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2025 Supreme(Online)(DRAT) 500
DEBT RECOVERY APPELLATE TRIBUNAL
Anil Kumar Srivastava, J
Mr. Imran Sha Choudhury – Appellant
Versus
Punjab National Bank – Respondent
Misc. Appeal No. 72 of 2025 | I.A. no. 418/2024 | SA no 71/2024
For the Appellants/Petitioners: Mr. Partha Bose, Mr. Proshit Deb
For the Respondents: Ms. Aprajita Rao
Res judicata bars re-litigation of SARFAESI notice validity in subsequent proceedings after final prior judgment.
Headnote:The relevant statutes include Sections 13(2), 13(4), and 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), along with Rule 8 of the Security Interest (Enforcement) Rules, 2002. The borrower challenged possession and demand notices issued under the SARFAESI Act after the loan account was classified as non-performing asset, leading to auction of secured assets and issuance of sale confirmation. The court found no illegality in the notices and proceedings, confirming compliance with statutory requirements and issuance of possession letters. The primary issues framed were whether the fresh possession notice violated statutory provisions pending a review petition and whether prior proceedings barred the current challenge under res judicata. The ratio decidendi emphasized that principles of res judicata apply to subsequent stages of the same or related proceedings, preventing re-litigation of settled issues like notice validity and possession orders, as supported by precedents holding that final decisions bind parties without need for appellate challenge (paras 7-9). The appeal against the dismissal of the interim application seeking stay on the vacation notice is dismissed, upholding the tribunal's order as the prior judgment attained finality absent any stay.
Based on the provided legal document, the key points are as follows:
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The appeal concerns a challenge to the order dismissing a stay application related to a notice to vacate issued by the bank under the SARFAESI Act (!) (!) .
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The appellant previously filed a suit challenging the same notices, which was dismissed, and the subsequent proceedings are barred by the principle of res judicata, as the issues raised are identical and have already been adjudicated on merits (!) (!) (!) .
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The appellant argued that the notice dated 11.06.2024 was issued pending a review petition and that the bank relied on an order passed by the District Magistrate that was not properly communicated to the appellant. The appellant contended that this rendered the notice invalid (!) .
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The respondent and the tribunal countered that the order of the District Magistrate was already communicated and that the issues relating to the notices and proceedings have been previously decided. They also emphasized that no stay was granted in the review petition, and thus, the issuance of the notice was lawful (!) (!) (!) .
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The tribunal found no illegality in the issuance of the notice or the proceedings, noting that the sale process had already been completed, with sale proceeds adjusted against the loan, thereby negating any prima facie case or likelihood of irreparable harm to the appellant (!) (!) .
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The tribunal concluded that the appeal lacked merit, upheld the earlier order, and dismissed the appeal accordingly (!) (!) .
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Overall, the decision underscores that principles of res judicata prevent re-litigation of issues that have been finally settled, and the procedural steps taken by the bank under the SARFAESI Act were in accordance with law (!) (!) .
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The appeal was dismissed, affirming the lawfulness of the notices and proceedings, and rejecting the appellant's claims regarding the pending review petition or procedural irregularities (!) .
| Table of Content |
|---|
| 1. hearing arguments and reviewing prior dismissal. (Para 1 , 2) |
| 2. summarizing original and fresh challenges to notices. (Para 3 , 4) |
| 3. appellant's claims of invalid notice pending review. (Para 5 , 6) |
| 4. res judicata bars re-challenging settled issues. (Para 7 , 8 , 9 , 10) |
| 5. no grounds for stay; appeal dismissed. (Para 11 , 12 , 13 , 14) |
1. Heard the learned counsel Mr. Nemani Srinivas for the appellant learned counsel for the respondent Ms. Aparajita Rao and perused the record.
2. Instant appeal has been preferred against order dated 19.07.2024 passed by Ld. DRT, Guwahati, in SA No. 71/2024, IA No 418 of 2024 whereby the Ld. DRT dismissed the IA No 418 of 2024 wherein relief for stay on the vacation notice issued by the bank on 11.06.2024 was sought for.2
3. As per the pleadings of the parties originally an SA No 93/2022 was filed by the appellant challenging the possession notice dated 14.09.2021 and demand notice dated 16.07.2019, which was dismissed by the Ld. DRT, Guwahati vide judgment and order dated 19.10.2023, Ld. DRT recorded a finding that the appellant was the borrower of the secured creditor. The loan account was classified as NPA. The secured creditor proceeded under the provisions of SARFAESI Act by issuing the mandatory notices. Secured assets were auctioned for an amount of Rs. 89 Lakhs. 25% of the bid amount was deposited by the successful auction purchaser and the confirmation of sale letter was issued on 01.09.2021. Order under Section 14 of the SARFAESI Act were obtained on 06.09.2021 from the District Magistrate and letter dated 14.09.2021 was issued by the secured creditor to the appellant to hand over the peaceful possession. Although appellant also preferred an application before the Hon'ble Guwahati High Court, wherein conditional order was passed but condition was not complied with. Consequently the Securitisation application was dismissed on 19.10.2023.
4. A review petition No. 10 of 2023 was filed by the appellant against the order dismissing the SA, which is still pending. A fresh letter dated 11.06.2024 was issued by the secured creditor to the appellant for handing over the possession, which was again challenged by the appellant by preferring the SA No 71/2024. The relief was sought to set aside the vacation notice dated 11.06.2024. Further relief was sought that there are violation of mandatory provisions of section 13(2) and section 13(4) of the Act and Rule 8 of the Security of Enforcement Rules. Pending SA, an IA no. 418/2024 was filed by the appellant seeking stay on the vacation notice dated 11.06.2024 on the ground that the District Magistrate Order passed U/s 14 was not communicated to the appellant. Further the ground relating to the compliance of mandatory provisions of SARFAESI Act as well as the Rules were also taken. Bank opposed the prayer, Ld. DRT dismissed IA No 418/2024 by passing the impugned order which is under challenge in this appeal.
5. Learned counsel for the appellant would submit that the impugned order is bad in law as the notice dated 11.06.2024 is issued by the bank pending review petition. It is further submitted that an order of the District Magistrate dated 19.02.2024 was allegedly taken help by3 the secured creditor wherein there is a mention of the order dated 06.09.2021 of the District Magistrate. Both these letters and orders came to the notice of the appellant pending SA. Hence, when the fresh orders have not been obtained by the bank U/s 14, letter dated 11.06.2024 for asking the appellant to vacate the property in dispute is bad in law. No other point is raised before me.
6. Per contra learned counsel for the respondent vehemently opposed the prayer and submits that the order dated 06.09.2021 passed U/s 14 of the Act by the District Magistrate was already communicated to the appellant. It is further submitted that all the issues which have been raised in the present SA have already been raised by the appellant in the earlier SA No 93/2022,
