Research › Search › Judgment

Calcutta High Court · body

2013 DIGILAW 889 (CAL)

Central Bank of India v. Aloke Goenka

2013-12-03

TOUFIQUE UDDIN

body2013
JUDGMENT This revision arose out of order No. 41 dated 18.12.12 passed by the learned Civil Judge (Sr. Div.), 1st Court, Alipore in T.S. No. 51/09. 2. The short background is that the petitioner is the third defendant in T.S. No. 51/09. The petitioner carried on business as a nationalised bank. The petitioner extended credit facilities to its borrowers viz. Kali Internationals Pvt. Ltd. and Rajco Steel Enterprises which was secured by the Opposite Party No. 2 and 3 by creating mortgage in respect of immovable properties being Flat. No. D and D1, 5th floor, Anant, 17/1E, Alipore Road, Kolkata-27. Against the said credit facilities granted, the petitioner has a claim of Rs. 77,18,77,615.87/- and Rs. 71,35,09,951.70/- respectively against the borrowers and the Opposite Party nos. 2 and 3 i.e. the defendant nos. 2 and 3 in the said suit who stood as guarantor and mortgagor to secure the said loan facilities. 3. Despite repeated demands the Opposite Party No. 2 and 3 failed to pay the instalments as guarantors for the said credit facilities and in view of fraud being committed the account was classified as non performing assets. As the account of the Opposite Party/borrowers were classified as a non performing asset, the petitioner enforced rights under the provisions of Sarfaesi Act, 2002 and issued demand notice upon the borrowers and guarantors under Section 13(2) of the Sarfaesi Act, 2002 on 19.5.2009. The petitioner suddenly received a letter dated June, 27, 2009 wherefrom for the first time the petitioner came to know that on June 26, 2009 an ex parte order of injunction was obtained by the Opposite Party No. 1 being the plaintiff in a suit being T.S. Suit No. 51/09 and by virtue of such ex parte order of injunction the petitioner could not proceed any further to recover its dues from the Opposite Parties and also could not take any steps against the suit property which is the secured assets being mortgaged with the petitioner. 4. 4. The main contention of the Opposite Party No. 1 in the aforementioned suit was that the Opposite Party No. 1 having been inducted in the suit property, by the owners of the suit property, being the defendant No. 1 and 2 in the suit, in terms of a duly executed Agreement of Tenancy dated 28.4.2006 was entitled to protection against eviction therefrom by the said defendants and/or by the petitioner otherwise than by due process of law. 5. By virtue of a Tenancy Agreement dated 28th April, 2006, entered into by and between the Opposite Party No. 1 and the Opposite Party nos. 2 and 3, the Opposite Party No. 1 was inducted as a monthly tenant in respect of two flats, being flat nos. D and D1, each measuring about 1430 sq. ft. of super built up area, situated on the 5th floor at premises No. 17/1E, Alipore Road, P.S. Alipore, Kolkata-27 as well as a car parking space, i.e. to say the suit property, at a monthly rent of Rs. 9000/- and in terms whereof the Opposite Party No. 1 had been residing thereat, with his family members by duly paying the monthly rent without any default. 6. On 27th May, 2009, the Opposite Party nos. 2 and 3 served notice upon the Opposite Party No. 1 intimating the Opposite Party No. 1 of certain proceedings initiated by the petitioner under the Sarfaesi Act, 2002 against the Opposite Party nos. 2 and 3 in respect of the suit property with a request to the Opposite Party No. 1 to vacate the flats comprised in the suit property within one month from the date of receipt of the said notice. 7. By virtue of the said notice dated 27th May, 2009, which had enclosed a notice dated May 19, 2009 issued under Section 13(2) of the said Act, 2002 by the petitioner to the Opposite Party No. 2 and 3 annexed thereto, the Opposite Party No. 1 was further intimated that the petitioner would oust the Opposite Party No. 1 from the suit property, with the help of police. Thereafter, the Opposite Party No. 2 and 3 refused to accept the monthly rent for the month of June, 2009 from the Opposite Party No. 1. 8. Thereafter, the Opposite Party No. 2 and 3 refused to accept the monthly rent for the month of June, 2009 from the Opposite Party No. 1. 8. On June, 20, 2009 at about 11.30 a.m. three persons, claiming themselves to be the authorized representatives of the petitioner reached the suit property and directed the Opposite Party No. 1 to vacate the suit property immediately and handover possession thereof to them and threatened that in default thereof, the matter would be reported to the petitioner who would thereafter oust the Opposite Party No. 1 and his family members from the suit property. 