A third party who is aggrieved by actions taken by a secured creditor under the SARFAESI Act has the locus standi to file an application under S. 17 before the Debts Recovery Tribunal, provided they can establish their status as an aggrieved person.

J U D G M E N T Dated this the 29th day of May, 2026 The petitioner is the applicant in S.A.No.202 of 2025 pending before the Debts Recovery Tribunal – I, Ernakulam. The petitioner has filed the S.A challenging the proceedings initiated by the 1^st respondent under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (hereinafter referred to as the ‘SARFAESI Act' for short) 2002.

2. It is alleged by the petitioner that the property belonging to the petitioner's husband has been fraudulently mortgaged by the 2^nd respondent, in collusion with the 1^st respondent. It is also his case that the Debts Recovery Tribunal did not grant any interim protection to him, since he was a third party and has no locus standi to maintain the application under Section 17 of the SARFAESI Act. It is in such circumstances, the petitioner filed this O.P.(DRT), seeking the following relief:-

“i)Issue a writ of mandamus or any other appropriate writ, order or direction, staying all further proceedings pursuant to the possession notice issued under Section 13(4) of the SARFAESI Act (Exhibit P7) and the order passed under Section 14 of the SARFAESI Act by the Chief Judicial Magistrate, Kozhikode (Exhibit P6), in respect of the property measuring 13.59 cents together with the residential building situated in Koduvalli Village, Thamarassery Taluk, Kozhikode, during the pendency of S.A. No. 202 of 2025 before the Hon’ble Debts Recovery Tribunal – I, Ernakulam, and until its final disposal;”

3. Heard the learned counsel for the petitioner and the learned counsel appearing for respondents 1 and 2.

4. The learned counsel for the petitioner submitted that the finding of the Tribunal in Ext.P3, that since the petitioner is a third party, he cannot file an S.A., cannot be sustained. He also submitted that during the pendency of this original petition, the civil suit which has been filed by the petitioner has been decreed in his favour and the sale deed has been set aside.

5. Per contra, the learned counsel for the 1^st respondent opposed the submissions made by the learned counsel for the petitioner and contended that the petitioner has no locus standi to move the Debts Recovery Tribunal and that he does not have any right over the secured asset.

6. At the outset itself, I may say that as per Section

17 of the SARFAESI Act, any person (including the borrower) who is aggrieved by the measures taken under the SARFAESI Act can file an application before the DRT to get his grievance redressed. If so, it can be stated without doubt that even a third party can file an application under Section 17 before the DRT. But, the third party who thus files an application must positively establish that he is aggrieved by the actions taken by the secured creditor before the DRT. If as contended by the petitioner, the title document of the property which is made a secured asset is set aside by the civil court, it is for the petitioner to establish the same before the DRT and to prove that the petitioner is an aggrieved person.

If so, with the above observations, this O.P (DRT) is disposed of by directing the Tribunal to consider the stay petition filed by the petitioner in S.A No.202 of 2025, within a period of two weeks from the date of receipt of a copy of this judgment.