Dismissed

Smt Meenadevi Madem v. Shriram Finance Ltd.

DRT27 Aug 2026SA/76/2025

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal dismissed an application filed by a guarantor seeking to set aside a demand notice and possess ion notice under the SARFAESI Act. The court held that the applicant failed to substantiate claims of NPA misclassification or procedural violations with evidence. The creditor demonstrated compliance with service and publication requirements. Consequently, the application fai

What did the court decide?

The Securitisation Application is dismissed. Interlocutory Applications pending, if any, shall stand closed.

Smt Meenadevi Madem versus Shriram Finance Ltd. — Company and Corporate | DRT (2026)

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IN THE DEBTS RECOVERY TRIBUNAL - II AT HYDERABADi

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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. 76 OF 2025

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Smt. Meenadevi Madem, W/o. M. Rajasekhar Reddy, Aged 58 years, Occ: Agriculture, R/o.H.No. U57, Thirumala Nivas, Peddakottala Village, Nandyal Mandal & District

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Applicant

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Versus

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Shriram Finance Ltd., Branch Office at Door No.251586, Gupta Building First Floor, Sreenivasa Nagar, Nandyal-518501, Rep. by its Authorized Officer

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.....Respondent

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Counsel for the Applicant : M/s. T. Sridhar Reddy Counsel for Respondent : M/s. N. Raghuveer

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-:ORDER:-

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The present Securitization Application is filed by the Applicarnt u/s.L7 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2OO2 ("Act" hereinafter for short) assailing demand notice dated 13.02.2023 under section 13(2): and possession notice dated L7.0L.2025 under section 13(4) of the Act in respect of the SA Schedule^properties.

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The averments of the application, in brief, are that applicant^is the wife of Sri M. Rajasekhar Reddy, who availed loans from various persons, including the Respondent Company, in connection with his real estate business, and that she stood as Guarantor to the said

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SA No. 76l2OZs

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[oan. ,T,he Applicant^{came to know of the SARFAESI proceedings only} upon beinq informed by^{persons claiming to be recovery agents of} ,'.lr the Re:pondent and, thereafter,^{on perusal of the Demand Notice} dpted'13.02.2023 and^{the PossessionNotice dated t7.0L.2025 issued} llndel,section^{13(4) of the SARFAESIAct. She further avers that her} husbapd has been untraceable^{since 19.10 .2024 and that FIR} No.256/2024 was registered^{by NandyalPolice Station in this regard.} The Applicant alleges that the^{loan account was not validlyclassified} as NPA, that the Demand^{Notice was issued contrary toRBI} guidelines, and that the Possession Notice was^{neither dulyserved} nor affixed on the schedule^{property nor published in two leading} newspapers in compliance^{with Rule B(2) of the Security Interest} (Enforcement) i Rules, 2002^{(hereinafter"Rules"} for^short).She further contends that substantial^{amountshave been paid towards} the loan and that the Respondent^{has claimedan excessive amount} by levying interest upon interest.^{The Applicant also asserts that a} portion of Item No.1 of the schedule property, is agricultural^land under cultivation and, therefore,^{is exempt under Section 31(i) of the} SARFAESI I Act. On these^grounds, the^{Applicant seeks setting aside of} the impugned measures and^production of the original^loan dbcuments and statement of account.^{In support of her contentions,} the Applicant relies upon Mardia Chemicals Ltd. v.^{Union of India,} (2004) 4 SCC 377, and Harshad Govardhan Sondagar v. International Assets Reconstruction Co. Ltd.,^(20t4) 6 SCC^1, contending^{that the} impugned measures are contrary to the statutory^{requirements and} p:rocedural 'l safeguards under the SARFAESI Act and the Rules framed thiereunder.