9. Apprehending interference of his tenancy rights to which the Opposite Party No. 1 was entitled to protection under the West Bengal Premises Tenancy Act, the plaintiff instituted the aforesaid suit. 10. The Opposite Party No. 1 filed an application under Order 39 Rules 1 and 2 read with Section 151 of the Code of Civil Procedure, praying for an order of temporary injunction restraining the petitioner and the Opposite Party No. 2 and 3 and their men and agents from ousting the Opposite Party No. 1 from and taking possession of flats, described in the schedule appended to the said application. The said prayer for ad interim relief was granted by the learned court below vide its order dated 26.6.2009 whereby and whereunder the defendants were restrained, by way of an ad interim injunction, from ousting the Opposite Party No. 1 or taking possession of the suit flat in any manner otherwise then by due process of law. The petitioner entered appearance in the suit and on 10.7.2009, filed an application under Order 7 Rule 11 of the Code of Civil Procedure, 1908 and an affidavit in opposition against the ex parte order of injunction dated 26.6.2009. The said application under Order 7 Rule 11 of the Code of Civil Procedure filed by the petitioner was taken up for consideration by the learned Court below on November 6, 2009 when the said application was rejected by the learned Court below. 11. Challenging the order of dismissal of the application of the petitioner under Order 7 Rule 11 of the Code of Civil Procedure, the petitioner filed an application under Article 227 of the Constitution of India being C.O. No. 2180/2010. The said application of the petitioner is still pending. 12. 11. Challenging the order of dismissal of the application of the petitioner under Order 7 Rule 11 of the Code of Civil Procedure, the petitioner filed an application under Article 227 of the Constitution of India being C.O. No. 2180/2010. The said application of the petitioner is still pending. 12. On 19.11.2010, the petitioner filed an application under Order 39 Rule 4 read with Section 151 of the Code of Civil Procedure. In view of filing of the said application by the Opposite Party No. 3, the learned Court below fixed January, 25, 2011 for hearing of the said application and directed filing of objections thereto in the meantime. It would be pertinent to mention that the application under Order 39 Rule 4 read with Section 151 of the Code of Civil Procedure was pending for disposal and ad interim order dated June 26, 2009 was subsisting, the same being extended from time to time. On January 25, 2011, two applications were filed on behalf of Opposite Party No. 1. One of such applications was for extension of ad interim order of injunction dated 26.6.2009. The second application was one praying for an adjournment of the hearing of an application under Order 39 Rule 4 read with Section 151 of the Code of Civil Procedure, filed by the petitioner on the ground that the learned Advocate appearing before the learned Court below, on behalf of Opposite Party No. 1 was out of station owing to his personal assignments. 13. In such view, there was none on behalf of the Opposite Party No. 1 before the learned Court below, no objection/opposition to the said application under Order 39 Rule 4 read with Section 151 of the Code of Civil Procedure was filed by or on behalf of Opposite Party No. 1, the learned Court below was pleased to vacate the ad interim order of injunction dated 26.6.2009. 14. Under such circumstances, the Opposite Party No. 1 filed an application being C.O. No. 356/2011 challenging the order dated 25.1.2011 by which the ex parte interim order of injunction dated 26.6.2009 was vacated on the ground of default. 15. 14. Under such circumstances, the Opposite Party No. 1 filed an application being C.O. No. 356/2011 challenging the order dated 25.1.2011 by which the ex parte interim order of injunction dated 26.6.2009 was vacated on the ground of default. 15. By an order dated 31.1.12 passed by the Hon'ble Court, the learned Trial Court was directed to expedite the matter and take steps for disposal of injunction application preferably within two months from the date of communication of the order without granting any unnecessary adjournments. 16. The Opposite Party No. 1 filed written objection to the application under Order 39 Rule 4 of the Code of Civil Procedure filed by the petitioner herein. The injunction application of the Opposite Party No. 1 as well as the application of the petitioner filed under Order 39 Rule 4 of the Code of Civil Procedure were taken up together and were disposed of by the order No. 41 dated 18.12.2012. The injunction application filed by the Opposite Party No. 1/plaintiff herein was considered and allowed on contest. Ad interim order was passed on 26th June, 2009 by which the defendants were restrained from ousting the plaintiff or taking possession of the suit property in any manner whatsoever otherwise than by due process of law, was made absolute. The application filed by the petitioner under Order 39 Rule 4 was considered and rejected on contest. 17. Hence this revision. 