KANUBOINA VENAKTA SRINIVASA RAO vs STATE BANK OF INDIA on 2 August 2021

ORDER

The petition MA.02 of 2020 is filed by petitioner under section 17 of SARFAESI Act read with section 5 of Limitation Act to condone the delay of 26 days in filing the SA, in the interest of justice.

2. According to the averments made in the petition that the Petitioner and his wife obtained housing loan of Rs.4,90,000/- in the year 2012 from the Respondent Bank by mortgaging his house property situated at Chagallu Village and Mandal. It is stated that Petitioner is an agriculturist by occupation and Respondent Bank offered another loan i.e. VERMY Compost loan (Term loan) stating that Petitioner could get subsidy to the above said loan to be availed by him. Believing the words of the officials of the Respondent Bank, the Petitioner availed loan of Rs.4,75,000/- in the year 2016 and along with the above loan, the Respondent Bank granted cash credit of Rs.75,000/-. The above said vermin compost loan(Term loan) and cash credit are independent loans. The Respondent Bank gave different account numbers for the housing loan, Vermin compost loan and cash credit. It is further, submitted that Respondent Bank issued sale notice dated 23-9-2019 fixing the sale on 25-10-2019 fixing the reserve price of Rs.14,00,000/- though the value of the house is more than Rs.30,00,000/- and that Respondent Bank conducted the auction on 25-10-2019 and one of the auction purchaser purchased his property and details of details of Auction purchaser not known to him and it is said that it is not known to the Petitioner whether Respondent Bank approached the District Collector or Chief Metropolitan Magistrate for taking physical possession of the schedule property and on 22-12-2019 the Respondent Bank seized the schedule property and directed the Petitioner to take out the movables in schedule property and without considering the request and representation made by the Petitioner, it is wholly illegal, arbitrary and violation of article 14 and 21 of Constitution of India and violative of principle of natural justice and Petitioner has no knowledge of demand notice and possession notice. It is also contended by the Petitioner that Respondent Bank did not A handwritten signature in black ink, appearing to be a stylized 'D' followed by several loops and a long horizontal stroke extending to the right.

furnish the details of Auction Purchaser despite several requests. It is also submitted that officials of the Respondent Bank colluded with the auction purchaser by putting reserve price undervalued substantially and the act of non furnishing of details of auction purchaser and Petitioner is willing to pay the loan amount as per statement of account and on 25-10-2019 the Petitioner came to know that one of auction purchaser participated in auction and purchased the schedule property. There are lot of lacoonas and irregularity committed by the Respondent Bank so far as auction is concerned. It is said that Petitioner did not approach the Tribunal within time to challenge the sale notice due to lack of knowledge and there is a delay of 26 days for filing the application and Petitioner prayed for condonation of delay of 26 days in filing the application.

3. Counter filed by the respondent bank denying the averments made in the petition and further stated that it is not true that Respondent bank sold the property under valuation. It is stated that there is no valid reason mentioned for delay and Petitioner has knowledge of issuance of sale notice and Petitioner is not entitled to any relief as prayed in MA since the same is not maintainable and as such delay cannot be condoned and prayed for dismissal of MA.

4 The point for consideration is whether the petitioner is entitled for condonation of delay of 26 days in filing the SA as prayed for or not? Heard both sides. The Ld. Counsel for the petitioner submitted that the there is a delay is only 26 days due to the reasons mentioned in the petition and that the delay was not intentional and not due to any negligence and there is no willful delay in the matter and that this Tribunal A handwritten signature in dark ink, appearing to be "D. Reddy" or similar, with a long horizontal stroke extending to the right.

has every right to condone the delay. On the other hand, the Ld. Counsel for the Respondent bank argued that the petition is not maintainable under law as such argued to dismiss the petition.

5. Heard the Ld. Counsel for the petitioner and respondent bank. Perused the petition and counter averments. However, as per the recent decision of Hon'ble High Court in WP.No.4941 of 2017 dt.29.11.2017 wherein their Lordship at para 2 of the order 'referring the law laid down by the Hon'ble Supreme Court of India in the matter of BALESHWAR DAYAL JAISWAL Vs. BANK OF INDIA & OTHERS DATED 5-8-2015 an application for condonation of delay in filing a Securitization Application under section 17 of the SARFAESI Act can be entertained by the Tribunal, by virtue of sub-sections 1 and 7 of section 17 of the SARFAESI Act read with Section 24 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. In that view of the matter, the Tribunal had power to condone the delay in filing of the said Securitization application, if it found valid grounds to do so'.

6. In view of the above said observation of the Hon'ble High Court of Andhra Pradesh, the DRT has got power to condone the delay of the appeals filing under Section 17 of SARFAESI Act and if Section 5 of the Limitation Act 1963 would made inapplicable to the application under Section 17(1) of the Act, it would virtually defeat valuable right of redemption available to the mortgagor. However, application of Section 5 of the Act 1963 to the proceedings under Section 17(1) of the Act 2002 would neither defeat rights of secured creditor nor cause irreparable hardship to the secured creditor. On the other hand, on perusal of the A handwritten signature in dark ink, appearing to be 'D. Rao' or similar, with a long horizontal stroke extending to the right.

petition averments, the petitioners stated that the delay of only 26 days has been occurred in filing the SA as he came to know that in auction conducted on 25-10-2019, one of auction purchaser participated in auction and purchased the schedule property and due to lack knowledge, he could not approach the Tribunal within time and therefore, in the interest of justice, it would be just and necessary to give an opportunity to the petitioner to contest his case, the delay can be condoned. Therefore, in view of the law laid down by Hon'ble Supreme Court and Hon'ble High Court of Andhra Pradesh stated supra, I am of the considered opinion to allow the petition by condoning the delay of 26 days in filing the SA in the interest of justice.

In the result, MA.02 of 2020 is allowed without costs, and the delay of 26 days in filing the SA is hereby condoned. The Registry is directed to number the SA if otherwise is in order.

[Typed to the dictation, corrected and pronounced by me in the open court on this 2^nd August, 2021]

PRESIDING OFFICER DEBTS RECOVERY TRIBUNAL VISAKHAPATNAM