Dismissed

Baddila Chadrasekhar v. Union Bank of India

DRT19 May 2026SA/69/2025

Case brief

AI extract

What is this about?

In an application under S. 77 of the SARFAESI Act, the applicants sought to set aside an auction sale notice on disputed agricultural land. The court held that since the sale deed was executed after the mortgage creation, the bank's rights prevailed. The dispute over land extent requires determination by a civil court, making this summary application infructuous and dismissed.

What did the court decide?

Securitization Application No. 69 of 2025 dismissed as infructuous; interlocutory applications closed.

Baddila Chadrasekhar versus Union Bank of India — Contract and Commercial Disputes | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL - II AT HYDERABAD

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DATED THIS THE 1gTH DAY OF MAY, 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. 69 OF 2025

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Between :

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BaddilaChandrasekhar

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S/o Baddila Narayana Aged about 45 years, Occupation : Agriculturist,

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R/o Kakarakayalapalli Village,

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H/o Valasapalli, Madanapalle Rural, Annamayya District

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K. Guruva Reddy S/o K. Dilip Reddy, Aged about 65 years, Male, Occupation : Agriculturist,

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R/o D.No. Plot No.202, Door No.239, 16th Sector,

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HSR Layout, Agarwal Bhavan, Adithi Bangalore City, Karnataka .....Applicants

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And

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The Authorized Officer,

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Union Bank of India, Regional Office, SVU Campus Tirupati - 517 502, Andhra Pradesh

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IswaryaEnterprises, Represented by its Managing Partner-P Ramnath, D. No.9-148/C, Madanpalle Road, Nallacheruvu (Village and Post), Sri Sathya Sai District - 515 551,

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Andhra Pradesh

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Page 2 of 10

SA No. 69/202s

Mr. P Ramnath, S/o, Late P Sankar Narayan Chetty ( Proprietor Snehit Enterprlses) Nalla Cheruvu lvla ndal, Sri Satya Sai District Andhra Pradesh - 515 551.

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.. .... Respondents.

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Counsel for the Applicant : Abhay Singh and Associates. Counsel for Respondent No.1 : Ms. Tarangini Pisipati. Counsel for Respondent 2 & 3 :Ex-parte.

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-iORDER:-

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The present Securitization Application is filed by the Applicants u/s. 77 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (.,Act,, hereinafter for short) to set aside the sale notice dated 27.01.2025 fixing the aucuon of the SA Schedute^property on 74.O2.2025.

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The fact of the case as averred by the applicants in the SA, in brief, are thau

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The Applicants are the third party to the SARFAESI proceedings. They purchased SA schedule agricultural land admeasuring Ac.2-08 cents in Sy.No.208-1 from Respondent No.3 through a registered Sale Deed bearing No.1439/202 dated 03,OB.ZO22. At the time of execution of sale deed, the respondent No.3 had suppressed the mortgage over the property created in favour of the respondent No.1 bank. As per the link document bearing No.836 of 2017 dated 04.70.2017, respondent No.3 acquired .^{the propertyof 2.08 Acres in Survey No.208-1} and 0.57 cents 7flgvnt.>\ (//^''i.q'