18. Both sides have submitted written notes of argument which have been made part of the record. In addition, the learned counsel for the respective parties also made oral arguments. The main plank of argument of the petitioner-bank is as follows: The flats in question having been mortgaged to the bank and the loan and advances having been not paid to recover dues, the bank issued notice under Section 13(2) of the Sarfaesi Act, 2002 (hereinafter referred to as the said Act) to the defendant No. 1 and 2 demanding the outstanding amount granted to two concerns viz. Kali International Pvt. Ltd. and Rajco Steel Enterprises within 60 days thereof. The defendant No. 1 and 2 with mala fide intention issued a letter on 27.5.09 calling upon the plaintiff to vacate the flats in question so that it may approach the court of law to prevent the bank from taking possession thereof under Section 13(4) of the SARFAESI Act. 19. The defendant No. 1 and 2 with mala fide intention issued a letter on 27.5.09 calling upon the plaintiff to vacate the flats in question so that it may approach the court of law to prevent the bank from taking possession thereof under Section 13(4) of the SARFAESI Act. 19. Though the ex parte injunction order was obtained by the plaintiff in that suit but the same is being used by the defendant No. 1 and 2 in its application seeking to vacate the ex parte injunction order passed by the Calcutta Debt Recovery Tribunal (I). 20. Mala fide injunction order of the defendant No. 1 and 2 and the plaintiff is there and their collusion is seen from the following facts: a) The bank in its notices dated 19.5.09 has only demanded the due amount and had not indicated that it would take possession of the flats in question. But the defendant No. 1 and 2 in the letter dated 27.5.09 issued to the plaintiff misrepresented that the bank would take possession of the flats in question. b) Intentionally the service of notices of defendants No. 1 and 2 were delayed for the purpose of extending the injunction order. c) Though the defendant No 1 and 2 are not appearing in the suit but they are relying on the ex parte injunction order passed on 26.6.10 to vacate the injunction order passed by the Calcutta Debt Recovery Tribunal (I) in bank’s application. d) Till the filing of that suit the bank had not issued any notice under Section 13(4) of the said Act requiring possession of the said flats. So, the application of the plaintiff is premature. 21. The bank having issued notices under Section 13(2) of the SARFAESI Act, this court could not have passed any order of injunction in view of Section 34 of the said Act. The said Section not only bars the jurisdiction of the civil court but also prohibits passing of any injunction order. If the present injunction is further continued then it would be contrary to the provision of the Sarfaesi Act. 22. On the other hand, the learned Counsel for the Opposite Party No. 1 has submitted written notes of argument contending inter alia the following points that the present revisional application is not maintainable inasmuch the order challenged in the revisional application is an appealable order under Order 43 Rule 1. 22. On the other hand, the learned Counsel for the Opposite Party No. 1 has submitted written notes of argument contending inter alia the following points that the present revisional application is not maintainable inasmuch the order challenged in the revisional application is an appealable order under Order 43 Rule 1. 23. In support of his contention reliance was placed in the decision of Drawings & Metals & Ors. vs. State Bank of India reported in 1996 CWN 978 wherein it was propounded that “no doubt there is no absolute bar in entertaining an application under Article 227 of the Constitution of India even in a case where an appeal lies but it is well settled by authorities that such interference should be made only in exceptional cases and that too only where there has been mala fide injustice relating to very patent and flagrant error of procedure. Perversity of findings, arbitrary or capricious, exercise of jurisdiction”. 24. In this regard it is needless to mention that the said Act has been aimed at taking care of the issues like the present one. So, it is an exceptional case for which the instant revision has been filed and it is quite maintainable. The plea of the petitioner that the suit is not maintainable has been negated by the learned Court below. But the order that the suit is maintainable is subsisting and plea of defendant No. 3/petitioner is barred by ‘res judicata’ in view of the decisions of Bhanu Kumar Jain vs. Archana Kumar & Anr. reported in 2005 (1) SCC 787 and Barkat Ali & Anr. Vs. Badri Narayan (D) by LRs (2008) 4 SCC 615 wherein it was propounded that the principles of res judicata not only applied in respect of separate proceedings but the general principles also apply at the subsequent stage of the same proceedings. So, was the view in the decision of Arjun Singh vs. Mohindra Kumar & Ors., [ (1964) 5 SCR 946 ] and in other decisions also. 25. So, was the view in the decision of Arjun Singh vs. Mohindra Kumar & Ors., [ (1964) 5 SCR 946 ] and in other decisions also. 25. It was the contention of the petitioner as contended by the Opposite Party that in so far as the agreement entered into by and between the plaintiff/Opposite Party No. 3 and defendant No. 1 and 2/Opposite Party No. 2 and 3 was an unregistered instrument, no reliance could have been placed thereon and such tenancy cannot be governed by the West Bengal Premises Tenancy Act, 1997. It was urged by the petitioner that such agreement has created a lease month by month and that by virtue of provisions of Section 3 of the W.B. Premises Tenancy Act, 1997, the tenancy of the plaintiff could not be deemed to be one under the W. B. Premises Tenancy Act, 1997. 