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2017 DIGILAW 1022 (JK)

Azad Ahmad Ganai v. Debts Recovery Tribunal-III

2017-11-23

M.K.HANJURA

body2017
JUDGMENT : M.K. Hanjura, J. 1. The pith and core of the petition of the petitioners, filed under Article 226 of the Constitution of India read with Section 103 of the Constitution of Jammu and Kashmir, for the grant of appropriate relief, is that the petitioners' mortgaged their proprietary land measuring 52.17 Kanals, situate at Bulgam, Tehsil Sopore, District Baramulla, to the J&K Bank in the year 2006. The account maintained by the petitioners was declared as a Non-performing Asset (NPA). The mortgaged land was valued by the surveyors of the J&K, Bank from time to time. The respondent-Bank filed an application under Section 19 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 (herein after called as 'The Act'), against the petitioners and some other defaulters, for the recovery of an amount of Rs. 2,14,16,865.75 (Rupees Two Crores Fourteen Lacs Sixteen Thousand Eight Hundred Sixty Five and Seventy Five Paisa Only) in the year 2012. The Tribunal vide order dated 29.06.2016, allowed the application of the Bank and the petitioners along with other defaulters were directed to pay jointly and severely to the Bank, within thirty days, a sum of Rs. 2,14,16,865 & 75 paisa together with cost charges and future interest @ 19% p.a. from the date of filing the application till such time that the same is released, failing which it was directed that the Bank shall be entitled to recover the same from the sale of the mortgaged property, that is, the land as stated above. The Tribunal also directed that in case of shortfall, the same shall be recovered from the sale of the movable and immoveable assets of the petitioners. The Bank acting upon the said order assessed the cost of the mortgaged land and evaluated it at the rate of rupees one lakh and five thousand per kanal. The Tribunal also directed that in case of shortfall, the same shall be recovered from the sale of the movable and immoveable assets of the petitioners. The Bank acting upon the said order assessed the cost of the mortgaged land and evaluated it at the rate of rupees one lakh and five thousand per kanal. The petitioners have questioned the order dated 29.06.2016 along with the recovery certificate forming Annexure 'H' to the petition and have craved the indulgence of this Court in granting them the following reliefs: a. Writ order or direction in the nature of Certiorari seeking quashment of order for recovery passed by Debt Recovery Tribunal-III Delhi in O.A No. 142 of 2012 dated 29.06.2016, along with Auction notice with regard to mortgage property falling in survey No. 886, 872 (bay), 8782 (jeem), 872 (Dal) 878 (Min) measuring 52 kanals and 17 marlas published in Greater Kashmir dated 13.09.2017. b. Writ order or direction in the nature of Mandamus commanding upon the respondents to assess the property as per prevalent market rates. And further direct the respondents to restrain from making valuation of the property as per their whim and caprice. 2. Mr. Z.A. Shah, learned Sr. Counsel appearing for the respondent Nos. 2 and 4 has stated that the petition of the petitioners is not maintainable and it entails dismissal in limine. 3. Heard and considered. 4. Learned counsel for the respondent Nos. 2 and 4 has vehemently argued that the petition of the petitioners is misconceived on the face of the provisions contained in the Debts Due to Banks and Financial Institution Act, 1993, in view of the inbuilt mechanism provided therein. Per contra, the learned counsel for the petitioners has argued that the powers conferred upon the High Court under Article 226 of the Constitution of India, to issue directions, orders or writs including the five prerogative writs for the specific enforcement of any of the rights provided under part III of the Constitution of India are vast and varied and no express limitation, bar or impediment is in place in the exercise of this power. He has further argued that the order of the Tribunal is without jurisdiction, and, therefore, a nullity in the eyes of the law. 5. He has further argued that the order of the Tribunal is without jurisdiction, and, therefore, a nullity in the eyes of the law. 5. To understand the import and extent of the arguments advanced by the learned counsel for the parties, it will at the very outset be important to see as to what does 'The Act' encompass. 6. Section 19 of 'The Act', makes a provision for filing an application before the Tribunal, and it reads as follows: "19. Application to the Tribunal: (1) Where a bank or a financial institution has to recover any debt from any person, it may make an application to the Tribunal within the local limits of whose jurisdiction- a. The defendant, or each of the defendants where there are more than one, at the time of making the application, actually and voluntarily resides, or carries on business, or personally works for gain; or b. Any of the defendants where there are more than one, at the time of making the application, actually and voluntarily resides, or carries on business, or personally works for gain; or c. The cause of action, wholly or in part, arises. 7. Section 20 of 'The Act', provides for an appeal to the Appellate Tribunal and it runs as under: "20. Appeal to the Appellate Tribunal.