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sA No. 69/2025

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Page 3 of¹⁰

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in Survey No.2O8-2.^{As per the Form IB, the PattadarPass} Book bearlng A/c^{No.454 shows the extent of land held by} Respondent^{No.3is 2.08 Acres in Sy No' 208-1 and 57 centsin} Sy. No. 208-2.^{Therefore,there is no ambiguity over the title of} 2.08 Acres in^{survey No 208-1 by the name of Respondent} No.3. As^{per the MoDT1O9Odated 27'07 '2018, Respondent} created mortgage^{over 0.53cents only i'e', part of 2'08 Acres} in favour of the^{1'r respondent bank Neitherthe SaleDeed} No.836/2017^{executed by the erstwhileowner of the landin} favour of Respondent^{No.3 nor the Sale Deed No 1439 of 2022} executed by^{RespondentNo.3 in favour of the applicants nor} the Memorandum^{of Title Deeds No'1090/2018createdin} favour of^{RespondentNo'1Bank ldentified or demarcated2 08} Acres or 53 cents^{in Sy. No.2O8-1The entireprocessof} proposed sale of 53 cents of^{land initiated by the Respondent} No.1 ls without^{any identificationor demarcationof the subject} land. In spite of^{such a situation, the respondent bank has} been trying to^{take disposeof 53 cents of land from out of the} 2.08 Acres covered^{underthe Sale Deed No'1439/2022Despite} bringing out this^{factual position to its notice,1"t respondent} proceeded with sale notice dated^{06'04'2023 for sale of 0'53} cents from out of^{2.08Acres in Sy.No208-1 belongingto the} applicants.^{Appllcants filed W.P.No.11515/2023 challengingthe} action of^{respondentbank.In the W'P , the Respondent No 1} relied on the^{proceedingsof the Revenue DivlsionalOfficer'} Kadiri, dated 31:01.2018^{sub-dividingthe land holdingof} Respondent^{No.3 as 53 centsin Sy.No.208-1 and 212 Acresin} Sy.No.208-3.^{Any sub-divisionwithout taklnginto account the} Form IB and entries^{in Pattadar Pass Book is misconceivedand} erroneous. The^{stand of RespondentNo.1 is factuallyincorrect} and contrary to the^{records.The 53 centsof land notified in the}

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Page 4 of 10

sA No. 69/202s

sale notice belongs to applicants. The Writ petition No. 11515/ 2023 was allowed by orders dated 30.08.2023 holding the action of Respondent No.1 bank as bad in law unless and untjt the extent of the mortgaged land is de_alienated and separated either by mutually agreed survey or through proper decree/ order passed by a court of competent jurisdiction. Respondent No.1 challenged the order in the W.p.11515/2023 before the Hon'ble Supreme Court in SLp (C) No.26350/2023. The Hon,bte Supreme Court set aside the High Court orders giving an opportunity to the applicants herein to approach Debt Recovery Tribunal or a jurisdictional forum asserting and claiming their rights, if any, including the issues raised by the Respondent No.1 vide orders dated 02.0g.2024. Thereafter, respondent No.1 issued impugned E-auction sale notice dated 27.01.2025 without resolving the issue of land holding of the applicants. The demarcation and the identification of the extent of land are being the issues remained unresolved, Respondent No.1 is not entitled to proceed in a summary way and the lis is required to be adjudicated by an appropriate competent civil court.

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The sum and substance of the reply statement of the 1.t Respondent Bank, in brief, is:

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The applicants are third parties to the Securitisation proceedings and have no locus to file the present SA. After purchase of 2.65 Acres, Respondent No.3 got conducted a field measurement on 29.12.2017, which determined the holding of Respondent No.3 as 53 cents in sy.No.2o8l1 and 2.12 Acres in Sy.No.208/3 in place of earlier holdings of 2.Og Acres in Sy.No. 208/L and 57 cents in Sy.No.2ogl2. Change in survey numbers is a part of revenue officials, actions. Respondent No.3 created

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SA No. 69/2025

Page 5 of 10

mortgage over those extents of land by deposit of title deeds bearing No.836/2017 and link deed No.139/2016. Schedule-B of MODT bearing No.1090/2018 dated 27.07.2018 also mentions the land holding of Respondent No.3 in Sy.208-1 as 53 cents and 2.12 Acres in Sy.No.208/3. The pertinent point is that the sale deed No.1439/2022 dated 03.08.2022 pressed into service by the applicants ls much later to the mortgage dated 27,07.?0L8 and demand notice u/s 13(2) of the SARFAESI Act, dated 07.03.2022. Thus, the respondent bank has already mortgage rlghts over the subject property right from the year of 2018. Therefore, the right of applicants if any, is subject to the 1't charge of the Respondent No.1 bank only. The entire holding of the Respondent No.3 is under mortgage with the Respondent No.1 bank and hence the question of transfer of part of the mortgaged property to the applicants does not arlse. The auction notified ln 2023 failed due to lack of bidders. Thereafter, notice before sale dated 06.03.2025 and E-auction notice dated 21.05.2025 were also issued by the respondent bank.

