SARFAESI / Limitation · F2J-C-2858
Mrs. Rishu Chaudhary v. Indian Overseas Bank & Anr.
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Holding (ratio)
A section 14 possession measure continues the section 13(4) process and is independently challengeable under section 17. Limitation runs from the last challenged action or its communication.
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The holding is confined to the issues actually decided in the retained judgment; no view is attributed to the court on questions expressly left open or remanded.
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Complete searchable judgment text
[2026:RJ-JP:36176]
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Civil Writ Petition No. 15726/2026
CNR: RJHC020765232026 | URN: CW / 33492U / 2026
Mrs. Rishu Chaudhary, W/o Shri Neelesh Chaudhary, Aged About
49 Years, Sole Proprietor Of M/s Sagar Overseas, Having Its
Registered Office At G1/125 (A), RIICO, Industial Area,
Khushkera, Bhiwadi, Rajasthan - 307719 Through Its Power Of
Attorney Holder Nilesh Kumar Choudhary S/o Shri Ranveer Singh
R/o B-160, Aashiyana Gardens, Alwar Byepass Road, Bhiwadi
Tehsil Tijara, Alwar Rajasthan Currently Residing At 40/40 Swarn
Path, Mansarovar, Jaipur, Rajasthan - 302020
----Petitioner
Versus
1. Indian Overseas Bank, 3A/7, U.i.t Colony, Gaurav Path
Bhiwadi, Tehsil Tihara, District Alwar, Rajasthan, Through
Its Branch Manager. Regional Office Sb-57, 1St Floor,
Riddhi Tower, Tonk Road, Jaipur-302015, Through Its
Chief Manager
2. M/s Amg Industries, A Partnership Firm Through Its
Partner And Authorized Signatory Mr. Amit Gupta Having
Its Office At D - 348/3, Gail No. 8, Near Jankalyan School
Road, Bhajanpura North East, New Delhi
----Respondents
For Petitioner(s) : Mr.S.S. Hora with
Mr.Ishan Khandelwal,
Mr.Himanshu Agarwal
For Respondent(s) : Mr.Anurag Kalawatia with
Ms.Anjali Sharma &
Ms.Suhani Bardia
Mr.Ganesh Sharma
JUSTICE ANOOP KUMAR DHAND
Order
08/09/2026
1. The instant writ petition has been preferred by the petitioner
for assailing the validity of the impugned order dated 04.06.2026,
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passed by the Debt Recovery Appellate Tribunal, Delhi (for short,
"the DRAT") by which the appeal submitted by the petitioner
against the order dated 03.01.2019 of Debt Recovery Tribunal,
Jaipur (for short, "the DRT") has been rejected on the ground that
a time barred Securitisation Application was submitted by the
petitioner before the DRT.
2. Learned counsel for the petitioner submits that SARFAESI
proceedings were initiated against the petitioner by the
respondent-Bank by way of issuing notice under Section 13(4) of
the SARFAESI Act on 17.04.2017. Thereafter, an order under
Section 14 of the SARFAESI Act was passed by the District
Collector & Magistrate, Alwar dated 08.10.2018 in the absence of
petitioner, hence, he was not aware about the aforesaid order
being passed by the Collector. Counsel submits that the order
dated 08.10.2018 passed by the Collector, was communicated to
the petitioner by the respondent-Bank vide e-mail dated
25.10.2018 and immediately thereafter, the petitioner approached
the DRT by way of filing a Securitistion Application under Section
17 of the SARFAESI Act on 29.11.2018. Counsel submits that the
grounds so raised by the petitioner in the aforesaid application
before the DRT were not considered and the DRT rejected the
application submitted by the petitioner being time barred vide
order dated 03.01.2019 against which an appeal was preferred by
the petitioner before the DRAT. The DRAT has not decided the said
appeal on its merits, but has rejected the same on a technical
count that there was delay in filing the aforesaid Securitisation
Application before the DRT.
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3. Counsel submits that all orders passed under Sections 13 &
14 of the SARFAESI Act can be assailed by an aggrieved person by
way of filing an application under Section 17 of the SARFAESI Act.
Counsel further submits that the limitation for such application
would not commence with effect from the date of issuance of
notice under Sections 13 and 14 of the SARFAESI Act, but in
stead, his cause of action would also arise, after passing of the
order under Section 14 of the SARFAESI Act.
4. In support of his contention, counsel for the petitioner has
placed reliance upon the following judgments:-
1. Vimla Kashyap & Ors. Vs. Union of India &
Ors. reported in 2025 SCC OnLine All 5299.
