WP/29771/2024 of AKI VENKATA SURYANARAYANA Vs AXIS BANK on 6 January 2026

1. AKI VENKATA SU AGED 53 YEARS COLLEGE ROAD,

2. AKI SARASWATHI, D.NO.3-4-92/3, FIR EAST GODAVARI D

3. AKI RAMA K SATYANARAYANA D.NO.3-4-92/3, FIR EAST GODAVARI D

1. AXIS BANK, REP TOWERS, D.NO.30 STREET, BESIDE CIRCLE, VIJAYAWA

2. M/S SAI MARUTH PABOLU SESHA PLAZA, NEAR V E HIGH COURT OF ANDHRA PRAD AT AMARAVATI (Special Original Jurisdiction) AY, THE SEVENTH DAY OF JANUAR O THOUSAND AND TWENTY SIX PRESENT RI JUSTICE CHEEKATI MANAVEND BLE SRI JUSTICE TUHIN KUMAR G RIT PETITION NO: 29771/2024 URYANARAYANA, S/O AKI SATY S, BUSINESS, D.NO.3-4-92/3, FI AMALAPURAM, EAST GODAVARI D ,, W/O AKI SATYANARAYANA, AGE RST FLOOR, COLLEGE ROAD, A DISTRICT RISHNA KAMESWARA RAO,, A, AGED 49 YEARS. CHARTERED A RST FLOOR, COLLEGE ROAD, A DISTRICT, ...P AND BY ITS AUTHORIZED OFFICER, 0-22-79, 1ST FLOOR, KOLLIPARA SBI BANK, ELUM ROAD, SEETH ADA. HI ENTERPRISES, REP BY ITS P KUMARI, D.NO.2-2, SHOP NO.6 PC MULTIPLEX EDURAPALLI, A DESH

RY DRANATH ROY GEDELA YANARAYANA, IRST FLOOR, DISTRICT ED 70 YEARS, AMALAPURAM, S/O AKI ACCOUNTANT AMALAPURAM, PETITIONER(S) CPC SREE A SRIRAMULU HARAMPURAM PROPRIETOR, AND 7, ASN AMALAPURAM,

EAST GODAVARI DISTRICT.

3. PABOLU VENKATASATYANARAYANA GUPTA, S/O PABOLU KAMMAYA, D.NO.4-2-80/4, BUPAYYA, AGRAHARAM, REVENUE WARD NO.7, AMALAPURAM, EAST GODAVARI DISTRICT.

4. PABOLU SESHA KUMARI, W/O.PABOLU VENKATA SATYANARAYANA GUPTA,D.NO.4-2-80/4, BUPAYYA, AGRAHARAM, REVENUE WARD NO.7, AMALAPURAM, EAST GODAVARI DISTRICT.

5. PABOLU KUMAR KAMESWARA SIVA RANGA PRASAD, S/O PABOLU VENKATA SATYANARAYANA GUPTA, D.NO.4-2-80/4, BUPAYYA, AGRAHARAM, REVENUE WARD NO.7, AMALAPURAM, EAST GODAVARI DISTRICT.

