Dismissed

Gudipati Manideep v. Karur Vysya Bank

DRT27 Aug 2026SA/379/2025

Case brief

AI extract

What is this about?

Securitization Application filed by a third-party tenant to quash SARFAESI possession measures. Debts Recovery Tribunal dismissed the application, holding that the tenancy was unsupported by a registered instrument and legally unenforceable.

What the court decided

AI extract

Gudipati Manideep versus Karur Vysya Bank — Company and Corporate | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL. II AT^HYDERABAD:

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DATED THIS THE 27TH DAY OF^AUGUST ,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. 379 OF 2025}

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Gudipati Manideep S/o^{G.Chandra Shaker,} Aged: 45 Years^(Male) Occ:^Business, R/o : H. NO.45l167- l,Chemmumiyapeta Kadapa (Town) &^{(Dist),AP-S16003}

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Applicant

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Versus

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Karur Vysya Bank^LTD, ARB Branch Rep Its^{Authorised Officer} Office at D.No.5-B-356^{to 362,3rd Floor,} Chirag Ali Lane,^{Abids, Hyderabad-500001}

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Sri Sai Mahalaxmi^Textiles, Rep by its Partner^{Tallam Satyanarayana Babu,} #D.NO.45/ t67 / t,^{Balajinagar, CK Street,} Kadapa, AP.

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Tallam SatYanarayana^Babu S/o Tallam Subba^Rao, Aged : Major, Occ:^Business, #D.NO.45/ t67 I^{L, Balajinagar,} CK Street, KadaPa,^AP.

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Tallam IsvariYa W/O Tallam SatYanarayana^Babu Aged : Major,^{Occ: Business,} #D.NO.45/^L67 /^{L, Balajinagar,} CK Street,^KadaPa,AP

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..... Respondents

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: Mr. Shravan^{Kumar Ragi} Counsel for^{the APP|icant} : M/s. Lotus Law^Associates Counsel for^{ResPondentNo.1} Counsel for^{ResPondentNos.} 2to4: Dismissed

.,.:

oage2of 5

SA No.379l202s

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'; ..-,

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-:ORDER:-

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The present Securitization Application is filed by the Applicant uls.'t7 of the Securitisation and Reconstruction of Financial Assets and Enforcement of security Interest Act, 2002 ("Act" hereinafter for short) to declare the action of the Respondent-Bank in taking physical possession of the S.A. Schedule Property pursuant to the vacate notice dated 25.08.2025, issued in pursuance of the orders passed in Crl.M:P.No.2B6 of 2025 on the file of the Hon'bte chief ludicial Magistrate, Kadapa, as null and void.

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The averments of the application, in brief, are that applicant is a third-party tenant in respect of the s.A. schedule property and has been in possession thereof pursuant to a rental agreement dated 04.t2.20t5, allegedly executed with Respondent No.2, much prior to the mortgage claimed by Respondent No.l-Bank. He submits that he has been residing in the property along with his family and has been regularly paying electricity, water and other statutory charges. The Applicant alleges that he came to know of the SARFAESI proceedings only upon receipt of the vacate notice dated 25.08.202s issued by the Advocate commissioner pursuant to crl.M.p.No.286 of 2o2s before the learned CJM, Kadapa District, proposing to take physical possession of the property on 02.09.2025. It is therefore contended that the tenancy having allegedly preceded the creation of the mortgage, the Bank cannot enforce the security interest so as to dispossess the Applicant without following the procedure prescribed under the SARFAESI Act and the Security Interest (Enforcement) Rules, 2002 (hereinafter "Rures" for short). Accordingly, the applicant prays for setting aside t0e SARFAESI measures initiated against the SA schedure propetylffiX

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Page 3 of 5

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SA No. 37912025

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The Respondent Bank filed its reply statement along with supporting documents. The averments thereof, in brief, are that the Applicant, being neither a borrower nor a guarantor, has no locus standi and that the alleged 3O-year tenancy based on an unregistered rental agreement dated 04.t2.2015 is neither valid nor enforceable against the secured creditor. Relying upon Section 65-4 of the Transfer of Property Act and the judgments of the Hon'ble supreme court in Harshad Govardhan sondagar v. International Assefs Reconstruction co. Ltd. (2014) 6 scc, vishal N. Kalsaria v. Bank of India (2016) 3 SCC 762 and Bajarang Shyamsunder Agarwal V. Central Bank of India, the Bank submits that only a valid and legally enforceable prior tenancy complying with the statutory requirements can claim protection against enforcement of the security interest. It.is further contended that the alleged tenancy is unsupported by'ariy cogent evidence of payment of rent or other contemporaneous documents and is merely a device to obstruct recovery. Accordingly, the Bank maintains that the SARFAESI measures and the proceedihgs under Section 14 have been duly undertaken in accordance witir iaw and that the Applicant has failed to establish any illegality or violation of natural justice, warranting dismissal of the S.A. with exemplary costs.

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Despite being afforded sufficient opportunities, the Rfflicant failed to effect service of summons upon Respondent Nos.2to 41 Consequently, vide docket order dated t2.02.2026, the S:A,^:WiiS dismissed against Respondent Nos.2 to 4.

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Heard learned counsel for the applicant and learned counsel for the respondent bank. Perused the material brought gn record.

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Page 4 of 5

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SA No. 3791202s

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The learned counsel appearing^{for the Applicant and the learned} counsel for the Respondent^{reiterated respective version as in the} Securitisation Application and^{the ReplyStatement,and prayed for} appropriate orders.

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

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i) Whether the Applicant^made out^{any valid groundto} quash any of the measures initiated by the^respondent against the SA schedule^{propertyas prayed for?}

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ii) To what relief?

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Point No.(i):

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B. Upon^perusal of the material^{availableon record, it is evident} that the Applicant has^{placed reliance upon an unregisteredlease} deed in support of the alleged^{tenancy. The Hon'ble SupremeCourt in} Bajarang Shyamsunder^{Agarwalv. Central Bank of India has held} that in any case, if any of the^{tenants claim that he is entitled to} possession of a secured asset for a term of more than a^{year, it has} to be supported by the execution^{of a registered instrument.In the} absence of a registered instrument, if^{the tenant relies on an} unregistered instrument or an oral^{agreementaccompaniedby} delivery of^possession, the tenant^{is not entitled to possessionof the} secured asset for more than the^{period prescribedunder Section} 107 of the T.P. Act. In the^{presentcase,the Applicant, being a third} party claiming a 30-year tenancy solely under an unregistered^lease deed, has failed to establish any^{legally enforceabletenancy over the} S.A. schedule^property. Consequently,^{the Applicant has no legal} basis to interdict the measures^{initiatedby the Respondentunder the} provisions of the SARFAESI Act. AccordiqgJy, the^present SA^{is devoid} of merits and is liable to be dismissed OWL&

Page 5 of 5

SA No. 37912025

Point No.(ii):

In the result, the Securitisation Application fails and is hereby dismissed.

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Consequently, Interlocutory Applications pending, if any, shall stand closed.

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No order as to costs.

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L2. Communicate a copy of this order to the parties concerned and upload in the official website.

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(Typed to my dictotion by the steno, corrected, signed ond pronounced by me in the open court on this the z/n day of August, 2026).

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ffisu sH0?Ah"rotrr) PRESIDING OFFICER

Gudipati Manideep v. Karur Vysya Bank

Case brief

What is this about?

What the court decided

Gudipati Manideep v. Karur Vysya Bank

Case brief

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