26. It was also contended that the plaintiff in paragraph 13 of the Injunction Petition claimed to be a tenant under West Bengal Premises Tenancy Act and also claimed protection under the said Act but on perusal of the tenancy agreement dated 28.4.2006, it appears that the tenancy was for residential purpose with a monthly rent of Rs. 9000/-. The monthly rents of the flats being more than Rs. 6500/- the plaintiff is not entitled to any protection as the said tenancy was also not within the purview of the said tenancy. 27. I find substance over such argument advanced by the learned Counsel for the Petitioner. Further, the contention of the Opposite Party No. 1 is that the West 13 Bengal Premises Tenancy Act, 1997 is squarely applicable in this case inasmuch as defendant No. 1 and 2/Opposite Party No. 2 and 3 in their objection under Order 39 Rule 4 stated that there were three tenancies but this matter is not concerned with the present petitioner. It is a matter between the Opposite Party No. 1 and Opposite Party No. 2 and 3. 28. Regarding the question of maintainability the Opposite Party relied on the decisions of Manager, Uco Bank vs. Samar Sarkar & Ors. reported in AIR 2008 Cal 9 wherein the Hon'ble court at Calcutta propounded that the provision of the said Act of 2002 does not authorize any bank to recover possession from a tenant under the borrower in the process of recovery of its dues from its borrower. reported in AIR 2008 Cal 9 wherein the Hon'ble court at Calcutta propounded that the provision of the said Act of 2002 does not authorize any bank to recover possession from a tenant under the borrower in the process of recovery of its dues from its borrower. The Opposite Party No. 1 further relied on the judgment of N. P. Pushpangadan & Ors. vs. Federal Bank & Ors. reported in 2011 (4) KLT 134 etc. 29. I have considered all judgments cited before me by the parties as well as oral arguments and written notes in support of their respective contention and have carefully gone through the materials. 30. Even if the West Bengal Premises Tenancy Act is applicable to the instant case, in that case the bank having taking the measure under the said Act would have an overriding effect on the Tenancy Act in view of Section 35 of the said Act being a Central Act. Reliance may be put in the decisions of 2012 (1) Banker’s Journal 336 (Allh.) (Kailashpati Asthana vs. Authorised Officer, SBI & Ors.) and AIR 2011 (Raj.) 93 (Vikash Book Ltd. vs. Bank of Baroda). Though purported tenancy is stated to have been created prior to mortgage of the flats in favour of the bank but the same was not disclosed at the time of creation of the mortgage. On a reading of the purported tenancy agreement dated 28.4.2006, it could be seen that the same was not for any specific period. The purported tenancy being not for any specific period, is a monthly tenancy and in view of provision of Section 106 of the Transfer of Property Act, it is a lease for month to month or in other words, new lease is created for another month on the expiry of a month. In view of Section 13(2) of the said Act creation of monthly lease after the bank had issued notice under Section 13(2) of the said Act is prohibited without the consent of the bank. As such the bank having issued the notices under Section 13(2) of the SARFAESI Act, the extension/creating of the tenancy in the nature of monthly lease after May, 2009 without written contention of the bank is violative of Section 13(13) of the Sarfaesi Act, if any injunction order is passed to protect such illegal tenancy that will be bad in law. 31. 31. In this case, I find that the plaintiff and the Opposite Party No. 2 and 3 ought to have been disclosed about the purported tenancy created prior to the mortgage of the flats. 32. The learned Counsel for the Petitioner contended that the plaintiff/Opposite Party No. 1 did not send copies of the documents relied by the plaintiff. So, on this score, the injunction order is liable to be vacated in view of the decision of SBL Ltd. vs. Himalaya Drug Co. reported in AIR 1988 Del. 126. It is a statutory obligation. The Opposite Party cannot bypass these provisions of law. 33. In the present case, notice was given under Section 13(2) of the Sarfaesi Act and not under West Bengal Premises Tenancy Act. The plaintiff has no relation with the bank. Therefore, there is no question of giving any notice under the West Bengal Premises Tenancy Act terminating the tenancy. So, the judgment in the case of Amarnath Pramanik as reported in 2008 (3) CHN 962 as referred by the plaintiff does not seem to be applicable in this case. Similarly, AIR 2008 Supreme Court 403; 2006 (1) CHN 659 cannot give any rescue to the Opposite Parties. 