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Summons served on Respondents 2 & 3, and they were set exparte on 11.03.2025 as called absent and no representation.

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Heard Learned Counsel for the Applicant and Learned Counsel for the Respondent Bank. Perused the synopsis/written arguments filed by the parties and the material brought on record.

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Learned counsel for the applicants while reiterating the pleadings ln the SA, would contend that the extent of land mortgaged by the respondent No.3 with the applicant bank in Sy.No.208/1 was 53 cents only. The boundaries of 53 cents Ko"t

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Page 6 of 10

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sA No. 69/2025

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were not specified nor was demarcated by any sketch. The east side boundary of land covered in sale deed No.1439/2022 has road access. With the 53 cents land having not been identified or demarcated, the mortgaged land has no access to the road. The alleged sub-division without taking into account the Form IB and the entries in the^pattadar pass Book is erroneous. The Hon'ble High Court found fault with the action of respondent No.1 in proceeding with auction sale without any de-alienation or demarcation of the land. Further, the Hon,ble Supreme court took cognizance of the entiuement of the applicants in the subject land. Therefore, the actjon of respondent No.1 bank in issuing the impugned sale notice without demarcation and identification of the subject land through a judicial forum is against the principles of natural justice. Applicants purchased 2.08 Acres in Sy.No.208-1 and respondent No.3 created mortgage over 53 cents in Sy.No.208-1, leaving a balance of 1.65 acres un-mortgaged lying with the applicants. Though respondent No.1 is entitled to proceed against 53 cents, but the same shall be subject to delineation and identification by a court of law competent to do so.

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Per contra, learned counsel for the 1st respondent bank would submit that pursuant to a Field Measurement Sketch dated 29.L2.2077 and RDO proceedings dated 31.01.2018, the extent of land holdings of respondent No.3 were revised to 53 cents in Sy.No.208/1 and 2.72 Acres in Sy.No.208/3. The MODT executed by respondent No.3 reflects the revised survey numbers and the extent of holdings respondent No.3 in the respective survey numbers. Due to default in repayment by the borrower, the loan account became NpA and the respondent bank issued demand notice u/s 13(2) of the SABFAESI Act, .M:^* (1/^' 'tq'v '

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sA No. 6912025

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Page 7 of 10

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dated 07.03.2022. Admittedly, the transaction between the Respondent No.3 and the appllcants is subsequent to the demand notice without the knowledge of the respondent bank amounting to violation of the^provisions of the SARFAESI Act and the Rules. As the link Sale Deed 836/2017 dated 04.70.20L7 being in the possession of the respondent bank, it is very clear that the applicants^purchased the land without verlfying the original title deed. The respondent bank has every right to enforce its mortgage rights over the subject^property. Hence the applicants claim is contrary to the^provisions of the SARFAESI Act and the Rules thereunder.

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The points for consideration are as follows : -

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i) Whether the applicants made out any valid ground to quash any of the measures initiated by the .respondent against the SA schedule property as prayed for?

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ii) To what relief?

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Point No,(i l:

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Applicants challenged the Sale Notice dated 27.01.2025 only to the extent of 53 cents in the overall holding of the respondent No.3 put for auction sale vide impugned sale notice. The total extent of land notifled for sale in the notice was 2.65 acres consisting of 53 cents in Sy.No.208-1 and 2.LZ Acres in Sy.No.208-3 belonging to respondent No.3. It is not in dispute that the applicants^purchased 2.08 acres much subsequent to the mortgage created in 2018 and demand notice issued on 07.03.2022. Respondent No.3 the executants of sale deedⁱⁿ .,AYz*.v, /u^{<^'tt'}

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sA No. 69/2025

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Page 8 of 10

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favour of applicants, who was mortgagor of the applicant bank remained exparte. According to respondent bank, applicants cannot question the mortgage rights created much before the execution of sale deed. It is the further contention of the respondent bank that the sale deed pressed into service by the applicants is subsequent to the demand notice too. Therefore, applicants' rights, if any, are subject to the mortgage rights of respondent bank under the SARFAESI Act.