-(1) Save as provided in sub-section (2), any person aggrieved by an order made, or deemed to have been made, by a Tribunal under this Act, may prefer an appeal to an Appellate Tribunal having jurisdiction in the matter. (2) No appeal shall lie to the Appellate Tribunal from an order made by a Tribunal with the consent of the parties. (3) Every appeal under sub-section (1) shall be filed within a period of forty five days from the date on which a copy of the order made, or deemed to have been made, by the Tribunal is received by him and it shall be in such form and be accompanied by such fee as may be prescribed.: Provided that the Appellate Tribunal may entertain an appeal after the expiry of the said period of forty-five days if it is satisfied that there was sufficient cause for not filing it within that period. (4) On receipt of an appeal under sub section (1) the Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such order thereon as it thinks fit, confirming, modifying or setting aside the order appealed against. (5) The Appellate Tribunal shall send a copy of every order made by it to the parties to the appeal and to the concerned Tribunal. (6) The appeal filed before the Appellate Tribunal under sub-section (1) shall be dealt with by it as expeditiously as possible and endeavor shall be made by it to dispose off the appeal finally within six months from the date of receipt of the appeal. 8. Section 25 of 'The Act', lays down the modes for the recovery of Debts and it conveys the following: "Modes of recovery of debts-The Recovery Officer shall, on receipt of the copy of the certificate under sub-section (7) of Sec. 19, proceed to recover the amount of debts specified in the certificate by one or more of the following modes, namely;- (a) attachment and sale of the movable or immovable property of the defendant; (b) arrest of the defendant and his detention in prison; (c) appointing a receiver for the management of the movable or immovable, properties of the defendant". 9. Sections 26, 27, 28 and 30 of 'The Act', provide for the Validity Certificate and amendment thereof; Stay of proceedings under certificate and amendment or withdrawal thereof; Other modes of recovery and appeal against the order of recovery officer, respectively. 10. Section 20 of 'The Act', as is repeated and reiterated here gives a right to the persons aggrieved by an order made or deemed to have been made by the Tribunal under 'The Act', to prefer an appeal before an Appellate Tribunal having the jurisdiction in the matter and Section 30 provides that any person aggrieved by the order of the Recovery Officer made under 'The Act' may within thirty days from the date on which the order is issued to him, prefer an appeal to the Tribunal. 11. On the dimensions of the provisions of 'The Act', detailed herein before the petitioners had a right to file an appeal, against the order impugned in this petition. 11. On the dimensions of the provisions of 'The Act', detailed herein before the petitioners had a right to file an appeal, against the order impugned in this petition. Learned counsel for the petitioners has not been able to persuade this Court as to how and in what manner this writ petition can be entertained on the anvil of the availability of an alternative remedy in the form of filing a statutory appeal under the statute. No reasons have been put forward in brushing aside the right to exhaust the alternative remedy available to the petitioners and to file this writ petition against the order impugned. There can be no denial of the fact that the existence of an alternative remedy does not ipso facto curtail or bar the jurisdiction vested in the High Court under Article 226 of the Constitution of India. The remedy under Article 226 is in general a discretionary one and the High Court has the power to refuse to grant it where the alternative remedy which is equally efficient and adequate is in existence unless there are good grounds therefor. The rule of exhaustion of alternative remedy is a rule of discretion but it is difficult to comprehend as to why this Court should entertain the petition filed under section 226 of the Constitution of India and pass the orders thereon by remaining oblivious to the fact that the petitioners have the right to file an appeal provided by the legislation/statute in which a detailed mechanism has been evolved. On the face of the existence of the provision of appeal incorporated in 'The Act', the Court has to exercise circumspection, care and caution in the exercise of discretion in attending to such matters. It is true that in peculiar cases, if the petitioner(s) is/are able to show that his/their case falls on the pedestal of the exceptions carved out to this rule, the Court can pass appropriate orders. However, in the present petition, the petitioners have not been able to bring their case within the canons of the exceptions chiseled out in various judicial pronouncements. 12. However, in the present petition, the petitioners have not been able to bring their case within the canons of the exceptions chiseled out in various judicial pronouncements. 12. Elaborating the principles of law on the subject, the apex court of the country in the case of Modern Industries v. Steel Authority of India Limited, (2010) 5 SCC 44 , held that where the remedy was available under the interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993, the High Court was not justified in entertaining a petition under Article 226 of the Constitution. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection. Insofar as this case in concerned, we are convinced that the High Court was not at all justified in injuncting the appellant from taking action in furtherance of notice issued under Section 13 (4) of the Act. 13. Applying the ratio of the law laid down above to the facts and the given circumstances of the case, the petition of the petitioners cannot be maintained before this Court for the reason that an alternative remedy is available to them. The petition entails dismissal and is, therefore, dismissed in limine. However, the petitioners shall be free to avail the alternative remedy as provided under the Debts Due to Banks and Financial Institution Act, 1993, if they choose so. 14. The writ petition is, accordingly, dismissed along with all connected MP(s).