34. The plaintiff relied on the decision as reported in 2011 (4) KLT 134 (supra) but that judgment has not considered the judgment of various High Courts holding that Sarfaesi Act has overriding effect on local tenancy law. In this regard, another decision relied upon by the plaintiff in the case of AIR 2008 Cal 9 is not applicable because in that judgment the court has not considered the position as law laid down in 2004 (4) SCC 31 whereunder the Hon'ble Apex Court held that the jurisdiction of the civil court is barred. 35. In the decision of Mardia Chemicals Ltd. & Ors. vs. Union of India & Ors. reported in (2004) 4 SCC 311 the Hon'ble Apex Court held that the contract between the parties as in the present case, is no more as private as sought to be asserted on behalf of the respondents. If that were so parties would be at liberty to seek redressal of their grievances of their grievances on account of breach of contract or otherwise, taking recourse to the normal process of law as available, by approaching the ordinary civil courts. If that were so parties would be at liberty to seek redressal of their grievances of their grievances on account of breach of contract or otherwise, taking recourse to the normal process of law as available, by approaching the ordinary civil courts. But it is found that a contract which has been entered into between the two private parties, in some respects has been superseded by the statutory provisions or it may be said that such contracts are now governed by the statutory provisions relating to recovery of debts and the bar of jurisdiction of the civil court to entertain any dispute in respect of such matters. Hence, it cannot be pleaded that the petitioners cannot complain of the conduct of the banking companies and financial institutions for whatever goes on between the two is absolutely a matter of contract between private parties. Therefore, no adjudication may be necessary. It cannot be denied that the financial institutions, namely, the lenders owe a duty to act fairly and in good faith. There has to be a fair dealing between the parties and the financing companies/institutions are not free to ignore performance of their part of the obligation as a party to the contract. They cannot be free from it. Irrespective of the fact as to whatever may have been held in the terms of the contracts and other details relating to those matters, that may or may not strictly apply, nonetheless, even in absence of any such decisions or good faith complying with their part of obligations under the contract. This is also the basic principle of concept of lender’s liability. It cannot be a one-sided affair shutting out all possible and reasonable remedies to the other party, namely, borrowers and assume all drastic powers for speedier recovery of NPAs. Possessing more drastic powers calls for exercise of higher degree of good faith and fair play. The borrowers cannot be left remediless in case they have been wronged against or subjected to unfair treatment violating the terms and conditions of the contract. They can always plead in defence deficiencies on the part of the banks and financial institutions. 36. Liquidity of finances and flow of money is essential for any healthy and growth-oriented economy. The borrowers cannot be left remediless in case they have been wronged against or subjected to unfair treatment violating the terms and conditions of the contract. They can always plead in defence deficiencies on the part of the banks and financial institutions. 36. Liquidity of finances and flow of money is essential for any healthy and growth-oriented economy. But certainly, what must be kept in mind is that the law should not be in derogation of the rights which are guaranteed to the people under the Constitution. The procedure should also be fair, reasonable and valid, though it may vary looking to the different situations needed to be tackled and object sought to be achieved. Under the Act in consideration, before taking action a notice of 60 days is required to be given and after the measures under Section 13(4) of the Act have been taken, a mechanism has been provided under Section 17 of the Act to approach the Debts Recovery Tribunal. Moreover, the Tribunal in exercise of its ancillary powers shall have jurisdiction to pass any stay/interim order subject to conditions it may deem fit and proper to impose. The above-noted provisions are for the purposes of giving some reasonable protection to the borrower. 