K. Kesavan vs The Authorised Officer, Indian Overseas Bank

As the conditional order is complied with and the appeal is numbered, the same is taken up for hearing.

Learned counsel for the petitioner/appellant submitted that this appeal is filed against the interim order dated 04.02.2026 passed in IA 200/2026 in SA 61/2026. and it is requested that this appeal may be disposed by giving directions to the Ld. Presiding Officer, DRT-III, Chennai to dispose SA 61/2026. He also prayed for maintenance of status quo as of today since the auction purchaser may demolish the building and create further encumbrance.

Learned counsel for the respondent-Bank objects for the grant of any interim stay.

This Tribunal finds that this appeal is filed only against the interim order passed in IA 200/2026 in SA 61/2026. The said IA is filed for staying the further proceedings in SA 61/2026. The main ground taken before this Tribunal is that the stay application was dismissed stating that the bank had produced all documents for due service of notice issued under Section 13(2) of the SARFAESI Act. It was recorded that demand notice was returned unclaimed with the postal endorsement that “unclaimed returned to sender”. It was also recorded that the notice sent to G. Kalyanmurthy was duly received. (Probably, the name of Kaliyamurthy is wrongly typed as Kalyanmurthy). Possession notice is returned as “left India; returned to sender”.

It is the grievance of the petitioner/appellant that the petitioner/appellant is the guarantor of the loan availed by his sister’s daughter Aarti for educational purposes. He is not in India. Demand notice was not served on him. The returned cover dated 4.12.2024 filed by the bank in proof of service of demand notice is not true for the reason that demand notice was dated as 6.11.2023 but it was claimed to have been returned to the sender on 4.12.2024. When demand notice was not properly served through post or by affixture or by publication, the subsequent proceedings initiated under the SARFAESI Act is not legal.

Learned counsel for the respondent-Bank rebuts this contention and submits that the demand notice and possession notice were duly served and the respondent-bank had already filed all the notices before the Tribunal. Further she submits that the order of Chief Judicial Magistrate also refers to publication of the demand notice and the respondent would produce proof for affixture of demand notice and other relevant documents.

In the light of the issue involved in this matter, questioning the very service of demand notice, this Tribunal dispose this appeal by giving direction to the Learned Presiding Officer, DRT-III, Chennai to dispose SA 61/2026, as expeditiously as possible. Accordingly, this appeal is disposed. Parties are directed to maintain status quo of the building as on today for a period of one month. Then, it is for the Learned Presiding Officer, DRT-III, Chennai to decide the continuance of the status quo or not. Accordingly, this appeal is disposed. Parties shall bear their own costs. Pending IAs, if any, shall stand closed.