MS PEGASUS ASSETS AND RECONSTRUCTION PVT LTD vs LALIT JAIN on 31 July 2026

**ORDER**

Review Application No.9/2026 was filed on 09.04.2026 under R.5A of the Debts Recovery Tribunal (Procedure) Rules, 1993 (as amended from time to time) – for short

'the Rules' - praying to review the order dated 10.03.2026 passed by this Tribunal in SA No.543 of 2025. The review petitioner is none other than the defendant in the SA 543 of 2025.

2. The present review application is filed by the review petitioner/defendant seeking review of the order passed in SA No.543/2025. According to the applicant/defendant, the final order dated 10/03/2026 fails to note the order dated 29/11/2024 passed by this Tribunal, which has conclusively held that the petitioner/defendant has correctly followed the procedures established by law, in which case tenets of "res judicata" and constructive res judicata would apply. This Tribunal allowed the SA 543/2025 primarily on the assumption that notice under Section 13(2) was not served. The petitioner/defendant, under a bona fide belief that the challenge was limited to the second SA procedural aspects, has inadvertently omitted to produce the original acknowledgment cards/proof of service of the Section 13(2) notice issued on 04/10/2022 in the earlier set of documents filed before this Tribunal in S.A 543/2025. The service of the Section 13(2) notice was indeed complied with and been confirmed in S.A 141/2023. The service was affected via Registered Post Acknowledgment Due(RPAD) on 4/10/2022. The Applicant possesses the POD Proof of Delivery (AD Card) in respect of RPAD against Lalit Jain which shows that the notice was received by the said borrower on 07/10/2022 and so the 1^st respondent/1^st applicant is not been deprived from exercising options under section 13(3A) of the Act, he has rather filed the S.A 141/2023. Further the applicant is also in possession of the Returned Parcels in respect RPAD to other borrowers namely Sharvani Sachidanand and Annetos Rewards and Retail Pvt. Ltd. which have returned with identical postal shara "Addressee Left/ Return to sender". Hence the review petitioner/defendant seeks review of the order dated 10.03.2026.

3. Per contra, the respondents/applicants in the SA opposes the Review Application contending that a review is not maintainable as to the SARFAESI Act does not confer any express power of review upon the DRT while exercising Section 17 jurisdiction. The order passed in SA 543/2025 dated 10.03.2026 attained its finality and the Tribunal has become functus officio. If at all the petitioner/secured creditor bank is aggrieved by the said order, the Act provides for an Appeal under section 18 of the SARFAESI Act, 2002. The petitioner/defendant cannot file an application to recall the order by filing the present Review Application. The petitioner/defendant in its objection to the main S.A.No.543/2025 did not produce the current Annexures. Now the petitioner/defendant is estopped from introducing any new documents. The question of review does not arise. Hence, there is no apparent error on the face of record. Therefore, the said application is not maintainable and liable to be rejected in limine.

4. I have considered the submissions and perused the materials on record. The only point arises for consideration is as to whether the review petitioner/defendant is entitled to the relief prayed for?

5. The Review Application is filed by the petitioner/defendant seeking review of the final order dated 10.03.2026 passed in SA No.543 of 2025, whereby the demand notice dated 04.10.2022 issued under Section 13(2) of the SARFAESI Act, the possession notice and the order passed by the learned Magistrate under Section 14 of the Act were set aside.

6. The principal contention of the petitioner/defendant is that the Tribunal allowed the Securitisation Application primarily on the ground that the petitioner/defendant had failed to establish due service of the demand notice. It is submitted that the petitioner/defendant had, due to inadvertence, omitted to produce the acknowledgement due (A/D) card evidencing service upon the respondent No.1/applicant No.1 and the returned postal cover bearing endorsement "Addressee left/Return to

Sender" in respect of the other borrowers. According to the petitioner/defendant, non-production of these crucial documents resulted in an adverse finding regarding non-compliance with the statutory requirement of service. It is, therefore, prayed that in the interest of natural justice and to render a just decision, the said documents may now be taken on record and the final order be reviewed.

7. The petitioner/defendant further submits that respondent No.1/applicant No.1, Sri Lalit Jain, was duly served with the demand notice, through RPAD as evidenced by the A/D card now produced. It is contended that Sri Lalit Jain had earlier filed SA No.141/2023 challenging the very same demand notice and, therefore, had complete knowledge of the proceedings and was never deprived of his statutory right under Section 13(3A) of the SARFAESI Act. In so far as the remaining borrowers are concerned, it is submitted that they had shifted their residence/business, and therefore, service through RPAD could not be completed, as reflected in the returned postal cover. It is further contended that publication of the demand notice was carried out and though affixure could not be effected at the borrowers' address, the notice was affixed on the mortgaged property. The petitioner/defendant also submits that there was no specific pleading in the Securitisation Application alleging non-compliance with Rule 3(1) of the Security Interest (Enforcement) Rules, 2002 regarding affixure and therefore, the Tribunal ought not to have granted relief on a ground not specifically pleaded.

