Allowed

S Pushpa Reddy v. Uco Bank

DRT16 Mar 2026SA/359/2024

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed the Securitization Application, setting aside the bank's possession notice issued under the SARFAESI Act. The court held the applicant was an aggrieved person and the application was not barred by limitation. It restrained the bank from interfering with the property pending the outcome of the civil title suit.

What did the court decide?

Possession notice dated 10.01.2017 under Section 13(4) of the SARFAESI Act is set aside, and the bank is restrained from interfering with the applicant's possession.

S Pushpa Reddy versus Uco Bank — Banking and Recovery | DRT (2026)

¶1

IN THE DEBTS RECOVERY^{TRIBUNAL_ II AT HYDERABAD}

¶2

DATED THIS THE 16th^{DAY OF MARCH,2026}

¶3

PRESENT: SH. RAIVIESHWAR^{KOTHE,B.COM, L.LB. (HONS.), M.A.} PRESIDING OFFICER

¶4

Securitization Application^{No. 359 OF 2024}

¶5

s. Pushpa Reddy

¶6

w/o. Late S. Bhaskar^Reddy R/o. H. No.17- 1-386/5N/5 Besides S.N. Reddy Gardens, Sagar Road, ChamPaPet, Saidabad, Hyderabad^{- 500060}

¶7

.......Applica nt.

¶8

Versus

¶9

UCO Bank

¶10

S.D. Road Branch 9- 1-38, YN4CA^ComPlex, Sardarpatel Road, Secu nderabad^-500003

¶11

S. Na ren Reddy

¶12

S/o. S. Bhaskar^Reddy R/o.9-1-386/5N/10

¶13

Champapet,^{PR District.}

¶14

V Sreepadh^Viswakarma S/o. Late Bammaraya Rlo. C-L92lA, Srinilaya^TownshiP BadangPet, Kanchanbagh Hyderabad

¶15

.....Respondents

¶16

: Mr. G. Dinesh^Kumar Counsel for the^APPlicant : Mr. N.V. Pruthvi^Raiu Counsel for^{Res7ondentNo.1} Counsel for^{Res7ondentNo'2} : Mr. G.V.N.^Babu Counsel for^{ResPondent No.i} : Ex-parte

¶17

-: Q_B_qgB:-

¶18

The present Securitlzation^{Application is Rled by the Applicants} uls.t7 of the^{securitisationand Reconstructionof FlnanclalAssets} 46*

¶19

PaSe 2 of 10

¶20

sA No. 359/2024

¶21

and Enforcement of Security Interest Act, 2002 (,.Act,, hereinafter for short) to declare the possession notice dated 70.O7.2077 issued by the respondent bank under section 13(4) of the Act against the SA schedule property as illegal, contrary to law and against the provisions of the Act; and to declare that the respondent bank has no security interest over the application schedule property.

¶22

The averments of the application, briefly, are that the applicant is neither borrower nor guarantor. She is the absolute owner and possessor of application schedule property by virtue of Registered Gift Deed Doc No.3861/2001 dated 04.11.2004 executed by her tate husband lvlr. S. Bhaskar Reddy, during his lifetime. Respondent Bank No.1 served possession notice dated 10.01.2017 against the property stating that it has mortgage rights. Aggrieved by the action, appticant filed WP No.3362/20L7 and as per liberty granted by the Hon,ble High Court of Andhra^pradesh, she subsequently filed Civil Suit OS No.108/2018 before learned XXVI ACj, CCC, Hyderabad. Though injunction was granted by the learned Civil Court, upon filing of IA No.55712019 by the respondent bank, learned Civil Court disposed of the matter with an observation that the appropriate forum would be DRT in respect of SARFAESI measures. Thereupon, present applicant is filed. The respondent Bank has no 'secured debt, or ,security interest'over the schedule property within the definition given u/s. 2 (ze) and (zf) SARFAESI Act, as no charge subsists against the gifted property; Respondents Nos.2 & 3 had right over the property to create mortgage. Hence this SA.

