Disposed

Vastu Housing Finacne Corportaion Limited v. Jana Small Finance Bank Ltd.

DRT3 Feb 2026SA/597/2024

Case brief

AI extract

What is this about?

The Presiding Officer, DRT Jaipur, disposed of multiple inter-se disputes between financial institutions. Relying on a Supreme Court judgment, the court held that Section 11 of the SARFAESI Act mandates statutory arbitration for such disputes, depriving the DRT of jurisdiction.

What did the court decide?

All matters disposed; parties directed to resolve disputes via arbitration under Section 11 of the SARFAESI Act.

Vastu Housing Finacne Corportaion Limited versus Jana Small… — Banking and Recovery | DRT (2026)

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Court of the Presiding Officer Debts Recovery Tribunal, Jaipur

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Item No. 12 T0 47

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SA/271/2025	HDB FINANCIAL SERVICES LIMITED	BANK OF BARODA
SA/507/2025	^{PIRAMAL CAPITAL} HOUSING FINANCE LTD	INDIA SHELTER FINANCE CORPORATION LIMITED
SA/348/2025	AU SMALL FINANCE BANK LIMITED	MENTOR HOME LOANS INDIA
SA/320/2025	CENT BANK HOME FINANCE LTD	MANIBHAVNANAM HOME FINANCE
SA/298/2019	INDIAN BANK	AU SMALL FINANCE BANK LIMITED
SA/319/2025	RAJASTHAN GRAMIN BANK	MANIBHAVNAM HOME FINANCE INDIA PRIVATE LIMITED
SA/280/2025	HERO HOUSING FINANCE LTD	MANIBHAV VANAM HOME INDIA FINANCE PVT LTD
SA/168/2025	CAPRI GLOBAL HOUSIN FINANCE LIMITED	IDFC FIRST BANK LTD
SA/107/2026	SHRIRAM FINANCE LIMITED	SK FINANCE LIMITED
SA/568/2025	VASTU HOUSING FINANCE CORPORATION LTD	AAVAS FINANCERS LIMITED
SA/569/2025	AU SMALL FINANCE BANK LIMITED	BANK OF BARODA
SA/441/2025	INDIA SHELTER FINANCE CORPORATION LIMITED	ADITYA BIRLA HOUSING FINANCE LIMITED
SA/468/2023	AXIS BANK LTD	KOTAK MAHINDRA BANK LIMITED
SA/326/2025	HINDUJA HOUSING FINANCE LIMITED	HERO HOUSING FINANCE LIMITED
SA/702/2025	SAMMAAN FINSERVE LIMITED	BANK OF BARODA
SA/773/2025	FEDBANK FINANCIAL SERVICES LIMITED	RELIGARE HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED

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Court of the Presiding Officer

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Debts Recovery Tribunal, Jaipur

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SA/430/2021	M S RELIGARE HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED	UCO BANK
SA/429/2021	M S RELIGARE HOUSING DEVELOPMENT FINANCE CORPORATION	UCO BANK
SA/432/2021	RELIGARE HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED	UCO BANK
SA/223/2023	AAVAS FINANCIERS LTD	PUNJAB NATIONAL BANK
SA/57/2020	RELIGARE HOUSING	AU SMALL FINANCE BANK LIMITED
SA/167/2024	VASTU HOUSING FINANCE CORPORATION LTD	IDFC BANK LIMITED
SA/751/2023	AMBIT FINVEST PRIVATE LTD	ICICI HOME FINANCE COMPANY
SA/703/2024	JUMBO FINVEST INDIA LTD	INDIAN OVERSEAS BANK
SA/650/2024	GIC HOUSING FINANCE LIMITED	JUMBO FINVEST INDIA LIMITED
SA/410/2023	VASTU HOUSING FINANCE CORPORATION LTD	INDIA SHELTER FINANCE CORPORATION LIMITED
SA/590/2024	FINOVA CAPITAL PVT LTD	MANAPPURAM HOME FINANCE LIMITED
SA/647/2023	VASTU HOUSING FINANCE CORPORATION LTD	CAPRI GLOBAL FINANCE PRIVATE LIMITED
SA/597/2024	VASTU HOUSING FINACNE CORPORTAION LIMITED	JANA SMALL FINANCE BANK LTD
SA/42/2023	BANK OF BARODA	JUMBO FINVEST INDIA LIMITED
SA/238/2021	AAVAS FINANCERS LTD	MENTOR HOME LOANS INDIA LTD
SA/410/2021	AAVAS FINANCERS LTD	MENTOR HOME LOANS INDIA LIMITED