6. KOTHA NAGA RATNAVATHI, W/O KOTHA NAGESWARA RAO, D.NO.79-2-17/2, TILAK ROAD, OPP. STREET TO CANARA BANK, MALLI NAGAR, DANAVAIPETA, RAJ AMAHENDRAVARAM, EAST GODAVARI DISTRICT. ...RESPONDENT(S): Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a writ, order or direction, more particularly, one in the nature of Writ of Mandamus declaring the action on the part of Respondent no.1 in seeking Orders of physical possession Under Sec. 14 of SARFAESI Act, 2002, in CRLMP.No.513 of 2024 on the file of The Chief Judicial Magistrate- cum- I Additional Assistant Sessions Judge, Rajamahendravaram (FAC) Principal Assistant Sessions Judge East Godavari, Rajamahendravaram, dt.22-11-2024, in order to take physical possession over the building property which is of G plus 2 upper floors, in the name of Sri Surya Complex, consisting of 12 shops in the ground floor, 4 residential portions in First floor, and 2 commercial premises and 1 residential portion in the entire second floor, bearing D.No.3-4-92/3, in R.S.No.437/15, College Road, Amalapuram, East Godavari District, without following the strict compliance of provisions of Sec 14 of SARFAESI Act, 2002, by directing the Petitioners and the tenants therein to vacate and handover physical possession by way of Notice dt.30- 11-2024 issued by the Advocate Commissioner is unlawful, illegal in violation of the fundamental rights of the Petitioners and the occupants in the said building and in the violation of Principles of Natural Justice, by consequently setting aside the Orders dt.22-11-2024 passed in CRLMP.No.513 of 2024 on the file of The Chief Judicial Magistrate-cum-I Additional Assistant Sessions Judge, Rajamahendravaram (FAC) Principal Assistant Sessions Judge East Godavari, Rajamahendravaram and pass IA NO: 1 OF 2024 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to Grant Interim Stay of all further proceedings of the execution of the Warrant issued under the Orders of physical possession passed under Sec. 14 of SARFAESI Act, 2002, by the Court of The Chief Judicial Magistrate-cum-I Additional Assistant Sessions Judge, Rajamahendravaram (FAC) Principal Assistant Sessions Judge : East Godavari, Rajamahendravaram, passed in CRLMP.No.513 of 2024, dt.22-11-2024 pending disposal of Writ Petition, and pass Counsel for the Petitioner(S):

1. P RAJESH BABU Counsel for the Respondent(S):

1. KUNUKU RAJA SEKHAR

The Court made the following: ORDER: (Per Hon’ble Sri Justice Cheekati Manavendranath Roy)

Heard learned counsel for the petitioners and learned Standing Counsel for the 1st respondent-Axis Bank.

2. The petitioners are the guarantors, who offered their immovable property as a security for the loan availed by respondent Nos.2 to 6, who are the principal borrowers, who availed loan from the 1st respondent-Bank.

3. As the principal borrowers committed default in repayment of the loan amount, the 1st respondent-Bank has initiated measures under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, ‘the Act’) for recovery of the loan amount. Initially they have issued notice under Section 13(2) of the Act and thereafter, as the principal borrowers and the guarantors failed to discharge the loan amount, they have initiated measures under Section 14 of the Act. An application under Section 14 of the Act was filed before the concerned Magistrate and the learned Magistrate has allowed the said application and appointed an advocate commissioner to take possession of the secured asset.

4. Challenging the said order of the learned Magistrate passed under Section 14 of the Act to take possession of the secured asset, the petitioners, who are the guarantors, have filed this writ petition. Be it noted here itself that the principal borrowers have no grievance at all whatsoever in respect of the said measures initiated by the Bank, including the impugned order passed by the learned Magistrate and they did not challenge the said proceedings. It is only the guarantors who have filed this writ petition challenging the said proceedings. The guarantors have challenged the said order on the ground that even though the tenants are residing in the secured asset, the Bank has not mentioned the said fact in the petition or the affidavit filed before the learned Magistrate under Section 14 of the Act and suppression of the said fact relating to the tenancy vitiates the order passed under Section 14 of the Act. Apart from the said ground, the petitioners/guarantors have also challenged the said proceedings on the other ground that the actual amount that is due and outstanding is not mentioned in the affidavit or the petition filed by the Bank under Section 14 of the Act before the learned Magistrate, as required under the proviso to Section 14 of the Act and it also vitiates the impugned order of the learned Magistrate and the measures initiated by the Bank.

5. As regards the first ground regarding the suppression of the fact that the tenants are residing in the secured asset, in the application filed before the learned Magistrate is concerned, we have absolutely no hesitation to hold that it will not vitiate the impugned order in any way as per law. Certain grounds are enumerated under the proviso to Section 14 of the Act regarding the facts to be declared in the affidavit filed under Section 14 of the Act before the learned Magistrate. It is nowhere stated in express terms or by way of necessary implication that it is mandatory on the part of the Bank or financial institution that when the tenants are residing in the secured asset that the Bank has to declare the said fact in the affidavit or the petition filed under Section 14 of the Act. Therefore, even if it is a fact that the tenants are residing in the secured asset and even if the said fact is not declared in the affidavit or the petition filed under Section 14 of the Act, it does not in any way vitiate the order passed by the learned Magistrate, as it is not required to be declared in the affidavit or the petition filed under Section 14 of the Act. Therefore, the said contention of the petitioners is devoid of any merit and it is liable to be rejected.