¶23

The respondent bank filed reply statement along with documents. The averments thereof, briefly, are that the application is beyond the limitation period even after taking into consideration the exemption as per Sec.14 of the Limitatioq_Act. The Tribunal vide

ffi*tt'

Page 3 of 10

5A No. 359/2024

orders ln OA 3433/2077^{already upheld the rightsof the respondent} bank over the^{subject property by virtue of sale deed depositedvide} MODT No.862/2015.^{Declarationof title in Sec 17 applicationis} beyond the^{jurisdiction of the Tribunal. However, the respective} properties under the Gift Deed and^{13(4) notice are independent to} each other which^{is evident by extent of land as well as built up area,} number of floors and^{boundariesespecially the West boundary} showing Pushpa^{Reddy's property. Respondent Bank issueddemand} notice dated 25.10.2016^{uls t3(2) followedby possession noticeThe} SA is fited in connivance^{withrespondents 2 and 3' Hence SA is liable} for dismlssal.

¶28

Respondent No.2 also filed^{reply statement slating, inter-alia,} that he is not a^{necessary partyfor effective adjudication of theSA} The title dispute is^{pending beforethe Civil Court being appropriate} Forum. S. Bhaskar^{Reddy who executed registeredGift Deed expired} on 20.05.2021.^{The Applicant's grievancesarise solely from alleged} unlawful actions of^{UCO Bank, with nod irect/conseq uentia I relief} against R2. Power^{to decide disputes touching title, ownership'} possession and civil rights in^{immovablepropertyvest exclusively} with civil courts, as^{SARFAESIproceedingscannot override or} prejudice title disputes^{pending in o.s' No.108/2018 before city civil} Court, Hyderabad.^{The same may be consideredwhile examining the} SA.

¶29

Summons served on^{respondentno 3, set ex-parteon} 18.06.2025 as^{called absent and no representatlon'}

¶30

Heard the arg^{u ments} of the learned^{counsel for the applicant,} learned counsel^{for the} resoondent hank and^{respondentno 2'}

¶31

Page 4 of 10

¶32

SA No.3S9l2O24

¶33

Perused the written

¶34

arguments filed by the applicant and the respondent bank and a lso perused the material brought on record.

¶35

During the course of arguments, learned counsel for the applicant contended that on having knowledge of Bank,s measures, the applicant approached the Hon,be High Court by filing W.p. No.3362/2017) and as per liberty granted in the Wp, the appticant filed O.S. No.108/2018 with LA. No.206/2018 wherein temporary injunction dated 25.04.2018 was initially granted and later on vacated on 14.08.2024 with liberty to approach DRT. pursuant thereto the present SA was filed wjthin 10 days i.e., on 24.0g.2024. Hence the SA is filed well within time. The applicant avers limitation period is exempted under sectjon 14 of the timitation Act, 1963. Learned counsel relied on Hon,ble Supreme Court iuctgment in Dwarika Prasad (D) THR. LRs v. prithviraj Singh [2024 INSC 7O3Oj wherein vide para 12 hetd that ,,there is no separate application for condonation of delay in the present case as well. The High court has erred in taking a hyper technical view and conctuding that there was violation of mandatory provision of law. Endorsing such a view would effectively mean ignoring the purpose of Judicial procedure. The procedure cannot stand in the way of achieving just and fair outcome. In the present case, the appellant acted bonafide and diligently. His conduct does not violate any rule of law.,,l and submitted that the said principle is squarely applicable to the applicant's case.

¶36

Learned counsel for applicant further submitted that the identity and ti e of the property are already the subject mafter of adjudication in o.s. No.108/2018 pending before the tearned xxvl ACJ, City Civil Court, Hyderabad, and the same is still sub iudl.ce. It is settled position of law that Civil Courts reta iq ju risdiction to decide ffi*"

¶37

Page 5 of¹⁰

¶38

sA No. 359/2024

¶39

questions of title and^{propertyidentity'The SupremeCourt of Indla} has repeatedly^{held that disputes relatingto title, ownership and civil} rights are within^{the domain of the Civil CourtTherefore'the} Respondents cannot^{circumventthe Applicant'ssubstantive rightsby} resorting to coercive^{proceedings. Learnedcounsel relied on the} recent^{judgementot Hon'ble Apex Court in Central Bank of India} v. Smt. Prabha Jain,^{(2025 SCc Online Sc 727)' holding that} Civil Courts^{retain jurisdictionover property ownershipdisputes' even} during Securitisation^{and Reconstruction of FinancialAssetsand} Enforcement of^{SecurityInterest (SARFAESI)proceedingsHe further} contended that^{the Respondent Bankis claimingrights overcertain} property on the strength^{of a Partition Deeddated 18 11'2013' The} title and^{possession over Schedule ItemNo 1 property have never} been specifically^{disputed by Respondent No'1 rather ithas} categorically^{admittedthat the Applicant'spropertyis distinct and} separate^{from the borrower's property and that it has no intention to} interfere with^{the Applicant's propertyWith the above contentions'} learned counsel^{sought to set aside all the measuresof the} respondent bank^{with a direction not to take up any action duringlls} before the^{learned Civil Court'}