2. Hindon Forge Private Limited & Anr. Vs. State
of Uttar Pradesh & Anr. reported in (2019) 2 SCC
198.
3. Kanaiyalal Lalchand Sachdev & Ors. Vs. State
of Maharashtra & Ors. reported in (2011) 2 SCC
782.
4. Standard Chartered Bank Vs. V. Noble Kumar
& Ors. reported in (2013) 9 SCC 620.
5. Authorised Officer, Indian Overseas Bank &
Anr. Vs. Ashok Saw Mill reported in (2009) 8 SCC
366.
6. Vinu Thomas Vs. South Indian Bank Ltd. &
Ors. reported in 2022 SCC OnLine Ker 8392.
5. Counsel submits that the impugned order passed by the
DRAT is not sustainable in the eyes of law, hence, the same is
liable to be quashed and set-aside.
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6. Per contra, learned counsel appearing on behalf of the
respondent-Bank as well as counsel appearing on behalf of the
auction purchaser submits that the petitioner borrowed certain
amount from the respondent-Bank and when the said amount was
not repaid by her, her account was declared as NPA on 31.12.2016
and thereafter, notice under Section 13(2) of the SARFAESI Act
was issued to the petitioner on 01.01.2017. When the petitioner
failed to repay the amount despite the aforesaid notice being
served to her, the notice under Section 13(4) of the SARFAESI Act
was issued to the petitioner on 17.04.2017. Thereafter, a sale
notice was issued by the respondent-Bank to auction the secured
property of the petitioner, however, the petitioner was allowed an
opportunity to go for one-time settlement, but the petitioner failed
to obey the conditions of the OTS Scheme and subsequently, the
second and third sale notices were issued by the respondent-Bank
and finally the mortgaged property was put to auction on
21.11.2018.
7. Counsel submits that the petitioner was well-aware about
the proceedings initiated against him under the SARFAESI Act by
the respondent-Bank in 2017, but he kept mum till the mortgaged
property was auctioned and thereafter, he approached the DRT at
a belated stage, without giving plausible explanation for such
inordinate delay in filing the Securitisation Application under
Section 17 of the SARFAESI Act before the DRT. Counsel submits
that the DRT has taken into account all the above objections,
which have been taken by the petitioner before this Court and the
application submitted by the petitioner was rightly rejected by the
DRT by passing the order impugned. Counsel submits that these
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facts were further reiterated by the DRAT, while passing the
impugned order dated 04.06.2026 thereby the appeal was
rejected. Hence, interference of this Court is not warranted and
the instant petition is liable to be rejected.
8. Heard and considered the submissions made at the Bar and
perused the material available on record.
9. Perusal of the record indicates that the order dated
04.06.2026 passed by the DRAT is under challenge before this
Court, by which the appeal submitted by the petitioner against the
order dated 03.01.2019 of DRT has been rejected by the DRAT, by
holding that there was a delay in filing the Securitisation
Application by the petitioner before the DRT.
10. Now, the question which remains for consideration of this
Court is as to whether there was delay in filing the Securitisation
Application before the DRT?
11. The petitioner has assailed a message received by him from
the respondent-Bank, through e-mail, dated 25.10.2018. Perusal
of the e-mail dated 25.10.2018 reveals that after initiating the
proceedings under Section 13(4) of the SARFAESI Act, this fact
was intimated to the petitioner by the respondent-bank by sending
the aforesaid e-mail and the petitioner has assailed the aforesaid
e-mail by way of filing a Securitisation Application under Section
17 of the SARFAESI Act before DRT.
12. The Hon'ble Apex Court in the case of Ashok Saw Mill
(supra) has dealt with the identical issue as to whether the DRT
would have jurisdiction to consider and adjudicate the proceedings
post commencement of Section 13(4) proceedings and the events
which occurred thereafter. The scope of the Section 17 was
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interpreted and finally it was held by the Hon'ble Apex Court in
Para Nos.35, 36 & 39, which reads as under:-
"35. In order to prevent misuse of such wide
powers and to prevent prejudice being caused to
a borrower on account of an error on the part of
the banks or financial institutions, certain checks
and balances have been introduced in Section 17
which allow any person, including the borrower,
aggrieved by any of the measures referred to in
sub-section (4) of Section 13 taken by the
secured creditor, to make an application to the
DRT having jurisdiction in the matter within 45
days from the date of such measures having
taken for the reliefs indicated in subsection (3)
thereof.