6. As regards the second ground that the amount due is not specifically pleaded in the petition filed under Section 14 of the Act is concerned, no doubt

Clause (1) of proviso to Section 14 envisages that it has to be declared in the petition regarding the aggregate amount of financial assistance granted and the total claim of the Bank as on the date of filing of the application. Learned Standing Counsel for the Bank has drawn our attention to para No.4 of the petition filed under Section 14 of the Act and vehemently contended that the Bank has clearly stated that a sum of Rs.4,53,43,272.73/- is the outstanding overdue against the accounts maintained in the usual and ordinary course of applicant business. We have carefully gone through para No.4 of the application. For better appreciation, para No.4 is extracted hereunder and it reads thus: “4. the respondents and the guarantors have failed to adhere to the terms and conditions as stipulated in loan agreement and have defaulted in repayment of the above loan and the said loan account became a non-performing asset (NPA) and consequently the sum of Rs.4,53,43,272.73/- is outstanding overdue against the accounts maintained in the usual and ordinary course of applicant business.”

7. A reading of the above paragraph clearly shows that the Bank has declared that the outstanding overdue as per the accounts maintained in the usual and ordinary course of applicant business is Rs.4,53,43,272.73/-. Therefore, in our considered view, the Bank has clearly complied with the requirement of proviso to Section 14 of the Act. The declaration to be made need not be in the same language as used in the Section. Suffice it to mention in the petition as to what is the outstanding overdue amount which the principal borrowers and guarantors are liable to pay on the loan account to the petitioner. Therefore, it cannot be said that the application filed under Section 14 of the Act is devoid of the requirements to be declared under the proviso to Section 14 of the Act and that it vitiates the impugned order of the learned Magistrate.

8. Therefore, the petitioners now cannot seek to impeach the impugned order of the learned Magistrate on the aforesaid two grounds, which are urged in this writ petition.

9. So, the impugned order of the learned Magistrate passed, is perfectly sustainable under law and it calls for no interference in this writ petition and the same is not liable to be set-aside.

10. Further, at the time when the matter came up for admission on 16.12.2024 before a coordinate Bench of this Court, the petitioners/guarantors have obtained an interim order of stay of all further proceedings. This Court has granted the said stay subject to the condition of the petitioners depositing a sum of Rs.50,00,000/-, within a period of four weeks from the date of the said order, with the 1st respondent-Bank and also depositing a further sum of Rs.50,00,000/- within a period of four weeks thereafter and in all, a sum of Rs.1 crore is ordered to be deposited within the stipulated time in two installments. Further, this Court clearly held that in the event of failure of the petitioners to deposit the said amount, the 1st respondent-Bank is at liberty to continue the process in accordance with law. The petitioners/guarantors have flagrantly flouted the said condition imposed by this Court at the time of granting stay. Not even a single pie was deposited by the petitioners, as ordered by this Court while granting conditional stay. It clearly shows that the petitioners/guarantors have been abusing the process of law to stall the proceedings initiated by the Bank for recovery of the loan amount, which is the public money, which is due from both the principal borrowers and the guarantors. The principal borrowers are not coming forward and they are only keeping the guarantors in front and fomenting the litigation to stall the measures initiated by the Bank for recovery of the loan amount.

11. Resultantly, the Writ Petition lacks merit and it is liable to be dismissed and accordingly, the Writ Petition is dismissed. There shall be no order as to costs. As a sequel, Interlocutory Applications pending, if any, shall stand closed.

________________________________________ JUSTICE CHEEKATI MANAVENDRANATH ROY

_____________________________ JUSTICE TUHIN KUMAR GEDELA

Date: 07.01.2026 MDP