¶40

In reiteration of^{avermentsof reply statement'learned counsel} for the 1st Respondent^{Bank contended that the applicant kept quite} when the^{possessionnotice was issued on 1O'012017;and she failed} to establish^{the main ingredients under Sec'14 of the Limitation Act} i.e., she was^{prosecutingher case with due diligence' proceedings} against^{same parties and for same relief, defectivejurisdictionetc'} slnce the relief^{sought before Hon'ble High Court and the Civil Court} ls wlth regard^{to tile and not SARFAESIactionThe learned Civil Court} dismlssed the^{IA on the groundthat DRT has jurisdictionwith regard} to the relief against^{SARFAESIaction and not wit[regardto title The} Nv*

¶41

page 6 of 10

¶42

SA No.359/2024

¶43

applicant has not filed any formal application for condonation of delay of 94 days'delay in filing the sec.17 apprication. Reriance praced on judgment of Hon'bre patna High court in Narain Das vs. Banarasi Lat and ors" ArR 7970 pAT 50' Learned counser further asserted that the Appricant's property is distinct from the mortgaged asset of the bank and hence the applicant is not the ,,aggrieved person,, as defined u/s 17 0f the Act and has no rocus standito question the measures of the bank against borrower,s property. He also said, the mortgage rights of the bank have been confirmed by the Tribunar vide order passed in OA No.3422/ZOl7. With these submissions, Iearned counsel sought for dismissal of the SA with exemplary costs.

¶44

10' Learned counsel for the 2nd respondent also reiterated the version as in the repry statement thau he has unnecessarily been included as party in this SA, the power to d( title, ownership, possession and civit rights ; [::::# ff:ff vest exclusively with Civil Courts; SARFAESI proceedings cannot override or prejudice tiUe disputes pending in O.S. No.108/2018 before Ci., Civil Court, Hyderabad. With these submissions, learned counsel prays to consider the same while adjudicating the SA.

¶45

The points for consideration are as follows ; _

¶46

i) whether the securitisation Apprication is within rimitation? ii) Whether the applicant i1 .1n qOOrieved person within the meanins of section 17 of the eihiiLTt nro

¶47

iii)Whether the D-?s::s.:ion notice issued by the respondent l:i:*,! respect or tne appiiJJni:, o-rZi.n, is sustainabte

¶48

iv) Whether the pendency of civit proceedir affects the ta'n*,s seiraeit urli"rl:],,,9s regarding titte

¶49

v) ro what extent? OY,*O

OY,*O

Page 7 of 10

SA No. 359/2024

Point No.( i):

It is evident from the record that the applicant had initially approached the High court by filing wP No.3362 of 2017 against the SARFAESI action initiated by the 1't respondent bank basing on^her claim over the^property settled in her favour by her husband under a registered settlement deed dated 04.17.2004. Hon'ble High Court vide order dated 06.12.2017 disposed of the WP granting liberty to approach the competent civil court for adjudication of the dispute. It is pertinent to note the observations of Hon'ble High Court while making reference to the^judgment in D. Ram Reddy v. M/s Asset Reconstruction Company (India) Pvt. Ltd [2016 SCC Online Hyd 1921 that, "Ihe aforestated facts disclose the nature of the dispute that would arise for consideration. As to whether^the petitioner has better title or whether the Bank can claim rights by virtue of the sale of the property in favour of^its borrower,^Sripada Viswa Karma, are contentious issues of fact^{which are not amenable} for resolution in a writ^{petition........"}

¶55

It is clear from the order that the^{applicantapproached the} Hon'ble High Court claiming title on^{the property-in-questionand} against the action of the^{respondent under the Act, 2002 as well'As} per liberty granted, she approached the^{learnedCivil Court by filing} OS No.108/2018. It^{is pertinentto note that the learnedCivil court} while dlsmissing the^{IA No.20612018for temporary injunction against} the Bank, observed^{that the most appropriatecourseof action for the} petitioner/plaintiff woutd be to^{challenge the transfer and seek} injunction through^{an applicatlonto theDRT under Section17 of the} Act, rather than agitating^{in a civil suit.}

¶56

From the above, three^{things are clear' Firstly, the applicant} herein had been^{prosecuting her case overAlle as wellas against the} 0w"

¶57

Page 8 of 10

¶58

SA No. 359/2024

¶59

SARFAESI action with due diligence as required under Sec.14 of the Limitation Act; secondly, the SA filed on 23.09.2024 was within reasonable time of three (3) days, by reckoning the date from 20.08.2024 i.e., the date of obtaining cerufied copy; and thirdly the title issue is not yet adjudicated by the learned Civil Court in OS No.108/2018.

