Tehsildar's Possession Letter Cannot Be Treated As SARFAESI 'Measure' For Computing Limitation: DRT Chandigarh

The Chandigarh Debts Recovery Tribunal (DRT) has recently held that a possession letter issued by a Tehsildar for execution of a Magistrate's possession order is not a "measure" under the SARFAESI Act.

The tribunal held that such a letter cannot be used to compute the limitation period for filing a securitisation application.

Presiding Officer Mridulesh Kumar Singh observed,

“In sub-Section (4) of the Section 13 nowhere it is provided that a letter issued by Tehsildar cum Executive Magistrate in compliance of order passed by the Magistrate concerned under Section 14 of the Act is a measure. In fact, such letter is an information for the execution of the order passed under Section 14 of the Act. Therefore, limitation to file SA cannot be counted from date of such letter.”

The ruling came while the tribunal was considering a securitisation application filed by Deepak Kumar and Sudesh Rani against Tata Capital Housing Finance Ltd. The tribunal ultimately dismissed the application as barred by limitation.

The borrowers had availed a housing loan of Rs 22.5 lakh in 2018. According to their application, repayment irregularities arose during the COVID-19 pandemic.

The lender thereafter issued a demand notice on February 10, 2024. It later issued a possession notice on May 22, 2024. The Chief Judicial Magistrate, Ludhiana, subsequently passed an order on August 7, 2024, authorizing physical possession of the secured asset.

The borrowers challenged the recovery proceedings on several grounds. They contended that the demand notice had not been served upon Sudesh Rani. They also argued that the possession notice had not been served upon them in accordance with the Rules.

The borrowers further alleged that the application filed before the Chief Judicial Magistrate contained incorrect property particulars. According to them, references were made to a property situated in Jalandhar instead of Ludhiana.

They also argued that the securitisation application filed on September 11, 2025 was within limitation. According to the borrowers, limitation had to be computed from a possession letter issued by the Tehsildar on August 29, 2025.

Tata Capital Housing Finance opposed the plea. It argued that the limitation commenced from the possession notice issued on May 22, 2024 and not from a subsequent letter issued by the Tehsildar while implementing the Magistrate's order.

The lender further argued that the Tehsildar's letter was not a measure under the Act. It also pointed out that no application seeking condonation of delay had been filed.

The tribunal noted that the borrowers had calculated the limitation from the Tehsildar's possession letter dated August 29, 2025.

Rejecting that contention, the tribunal held that the letter was issued in compliance with the magistrate's order. The Tribunal observed that the letter was "an information for the execution of the order passed under Section 14." It therefore could not be treated as a measure under the Act.

The tribunal added,

“Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 provides, the time limit of 45 days of filing application under this Section from the date on which a measure had been taken referred to in sub-section (4) of Section 13 taken by the secured creditor or his Authorised Officer. Therefore, this SA was to be filed within 45 days from the date of measure referred to in sub- Section (4) of Section 13 or sale notice.”

The tribunal noted that the possession notice had been issued on May 22, 2024. It further noted that the securitisation application was filed on September 11, 2025. The Tribunal therefore held that the application was filed beyond the prescribed period.

The tribunal also noted that no application seeking condonation of delay had been filed. It observed that no explanation had been offered for the delay.

On the borrowers' objections regarding service of notices, the tribunal held that the demand notice had been validly served in accordance with the Rules. The Tribunal also held that the possession notice had been served in accordance with the Rules.

Addressing the borrowers' challenge to the proceedings before the Chief Judicial Magistrate, the Tribunal held that there is no requirement to issue notice to borrowers before passing an order under Section 14.

Holding that the application was filed beyond limitation, the Tribunal dismissed the securitisation application. The tribunal further held that no illegality or irregularity had been shown in the lender's proceedings up to the stage of the possession notice.