Amount deposited under DRT interim order adjustable in loan account absent no-lien direction; OTS acceptance and no-complaint endorsement estop refund claim.

JUDGMENT

17 April, 2026

THE APPELLATE TRIBUNAL :

Instant appeal has been preferred against a judgment and order dated 14.02.2020 passed by Learned DRT-*1 Hyderabad in S.A. No. 20 of 2019 (Smt. G. Sireesha versus State Bank of India and others) along with I.A. No. 3361 of 2019 whereby Learned DRT dismissed the S.A.

2. As per the pleadings of the parties, the Appellant herein admittedly is a guarantor of a loan account sanctioned by the Respondent Bank in favour of the borrower M/s Delta De Aqua materials Pvt. Ltd. Loan account was classified as NPA on 01.03.2016. Demand Notice under Section 13(2) of the SARFAESI Act, 2002 was issued on 07.10.2016 for an amount of Rs.2,13,27,402/-. E-auction Sale Notice was also issued with a reserve price of Rs.42,79 lacs as far as the secured assets flat is concerned. Some proposal for O.T.S. was moved wherein certain amount was to be deposited. Accordingly, an amount of Rs. 45.00 lacs was deposited on different dates. But the documents of Title of flat No. 108 were not returned. SARFAESI Action was initiated by the Bank. Subsequently, on 18.08.2018, Bank offered to close all loans of the Company by paying Rs.1,24,75,428/- by appropriating the sum of Rs. 42.50 lacs. E-auction Sale Notice was again published on 30.12.2018 fixing the date 31.01.2019 for e-auction. In the _ notification dated 29.12.2018 of the Bank, dues were Rs.200.00 lacs. The reserve price of flat No. 108 is of Rs. 34.00 lacs while the Appellant has already paid Rs.42.50 lacs in the month of May, 2017. When an S.A. was filed challenging the e- auction Sale Notice dated 29.12.2018, an I.A. No. 179 of 2019 was filed pending S.A. for staying the further proceedings wherein vide order dated 28.01.2019 DRT directed that the Bank may proceed with the e-auction. But not to confirm the sale subject to the condition that, Applicant shall deposit a sum of Rs 20.00 lacs in two instalments directly with the Bank, failing which sale can be confirmed. In the said e-auction sale dated 31.01.2019, one Smt. Rama Devi Uppala stood as the highest bidder and paid entire sale consideration of Rs.43.50 lacs. Accordingly, the conditional order of the stay became _ absolute. However, in the meantime, the auction got cancelled and the sale consideration was returned to the highest bidder.

3. During pendency of the S.A. Bank offered a scheme for One Time Settlement (SBI OTS 2019) vide letter dated 23.09.2019 to the borrower, which was availed by the borrower and entire O.T.S. amount was paid and the original title deeds were returned.

4. Another I.A. No. 3361 of 2019 was filed by the Appellant for direction to the Bank to refund the amount of Rs. 20.00 lacs deposited by the Appellant in compliance of the order of DRT dated 28.01.2019 which was dismissed by the Learned DRT by the impugned order.

5. As far as reply of the Bank is concerned, facts regarding availing the loan facility and the status of the Appellant as guarantor are not in dispute. Further, initiation of the SARFAESI action after classifying the account as NPA is also not in dispute. It is also not disputed that the amount of Rs. 20.00 lacs was deposited by the Appellants which was duly adjusted in the loan account. It is also not in dispute that the O.T.S. proposal in SBI OTS 2019 was accepted by the Appellant and the account was settled. Original deeds were also returned to the Appellants. However, as far as the issue of refund of Rs.20.00 lacs is concerned, it is stated that the amount was deposited under the directions of the DRT and was given a due credit in the Statement of Account and was adjusted in the