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3.r The Respondent Company filed its reply^{statement along with} SUppoirting documents. The averments thereof,^{in brief, are that} RespQndent admits issuance of the Demand Notice dated^t3.02.2023 I 6M

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Page 3 of 5

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I sA No.76l2oPs

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and the Possession Notice dated t7.01.2025 under Section 13(4) lof the SARFAESI Act, but denies the Applicant's contention regardifig want of service and asserts that the notices were duly served by affixture and publication, supported by photographs and GPF-) mapping evidence. The Respondent contends that the alleged missirrg complaint concerning the borrower is irrelevant to the SARFAESI proceedings and does not affect the loan liability. It further asserts that the dues were computed in accordance with the contractual terms and RBI^guidelines and denies levy of interest upon interest, contending that the SMS/message relied upon by the Applicant hES no evidentiary value against the loan accounts maintained by tfrb Bank. The Respondent also disputes the agricultural character of the1 secured property and contends that the Crop Certificate datbd 27.01.2025 was subsequently obtained as an afterthought, assertihg that the property was classified as non-agricultural at the time of sanction of the loan. Accordingly, the respondent^prays for dismisdal of the SA with costs.

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Both learned counsel for the applicant and learned counsel for the respondent reported no oral arguments. Perused the written arguments filed by the respondent and also^perused thermaterial brought on record. i

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';i.t

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Learned Counsel for the Respondent Company, in its written arguments, reiterated the contents of the reply statement, denied the averments made in the SA and^placed reliance upon the documents filed alonq with the reply. It is submitted that the loan account was duly classified as NPA in accordance with the applicable. RBI guidelines and that the Respondent Company had strictly compliFd . 1., with the procedure prescribed under the SARFAESI Act and the'Ru'leis, 1 2002. Accordingly, Learned Counsel prayed for^Qismissal of the SA.

//fzrl*Y ot^'u"

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SA No. 7612025

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

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i) whether the^{Applicantmade out any valid groundto} quash any of the measures initiated^{by the respondent} against the SA schedule^{properties as prayed for?}

ii) To what relief?

Point^No.(i):

7,., Admittedly, the^{Applicantstood as a Guarantorto the loan} facility ,] availed by the^{borrower.Upon failure of the borrower to} adhere to the repayment^{schedule,the liability of the Guarantor is co-} extensive with that of^{the principal debtor.Consequently,the} clqssification of the^{loan account as NPA and the consequential} initiation.of^{proceedings underthe SARFAESIAct by the Respondent} cannot, in the facts and^{circumstancesof the case,be held to be} illegal or irregular merely^{on the ground urged by the Applicant.}

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B i The Applicant has contended^{that the loan account was} wrongfully i^{classified as NPA and that the Respondent failed to adhere} to; the applicable^{RBI guidelines. However, the Applicant has neither} specified the^{particular RBI guidelines allegedlyviolated by the} Respondent nor^{placed on recOrd any material or documentary} evidence in support of^{the said contention.In the absence of any} sqecific pleading or supporting^{evidence to establish such violation,} fhie^{said contention remains unsubstantiated and cannot be accepted.} i,,. r:I

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g.i 'ii The Respondent Company filed material documents along with reiply i statement as^{proof of compliance of due procedureof law' A} perusal of the record reveals that^{the DemandNotice was duly} dispatched through^{post to the Applicantand, prorli-ng service of the} ,t avw

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Page 5 of 5

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sA No.,7612025

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Demand Notice upon the Applicant. Similarly the Respondent Company has filed the photostat copies service of possession notice dated L7.0L.2025 via registered post, paper publication ,of the possession notice in English and Vernacular language and photograph of affixture of the notice. The documents placed on record by the Respondent Company remain undisputed. In view of sufficient proof place on record, I find no infraction of section 13(2) & 13(4) of the Act and Rules 3, 8(1) & B(2) of the Rules, 2002. As a secured creditor the Respondent Company initiated the SARFESI proceedings, which : ' cannot be catego rized as illegal or arbitrary.

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In view of above observation, it is concluded that the Applica:nt failed to establish any ground to set aside demand notice under section 13(2) and possession notice under section 13(4) of the Act, 2002 in respect of the SA Schedule Properties and accordingly the SA is liable to be dismissed.

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Point No.(ii):

In the result, the Securitisation Application fails and is hereby dismissed. L2. Consequently, Interlocutory Applications pending, if any; shall stand closed.

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L4. 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 and pronounced by me in the open court on this the Zt'n doy of August, 2026).

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(RAMrsnwAR /)W**KoTHE) PRESIDING OFFICER

Smt Meenadevi Madem v. Shriram Finance Ltd.

Case brief

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Smt Meenadevi Madem v. Shriram Finance Ltd.

Case brief

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