Partly allowed

Sri. V.R. Munuswamy Naidu v. The State Bank of India

Telangana HC13 Apr 2022WP/18613/2022

Case brief

AI extract

What is this about?

The Court quashed the sale notice regarding specific property property No.3 of the petitioner, conditional on a deposit of 15% of the reserve price within 30 days. The stay did not affect proceedings concerning other schedule properties, and the petitioner was directed to pursue the statutory remedy under Section 17 of the SARFAESI Act with the Debts Recovery Tribunal.

What did the court decide?

Stay on sale notice regarding Property No.3 contingent upon deposit of 15% of reserve price within 30 days; other schedule properties remain liable to auction.

Sri. V.R. Munuswamy Naidu Vs The State Bank of… — Execution and Attachment | Telangana HC (2022)

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THE HONOURABLE SRI JUSTICE UJJAL BHUYAN

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AND

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THE HONOURABLE MRS JUSTICE SUREPALLI NANDA WRIT PETITION No.18613 of 2022

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ORDER: (Per Hon’ble Sri Justice Ujjal Bhuyan)

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Heard Ms. Hamsa Durga Ponnam, learned counsel for the petitioner and Mr. Krishnam Raju, learned counsel appearing on behalf of Mr. K.Sandeep, learned counsel for respondent No.1.

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By filing this petition under Article 226 of the Constitution of India, petitioner seeking quashing of sale notice dated 07.03.2022 issued by the 1^st respondent proposing to hold auction sale of eight numbers of schedule properties on 18.04.2022.

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It is submitted that petitioner as the guarantor

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to the loan availed of by respondent No.2 from respondent No.1 had mortgaged property No.3 in terms of the sale notice to respondent No.1. For default in repayment, 1^st respondent has invoked provisions of the Securitisation

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and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (briefly referred to hereinafter as the ‘SARFAESI Act’). As a consequence, the impugned sale notice has been issued, wherefrom it is seen that outstanding dues of the 2^nd respondent has been quantified by the 1^st respondent at Rs.42,74,08,238.62 as on 28.02.2022. Insofar property No.3 of the petitioner is concerned, the Reserve Price has been fixed at Rs.1,59,00,000.00.

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Aggrieved by the sale notice, petitioner has filed securitisation application under Section 17 of the SARFAESI Act before the Debts Recovery Tribunal-II, Hyderabad (Tribunal), which has been numbered as S.A(I.R).No.410 of 2022. With the grievance that there is no Presiding Officer in the Tribunal rendering the same non-functional, present writ petition has been filed.

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After hearing learned counsel for the parties

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and on due consideration, we are of the view that since petitioner has availed his statutory remedy before the

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Tribunal, he may pursue the said remedy. That apart, if the petitioner deposits 15% of the Reserve Price of property No.3 within a period of 30 days from today, respondent No.1 shall not take further steps pursuant to the sale notice dated 07.03.2022 in respect of the said property No.3, the details of which are as under:

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“ Property 3:

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Residential land measuring 0.65 cents & Building in S.No.137/1F with D No.1-2594, Dr.Ambedkar Main Road, Attanthangal, PonneriTaluk, Tiruvallur District, Chennai, Tamilnadu in the name of Shri V.R.Munuswamy Naidu and SmtK.Amudha w/o Shri.Kesavulu Naidu vide Document No.4600/1989 dated 22.11.1989 and Document No.5112/2004 dated 09.12.2004 and bounded by:

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North : Land owned by Dr. Ansari South : Common passage leads fromAttan ThangalVillage ToTiruvanlluru main road East : Road leads to AttanThangal West : Land owned by GurunathChettiar”

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In any event, the said sale notice would be

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subject to outcome of S.A(I.R).No.410 of 2022. We make it clear that upon such deposit, it would be open to

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respondent No.1 to appropriate the said amount towards the loan account. However, if there is any default in making the payment as above by the petitioner, respondent No.1 would be at liberty to take such steps as is permissible in law for recovery of dues.

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We further clarify that the stay order passed by this Court is only confined to the schedule property No.3. Respondent No.1 would be at liberty to proceed with the proposed auction sale on 18.04.2022 with respect to the other schedule properties.

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