8. The petitioner/defendant has also contended that the Tribunal failed to notice its earlier order dated 29.11.2024 passed in SA No.141/2023, wherein, according to the petitioner/defendant, it was held that the petitioner/defendant had followed the prescribed procedure. It is submitted that the said finding operates as res-judicata and the failure to consider the same constitutes an error apparent on the face of the record.

9. Heard the learned Counsel for the petitioner/defendant and the respondent/applicant side.

10. The scope of review jurisdiction is well settled. A review lies only when there is an error apparent on the face of the record or discovery of new and important matter or evidence which despite the exercise of due diligence, was not within the knowledge of the applicant or could not be produced when the order was passed. A review cannot be treated as an appeal in disguise nor can it be invoked to fill up the omissions or lacunae in evidence.

11. In the final order dated 10.03.2026, this Tribunal specifically recorded that though the petitioner/defendant asserted that the borrowers were avoiding service and that publication had been effected in newspapers, it had failed to produce any returned postal cover, postal tracking report or any other documentary material to establish that an attempt had in fact been made to serve the demand notice through RPAD. The Tribunal further held that publication in newspapers, by itself, could not substitute the mandatory requirement of service of demand notice.

12. The acknowledgment due card, the returned postal cover and the plea regarding affixure on the mortgaged property are admittedly being relied upon for the first time in the present Review Application. These documents were never produced before the Tribunal during the original proceedings of SA No.543/2025 despite adequate opportunity. The Tribunal cannot be faulted for recording its findings on the basis of the evidence then available on record. The petitioner/defendant itself admits that omission to produce A/D card and the returned postal cover was inadvertent. Such inadvertence or negligence in producing material evidence cannot constitute an error apparent on the face of the record.

13. The submission that documents should now be taken on record in the interest of natural justice is equally untenable. The principles of natural justice cannot be invoked to enlarge the limited scope of review jurisdiction. Permitting production of documents which were admittedly available with the petitioner/defendant at the time of the original proceedings in SA No.543/2025 would amount to allowing the petitioner/defendant to fill up lacunae in its evidence and virtually convert the review proceedings into a rehearing on merits, which is impermissible.

14. The contention that affixure at the borrower's address was not possible since they had shifted their residence/business also does not assist the petitioner/defendant. Firstly, this factual plea, together with the returned postal cover, is sought to be substantiated only in the review proceedings. Secondly, the final order in SA No.543/2025 was not founded on merely on non-affixure but on the petitioner's/defendant's failure to establish due service of the demand notice through legally recognised modes by producing the necessary documentary evidence. Likewise, the plea that affixure was effected on the mortgaged property is also based on facts and material which were not placed before the Tribunal at the time of disposal of SA No.543/2025.

15. The contention that there was no pleading regarding non-compliance with Rule 3(1) of the Security Interest (Enforcement) Rules, 2002 or that the Tribunal granted relief on a ground not pleaded is also without merit. This Tribunal is duty bound to examine whether the secured creditor has complied with the mandatory provisions of the SARFAESI Act and the Rules before sustaining the measures taken thereunder. The burden to establish such compliance rests upon the secured creditor. The findings recorded in the final order of SA No.543/2025 were based on the evidence then available on record and not on any deficiency in the pleadings of the borrowers.

16. The reliance placed upon the order dated 29.11.2024 passed in SA No.141/2023 is equally misconceived. Admittedly, the said order was neither produced nor relied upon during the hearing of the SA No.543/2025. The Tribunal cannot be expected to consider a judgement which was never brought to its notice. The plea of res-judicata is a mixed question of fact and law which ought to have been specifically raised

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and substantiated during the original proceedings. The petitioner/defendant cannot be permitted to raise such a plea for the first time in review.

17. Similarly, the contention that respondent No.1/applicant No.1 had knowledge of the demand notice, since he has filed SA No.141/2023 and therefore, was not deprived of his remedy, under Section 13(3A) of the SARFAESI Act pertains to the merits of the controversy and is founded upon documents and proceedings which were not relied upon during the original hearing of SA No.543/2025. Such issues cannot be examined in review jurisdiction.

18. The learned counsel for the petitioner/defendant has relied upon various judicial precedents in support of the Review Application; which are i) State Bank of India vs. Emerald Mineral Exim Pvt. Ltd. & Anr., ii) Standard Chartered Bank vs. MSTC Ltd., iii) S Madhusudhan Reddy vs. V Narayana Reddy and iv) Celir LLP vs. Sumati Prasad Bafna & Ors. 2024 SCC Online SC 3727. This Tribunal has carefully considered the principles laid down in the said decisions. However, judgments are distinguishable on facts and do not advance the case of the applicant. In the present case, the applicant seeks to produce material documents, namely the acknowledgment due card, returned postal cover and the earlier order in SA No.141 of 2023, for the first time in the review proceedings, despite such documents being available during the original adjudication. The Review Application is thus founded upon additional documents and fresh pleas rather than any error apparent on the face of the record. The decisions relied upon by the applicant, therefore, have no application to the facts and circumstances of the present case and do not warrant interference with the final order dated 10.03.2026.