37. The purpose of serving a notice upon the borrower under Section 13(2) of the Act is that a reply may be submitted by him explaining the reasons as to why measures may or may not be taken under Section 13(4) in case of non-compliance with notice within 60 days. The creditor must apply its mind to the objections raised in reply to such notice and an internal mechanism must be particularly evolved to consider such objections raised in the reply to the notice. There may be some meaningful consideration of the objections raised rather than to ritually reject them and proceed to take drastic measures under Section 13(4). The creditor must apply its mind to the objections raised in reply to such notice and an internal mechanism must be particularly evolved to consider such objections raised in the reply to the notice. There may be some meaningful consideration of the objections raised rather than to ritually reject them and proceed to take drastic measures under Section 13(4). Once a duty to consider the objections raised by the borrower in reply to a notice under Section 13(2) is envisaged on the part of the creditor it would only be conducive to the principles of fairness on the part of the banks and financial institutions in dealing with their borrowers to apprise them of the reasons for not accepting the objections or points raised in reply to the notice served upon them before proceeding to take measures under Section 13(4) till the stage of making of demand and notice under Section 13(2) of the Act, no hearing can be claimed by the borrower. 38. A person in respect of whom steps under Section 13(4) of the Act are likely to be taken cannot be denied the right to know the reason of non-acceptance and of his objections. Communication of reasons not to accept the objections of the borrower, would certainly be for the purpose of his knowledge which would be a step forward towards his right to know as to why his objections have not been accepted by the secured creditor who intends to resort to harsh steps of taking over the management/business of viz. secured assets without intervention of the court and would certainly provide guidance to secured debtors in general in conducting the affairs in a manner that they may not be found defaulting and being made liable for the unsavoury steps contained under Section 13(4), it will only be in fulfilment of a requirement of reasonableness and fairness in the dealings of institutional financing which is so important from the point of view of the economy of the country and would serve the purpose in the growth of a healthy economy. 39. 39. It is necessary to communicate the reasons for not accepting the objections raised by the borrower in reply to the notice under Section 13(2) of the Act, more particularly, for the reason that normally in the event of non-compliance with the notice, the party giving notice approaches the court to seek redressal but in the present case, in view of Section 13(1) of the Act the creditor is empowered to enforce the security himself without intervention of the court. Therefore, it goes with logic and reason that he may be checked to communicate the reason for not accepting the objections, if raised and before he takes the measures like taking over possession of the secured assets, etc. This will also be in keeping with the concept of right to know and lender’s liability of fairness to keep the borrower informed particularly of the developments immediately before taking measures under Section 13(4) of the Act. It will also cater to the cause of transparency and not secrecy and shall be conducive in building an atmosphere of confidence and healthy commercial practice. Such a duty, in the circumstances of the case and the provisions, is inherent under Section 13(2) of the Act. 40. A right to approach the DRT under Section 17 of the Act accrues only after measures are taken under Section 13(4) of the Act, it is clarified unequivocally that communication of the reasons not accepting the objections taken by the secured borrower may not be taken to give an occasion to resort to such proceedings which are not permissible under the provisions of the Act. Issue of a notice to the debtor by the creditor does not attract the application of the principles of natural justice. It is always open to tell the debtor what he owes to repay. No hearing can be demanded from the creditor at this stage. As per the provisions under the Act the borrower may not be entitled to challenge the reasons communicated or the likely action of the secured creditor at the stage of communication of reasons, unless his right to approach the Debts Recovery Tribunal as provided under Section 17 of the Act matures on any measure being taken under Section 13(4) of the Act. 41. The borrowers would get a reasonably fair deal and opportunity to get the matter adjudicated upon before the Debts Recovery Tribunal. 41. The borrowers would get a reasonably fair deal and opportunity to get the matter adjudicated upon before the Debts Recovery Tribunal. The effect of some 22 of the provisions may be a bit harsh for some of the borrowers but on that ground the impugned provisions of the Act cannot be said to be unconstitutional in view of the fact that the object of the Act is to achieve speedier recovery of the dues declared as NPAs and better availability of capital liquidity and resources to help in growth of economy of the country and welfare of the people in general which would subserve the public interest. To test the legitimacy of a measure like the securitization and reconstruction of financial assets and enforcement of Security Interest Act, 2002 relating to financial policy is not a matter to be gone into by the courts. 