Union Bank Of India vs M/s. Sri Tejaswi Aac Blocks Private Limited & Ors.

Instant appeal is preferred against the order dated 13.02.2026 passed by learned DRT II Hyderabad in I.A. No. 495 of 2026 arising out of S.A. 66 of 2026 (Sri Tejaswi AAC Blocks Pvt. Ltd. Vs. Union Bank of India) whereby learned DRT stayed all further SARFAESI proceedings including auction scheduled on 13.02.2026 pursuant to auction sale notice dated 30.12.2025.

As per pleadings of the parties, jural relationship between the parties is not in dispute. Securitization application u/s 17 of the SARFAESI Act, 2002 was filed by the borrower challenging the sale notice 30.12.2025 fixing auction sale on 13.02.2026. Pending S.A., I.A. 495 of 2026 was filed for staying the SARFAESI proceedings on different grounds for violation of mandatory provisions of the Act. Learned DRT heard the learned counsel for the parties and observed that after issuance of possession notice dated 13.10.2025, fresh demand notice was issued on 12.11.2025 in respect of two properties which is not in accordance with law. Notice issued under Rule 8(6) of the Security Interest (Enforcement) Rules, 2002 was also not in accordance with law. Publication of notices was not made at the appellants’ residential address and the area where property is situated. Accordingly, learned DRT stayed all further proceedings including auction sale scheduled on 13.02.2026.

Heard learned counsel for the parties and perused the records.

Learned counsel for the appellant bank would submit that demand notice u/s 13(2) of the Act was issued with respect to different account number relating to house building advance. It is further submitted that subsequent demand notice has no concern with the earlier demand notice. There is no requirement of mentioning the debt due or the amount due in the notice. Notice under Rule 8(6) of the Rules was issued in accordance with law and publication of notice was also done in accordance with law.

Per contra, learned counsel for the respondent would submit that the publication of notice was not made in accordance with law. No debt due amount was mentioned in the notices which could have enable the borrower to redeem their property. Learned counsel would further submit that publication of notices was not made in the newspapers for wide circulation in the area where borrower is residing.

Learned DRT based its order on an issue which could not have support from the record. The notice u/s 13(2) dated 04.07.2025 relates to three accounts, (i) Term Loan a/c no. 625306640000002; (ii) Term Loan a/c no. 625306390000002 and (iii) Cash Credit a/c no. 625305010000106 mentioning nine immovable properties. Another notice u/s 13(2) was issued on 12.11.2025 which is neither in continuation nor in derogation of earlier notice rather notice dated 12.11.2025 was issued with respect to housing loan account no.625306650000173. Notice was addressed to the borrower Ms. Buddareddy Yashaswini and Ms. B. Sreedevi. This notice was also issued mentioning only two immovable properties which were not included in earlier notice. Accordingly, the subsequent demand notice was related to different account number. It is also to be observed here that S.A. 66 of 2026 was filed by the borrower whose name find place in the notice dated 04.07.2025 and schedule of property in the S.A. were also same in the notice. Hence, there is no requirement of issuing a fresh possession notice with respect to the property involved in the present S.A.

As far as issue of redemption notice is concerned, notice under Rule 8(6) of the Rules was issued wherein all the provisions of law were duly complied. As far as redemption is concerned, when notice under Rule 8(6) of the Rules was issued it duly served the purpose. Further, it is not denied that notice u/s 13(2) and u/s 13(4) of the SARFAESI Act, 2002 were duly served upon the respondent borrower. Hence, as far as right to redemption is concerned, at this stage prima facie we do not find any substance in the argument. Further, this issue has to be decided by the learned DRT on merits at the time of final disposal of the S.A.

As far as issue of publication of notices are concerned, the notices were duly served and published in two newspapers, one in vernacular and the other in English for wide circulation in Nandyal area. We do not find at this stage any illegality in the publication of notices.

Accordingly, we are of the considered view that learned DRT has erred in passing the impugned order staying all further SARFAESI proceedings initiated by the bank. Impugned order suffers from material illegality, which is liable to be set aside. Appeal deserves to be allowed.

Appeal is allowed. Impugned order dated 13.02.2026 is set aside. However, the issues raised in the S.A. are required to be considered by the learned DRT on its own merit without being influenced by the observations made above. All pending I.A.s are also disposed of.

File be consigned to record room.

Copy of the Order be uploaded in the Tribunal's website.