19. Upon an overall consideration, this Tribunal finds that the petitioner/defendant has failed to point out any error apparent on the face of the record in the final order dated 10.03.2026. What is sought is a re appreciation of the matter on the basis of fresh documents, additional evidence and new factual pleas which were available to the petitioner/defendant but were not placed before the Tribunal despite sufficient opportunity. Such an exercise is beyond the limited scope of review under law.

20. The law relating to the exercise of review jurisdiction is no longer res integra. In *Lily Thomas vs. Union of India*, the Hon'ble Supreme Court held that the power of review cannot be exercised merely because a different view is possible or because the judgment is considered erroneous on merits. A review is maintainable only when there is an error apparent on the face of the record or any other ground recognised under law.

21. In *State of West Bengal vs. Kamal Sengupta*, the Hon'ble Supreme Court reiterated that review jurisdiction is extremely limited and cannot be exercised to permit rehearing of the matter on merits or to enable a party to produce evidence which was available at the time of original proceedings but was not produced despite due diligence.

22. Again, in *Kamlesh Verma vs Mayawati*, the Hon'ble Supreme Court summarised the principles governing review jurisdiction and held that review is not maintainable to correct an erroneous decision on merits, to re-appreciate evidence, to advance fresh arguments, or to produce additional evidence that could have been produced earlier. A review also cannot be used to fill up omissions or lacunae in the case of a party.

23. Applying the aforesaid principles to the facts of the present case, this Tribunal finds that the acknowledgement due card, returned postal cover and the order dated 29.11.2024 in SA No.141/2023 were admittedly not produced during the original proceedings in SA No.543/2025. The applicant seeks to rely upon these documents for the first time in the present Review Application and has also raised additional factual and legal pleas founded upon those documents. The omission to produce such material, even if stated to be inadvertent, cannot be construed as an error apparent on the face of the record. What the petitioner/defendant seeks is, in effect, a rehearing of the matter on the basis of fresh evidence and new contentions, which falls outside the ambit of review jurisdiction. Accordingly, this Tribunal is of the considered opinion that the applicant has failed to establish any ground warranting review of the final order dated 10.03.2026 passed in SA No.543/2025.

24. The petitioner/defendant has involved the review jurisdiction without demonstrating any error apparent on the face of the record and has sought to introduce documents and contentions which were admittedly available with them but not produced during the original proceedings in SA No.543/2025. Such an exercise has unnecessarily consumed the time of the Tribunal and compelled the respondents/applicants to contest the proceedings which were otherwise concluded. Accordingly, while dismissing the Review Application No.9/2026, this Tribunal deems it appropriate to impose costs of ₹25,000/- upon the petitioner/defendant, payable to the respondents/applicants within four weeks from the date of this order.

25. Accordingly, the Review Application No.9/2026 stands dismissed with cost.

*[Dictated to my P.A. transcribed by him, corrected and pronounced by me in the open Tribunal on this the 31^st day of July, 2026]*

[ IMTIAZ ALI] PRESIDING OFFICER

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RA No.9/2026 in SA No.543/202510ANNEXURESReview petitioner's documents <table border="1"><thead><tr><th><b>Sl.No.</b></th><th><b>List of documents</b></th></tr></thead><tbody><tr><td>1</td><td>Photocopy of the AD card in respect of the demand notice dated 04.10.2022 issued to Lalit Jain.</td></tr><tr><td>2</td><td>Photocopy of the returned parcel in respect of demand notice dated 04.10.2022 issued to Sharvani Sachidananda</td></tr><tr><td>3</td><td>Photocopy of the returned parcel in respect of demand notice dated 04.10.2022 issued to Annectos Rewards and Retail Pvt Ltd</td></tr><tr><td>4</td><td>Photograph evidencing pasting of the demand notice dated 04.10.2022 on the mortgaged property</td></tr><tr><td>5</td><td>Certified copy of order dated 10.03.2026 in SA No.543/2025</td></tr></tbody></table>

A handwritten green checkmark is located to the left of the table, indicating approval or completion of the document.

IN THE DEBTS RECOVERY TRIBUNAL - 1, KARNATAKA AT BANGALORE

PRESENT: SRI IMTIAZ ALI PRESIDING OFFICER

Dated the 31^th day of July, 2026

**REVIEW APPLICATION NO.9 OF 2026**

**IN**

**SECURITISATION APPLICATION NO.543 OF 2025**

Between

The Authorised Officer, Pegasus Assets Reconstruction Pvt Ltd, No. B-515, 5^th Floor, Mittal Tower, M G Road, Bengaluru-560001.

..... Petitioner

And

Lalit Jain, S/o Tejraj Bantiya, Aged 47 years, No.50, Yamunabai Road, Madhav Nagar, Bangalore – 560001, And another.

..... Respondents

**ORDER**

31.7.26