George Kutty Luckose ad another vs ICICI BANK LIMITED on 27 September 2024

1. George Kutty Luckose S/o. Luckose Aged about 65 years

2. Ms. Stancy W/o. George Kutty Luckose Aged about 64 years

Both are residing at No.32, White House, 1^st Main, Mahadevapura Post, Bangalore - 560048

New Address: 172-173, "Sony Bhavan", 2^nd Cross, Mahaeshwarinagar, Mahadevapuram Post, Bangalore - 560048

... **APPLICANTS/ DEFENDANTS**

**AND**

M/s. ICICI Bank Limited Mystree Center, 1/10, Hosur Road, Bommanahalli, Bangalore - 560068

... **RESPONDENT/ APPLICANT**

**Counsels on record/appeared for:**

Applicant : M/s. J K Associates Respondent : ----

2MA.No.20/2022**ORDER on MA**

The present miscellaneous application is filed by the defendants, in OA No.128/2017 u/s.22(2)(b)(e) & (h) read with Section 19(25) of the Recovery of Debts due to Banks and Financial Institutions Act, with a prayer to stay the execution of impugned Exparte Order passed in OA.No.128/2017 dated 25.08.2018 (Annexure-A) consequently stay the impugned demand notice issued under Rule 2 r/w Regulation 33(2) of Second Schedule Income Tax Act 1961 (Annexure-B) in OA.No.128/2017.

2. The case as put forth by the applicants is that the applicants did not received any notice from this Tribunal as well as from the respondent bank and they have changed their residential address and same was intimated to respondent bank and the respondent bank is aware of new residential address, but with the malafide intention did not served any notice to them till today and they are not aware of proceedings held before this Tribunal. Hence the defendants could not able to defend their case on merits.

3. It is submitted that the respondent bank who are the applicant in OA.No.128/2017 has obtained an exparte final Order on 25.08.2018. In view of the impugned order passed by this 3MA.No.20/2022

Tribunal on 28.08.2018, the Ld. Recovery officer of this Tribunal has taken up proceedings in terms of Recovery Certificate vide RC No.850/2019.

4. It is submitted that the applicants are regular in paying monthly EMIs and they have not defaulted at all to invoke Section 10 of RDBD & FI Act 1993 and to file OA.No.128/2017. The applicants have repaid the amount directly into the respondent bank. The respondent bank has invoked S.13 of the Securitization Act 2002 during the year 2012 and issued possession notice under S.13(4) on 23.05.2012. Aggrieved by the impugned possession notice issued under S.13(4), the applicants preferred an appeal under S.17 of the Securitization Act vide SA.No.551/2012 and have obtained conditional interim order of stay and complied the Order.

5. It is submitted that the applicants have filed a complaint before Director General of Police, Bangalore to the effect that the then recovery agents when they were taking physical possession of the property they looted a sum of Rs.5.00 lakhs and gold and jewellery worth of Rs.25.00 lakhs, but the police in collusion with the respondent bank did not take any action against the bank or recovered the looted cash and gem and jewels till 4MA.No.20/2022

today. The respondent bank has initiated proceedings under S.14 of the Securitization Act.

6. In the above grounds, it is contended that the Recovery officer has erroneously issued the notice under Rule 2 and regulation 33(2) of Second Schedule Income Tax Act, which is not permissible in the eye of law and liable to be quashed. The recovery officer failed to consider the amount deposited to the tune of Rs.49.00 lakhs, and the demand notice served on the applicant on 03.03.2019 by way of Registered post is not sustainable.

7. It is further submitted that though the applicants have paid entire amount due towards and as such, there is no any dues towards amended RC.No. 3382 dated 22.03.2007 and there is no dues as on today. The demand notice issued by Recovery Officer is not sustainable. It is mandatory duty of the Recovery officer of this Tribunal to consider the objections filed under Rule 11 of second schedule of Income Tax Act dated 16.03.2020 which is still pending for adjudication and the objections are yet to be cleared and during the pendency of objections under Rule 11 of Second Schedule of Income Tax Act 1961, proceeding further till the disposal of this appeal is null and void, and proceeding further on his whims and fancies is bad in law. Hence, the applicants prays 5MA.No.20/2022

to set aside and quashed the impugned exparte order dated 25.08.2018 in OA.No.128/2017 and consequently set aside alleged demand notice issued under Rule 2 r/w Regulation 33(2) of second schedule Income Tax Act dated 27.02.2020 issued by the Recovery officer of this Tribunal.

