Dismissed

K Veerender Reddy v. City Union Bank Limited

DRT9 Apr 2026SA/75/2025

Case brief

AI extract

What is this about?

In this securitisation application, the applicant, a guarantor, challenged a possession notice and auction sale notice issued by a bank under the SARFAESI Act. The Tribunal dismissed the application, finding no infraction of statutory requirements despite the applicant's objections regarding NPA status and unrelated criminal cases.

What did the court decide?

Application dismissed; interlocutory applications closed; no order as to costs.

K Veerender Reddy versus City Union Bank Limited — Company and Corporate | DRT (2026)

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IN THE DEBTS RECOVERYTRIBUNAL - II AT HYDEMBAD

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DATED THIS THE O9TH^DAY OF^APRIL,2026

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

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SECURITISATION APPLICATION^{No.75OF 2025}

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K. Veerender Reddy S/o Sri K. Satyanarayana Reddy Plot No.19 & 20, Wahab Nagar Sikh Viltage, Secunderabad .......Applicant.

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Versus

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City Union Bank Limited Credit Recovery and Management^Department Administrative Office, No.24-8,^{Gandhi Nagar} Kumbakonam 612001

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Rep by its authorized officer

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Mls Kura Motors Pvt^Ltd

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3-6-7 5U l, HimaYath^Nagar Main Road, Hyderabad 500029

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....Respondents

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Counsel for the Appticant^{: Mr.B Sreenivasa Reddy} Counsel for 7't Respondent^{: Mrs. Ch. Laxmi Chaya} : SA not Pressed 2'd Respondent

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-: O-UEB:.

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The Applicant filed^{the present SecuritisationApplication u/s'} 17 0f the securitization^{and Reconstruction of FinancialAssets and} Enforcement of Security^{Interest Act, 2OO2 (hereinafter referred to} as "SARFAESI Act 2002")^{assailingpossessionnotice and Tender} Cum Auction Sale^{Notice dated 20.01} '2022^{fixing auction on} 3L.o3.2o22in^{respectof SA schedu te propev.ffiw}

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2of5

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sA No.7512025

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The case of the applicant^{in brief, is that he is allegedly} guarantor to the loan availed^{by 2nd respondentcompanyThe} account does not^{comeunder purview of NPA. Applicant raised} objections to demand^{notice disputing outstandingamount and} execution of documents^{but respondentbank issuedreply without} answering the same.^{Without servingpossession notice,the} respondent bank^{issuedimpugned auction sale noticefixing auction} on 30.03.2022. The^{subject propertyis in possession of M/s} Chaitanya Educational^{Trustrunning a school therein since 2009} that is much^prior to^{alleged mortgage. There is a criminal case vide} FIR No.177/2021 with^{KarkhanaPolice StationRled by applicant} against Director^{of 2nd respondent companyfor forgery of signatures} of applicant on^{guaranteeagreementsetc. The 1't respondent} violated Secs.13(2), 13(4) and^{13(8) of the Act, 2002 and Rules} 8( 1), 8(2), 8(s), 8(6), 8(7)^{and 9(1) ofthe Rules,2002. Hencethis} SA.

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The 1't^{respondentbank filed reply statement along with} documents. The submissions,^{briefly, are that applicantstoodas} guarantor along with Prashanth Saboo, and^{also mortgaged} application schedule^{propertyas securityfor the loan sanctioned to} 2nd respondent company.^Due to^{default in repayment loan account} became NPA on 30.04.2021 as^{per prudential norms. In spite of} substantial opportunity to regularize^{the account,applicant/} borrower failed to utilize the^{same as a consequence,respondent} bank issued demand^notice dated^{31.07.2021. It consideredthe} objectlons and issued^{suitable reply. Possession noticedated} 02.77.2027 was duly sent^{by registeredpost, affixed on secured} asset and^{got published in 'Andhra Jyothi' and 'The New Indian} Express' on 08.11.2021. since applicant^{failed to redeem the} property by paying outstanding dues, respondent bank^issued auction sale notice dated 20.0.2022^{howeverscheduledauctionon}

