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M/s Shaftek Infrastructure Private Limited v. The Union of India

Court: High Court for State of Telangana

Bench: MOUSHUMI BHATTACHARYA,GADI PRAVEEN KUMAR

Judgment date:

Case summary

High Court for State of Telangana judgment dated 2025-12-04. M/s Shaftek Infrastructure Private Limited v. The Union of India. Read the judgment and case...

Judgment text

[34s] I IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE FOURTH DAY OF DECEMBER TWO THOUSAND AND TWENTY FIVE PRESENT THE HON'BLE JUSTICE MOUSHUMI BHATTACHARYA AND THE HON'BLE SRI JUSTICE GADI PRAVEEN KUMAR WRIT PETITION NO: 32316 OF 2025 Between: 1. tr//s Shaftek lnfrastructure Private Limited, Having its office at Plot No- 108/3, IDA Phase ll, Charlapally, Hyderabad Rep. by its Director Smt Bhupatiraju Vijayalaxmi W/o B R Chirina Suryanarayana. Raju, Aged about 72 years. Occ: Business Fl/o H. No. 11-13-60i1lA, Plot No. 65, Alkapuri, R K Puram Saroornagar, Hyderabad, Telangana - 500035 Aged 2. Smt Bhupatiraju Vijayalaxmi, W/o B R Chinna Sury:narayana -Raiu. , about 72 years, Oc6 6usiness Fl/o H. No 11-13-60111A, Plot No. 65, Alkapuri, - R K Purari Saroornagar, Hyderabad, Telangana 500035 ,.. PETITIONERS AND 1 The Union of lndia, Rep.

By its Secretary to Government of lndia Department of Finance New Delhi 3-6- 150' 2 lndian Bank, Himayatnagar Branch, PB No. 10'10, H. No. - its Himayatnagai, Hydeiabad, Telangana 50002S, Represented by Authorised Officer. Aged about: 4'1 years' 3 Smt. Lakshmi Aparna Potharaju W/o. Pavan Gopal, OcC: Oentat Do'ctor, Rl/o. 3-1'-200121403, Sreenivasam Builders, Mallapur, Behind S. L. N. Function Halt, Uppal, Mallapur, K. V. Rangareddy, Telangana - 500076. 4 B. Pavan Gopal S/o. Sundra Ramaiah 8. , Occ: Engineer, aged about: 48 Mallapur, Behind S. L. N. vears, F/o. 3-1-2001214O3, Sreenivasam Builders, Telangana, Function Hall, Uppal, Mallapur, 500076, K. V. Rangareddy, Hyderabad, Telangana State - 500076. Respondent No. 3 and 4 are impleade-d as-p-er Court Order dated 04 12'2025 vide l. A. No. 2 of 2025 in W. P. No. 32316 of 2025. ...

RESPONDENTS Petition under Article 226 of the constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to issue a Writ, Orders or Direction, particularly ir he nature of Writ of Mandamus a. Declaring the action of the Respondent no. 2 : tthority in initiating proceedrngs under SARFAESI Act, 2002 and procee I ng with the issuance of Demand Notice dated 1. 07. 2024 under section ' 3(2), further issuing Possession Notice dated 02. O9. 2024 and thereupo I proceeding with the auction and sale of the subject property and notice j rted 24. 09 2024 and notice of taking possession dated 13. 1O. 2025 issuc< by the Respondent no. 2 Bank, without the compliance of the provisions L ider Section 26 D of the SARFAESI act,2002 as being bad, arbitrary and i egal and violative of Article 14, 21 and 300-4 of Constitution of lndia b. Consequentially set aside the proceedings initiated t, the Respondent no.

2 under the SARFAESI acl, 2OO2, on the ground I they being void ab in itio c. Consequentially direct the Respondent no 2 t't:t k to handover the possession of the residential house bearing H. No i1-13-36212, on plot No. 65, admeasuring 298 sq. yds. , situated e Alkapurr Colony, Saroornagar, Hyderabad as well as the movable prol rrties in it. lA NO: 1 OF 2025 Petition under Section 151 CPC praying that in the ,ircumstances stated in the affidavit filed in suppo( of the petition, the High CoJ t may be pleased to stay all the proceedings that have been initiated by the R:;pondent no. 2 bank under the provisions of the SARFAESI act, 2O02 in resJr, ct of the residential house bearing H. No. 1 1-13-36212, on Plot No. 65, adme : suring 298 sq. yds,, :w -,.. -.. ,/ situated at Alkapuri Colony, Saroornagar, Hyderabad, Direct the Respondent no 2 to not take any coercive action pending disposal of the Writ Petition. Counsel for the Petitioners: SRI A.