42. In the decision of Prime Timbers Pvt. Ltd. vs. State Bank of India reported in AIR 2010 Cal 40 the Hon'ble court held that if a response that a secured creditor is obliged to issue under Section 13(3A) is permitted to be made the subject matter of a civil suit, and particularly, before a High Court exercising original jurisdiction, it may cast a shadow both on the measures adopted by the secured creditor under Section 13(4) and on the adjudication of the propriety of the secured creditor’s conduct in proceedings that may be brought by the borrower under Section 17 of the Act. If High Court in its original jurisdiction has the authority to receive this suit, it is more than likely that in exercise of its jurisdiction under Article 227 of 23 the Constitution it will exercise superintendence over the Debts Recovery Tribunal that would be authorized to receive the plaintiff’s appeal under Section 17 of the Act. That would lead to an embarrassment since the Tribunal would then be seeking to prejudge a matter that may be in issue in the suit instituted before the High Court. 43. The first limb of Section 34 altogether rules out any civil court receiving a suit in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under the Act to determine. 43. The first limb of Section 34 altogether rules out any civil court receiving a suit in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under the Act to determine. As is evident from the wording of the Section it does not imply that there must be an action pending before a Debts Recovery Tribunal or Appellate Tribunal for the bar to operate. If a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under the Act to determine any matter, never mind that no proceedings have been brought before either Tribunal, such matter cannot be made the subject matter of a civil suit. Relief or declaring notice/letter by secured creditor rejecting proposal of restructuring of Debt being null and void. Relief of perpetual injunction restraining secured creditor from acting contrary to or in any manner inconsistent with terms of agreement between parties and from effecting recoveries in a manner contrary thereto, alternative decree for determination of amounts due and payable by borrower to secured creditor can be determined by Debts Recovery Tribunal under Section 17 of the Act. None of the said relief’s that borrower has claimed can be entertained in a civil suit as matters relating thereto fall within jurisdiction of appropriate Debts Recovery Tribunal to determine in accordance with the Act of 2002. 44. In this regard for better appreciation of the subject, Sections 17 and 34 of the Sarfaesi Act, 2002 are reproduced hereunder: “S. 17 - It gives any person aggrieved by any of the measures referred to in Section 13(2) of the Act taken by a secured creditor a right to apply to the appropriate Debts Recovery Tribunal within 45 days from the date on which such measure had been taken. It is the conduct of the secured creditor that is called into question in proceedings under Section 17 of the Act. If a borrower feels that the representation or objection to the notice under Section 13(2) of the Act was adequate to stall the secured creditor’s progress to the Section 13(4) stage, such contention can certainly be asserted by the borrower in the proceedings under Section 17 as it would be a ground to sail any measure taken by the secured creditor under Section 13(4) of the Act. The said Act of 2002, in a sense, provides for harsher measure to be taken against borrowers within the meaning of the said Act than had been legally mandated before the introduction of the Act. The right under Section 17 to carry a grievance to the Debts Recovery Tribunal is only upon any measure under Section 13(4) having been adopted by the secured creditor. It is a statutory precondition for the exercise of the jurisdiction under Section 17 of the Act. S. 34 – Civil Court not to have jurisdiction – No civil court shall have jurisdiction to entertain any suit or proceedings in respect of any matter which a Debts Recovery Tribunal or the Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.” 