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There is no ambiguity that the sale transaction between the applicants and the respondent No.3 took place after the mortgage was created in favour of 1st respondent bank in the year 2018. Learned counsel for the respondent bank emphasizes that the applicants are trying to build up their case without taking into account the land holdings of respondent No.3 in the changed survey number scenario. Learned counsel for the respondent bank places much reliance on the ScheduleB of the MODT annexed to the SA, which inter alia mentions the extent of land holding by respondent No.3 as 53 cents in survey No.208-1. However, as per the sale deed No.1439/2022 dated 03.08.2022, the extent of land alienated in favour of applicants in New Sy.No.20B-1 was 2.08 acres. If this version is to be believed, it is a clear that respondent No.3 executed sale deed in favour of applicants in excess of his land holding in Sy.No.208-1. This fact is corroborated vide para 11 of the counter of respondent bank in W.P. No.11515 of 2013 and attached with the SA material papers, states that "as per the New Sub Division proceedings dt.30.12.2017 issued by Tahsiladar, Nallacheruvu Mandal, the total extent of land in Survey No,208/1 is only 53 cents and there is extent of Ac.2.08 Cents as claimed by the Petitioner (Applicants herein)", ,,. )iryr.1.,rt

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5A No. 59/2025

Page 9 of 10

It is not in dispute that respondent No.3 created mortgage over 53 cents in Sy.No.208-1 on 27.O7.2078.It is not in dispute that the sale transaction between the applicants and the respondent No.3 was also subsequent to the mortgage created in favour of respondent bank. It is also not in dispute that respondent bank issued demand notice u/s 13(2) of the SARFAESI Act on 07.O3.2022 i.e., before the sale transaction between applicants and the respondent No.3. Therefore, by any stretch, the sale transaction, irrespective of revision in survey numbers and the resultant change in land holdings, is much later to the mortgage. It is also not in dispute that applicants purchased the property when the original title deeds were in the possession of the respondent ban k.

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t2. In the present SA, applicants' centered their grievance only with respect to 53 cents notified with survey number being 2081. Applicants' grlevance is that respondent bank is not entitled to proceed against 53 cents of land without demarcation and identification. However, despite being afforded an opportunity in SLP (C) No.26356/2023 on 02.09.2024, applicants do not appear to have taken any action to determine land holding of respondent No.3 and that of theirs in Sy.No. 208-1 from any competent court of law, much less the claim against 53 cents or total 2.08 acres/ till the issuance of the impugned sale notice on 07.Ol.2025 or the subsequent sale notices dated 21.05.2015, 07.0A.2025 16.10.2025 for the reasons best known to them.

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As far as the SA challenging the sale notice dated 27.01.2015 is concerned, the sA became with the auction sale^proceedings having not been materialised. In so far as the dispute over the mortgage rights of the respondent bank over the 53 cents is ,z7t*>-.^o>t,

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Page 10 of 10

sA No. 69l202s

concerned, irrespective of the change in survey numbers and the resultant land holds, the mortgage in favour of the applicant bank being much prior to the sale deed, no fault can be found against the respondent bank to enforce its rights under the SARFAESI Act. As observed above, the applicants are at liberty to approach the appropriate civil court or any competent authority to redress their grievance over the change in survey numbers or the consequential change in the land holdings, if any. Accordingly, the SA is liable to be dismissed as infructous.

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Point No.(ii):

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In the result, the SA fails and is hereby dismissed as in fructuous.

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Consequently, Interlocutory Applications pending, if any, shall stand clcsed. No order as to cost.

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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 PS, corrected, signed ond pronounced by me in the open court on this the 19th ddy of Moy,2026).

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@;*'u (RAMESHWAR KOTHE) PRESIDING OFFICER

Baddila Chadrasekhar v. Union Bank of India

Case brief

What is this about?

What did the court decide?

Baddila Chadrasekhar v. Union Bank of India

Case brief

What is this about?

What did the court decide?

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