VENKATESH, SENIOR COUNSEL REPRESENTING SRI KOTA LAKSHMI SAI SIRISHA Counsel for the Respondent No. 1: SRI ANGOTHU NEHRU, S. C. FOR CENTRAL GOVERNMENT Counsel for the Respondent No. 2: SRI A. SATYANARAYANA, SENIOR COUNSEL REPRESENTING SMT. CH. LAXMI CHAYA Counsel for the Respondent Nos. 3 & 4: SRI RAMAKANTH REDDY The Court made the following: ORDER HIGH COI]RT FOR THE STA-I'E OF'fEt,,AI IGANA A'f HYDERABAD. I'Ht] HON'RLII. IUSTICE MOUSHUMI BHAl''I ] CHARYA AND i I]MAR THE HON'I}LE JUSTICE GADI PRAVEEN WRTT PETITION No. 32316 of 2025 DATE:09-12-2025 Benvcerr l. M/s. Shaftek Intiastructurc Private Limitcd and anothcr Petitioners And l. l-hc I Inion ol lutlia, Rcp. by its Secretary 'l'o Government o1'India and three others I{cspondents. ORDEIT: (ptr IIon blL' . lu:tict: Gudi l'ravectt Kunur) Heard Sri A. Vcnkatesh, learned Senior C'orl sel lcprcsenting Ms. Kota Lakshrni Sai Sirisha, learned counsel lor tl': pctitioners, Sri A. satyanarayana, learned Senior Counsel represent r s Srnt.

Clh Laxrni Chal'a, learned counsel appearing for respondent Nc 2 []ank and Sri Ramakanth Reddy, tearned counsel for respondent Nos. l and 4. ,: , t l I I I 2. Thc present Writ l)etition is filed assailing the action ol the respondent No. 2 Bank in initiating proceedings under The Securitization and Reconstruction of Fir-rancial Assets and Entbrcernent o f Security Interest Act,2002 (for short 'the Act') and issuing of Demand Notice dated Ol . 07. 2024 under Section l3(2) of the Act and subsequent Possession Notice under Section l3(4) ol the Act dated 02. 09. 2024 and thereupon proceeding with the auction and sale ol the sub. icct propeny and notice dated 24. 09. 2024 as well as noticc of taking possession dated 13. 10. 2025 rvithout complying with Section 26D ol the Act, as arbitrarv and illegal and a consequential direction to set aside the proceedings initiated by respondent No. 2 under SARFAESI Act and handover the possession olthe subject land. 'lhc 3.

facts teading to filing of thc present Writ Petition arc that petitioner No. I is engaged in thc business of erecting and labricating works lor cell phone towers. Respondent No. 2 had offbred overdraft facility to petitioner No. 1. In the year 20 16, petitioner No. I approached the respondent No. 2 Bank lor financial assistance, upon which, the Bank extended overdraft facilities sanctioning an amount of Rs. 3,75,00,000/-in favour of petitioner No. 1 . The subject overdraft facility stands secured by collateral, comprising a residential house bearing H. No. t 1-13-36212, on J Plot No. 65. adrneasuring 298 scl yards situated at A Saroouragar, Hydcrabacl (tirr short 'the schedule propelt'' anccstral proporty ol' petitioner No. 2, who is one ol' r petitioner No. l cotupatrv. Against thc said security llrl) partition vide O. S. No. 574 ol 2024, is presently pentrrg Additionrl Senior ci'il Juclge' ILa. ga Reddy District' i't and intcrests ol'thc co-oiincrs are under adjudication (-t'id-19 1.

t)uring thc pcriod liom 1020 to 2022 due to ccrlein iinancial constraints arose on account of adversr. : I rvhich tcrnporarily atlectcd thc regular flou, of bus ress petitioner No. I and also due to ill-health of petitioner No ' schcdule ol'the loan aocollnt u,as affected and thcrealie ' Bank classificd ttre account of pctitioner No. I as 'Norl (NPA)' on 28. 06. 2024 5. Subsequently, respondent No. 2 Bank initiated rec( dated 0l-07-::l under the Act by issuing a Demand Notice amount or'Rs. i,00,87,923l-' 13(2) of the Act indicating the outstanding Thereafter, Possession Notice under Section l3(4) of thc 02. 09. 2024 indicating the outstanding amount of Rs. 2,tt'i 6. Aggrieved by the action of respondent No'2, the petitioners approachecl the Debts Recovery Tribunal Il, Ilyderabad (for short 'DRT') by filing S. A. No. 438 ol 2024. TIte learned DRT, by an interim order dated 28. 10. 2024 passed in I-A. No.

