applicant, as mentioned in the mortgage-deed. It is stated that Bank has committed a fraud. Further, the property was joint. The Applicant had sold a part of the property to Smt. Priksha Chandel vide sale deed dated 01.10.2015, who had mortgaged the same in favour of the Bank vide mortgage deed dated

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SA No.356/2025

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05.11.2015. It is alleged that in case this property had been mortgaged by the Applicant in the year 2013 in favour of the Bank, she could not have sold the same to Smt. Priksha Chandel, who also could not have mortgaged the same in the year 2015 to the Bank. Again, the Applicant had sold a portion of the property to Smt. Sunita vide sale deed dated 12.01.2022. The property consists of five floors and a basement. The first floor was sold on 03.10.2015 to Smt. Pariksha Chandel. The second floor was sold on 13.01.2022 to Smt. Sunita. On the third floor, the Applicant is residing. On the fourth floor, there are tenants. On the fifth floor, there is a medical store and there are other tenants. The Tehsildar did not serve any notice to them. On these facts, the Applicant has alleged that the possession notice be set aside.

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The Bank, in reply, has denied the facts mentioned in the application and alleged that, in fact, the Bank had sanctioned two loans to Surinder Singh Verma (respondent No.2) for Rs.40.00 lacs and Rs.35.00 lacs. To secure the same, the Applicant had created security interest in respect of the property in question. The Applicant had sought permission from the Bank to release a portion of the property, which was granted by the Bank, and in these circumstances, the Applicant cannot be heard to say that the property was not mortgaged by her for the loan of Surinder Singh Verma.

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Mr. I.P. Singh, counsel for the Applicant, argued that the entire action of the Bank is null and void. The Bank obtained the order under Section 14 of the SARFAESI Act from the D.M. by misstating the facts. The Bank, in the application under Section 14 of the SARFAESI Act filed before the D.M., alleged that the Applicant had not filed any objections to the notice dated 02.01.2025 issued under Section 13(2) of the SARFAESI

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SA No.356/2025

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Act. In fact, the Applicant had filed objections on 03.03.2025 and the Bank had rejected the same on 10.03.2025. The Bank misstated the facts before the D.M. that the Applicant had not filed any objections. However, later on, a fresh affidavit was filed stating the facts and on the basis of the same, the D.M. granted permission. Mr. I.P. Singh submitted that the Applicant had never mortgaged the property in the loan account of Surinder Singh Verma. In these circumstances, the Bank cannot enforce the security interest in respect of the property of the Applicant for the loan of Surinder Singh Verma. Accordingly, the SARFAESI action be set aside.

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Per contra , Mr. Yogesh Jain, counsel for the respondent Bank, argued that the Bank has produced on record a sanction letter dated 16.01.2012 vide which a loan of Rs.15.00 lacs was sanctioned to the Applicant and Surinder Singh Verma (Annexure R-9). The Applicant had created a security interest in respect of this very property. On 23.01.2012, the Bank registered the charge with the SDM in respect of this property and an entry was also made in the Jamabandi. Later, the Applicant had stood surety for the two loans of Surinder Singh Verma for Rs.40.00 Lacs and Rs.35.00 Lacs and created the mortgage in respect of this property. The Applicant has unnecessarily raised an issue. Mr. Jain argued that though the Applicant is a guarantor and mortgagor, yet for all intents and purposes of the SARFAESI Act, she is a borrower. In case she has been addressed as a borrower in any document, that does not mean that she is not liable at all. Mr. Jain admitted that though in the application under Section 14 of the SARFAESI Act before the D.M., the Bank inadvertently stated that the Applicant had not filed objections, however, later a fresh affidavit was filed stating the true facts and on that basis the D.M. granted permission. Mr. Jain submitted that the Applicant had earlier also filed SA No.127 of 2022,

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SA No.356/2025

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in which she had never raised the issue that she had not mortgaged the property for the loan of Surinder Singh Verma. Mr. Jain submitted that there is no merit in the SA and the same be dismissed.

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I have considered the rival contentions.

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The Bank has produced on record a copy of the letter dated 23.05.2013 stating that the Bank had sanctioned a loan of Rs.40.00 lacs to Surinder Singh Verma and the Applicant had stood surety for the same. She had created a security interest in respect of the land in question. The Bank has again produced on record a letter dated 11.12.2018 stating that the Bank had sanctioned a loan of Rs.35.00 lacs to Surinder Singh Verma, for which the Applicant had stood surety and had created a security interest in respect of the land in question. The Bank has also produced on record a letter of lien dated 01.06.2013 signed by the Applicant and a copy of the agreement dated 01.06.2013 signed by the Applicant in respect of the loan of Rs.40.00 lacs. There is a letter by Surinder Singh Verma to the Bank dated 30.03.2019 for the loan of Rs.35.00 lacs and a term loan agreement dated 30.03.2019. There is a document dated 30.03.2019 signed by the Applicant and Kapil Mohan Bhasin stating that they would be the guarantors. Again, there is an agreement signed by the Applicant for this loan. The Bank has produced on record notices issued by the Bank to respondent No.2 and the Applicant to make the payments. Again, there are notices dated 25.11.2013, 27.01.2014, 05.12.2019, 31.05.2019, 20.07.2019 and 15.09.2021. From all these documents, it is apparently clear that the Bank had sanctioned the loans to Surinder Singh Verma and the Applicant had stood surety and had also created a security interest in respect of the property in question. The Bank may have made some mistakes in making certain averments before

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SA No.356/2025

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the D.M. in the application under Section 14 of the SARFAESI Act. However, the District Magistrate, after obtaining the fresh affidavit from the Bank, passed the order. I am of the considered view that there is no merit in the present SA and the same is hereby dismissed . It is admitted that the Bank has already taken possession.

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Registrar is directed to send a copy of this order to all the parties, as per rule. File be consigned to record room after due compliance.

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(A S Narang) Presiding Officer DRT-I, Chandigarh

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Pronounced in open court Dated; 27.01.2026 PANKAJ

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Mrs. Saroj Verma v. the Baghat Urban Co. Operative Bank Ltd.

Case brief

What is this about?

What did the court decide?

Mrs. Saroj Verma v. the Baghat Urban Co. Operative Bank Ltd.

Case brief

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What did the court decide?

What the court decided

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