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Court of the Presiding Officer Debts Recovery Tribunal, Jaipur

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SA/671/2023	NICE FINANCE AND LEASING PVT. LIMITED	CAPRI GLOBAL HOUSING FINANCE LIMITED
SA/446/2022	STANDARD CHARTERED BANK	MS J C FLOWERS ASSET RECONSTRUCTION P LTD
SA/417/2021	AAVAS FINANCERS LIMITED	MENTOR HOME LOANS INDIA LIMITED
SA/217/2025	CHOLAMANDALAM INVESTMENT AND FINANCE COMPANY LIMITED	MENTOR HOME LOANS INDIA LIMITED

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Date: 03.02.2026. Proceedings through hybrid mode

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Common order passed in the matters involving financial institutions having inter-se disputes

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In the above matters the dispute relates to inter-se financial institutions and as per judgment of Hon’ble Supreme Court passed in the matter of Bank of India vs M/S Sri Nangli Rice Mills Pvt. Ltd on 23 May,2025 hon’ble Supreme Court has held as under:

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G. FINAL CONCLUSION

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124. We summarize our final conclusion as under:

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(I) Section 11 of the SARFAESI Act deals with resolution of disputes relating to securitisation, reconstruction or non-payment of any amount due between the bank or financial institution or asset reconstruction company or qualified buyer.

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(II) In order to attract the provision of Section 11 of the SARFAESI Act, twin conditions have to be fulfilled being; first, the dispute must be between any bank or financial institution or asset reconstruction company or qualified buyer and secondly, the dispute must relate to securitisation or reconstruction or non-payment of any amount due including interest. Where the aforesaid two conditions are found to be

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Court of the Presiding Officer Debts Recovery Tribunal, Jaipur

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prima-facie satisfied, there the DRT will have no jurisdiction and the proper recourse would only be through Section 11 of the SARFAESI Act read with the Act, 1996.

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(III) The expression “non-payment of any amount due, including interest” used in Section 11 of the SARFAESI Act is of wide import and would include a various range of scenarios of ‘disputes’ connected to unpaid amounts including those arising due to third-party defaults, such as indirect defaults of the borrowers.

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(IV) Any dispute between two banks, financial institutions, asset reconstruction companies or qualified buyers etc., where the jural relation between the two is of a lender and borrower, then Section 11 of the SARFAESI Act will have no application whatsoever. The use of the phrase “any person” in the definition of ‘borrower’ in Section 2(f) of the SARFAESI Act, makes it abundantly clear that even a bank, financial institution or asset reconstruction company or qualified buyer can be considered a borrower, if they receive financial assistance from a bank or financial institution etc by providing or creating a security interest. Thus, a lender-turned-borrower would also fall within the scope of a “borrower” under the SARFAESI Act and shall be governed by the same statutory framework as any ordinary borrower.

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(V) Section 11 of the SARFAESI Act, provides for a statutory arbitration for any dispute mentioned therein between any of the parties enumerated thereunder. There is no need for an explicit written agreement to arbitrate between such parties in order to attract Section 11 of the SARFAESI Act. The said provision creates a legal fiction as regards the existence of an arbitration agreement notwithstanding whether such agreement exists or not in actuality.

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(VI) Section 11 of the SARFAESI Act is mandatory in nature. The use of the word “shall” therein, the mandate of the said provision cannot

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Court of the Presiding Officer Debts Recovery Tribunal, Jaipur

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be bypassed or subverted by the parties by seeking recourse elsewhere. 125. Thus, for all the foregoing reasons, we have reached the conclusion that there is no infirmity in the impugned order passed by the High Court, directing the appellant and the respondent banks to resolve their dispute by way of arbitration in terms of Section 11 of the SARFAESI Act.

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Accordingly, all the matters stand disposed of and parties are directed to resolve their disputes by way of Arbitration in terms of section 11 of the SARFASAI Act.

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The period for which the pleadings were filed and till date shall not be counted for limitation.

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Signed copy be kept in SA no 271/2025 & photocopy be kept in all other proceedings.

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Files be consigned to record as per rules. Copy of order be uploaded on website.

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(Vimal Gupta) Presiding Officer Debts Recovery Tribunal, Jaipur

Vastu Housing Finacne Corportaion Limited v. Jana Small Finance Bank Ltd.

Case brief

What is this about?

What did the court decide?

Vastu Housing Finacne Corportaion Limited v. Jana Small Finance Bank Ltd.

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

Case details

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