36. The intention of the legislature is, therefore,
clear that while the banks and financial
institutions have been vested with stringent
powers for recovery of their dues, safeguards
have also been provided for rectifying any error or
wrongful use of such powers by vesting the DRT
with authority after conducting an adjudication
into the matter to declare any such action invalid
and also to restore possession even though
possession may have been made over to the
transferee.
***
39. We are unable to agree with or accept the
submissions made on behalf of the appellants that
the DRT had no jurisdiction to interfere with the
action taken by the secured creditor after the
stage contemplated under Section 13(4) of the
Act. On the other hand, the law is otherwise and
it contemplates that the action taken by a secured
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creditor in terms of Section 13(4) is open to
scrutiny and cannot only be set aside but even
the status quo ante can be restored by the DRT."
13. The aforesaid view taken by the Hon'ble Apex Court in the
case of Ashok Saw Mill (supra) was further reiterated by the
Hon'ble Apex Court in the case of Kanaiyalal Lalchand Sachdev
(supra) wherein the Hon'ble Apex Court has held that Section 14
is continuance of the proceedings under Section 13(4) of the
SARFAESI Act and would give cause of action to file Securitisation
Application before the DRT. The Hon'ble Apex Court has further
held that all steps, contemplated under Section 13(4) of the
SARFAESI Act, give rise to a cause of action to the borrower or the
person aggrieved to approach the DRT by way of filing an
application/petition under Section 17 of SARFAESI Act. The
limitation for filing such application has to be calculated from the
date of the last action against which the aggrieved person has
approached the DRT under Section 17 of SARFAESI Act. It has
been held in Para No.22, which read as under:
"22. We are in respectful agreement with the
above enunciation of law on the point. It is
manifest that an action under Section 14 of the Act
constitutes an action taken after the stage of
Section 13(4), and therefore, the same would fall
within the ambit of Section 17(1) of the Act. Thus,
the Act itself contemplates an efficacious remedy
for the borrower or any person affected by an
action under Section 13(4) of the Act, by providing
for an appeal before the DRT."
In the instant case, the last communication was made to the
petitioner on 25.10.2018 and upon feeling aggrieved by the
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aforesaid, the petitioner approached the DRT by way of filing the
application under Section 17 of the SARFAESI Act on 29.11.2018,
hence, there is no delay on the part of the petitioner in
approaching the DRT, as per the law laid down by the Hon'ble
Apex Court in the case of Kanaiyalal Lalchand Sachdev (supra).
14. The provisions contained under Section 17 of the SARFAESI
Act and the limitation prescribed thereunder is required to be
construed liberally. The law should not be harsh against the
defaulter-borrower. In the case of default in repaying the
borrowed amount to the bank, the Bank itself is the claimant, the
judge and the executioner. The only remedy available to the
defaulter-borrower is to approach the DRT by way of filing an
application under Section 17 of the SARFAESI Act.
To deny the borrower an opportunity to access or approach
the DRT while questioning the steps taken by the secured creditor
to get physical possession of the mortgaged assets, would
tantamount to ignoring the Constitutional Right available to
him/her under Article 300A of the Constitution of India. Deferring
the legal access to a stage after he/she has been dispossessed,
would render his/her rights under Article 300A as meaningless.
In the considered opinion of this Court, even after initiation
of the procedure under Sections 13(4) and 14 of the SARFAESI
Act, the petitioner has a valid cause of action to move the DRT.
15. In the considered opinion of this Court, the DRAT instead of
rejecting the appeal of the petitioner, on a technical count of delay
in approaching the DRT and limitation, ought to have proceeded to
decide the appeal on its merits. But in stead of doing so, the
appeal has been decided only on the technicalities, i.e., delay in
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approaching the DRT at a belated stage. On this count alone, the
impugned order dated 04.06.2026 passed by the DRAT is not
found to be sustainable in the eyes of law and the same is
required to be quashed and set-aside. The appeal, submitted by
the petitioner before the DRAT, is ordered to be restored and re-
registered to its original number.
16. The parties are directed to appear before the DRAT on
22.09.2026.
17. The DRAT is directed to decide the appeal expeditiously as
early as possible, preferably within a period of four weeks
thereafter, without entertaining any unnecessary and unwarranted
request for adjournment made by either side.
18. Before parting with this order, it is made clear that the DRAT
would decide the appeal on its merits, without being influenced by
any of the observations made by this Court.
19. With the aforesaid observations and directions, the instant
writ petition stands disposed of. Stay application and all pending
application(s), if any, also stand disposed of.
(ANOOP KUMAR DHAND),J
253/Aayush Sharma
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