Dismissed

Bharat Iti Mr S Rajashekar Reddy v. Wardhaman Urban Cooperative Bank Ltd.

DRT19 Feb 2026SA/74/2025

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed an applicant's application challenging a bank's notice to take possession of mortgaged property. The court held that the applicant could not establish a valid lease under unregistered instruments, thus failing to justify an injunction under Section 14 of the SARFAESI Act.

What did the court decide?

The Securitization Application is dismissed and pending interlocutory applications are stayed.

Bharat Iti Mr S Rajashekar Reddy versus Wardhaman Urban… — Execution and Attachment | DRT (2026)

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IN THE DEBTS RECOVERY^TRIBUNAL-I AT HYDEMBAD

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DATED THIS THE^{19THDAYOF FEBRUARY, 2026}

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

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SECURITISATION^{APPLIATIONNo. 74 OF 2025}

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Bharat ITI Represented by its^PrinciPal Mr. S. Rajashekar^Reddy Registered Office 48/8, Phasel, IDA leedimetla, R.R. Dist.50OO55

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"""Applicant'

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Versus

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Vardhaman^{(Mahila)Co-operative} llrban Bank Limited,^Re\resented by CEO &^{Authorised Officer} H. No. #8-2-351/N/1 Nishant House,^{3'd Ftoor}

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Road No.2, Baniara Hi^s Hyderabad^- 500034,^Telangana.

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M/s. Gra7hic SYstems Rep by its Managing^Partner ui. uetaii, #4-1-882/1/7,^{1st Floor} Reddy Hostel ShoPPing^ComPlex Titak Road,^{Abids, Hyderabad-500001.}

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M/s. Sri PriYanka^EnterPrises Rep bY its Managing^Partner ui. ttbtaii, #4-I-8t2/1/7,^{1't Ftoor} Reddy Hostel ShoPPing^ComPlex Tilak Road,^{Abids, Hyderabad-500001'}

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M/s. Sri PriYanka^{GraphTech Pvt.Ltd} ' ReP bY its^{ManagingPartner} Mr. Netaii, Plot^{No.48/8,Phase-I} Sy, No, 257,^{IDA leedimetlaVillage} leedimetla^Mandal euthbuttapur,^{R.R. Dist.} AU^." ul "f'

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2ofG

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SA No.74l2025

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Sri Suram Venkat Reddy Proprietor - Representi ng Poly Industrial Enterprises H. No. 12-5-143, Tarnaka Secunderabad- 500017. (Respondent No.5 is formal party and Guarantor).

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......Respondents.

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Counsel for the Applicant Mr. Salvaji Raja Shekar Rao. Counsel for 7st Respondent Mr. Keerthi Kiran Kota. Respondents 2 to 5 Ex parte.

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:ORDER:-

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Applicant filed the present Securitisation Application u/s 77 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2OO2 (hereinafter referred to as "SARFAESI Act") assailing the Advocate Commissioner notice dated 37.72.2024 in Cr. M.P. No. 03 of 2024 on the file of the tearned Senior Civil Judge-cum-Additional Chief Metropolitan Magistrate, Medchal- Malkajgiri District at Medchal against the SA schedule property.

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The case of the applicant as per the averments of securitisation application, in brief, is that it is running an educational institution since 1990 from a part of the building on the subject land taken on lease from 5th respondent. There is a clear demarcation between the institute's building/infrastructure and the remaining land allegedly mortgaged by 5th respondent. The impugned Notice shows the mortgaged property as an open land. Applicant is a bonafide institution having permissions from the Government of Andhra A,^. g/./O.r,))_e

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sA No.74l2025

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Pradesh and Directorate^{Generalof Training, Government of India,} Ministry of Skill Development^{& Entrepreneurship. The 1't respondent} bank, after issuance of^notice u/s^{13(4) of the SARFAESI Act, 2002} obtained Warrant^{suppressingthe fact applicantinstitute beingrun} from a bullding constructed^{on the subject land. As per the} instructions issued by the^{Governmentof India, l4inistry of Skill} Development and^{Entrepreneurship,Director General of Training,no} educational institution^{can be shifted during the mid-termof the} tralning course and in^{case it is to be shiftedit must be in line with} the^quidelines specified by^{the Government for the purposeThe} applicant is in^{possessionof the building even before creationof} mortgage and hence^{evictionhas to be done in accordancewith the} provislons of the Transfer of^{PropertyAct but not under the provislons} of the SARFAESI Act.^{Therefore,the actionof respondentbank to} dispossess the applicant^{from the property pursuant to Advocate} Commlssioner's Notice^{is without justification,erroneous,illegal,} arbitrary and^void.