45. In the decision of Vicky Kumar Rana vs. Kamal Kumar Nangia & Ors. reported in AIR 2010 Delhi 210 the Hon'ble court propounded that it has been visualized by the legislature that there may be persons other than the borrowers who may have interest in the property who may have some objections regarding the realization of the loan amount from the secured assets and for such a person Section 17(1) of the Act makes it abundantly clear that any person which will include a ‘borrower’ as well as non-borrower also if he feels aggrieved from any action of the bank he can approach the Debts Recovery Tribunal which is a specialized forum created under the Act itself to seek redressal of his grievance. Further, in order to make this scheme of the Act operative both functional as well as effective the jurisdiction of the civil court has been specifically barred under Section 34 of the Act. Further, in order to make this scheme of the Act operative both functional as well as effective the jurisdiction of the civil court has been specifically barred under Section 34 of the Act. A conjoint reading of the Sections 13, 17 and 34 of the Act would clearly show that even though the plaintiff who may be claiming himself to be the tenant in respect of the third floor of the suit property which was pledged with Bank as a secured asset had to approach the Debts Recovery Tribunal in case he felt aggrieved from the action of Bank in issuing the public notice or by threatening to take possession of the suit property when the officials of the bank alongwith the borrowers are alleged to have visited and threatened the plaintiff from being dispossessed. Further Section 34 of the Act ousted the jurisdiction of the civil court thereby meaning that this court is prohibited from taking cognizance of the suit filed by the plaintiff himself. 46. The plaintiff relied on a Single Bench judgment of the Hon'ble High Court at Calcutta viz. AIR 2008 Cal 9 (supra) stipulating that there may be areas where the civil court will have the jurisdiction but the Hon'ble Apex Court appears to have taken different views as is apparent from the decision referred to above. 47. In another decision of M. G. Ashwatha Shastri vs. Canara Bank, Chamarajpet Branch, Chamarajpet, Bangalore & Ors. reported in AIR 2011 Karnataka 138 the Hon'ble Court held that the scheme of Sarfaesi Act is such that the Civil Court’s jurisdiction to entertain any suit in respect of a matter which the Debt Recovery Tribunal or the Appellate Tribunal is empowered to determine, is ousted. Further, the legislature has visualized that not only a borrower but a non-borrower could also be aggrieved by the action of the bank. And the remedy of the aggrieved person is to file the appeal. 48. The legislature in its wisdom has enacted a special Act i.e. Sarfaesi Act, 2002. The vires of the said Act had not yet been taken care of. Rather, from the decisions as disclosed above it is abundantly clear that such Act has overriding effect upon local tenancy Acts. That Act has clearly demarcated the jurisdiction of the authority who can take care of the issues like the present one. The vires of the said Act had not yet been taken care of. Rather, from the decisions as disclosed above it is abundantly clear that such Act has overriding effect upon local tenancy Acts. That Act has clearly demarcated the jurisdiction of the authority who can take care of the issues like the present one. Even an interested party/tenant can have recourse to Debt Recovery Tribunal, if he feels it necessary instead of going to Civil Court. Bypassing the authority of the said Act and approaching the civil court will tantamount to disregarding the wisdom of the legislature who passed the special Act i.e. the Sarfaesi Act, 2002. 49. The broad parameters of the said Act has wide amplitude. All related issues may. be addressed by the Debt Recovery Tribunal while dealing with the relationship of the debtor and creditor in regard to the bank transaction. That Act has been enacted to protect the economy for its healthy condition. The creditor cannot have the cake and eat the cake at the same time. He took advantage of the loan taken from the bank who advanced the same out of public exchequer. But the plaintiff resorted to litigation before a civil Court. 50. By obtaining an order of injunction, the flow of public money cannot be stalled. 51. The borrower and non-borrower may approach the Debt Recovery Tribunal in appropriate cases. The borrower and the guarantor creditor may be hand-in-glove to stop bank to recover the dues payable by the debtor/ guarantors. Allowing of the suit to be filed either by the debtor/guarantor before a civil Court will be injurious to the interest of bank because the money involved therein may not be recovered during the continuance of the suit, the end of which is unknown resulting in blockage of public money to serve the cause of a private individual. 52. Therefore, considering the aforesaid aspects of the matter/ I find merit in the instant revision. The impugned order is not sustainable in the eye of law. 53. Accordingly, the same is set aside. 54. Before parting with the record, I hold that the bank authorities shall follow the due process of law for the purpose of recovery of the loans/ advances strictly adhering to the principles of audi alterem partem. 55. Hence, the revisional application is allowed. 56. There will be no order as to costs. 53. Accordingly, the same is set aside. 54. Before parting with the record, I hold that the bank authorities shall follow the due process of law for the purpose of recovery of the loans/ advances strictly adhering to the principles of audi alterem partem. 55. Hence, the revisional application is allowed. 56. There will be no order as to costs. Urgent certified copies, if applied for, to be issued according to rules.