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2021 (2) TMI 1361 - HC - Indian LawsDefault in payment of loan instalments - non-service of possession notice - HELD THAT - The grounds urged by the petitioners that they were not served with sale notice under Rule 8(6), and 30 day notice period fixed there under was not given to them to clear the loan, and to redeem the property, is found to be not correct, and the Bank has followed the due procedure as envisaged under the provisions of SARFAESI Act, and the Rules of 2002, and further, the petitioners have suppressed the material facts with regard to filing of securitization applications before the Debts Recovery Tribunal, and the facts and circumstances manifestly disclose that they are resorting to dilatory and subterfuge tactics, to see that the recovery proceedings initiated by the Bank, are defeated. This cannot be appreciated. For suppression of material facts, the writ petition is liable to be dismissed with exemplary cost - Petition dismissed with costs.
Issues Involved:
1. Issuance of possession notice under Section 13(4) of the SARFAESI Act. 2. Compliance with Rule 8(6) and Rule 9(1) of the Security Interest (Enforcement) Rules, 2002. 3. Service of sale notice and the right to redeem under Section 13(8) of the SARFAESI Act. 4. Allegations of suppression of material facts by the petitioners. 5. Maintainability of the writ petition due to the availability of alternative remedies. Issue-wise Detailed Analysis: 1. Issuance of Possession Notice under Section 13(4) of the SARFAESI Act: The petitioners alleged that no possession notice under Section 13(4) was issued and that the procedure under sub-rules 1 and 2 of Rule 8 was not followed. The Bank, however, provided evidence that possession notices dated 11.02.2015 were issued and affixed on the secured assets, and published in Indian Express and Andhra Jyothi newspapers on 15.02.2015. The court noted that the petitioners did not file a reply affidavit to deny these assertions, leading to the conclusion that the allegation was baseless. 2. Compliance with Rule 8(6) and Rule 9(1) of the Security Interest (Enforcement) Rules, 2002: The petitioners contended that they were not served with a sale notice under Rule 8(6) and were not given the 30-day notice period to clear the loan. The Bank countered that notices dated 03.03.2015 and 06.08.2019 were issued, with the latter returned un-served with endorsements like 'unclaimed' and 'door locked'. The court referenced precedents, including K. Bhaskaran vs. Sankaran Vaidhyan Balan, to establish that unclaimed notices are deemed served. Thus, the court presumed that the sale notice was served, and the Bank complied with the necessary rules. 3. Service of Sale Notice and Right to Redeem under Section 13(8) of the SARFAESI Act: The court examined the provisions of Section 13(8) and Rule 8(6), emphasizing the borrower's right to a 30-day notice period for redeeming the property. It cited judgments like J. Rajiv Subramaniyan vs. Pandiyas and Sri Sai Annadatha Polymers v. Canara Bank, which underscored the necessity of this notice period. The court found that the Bank had indeed followed the procedure, and the petitioners' right to redeem was not violated. 4. Allegations of Suppression of Material Facts by the Petitioners: The court found that the petitioners had suppressed material facts, including the filing of securitization applications and obtaining interim orders from the Debts Recovery Tribunal. The court cited K.D. Sharma v. SAIL, emphasizing that suppression of facts warrants dismissal of the writ petition. The court concluded that the petitioners' actions were intended to mislead the court and delay the recovery process. 5. Maintainability of the Writ Petition Due to the Availability of Alternative Remedies: The Bank argued that the writ petition was not maintainable due to the availability of alternative remedies under Section 17 of the SARFAESI Act. The court did not explicitly address this argument in detail, but the dismissal of the petition on other grounds rendered this issue moot. Conclusion: The court dismissed the writ petition with costs, finding that the Bank had complied with the necessary legal procedures and that the petitioners had suppressed material facts. The petitioners were ordered to pay Rs. 20,000 to the Telangana State Legal Services Authority within eight weeks.
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