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The respondent bank^{adopted the counterfiled in IA' 36512025} as reply in the^{SA. The submissionsof the respondent as per the} reply statement,^{in brief, are,}

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The applicant, being neither^{a borrowernor a guarantoror a} tenant under a^{registered leasedeed,is not entitled to any rellef in} the SA. As on the^{date of mortgage, no institutionwas running in the} mortgaged^{property. The leaseagreementpressedinto service by the} appllcant is an^{unregistered document and has no legalsanctity in} the eye of law. Section^{107 of Transferof Property Act clearlystates} that any lease^{beyond a periodof one year shall be by way of a} registered instrument.^{Respondentbank relies on the judgements of}

OY*'

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sA No.74l2025

Hon'ble Supreme Couft in Harshad covardhan Sondagar vs. International Assets Reconstruction Co. Ltd. (2014) 6 SCC 7 and Bajarang Shyamsunder Agarwal vs. Central Bank of India & Another (2019) g SCC 94 in support of its pleadings.

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Heard the learned counsel for the 1st respondent bank. perused the written arguments filed by the applicant and the 1st respondent bank and the material brought on record.

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According to the applicant, the institute is situated on a part of the land owned by 5th respondent and there is a clear demarcation between the open land and the building and infrastructure of the institute. This fact has been suppressed by the respondent bank in collusion with the borrowers by recording the entire mortgaged property as an open land as also in obtaining Warrant u/s 14 of the SARFAESI Act. Applicant relies on the judgement of the Hon,ble Madras High Court in W.P.(MD) Nos. 16622 to 16634 of 2OZ2 and bunch of cases decided on 07.0A.2022.

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Learned counsel for the 1"t respondent bank would submit that the SA schedule property was mortgaged vide MODT and the schedule of property. The applicant has not produced any drawings or photographs of the alleged structures to distinguish the same. The SA is devoid of any merit as the very lease deed pressed into service by the applicant is an unregistered lnstrument. Learned counsel placed reliance on the judgements of the Hob,ble Supreme Court cited supra to buttress his point.

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The points for consideration are as follows : _ (i) Whether the Applicant made out a vatid ground for interdicting the proceedings of ffi"*

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sA No.74l202s

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respondent bank u/s 14 of the SARFAESI^Act for taking the^{phYsical possession} of^{the SA} schedule^property?

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( ii) To what relief?

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Point No.^(i):

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The applicant's^{principal grievance} is that the 1't^respondent bank's action to take the^possession of the institute's^{building which} is a part of SA schedule^property under the^{provisions of the} SARFAESI Act, is arbitrary,^{illegal and against the provisions of the} Transfer of Property Act. Applicant^pressed into service^{a lease} agreement dated 19.04.2008 entered into^{betweenthe5th} respondent herein and the applicant. The^{schedule of} premlses/property mentioned in the lease agreement reads^as u nder: -

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"All that the entire land and building in^Plot no.48/B Phase-r, admeasuring 2371'60^Sq. yards or equivalent to 1903'03 Sq. meters in 5y.No.257, situated at leedimetla^Village, Industrial Development Area,^leedimetla, Quthubullapur^{Mandal,Ranga ReddY} District."

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It is an admitted fact that^{leaseagreementrelled on by the} applicant is an unregistered^{instrument. Itis well settledlaw} emphasised by the Hon'ble Apex Court^{(BairangShyamsunder} Agarwal vs. central Bank of rndia), that^{no rights can be claimed} under the Transfer of^{Property Act in respect of lease of morethan a} year, on the strength of an unregistered instrument as^per Sec.107^of the Transfer of Property Act.

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Further, despite claiming^existence of^{a building demarcated} separately from the SA schedule^{property,the applicanthas not} DY.,*

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SANo.74l2025

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produced any drawing or photographs or any supporting material evidencing such a structure. Nor did the applicant produce any supplemental evidence like electricity bills, rent receipts or institute's registration certificate as to the existence of the institute at the subject premises. Thus, there is no cause of action to challenge the action of 1't respondent bank to take the^{physicalpossession} of the SA schedule property under Section 14 of the SARFAESI Act. However, being secured creditor, the respondent bank is entitled to take physical possession of the secured asset which cannot be interdicted without any valid and registered lease agreement. Therefore, the applicant is not entitled to any relief.

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L2. In view of the above observations, it is concluded that applicant failed to establish any valid ground to quash the measures of the bank against the application schedule property. Accordingly, the SA is liable to be dismissed.

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Point No.(ii):

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

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t4. Consequently, Interlocutory Applications pending, if any, shall stand closed. No order as to costs. Communicate a copy of this order to the parties concerned and upload in official Web Portal.

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(Typed to my dictation by the steno, corrected, signed and pronounced by me in the open court on this the l/n day ol February, 2026.1.

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0w*' (RAMESHWAR KOTHE) PRESIDING OFFICER

Bharat Iti Mr S Rajashekar Reddy v. Wardhaman Urban Cooperative Bank Ltd.

Case brief

What is this about?

What did the court decide?

Bharat Iti Mr S Rajashekar Reddy v. Wardhaman Urban Cooperative Bank Ltd.

Case brief

What is this about?

What did the court decide?

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