*Heard the submissions of the applicant Counsel and perused the available records of the case.*

8. The present Miscellaneous Application is filed by the defendants in the OA. The 1^st applicant and 2^nd applicant are the borrowers to the credit facility availed. It is admitted fact that the applicants herein had availed loan against property of Rs.26,12,625/- on 04.10.2010.

9. There is no dispute with regard to the execution of the loan documents, creation of the properties as security towards the credit facilities. As the applicants here in defaulted to repay the loan amount, the respondent bank has filed OA.No.128/2017 for recovery of an amount Rs.37,63,807.84/- (Rupees Thirty Seven Lakh Sixty Three Thousand Eight Hundred Seven and Eighty Four Paisa only).

10. Further, in the OA summons were duly served but the applicants/defendants did not choose to contest the matter, on 6MA.No.20/2022

the other hand, remained silent. Hence, this Tribunal set them as exparte and the final order came to be passed on 25.08.2018.

11. The averments in the Para.No.3 clearly reflects that OA.No.128/2017 came to be allowed and Recovery Certificate is drawn in RC.850/2019. It further reflects that respondent have also initiated proceedings and issued demand notice dated 27.02.2020.

12. It is pertinent to note that the applicants herein did not contest the OA, hence the claim of the bank was allowed based on the documents and evidence adduced by them in the OA.No.128/2017. The application only highlights the admission of loan and execution of loan documents and fact of knowledge of the applicant with regard to the measures initiated by the bank in recovering the amount due in the loan account and only highlights that the applicants were sleeping over their rights in contesting the matter either in the OA nor in the recovery proceedings under the Recovery Certificate.

13. The applicants have challenged the possession notice dated 23.05.2012 in SA.No.551/2012 and obtained conditional status quo order on 05.09.2012.

7MA.No.20/2022

14. It is pertinent to note that all along the applicants who are the defendants in the OA have not disputed with regard to the credit facility, the creation of the mortgage of the property and the default in the repayment towards the credit facility. As there was no representation from the defendants, hence they were placed ex parte. Considering the documents produced by the bank and the evidence adduced, the documents came to be marked which clearly established the case of the bank. Hence OA came to allowed directing the applicants to pay entire OA amount of Rs.37,63,807.84/- along with interest and costs.

15. Furthermore the applicant who are vigilant litigants has been prosecuting the matter challenging the measures under the SARFAESI Act, as such, it appears that the applicants did not intentionally contest the matter in OA. The applicants having waived their right to contest the claim of the OA in spite of sufficient opportunities now cannot claim that the respondent bank has misrepresented the facts.

16. It is also admitted fact that the Recovery Officer has issued the demand notice under the recovery proceedings on 27.02.2020 and then the applicants got awaken to contest the matter. Further contention of the applicants that they have changed their residential address and communicated to 8MA.No.20/2022

respondent bank is not supported by any document. Further it is also clear that the applicants were aware of the recovery measures taken by the bank and have also filed the Securitization Application challenging the possession notice. The applicants after the due service of the summons have failed to appear, hence, they were set Exparte and the final order came to be allowed.

17. The issue before this Tribunal is whether the applicants were duly served with the OA summons and in spite of the knowledge they did not contest the matter. The records clearly reflects that the OA summons were duly served which is also seen recorded duly served and thereafter when the OA was taken up on record, as there was no representation for the defendants they were set Exparte in Para 6 of the Final Order dated 25.08.2018. On the other hand, the defendants does not give any valid reason for their non-appearance before this Tribunal and to contest the matter as required under the law. Now, after the Recovery officer has issued a demand notice to proceed further under the recovery proceedings, the applicants have filed the Miscellaneous Application without any merits or any bonafide reasons.