3051 of 2024' granted stay on the a of Rs'80,00'000/ in condition that thc deposit sum three Petitioners installntents. one rvithin two weeks from thc date o{' the order and the remaining two at intervals of two weeks each' On account of non- conrpliance of thc said conditional ordcr passed by the learncd DRT' respondcnt No. 2 Bank conducted auction olthe schedtrle property and sold the same to the highest bidder. Accordingly, r'espondcnt No 2 Bank issued another notice dated 13. 10. 2025 to the petitioners for taking possession of the schedule property. 7. J'herefore. the present Writ Petition is flled contending that the proceedings issued by respondent No. 2 Bank are in violation of Section 26D of the Act, which imPoses a mandatory pre-condition for the I enforcement of any security interest I t I i 8. Sri A.

Venkatesh, learned Senior Counsel appearing for the i I I petitioners contended that the respondent clearly violated Section 26D of I i I i the SARFAESI Act which provides that a security interest has to be i I I I created in fai,our of secured creditol by the borrowcr i nd it has to be registered with the (lentral Registry lor commencetnetrt ot'enfbrccnrent proceedings rvith rcspect to sccuritics by tl're secured : editor. [. earned Senior Clounsel has placed reliauce on thc Asset Rirsr:r Scarch Repoft generated on 18. 10. 2025, reflccting that the secured ru set lonring the sub. ject matler was not registered with the Cer. r I rl Registry of Securitisation Asset Reconstruction and Security lr -crcst o1- lndia (cEnsAr) ( 9. l,earncd S,. 'nior ounsel lurther corrtended that ; nce thc scctLritv interest was nc\ cr i'cpistcled, rcspondent No.

2 Bank is talutorill barred undcr Scction 2(rD ol- the Act lrom exercising any en f )rcernent powers conf'ened undcr C'hapter III and as such, all actions takcn including Demand Noticc. Possession Notice. auction proces i ancl possession attempt, are all illegal, arbitrary and devoid ofjurisdictio r 10. On the otl-rer hand, Sri A-Satyanarayana, leame t Senior ('ounsel appearing for the respondent No. 2 Bank contended that the Writ Petition itself is not maintainable in view of the Writ Petition irroking of Section 17 of the Act by filing S. A. No. 4l8 of 2024 before the l,: rmed DRT which is pending consideration and that the issues raised irr the present Writ Petition as well as the issues raised betbre the leamed DRT are one and the same. I l.

Learned Scnior Counsel lurther subrnitted that, the petitioners having suf'fered an adversc conditional order and having failed to comply ivith thc deposit rnandatcd therein, are not entitled to invoke the extraordinary jurisdiction of this Court, and on this ground alone, the Writ Petition deserves to be disrnissed. 11. Learned Senior Counscl lurther contended that thc docurnents filed by' the petitioncrs rel'crring to the schedule propert)'are dil'f-erent fior-n the one ret'lccted in thc Asset Based Search Report of CERSAI dated t8. 10. 2025, which specifically relers to two propcrties viz.. H. No. ll-ll- 36212 (as claimed by the petitioners) and H. No. I I -13-60lllA (as shown in the CERSAI report) as secured asset. 13. Lealned Senior Counsel appearing for respondent No.

2 categorically denies the allegation with respect to violation of Section 26D of the Act stating that the Security Interest was duly registered with the CERSAI and the said mortgage was created by deposit of title deeds on24-03-2O16by petitioner No. 2 and was confirmed by executing a registered Memorandum of deposit of title deeds on 29. 03. 2016. It is contended that the Bank registered the security intorest on the property with Ocrr ral Registry by i. e. mentioning the new I). No. I I -13-362 corresponding to sul:l ecL Properry sq rJs, whercas the in Sy. No. 9/1/l; parr, plor No. 65 adrneasuring 298 l'r by using ror Nurnber i. e. search conducted by the petitioncrs was old I) ll-13-60/lA, disclosing thc result as'not satisfied'. attd I s such, both the House Numbers are one and the same situatcd at \ ikaptLri Colony, Saroornagar, I Iydc'r'abad- of CERSAI 14. Respondent No. l lllcd l)ebtor Based Scarch I{': 'on porL dated 04. 09. 201 [ and datcd 2<). l0. l()li.

