JUDGEMENT

:

22nd April, 2024 THE APPELLATE TRIBUNAL :

Instant appeal has arisen against judgment and order dated 14.12.2022, passed by Learned DRT-I, Hyderabad dismissing T.S.A. 3 of 2022 (Srikanth Reddy Kasu -vs- Bank of India & Another).

2. As per the pleadings of the parties, a Housing Loan of Rs.1.27 lac was sanctioned to the SARFAESI Applicant, Appellant herein, for purchase of a plot and for construction of building thereon.

Schedule property was mortgaged to secure the loan. It is stated that the entire amount of loan was not released by the Bank as per the schedule. Accordingly, construction of the building got delayed. Rate of interest was increased from 7% to 10.5% per annum by the Bank without informing the Appellant. An amount of Rs.45.00 lac was deposited by the Appellant. Appellant came to know from his friends and relatives that Sale Notice dated 23.5.2022 was issued by the Bank fixing the auction on 27.6.2022. Objections against the Demand Notice were made which were not considered. It appears that a SARFAESI Application under Section 17 of the SARFAESI Act, 2002 (herein referred to as the Act) was filed by the Appellant challenging the action of the Bank. It is further stated that Possession Notice was not served upon the Appellant and it was not published in two leading newspapers. It was also not affixed on the secured assets. Sale Notice dated 23.5.2022 was not served upon the Appellant and was also not affixed on the secured assets and not published in two leading newspapers. It is further stated that the description of the property was wrong, boundaries of the property, in the Sale Notice dated 23.5.2022, were not given and the valuation report of the property was not obtained from the approved valuer. Provisions of Rules 8 (1), 8 (2), 8 (5), 8 (6), 8 (7), 9 (1) and 9 (3) of the Security Interest (Enforcement) Rules, were violated. Amendment was sought in the SARFAESI Application to the effect that action taken by the Bank, in pursuance of the Advocate Commissioner Notice dated 17.9.2022 in Criminal Proceedings No. M.P. No. 54 of 2022 in the file of Chief Judicial Magistrate, Medchal Malkajgiri, be set aside as illegal and against law.

3. Respondent Bank filed the opposition before the Learned DRT stating that the Housing Loan of Rs.1.27 lac was sanctioned to the Appellant for purchase of a plot and construction of the house on 18.11.2017 which was duly acknowledged and confirmed by the Appellant. Appellant was duly informed about the revision of interest on account of delay in constructing the building on 11.01.2022. Since Appellant failed to repay the loan as per the terms and conditions of the sanction letter, it was classified as N.P.A. on 20.01.2022. Demand Notice dated 21.1.2022 for Rs.1,48,25,807.78 was issued. Objections were made by the Appellant on 27.1.2022 which was duly replied by the Bank on 18.2.2022. Possession Notice was published on 01.4.2022 and symbolic possession was taken by the Bank. Possession Notice was also served upon the Appellant and was affixed on the secured assets and published in two newspapers. Sale Notice dated 23.5.2022 fixing the date of e-auction on 27.6.2022 was published in Hindu and Andhra Jyothi newspapers on 26.5.2022.

4. Valuation Report was obtained from the Government approved valuer and the reserve price was fixed at Rs.2.17 lac. In the e-auction, conducted on 27.6.2022, Respondent No. 2 stood as the highest bidder for an amount of Rs.2.32 lac who paid Rs.58.00 lac on 28.6.2022 as 25% of the bid amount.

5. In the meantime, Appellant moved an application, being I.A. 777 of 2022, in T.S.A. 3 of 2022 for stay of further proceedings wherein vide order dated 30.06.2022 confirmation of sale and issuance of Sale Certificate, including handing over physical possession, was stayed by the Learned DRT subject to the condition that the Appellant should deposit Rs.20.00 lac on or before 15.7.2022 and the balance Rs.20.00 lac on or before 29.7.2022. If any of