18. The contentions raised in the present MA are in the nature of an appeal where the applicants have made effort to challenge the order passed by this Tribunal dated 25.08.2018 in 9MA.No.20/2022

OA. If the applicants are aggrieved by the exparte order passed in OA.No.128/2017, the remedy available to the applicants is to file an application to set aside the exparte order under S.20 of the RDB act. The applicants did not choose to challenge the final order passed in TA and was silent spectator till the Recovery Officer issued demand notice dated 27.02.2020. As the applicants are unable to provide a compelling reason and are found to be negligent in presenting their case, the Tribunal can neither stay the impugned exparte Order nor can set aside the same at this stage.

19. For the foregoing reasons, the present Miscellaneous Application fails. Accordingly, MA.No.20/2022 stands dismissed. Interim Order granted, if any stands vacated. Pending IA's are also disposed of in terms of this order. No order as to cost.

*(Dictated to the Stenographer (PR), after its transcription and necessary corrections, signed and Order is passed on this day 27^th day of September 2024)*

**(IMTIAZ ALI)** **PRESIDING OFFICER** **I/c DRT-2, BENGALURU**

10MA.No.20/2022

APPENDIX

LIST OF DOCUMENTS PRODUCED BY THE APPELLANT

<table border="1"> <thead> <tr> <th style="text-align: center;">SI<br/>No.</th> <th style="text-align: center;">Particulars</th> <th style="text-align: center;">Annexure</th> </tr> </thead> <tbody> <tr> <td style="text-align: center;">1</td> <td>Impugned Exparte Order in OA.No.128/2017 dated 25.08.2018</td> <td style="text-align: center;">A1</td> </tr> <tr> <td style="text-align: center;">2</td> <td>Impugned Demand Notice in RC.850/2018 issued by RO-1, DRT, Bangalore</td> <td style="text-align: center;">A2</td> </tr> <tr> <td style="text-align: center;">3</td> <td>Housing loan sanction letter dated 08.09.2006</td> <td style="text-align: center;">A3</td> </tr> <tr> <td style="text-align: center;">4</td> <td>Statement of accounts from 29.12.2016 to 07.02.2020</td> <td style="text-align: center;">A4</td> </tr> <tr> <td style="text-align: center;">5</td> <td>Symbolic possession notice dated 23.05.2012</td> <td style="text-align: center;">A5</td> </tr> <tr> <td style="text-align: center;">6</td> <td>Interim order of this Tribunal in IR.1800/2012 dated 05.09.2012</td> <td style="text-align: center;">A6</td> </tr> <tr> <td style="text-align: center;">7</td> <td>Copy of cheque for a sum of Rs.100,000/- paid to the bank on 04.10.2012</td> <td style="text-align: center;">A7</td> </tr> <tr> <td style="text-align: center;">8</td> <td>Bank deposit receipts of EMI paid by applicant</td> <td style="text-align: center;">A8</td> </tr> <tr> <td style="text-align: center;">9</td> <td>Postal cover sent to bank</td> <td style="text-align: center;">A9</td> </tr> <tr> <td style="text-align: center;">10</td> <td>Copy of the Aadhar card</td> <td style="text-align: center;">A10</td> </tr> <tr> <td style="text-align: center;">11</td> <td>Copy of Electricity Bill</td> <td style="text-align: center;">A11</td> </tr> <tr> <td style="text-align: center;">12</td> <td>Complaint filed by applicants against bank with DGP, Bangalore dated 08.12.2014</td> <td style="text-align: center;">A12</td> </tr> <tr> <td style="text-align: center;">13</td> <td>Copy of petition filed by the bank under S.14 of Securitization Act 2002 on 14.11.2013</td> <td style="text-align: center;">A13</td> </tr> <tr> <td style="text-align: center;">14</td> <td>Complaint filed by applicants about loss of gem and jewels and cash to the tune of 30.00 lakhs looted by the bank officials while taking possession of property.</td> <td style="text-align: center;">A14</td> </tr> </tbody> </table>

(IMTIAZ ALI) PRESIDING OFFICER I/c DRT-2, BENGALURU