\/altrrrrion re Ccrtificate confimiug the identitl ol thc propcrty. 15. Leamed Senior Counsel appearing for respotl ent No'2 lastly contended that, iu Vicu ol the pendency of the proc, r dings before the leamed DRT and thc petitioners' lailure to compll'r'T'itlr the interim order passed therein, thc pctitioners are barred from i I roking the writ jurisdiction of th is Court. - 16. Sri Rarnakanth Reddy, Iearned counsel appea ng lbr petitioner Nos. 3 and 4/auction purchasers submits that they z re the successful bidders and pursuant to the auction, they have depo; ted an amount of Rs,. 3,29,1 8,000/- and accordingty, the Bank has issuecl ! rle Certiflcate and took possession and as such, the Writ l)etition has become infructuous and liable to be dismissed. 17. Wc havc given our eamest consideration to the contentions urged by respectivc partres 18. Section 26D of the Act states ')bl). Right of enfitrume nl o[ . securitie. s ' Notv,ithslunding on.

)lhing trtrttuinttl in tttl other lutr'fttr the time baing in. /i;rcc,. liom the cktt tsf' (ontm(nL'enrcnl of lhe pr<xi. sions o/ this ('haptar, no sacurtd crtditor shull hc antitlatl to exercise lhc rights o[ enJircemcnl of stcuritir:s utklt'r (-lNptL't'ill unlc. s: thc:rtt:urttv intctast L:tcdlcd itt it. ;. ftrtout h1' tltt horrovtr ltas bean re gistere tl :rilh the ('entrul Registr. y. 19. A perusal of the record rcveals that it is not in dispute that the petitioners k-nocked the doors of the leamed DRT on the similar circumstances bf irrstituting S. A. No. 438 ol 2024, which is pending lor consideration. 20. Thc security asset (schedule property) is situated in Sy. No. 9/l/F bearing Plot No. 65 admeasuring 298 sq. yards with Door No. 11-13-60/iA (old) and new Door No. l1-13-362, which was subsequently bifurcated and allotted Door Numbers ll-13-362, 362/l and 36212, situated at Alkapuri Colony, Saroor Nagar, Hyderabad. The sale deed bearing Doc. No.

141201 6, () which is mortgagcd on 2. 1. 03. 2016 with respondent No. 2 [ ank' reflects old Door Number of' the property bcaling No. I 1-13-601 [ {, u'hcreas the respondent No. 2 Ilank rcgistered thc sccurity interesVchar le crcatcd ort the ('entral Rcgistrl property with the by mentioning the ner" D. No. 1l-ll-162 'fhe in the same survey nurttber. said charge was dull' rl ristcred with the '[he Central Rcgistry as reqLrired undcr Scction 26D of the A: . documents placed on record bv the leamed cottnsel appearing tirr r. -spondent No. 2 specifu the sarne. Thcrefbrc, it caut-tot be said that th: e is violation of Section 26D of the Act 2l . The record fufther reveals tltat the petitioners levcr raised any objection with respect to the alleged non-registration ,r'charge u'ith the 'l)e Central Registry at an1 point ol'titne cither at the tirre r urand Notice, \ Possession Noticc or Salc Noticc. A perusaI of the pror', edings befbre the leamed DRf in S. A. No.

,138 o1' 2024, rcveal that thr' petitioners never raised any objection during the auction proceedings. Si Lce lhe petitioners have failed to comply with the conditional order pass :d by the leamed DRT while passing the interim orders, the petitioners Lre cstopped liom -invoking the of this Court under A icle 226 of t}:. e . jurisdiction Constitution of India l0 22. Further, the petitioners did not raise any objection at the time of receiving Demand Notice under Section l3(2) ol the Act or subsequently on the part of the and the sanre indicates that there are no bono fitles petitioners. 23. The petitioners availed the statutory renredy before the leamed DRT" however, lailed to comply with the conditional orders and the registration under CERSAI is duly completed. Thereforc, rve are of the opinion that initiation ol the present writ Petition is clcarly abuse of process of law, arrd the saure'is llot maintainable. 24. Accordingly, W. P. No.

323 l6 of 2025, along with all connected applications, is disrnissed. There shall be no order as to costs' sH4ry[48 sD/' A'H's' GowRl ASSISTANT REGISTRAR il //TRUE COPY// SECTION OFFICER To IOPUCI SAI SIRISHA' Advocate KOTA LAKSHMI 1. One CC to SRI C for Central Government IOPUC] 2. One CC to SRI ANGOTHU NEHRU' S [OPUCI LAXMI CHAYA' Advocate 3 One CC to SMT CH' IOPUCI 4 One CC to SRI RAMAKANTH REDDY' Advocate q Two CD CoPies MP LS {IGH COURT DATI: D:0411212025 t T J . (' -) . "$ + (r ,S ,</ l \) L:. I \ t\ + ORDER WP. No ,t2316 of 2025 DISMISSING THE ! [/ ? IT PETITION WII'{OUT COSTS 4- / "J) \b

Source: High Court for State of Telangana. Dataset: Dattam Labs. CC BY 4.0. Text extracted automatically; compare with the source PDF for layout and accuracy.