¶60

The applicant is entiued to exclusion of time under Section 14 of the Limitation Act, 1963. In this context reliance is placed on the judgment of the Hon'ble Supreme Court in Dwarika prasad (D) Thr. LRs v. Prithviraj singh (supra), wherein it was held that procedural technicalities should not defeat substantive justice when the litigant has acted bona fide and diligenuy. Hence the present application cannot be rejected on the ground of limitation.

¶61

Point No.(ii):

¶62

The applicant claims ownership through a registered gift deed executed by her husband much prior to mortgage. The possession notice issued by the bank direcfly affects the property claimed by the applicant. The expression^,\any person aggrieved,, under Section 17 of the SARFAESI Act has a wide amplitude and includes persons who claim independent rights in the property against which SARFAESI measures are taken. Therefore the applicant has /ocus standi to maintain the present application.

¶63

Point No.(iii):

¶64

The record reveals that the identity and tiue of the property are already the subject matter of adjudication in O.S. No.108/2018 before the competent civil court. The Tribunal is conscious of the rimited jurisdiction conferred upon it under the SARFAESI Act. whire the Tribunal can examine the legality of measures taken under the

¶65

PaBe 9 of 10

¶66

sA No. 359/2024

¶67

Act, it cannot adjudicate complex questions relating to tiue, ownership and civil rights in immovable property. fhe Hon,bte Supreme Court in Central Bank of India v, Prabha rain (supra) has reiterated that civil courts continue to retain jurisdiction to adjudicate disputes relating to ownership and title in immovable property even where SARFAESI proceedings are initlated. The Supreme Court held that the bar under Section 34 of the SARFAESI Act does not operate in cases where the dispute relates to independent civil^{rights and} ownership claims of third^parties. Therefore,^{where a person asserts} independent title over the^{propertyand such title is already under} conslderation before a clvil^{court, the secured creditor cannot resort} to coercive SARFAESI^{measuresso as to defeat or prejudice the} adjudication of^suchrights.

¶68

In the^{presentcase the respondent bankhas failed to establish} that the^{propertyclaimedby the applicantforms part of thesecured} asset^{createdby the borrower' On the contrary' the applicanthas} produced^{a registered gift deed demonstrating primafacie title and} iss;"": 00,.",on^Fufther'the - JI"IH^{1 Tff :[1'"".1i} pendine adiudica':i.::::j,r;;'u,n* *" appricant's^propertv continuation^{of SARFAESImer} would^{be contrarY to law'} above^{discussion'it is held that the possession} 19. notice^{In lssued view bY of thethe} .1lili *;";'ffi )"^ :: o"'a^{nt'sP ro,ertY} is not^sustainable' //,/' 'tV'"

//,/' 'tV'"

Page 10 of 10

SA No. 35912024

Point No.(v):

In the result, the Securitization Application is allowed by setting aside the possession notice dated 10.01 .2017 issued by 1't respondent bank under Section 13(4) of the Act, 2002 in respect of the application schedule property.

¶74

2L' The respondent bank is restrained from interfering with the applicant's possession of the schedule property till adjudication of tile dispute in the pending civil suit.

¶75

It is made clear that the observations made in this order shall not affect the adjudication of title issues pending before the competent civil court.

¶76

23' consequenry, Interrocutory Apprications pending, if any, shail stand closed. No order as to costs.

¶77

24' communicate a copy of this order to the parties concerned and upload in the official website. (Typed to my dict

¶78

open court ";l;",::;',! r:i,riz;t;r,;:,;r,,"*;rined and pronounced by me in the

¶79

,ffiffii#*

S Pushpa Reddy v. Uco Bank

Case brief

What is this about?

What did the court decide?

S Pushpa Reddy v. Uco Bank

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

State Bank of India versus M/s. Eswar Filling Station.

Axis Bank versus Chandra Mohan

Hdfc Bank Ltd. versus M/s. Jmj Fleet Services

Canara Bank versus Sri. Nittoori Srinivas

Central Bank of India versus M/s Smart Medias

M/s. Icici Bank Limited, versus Mr. Vorse Mahesh