Debts Recovery Tribunals and Appellate Tribunals
JANA SMALL FINANCE BANK LTD vs (1) YOGANANDA SWAMY T A (2) S SHALINI on 15 October 2026
IN THE DEBT RECOVERY APPELLATE TRIBUNAL AT CHENNAI
Dated the 15th day of October, 2026
PRESENT: HON’BLE MR. JUSTICE G. CHANDRASEKHARAN
CHAIRPERSON
RA(SA) 120/2026
(arising out of SA No.817/2022 on the file of DRT-I, Bangalore)
Between
The Authorised Officer,
JANA Small Finance Limited,
Reg. Office at Fairway Business Park,
No.10/1, 11/2, 12/2B, Off Domlur,
Koramangala Inner Ring Road,
Next to EGL Business Park,
Challaghatta, Bengaluru 560 071.
…..Appellant
And
1. Yoganada Swamy T A,
S/o Appajaiah,
R at No.38, 7th Cross,
Shambhavi Nagar,
GKW Layout, Peenya 2nd Stage,
Bangalore 560 058.
2. Shalini S
W/o Yoganada Swamy T A,
R at No.38, 7th Cross,
Shambhavi Nagar,
GKW Layout, Peenya 2nd Stage,
Bangalore 560 058.
…..Respondents
Counsel for Appellant : Mr. T.K.M. Sai Krishnan Respondents remained ex parte.
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ORDER
Learned Counsel for the appellant bank is present Aggrieved against the order passed by the Learned Presiding Officer, DRT-I, Bangalore in SA No.817/2022 dated 16.3.2026, this appeal is filed.
SA 817/2022 has been filed to set aside the order dated 18.11.2022 passed under Section 14 of the SARFAESI Act by Learned VII Additional CMM, Bangalore in Cr.MP.No.5366/2022 in respect of the schedule property.
This SA has been allowed mainly on the ground that appellant bank failed to establish the service of demand notice through post and its affixture in the event of non service of demand notice through post. It was found by the Learned Presiding Officer that appellant had not produced any material to show that the demand notice was affixed at the borrower’s address before resorting to newspaper publication. If the bank fails to produce postal acknowledgment in proof of service of demand notice or returned cover or any proof of attempted service, mere publication cannot be treated as a valid service. Thus Learned Presiding Officer held that demand notice cannot be treated as validly served upon the respondents, therefore, subsequent measures initiated under Section 13(4) of the SARFAESI Act including possession notice has been vitiated. For the same reason, order passed under Section 14 of the SARFAESI Act, being a consequential in nature also cannot survive once the underlying measures under Section 13(4) of the SARFAESI Act are held to be vitiated. In this view of the matter, Learned Presiding Officer set aside the demand notice dated 16.8.2021 issued under Section 13(2) of the SARFAESI Act, Possession Notice issued under Section 13(4) and the order passed under Section 14 of the SARFAESI Act dated 18.11.2022.
Learned Counsel for the appellant financial institution submitted that demand notice had in fact been served on the second respondent Mrs. S. Shalini. In support of his submission, he produced Xerox copy of the acknowledgment card. He also produced proof of affixture of demand notice dated 16.8.2021 at 04:07:31 PM, by producing Xerox copy of the photo taken at the time of affixture. There is no issue with regard to publication of the demand notice. Even assuming that demand notice was not served through post to respondents 1 and 2, there is sufficient evidence available to show that demand notice was affixed and then published as required under Rule 3 of SIE Rules, 2002. He further submitted that physical possession was taken, but the respondents forcibly tres-passed into the property and a criminal compliant has been lodged, FIR was registered and the same is pending.
Heard Learned Counsel for the appellant and perused the records. Respondents already set ex parte.
From the aforesaid submissions made by the learned Counsel for the appellant and on perusal of records produced before this Tribunal, this Tribunal is of the view that the finding of the Learned Presiding Officer, DRT-I, Bangalore that there was no proper service of demand notice is not appropriate and legal and also his finding that Possession Notice issued under Section 13(4) and the order passed under Section 14 of the SARFAESI Act were also to be set aside in view of non service of demand notice is also not correct. The reason is that the demand notice issued under Section 13(2) of the SARFAESI Act was served to the Respondent through affixture and publication, as required under Rule 3 of the SIE Rules, 2002.
In this view of the matter, the order of the Learned Presiding Officer, DRT-I, Bangalore dated 16.3.2026 passed in SA No.817/2022 is set aside and SA 817/2022 is remitted back to DRT-I, Bangalore with a direction to the Learned Presiding Officer to consider the SARFAESI application in the light of the evidence produced before this Tribunal with regard to service of demand notice through affixture and publication and then take a decision on merits and in accordance with law.
In the result, this Appeal RA(SA) 120/2026 is allowed, as indicated above.
Parties are directed to bear their own costs. Pending IAs, if any, stand closed.
Sd/- (JUSTICE G. CHANDRASEKHARAN) CHAIRPERSON