DRT Case Regarding Unjust Possession Of Mortgaged Property

Facts

Mr. D had applied for a term loan at a bank for educational purposes, which was subsequently classified as a Non-Performing Asset (NPA). The matter was taken to the Lok Adalat, where the bank claimed a certain amount from Mr. D. The Lok Adalat settled the dispute by awarding the bank Rs. 2 Lacs to be paid by Mr. D. Mr D believed that he had paid off all his instalment amounts within the stipulated date, thereby settling the matter.

However, the respondent issued a notice under Section 13(2) of the SARFAESI Act, 2002. Upon inquiry regarding the instalment payments, it was discovered that due to a mere typographical error, Mr. D failed to pay the first instalment. Later, Mr. D received a notice under Section 13(4) of the SARFAESI Act, purportedly taking symbolic possession of his mortgaged property for alleged failure to pay the loan to the bank.

Solution

Mr. D approached Rajesh Kshetry after his mortgaged property was unlawfully and arbitrarily taken into possession by the bank. Rajesh Kshetry provided significant assistance to Mr D and pleaded in court regarding the wrongful act by the bank. It was prayed to the tribunal that the bank did not comply with the order passed by the Lok Adalat. Even though Mr. D acted in a bona fide manner regarding the payment of the debt, the bank acted in an arbitrary manner. Hence, due to the aforementioned reasons, the case was moved to the Debt Recovery Tribunal (DRT).

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