ffi'.*

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SA No.75l202S

30.03.2022 was not conducl wp No.1ses1/20 zz ,^ zg.o?.dzloi;^"rl,."j HT;:1";::"",,TJ: Educational Society filed SA No.234/2023 challenging the action of bank for taking physicar possession of the property vide crr.Mp No'9A7/2023, and arso fired stay petition which was dismissed by the Tribunal while upholding the mortgage rights of the respondent bank. Said SA is pending adjudication. Respondent bank is no way concerned with internar disputes of appricant and director of the company. On one hand applicant denies guaranty and setuing the loan account through OTS, on the other hand. Applicant moftgaged SA schedule property consisting 3O0O sft constructed area on 400 sq. yards Iand as per sale deed No.2g2312015 and respondent bank is proceeding against the same by following due procedure of law. The SA is liable to be dismissed.

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It is a matter of record that applicant not pressed the SA against R2lborrower company.

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5' Appricant continuousry reported not ready and did not advance arguments. Perused the written arguments filed for the 1st respondent bank and the material brought on record.

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6.. Learned counsel for the 1st respondent bank in her written arguments reiterated the version as in the reply statement and sought for dismissal of the SA.

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Now the points that arise for adjudication are:_

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(i) Whether the Applicant made out any valid ground for quashing the measures of the 1't respondent bank under the provisions of the Act, 2002, including e-auction sale notice dated 20.01.2022 in respect of application schedule property, as prayed for? ,O$*w - .t^ / /,/r __,z{\rJv

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'-'/ t

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(ii) To what retief?

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4ofs

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sA^No.7512025

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:',;; 8.^{As per averments} "l'::,';':::'':l;l:,1; 1i, respondent^bank, raled^{ro rorrowsec 13(3A)'} ]:l;l;:;;;; 8(7)^{and 9(1) of the *'ll-t} -1ll"n"^{prace pursuant} "",T;:E:^{to orders passed} the^{impugned auctiondid} ""1^ta;;"., sgsr/zozz.^{Hence the} bv^{the Hon'ble t.'nn tou1,.r;';t"} n""o^{no consideration and sA} averments^{Pertaining to auctio} became^{infructuousto that extent'}

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-concerned' 9. As far^{as avermentof non-compliance of Secs 13(3A)' 13(4)} the 1't^{respondent bank} and^{Rules8(1) and 8(2)are} filed^{materialdocuments along with reply statement'Applicant} oo."o ""^- ""*: ":: l1';T :J,:L::: i:il"il i;H,'l the 1't^{resPondent bank The} found^{to be comprehensivetouchingthe points raised by the} applicant^{is his objectionsdateO 28'og'2021' The 1't respondent} guarantee^{agreement and MODT} bank^{filed copies of tunttton} '"tt"'' executed^{by the applicantand sale deed deposited therewith' as} proof of^{creating security interest over the tq tt6s6ulqpropertY} vide^{pages1 to 32 Copies of possession notice' postal receipts'} acknowledgements,paperclippingsandphotographSeVidencin9 service,^{publication and affixtureof possessionnotice areplaced at} pages 47to^{58 Noneof the documents is disputed by the applicant'} I find^{absolutely no infraction of Secs 13(3A)' 13(4) and nutes 8(1)} and^{8(2) of 2002'}

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10.^{In view of the above observations' I find that the applicant} failed to^{make out any valid groundto set aside the possession} noticeinrespectofapplicationscheduleproperty.AccordinglySAis tiabre to^be dismissed ZF"to

5 of 5

SA No.7sl2025

Point No.(ii):

In the result, the Securitization dismissed.

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Application fails and is hereby

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ConsequenUy, InterlocutoryApplications pending if any, shall stand closed.

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No order as to costs.

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t4. communicate a copy of this order to the parties concerned and upload in official Website.

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(Typed to my dictotion !! lhe pS, corrected, signed ond pronounced by me in the open court on this the 09th doy of April, 2026).

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1^{I_/,/ ia:0\N--} (RAVESHWAR KoTHE) PRESIDING OFFICER

K Veerender Reddy v. City Union Bank Limited

Case brief

What is this about?

What did the court decide?

K Veerender Reddy v. City Union Bank Limited

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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