GOVINDAN NAIR v. BOARD OF DIRECTORS OF INDIAN OVERSEAS BANK, REPRESENTED BY ITS CHAIRMAN & MANAGING DIRECTOR
2017-02-21
K.VINOD CHANDRAN
body2017
DigiLaw.ai
JUDGMENT : The petitioner had filed an identical writ petition [W.P.(C) No.1477 of 2017] against the proceedings initiated by the 4th respondent-Bank for recovery of total outstanding dues in a credit facility under the SARFAESI Act against the mortgaged properties of the petitioner. At the earlier instance, the petitioner had taken up two contentions in the arguments addressed, as to the petitioner being entitled to a set off, which could be agitated only if an Original Application is filed by the respondent-Bank under The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 [for brevity "RDDB Act"]. It was contended that an application, provided under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [for brevity "SARFAESI Act"] to the Debts Recovery Tribunal [for brevity "DRT"] against proceedings initiated under Section 13(4), would not be a remedy to agitate the said claim of set off and the Bank having initiated SARFAESI proceedings alone, the petitioner is rendered helpless with no remedy to agitate his contention of set off. A declaration was also sought, in the aforesaid circumstance, that a suit would be maintainable. 2. On the admission of the learned Counsel appearing for the petitioner himself, this Court found that there was a civil suit initiated by the petitioner before the Mumbai City Civil Court. The petitioner's apprehension was that the same would not be entertained, since the Bank has raised a preliminary objection of maintainability. It was also disclosed that the petitioner had filed a Securitisation Application [for brevity "SA"] in the DRT against the proceedings initiated by the Bank, under Section 13(4) and before the Chief Judicial Magistrate, Alappuzha, under Section 14; to take possession of a property situated within the State of Kerala, which was admittedly mortgaged in favour of the respondent-Bank. This Court found that the petitioner could claim a set off in the Original Application filed by the Bank before the DRT, Mumbai and also could challenge the proceedings under the SARFAESI Act, against the mortgaged property lying within the State of Kerala, before the DRT, Ernakulam. The claim of set off already having been taken before the Mumbai Civil Court; any adverse order there would have to be agitated before the jurisdictional High Court. Leaving open such remedies, the writ petition was closed. 3.
The claim of set off already having been taken before the Mumbai Civil Court; any adverse order there would have to be agitated before the jurisdictional High Court. Leaving open such remedies, the writ petition was closed. 3. When this present writ petition came up for admission, it was argued that there was a different cause of action insofar as the respondent-Bank having proceeded with the steps to take possession of a property lying within the jurisdiction of the District Magistrate, Thane under Section 14 of the SARFAESI Act. It is submitted that an application is filed in the SA; pending before the DRT, Ernakulam, which is posted to today the 20th . However the pleadings and the learned Counsel for the petitioner, assert that the petitioner does not consider the remedy to be of 'any avail to him' (sic) and that the 'denial of equity and justice at the hands of the DRT is fait accompli' (sic). There is nothing stated to reveal the reasons for such broad assumptions and immediately it has to be noticed that no copies have been produced in the writ petition, of such an application or SA No. 233/2016 said to have been already filed before the DRT Ernakulam; one proceeding alone of which is seen produced as Exhibit P15 in the writ petition. This obviously was after the order of the CJM, Alappuzha and the District Magistrate, Thane. 4. It was argued that since one of the properties is situated within the State of Kerala and there was also a SA filed against the proceedings taken against that property under Section 14 before the DRT, Ernakulam, the petitioner should be permitted to challenge the order of the District Magistrate, Thane also before the DRT, Ernakulam. Reliance is placed on Mardia Chemicals Ltd. v. Union of India [ (2004) 4 SCC 311 ] and specifically paragraph 59, in which it was held by the Hon'ble Supreme Court that a proceeding under Section 17 of the SARFAESI Act before the DRT against an action under Section 14 of the Act would be akin to institution of a suit. In such circumstance, the petitioner being the dominus litis, is entitled to invoke the remedy before any of the forums in whose jurisdiction any one of the cause of action arises.
In such circumstance, the petitioner being the dominus litis, is entitled to invoke the remedy before any of the forums in whose jurisdiction any one of the cause of action arises. Hence, a direction is sought to the DRT to entertain the challenge made against the proceedings issued by the District Magistrate, Thane. However without a copy of the SA this Court is unable to find any challenge having been made before the DRT, Ernakulam and if made then it is for the DRT to first consider the same, which order could be challenged appropriately. 5. On the arguments put forth by the learned Counsel, this Court also looked into the Judges Papers with respect to the earlier writ petition [WP(C) No.1477 of 2017]. This Court is surprised to note that the present writ petition but for minor changes, is a verbatim reproduction of the earlier writ petition. Exhibits P1 to P16 are those produced in the earlier writ petition itself. The additional Exhibit in the instant writ petition is Exhibit P17; a true copy of the process/order dated 07.02.2017 issued by the Mandal Adhikari, Dombivali (W), Dist.Thane; which is a direct consequence of Exhibit P14 order. The statement of facts upto paragraph 51 is verbatim reproduction. From paragraph 52 onwards, the subsequent facts with respect to the suit filed before the Mumbai City Civil Court and the proceedings taken by the Bank before the DRT, Mumbai; which were already placed before this Court at the earlier instance, though not specifically pleaded in that writ petition, are detailed; which also find a place in the judgment passed. Exhibit P17 is the only additional document placed in the present writ petition. Grounds "A" to "Q" are similar in both the writ petitions. Hence, there is no fresh ground urged before this Court in the second writ petition. The reliefs prayed for are again as in the earlier writ petition with only the prayers (j), (z) and (aa) in the earlier writ petition being absent. The present writ petition contains prayers (a) to (y) and (aa) to (hh). The interim reliefs prayed for as (a) to (d) are the interim reliefs (a), (b), (d) and (f) in the earlier writ petition. 6.
The present writ petition contains prayers (a) to (y) and (aa) to (hh). The interim reliefs prayed for as (a) to (d) are the interim reliefs (a), (b), (d) and (f) in the earlier writ petition. 6. Be that as it may, the contention of the petitioner, relying on Mardia Chemicals Ltd. (supra) is that the petitioner is the dominus litis and would be entitled to choose the forum where all or any of the cause of action arises. In this context, Section 17 of the SARFAESI Act has to be looked into. Section 17 (1) provides for an application to the DRT against any measure taken by the respondent-Bank to enforce the security interest under Section 13 (4) and (1A) provides for the filing of an application before the DRT within whose jurisdiction the cause of action wholly or in part arises . In the present case, admittedly the properties situated in the State of Maharashtra and the State of Kerala have been mortgaged. The transaction occurred in Mumbai and the petitioner is also a resident of Mumbai, as is seen from the address of the petitioner. The business, for which the credit facility was availed, was also carried on from Mumbai. The Bank initiated proceedings under the SARFAESI Act at Mumbai and served it on the petitioner at Mumbai. The mortgaged property in the State of Kerala was proceeded against under Section 14 before the jurisdictional CJM, against which a SA was filed under Section 17 before the DRT, Ernakulam. The simultaneous action of the respondent-Bank in proceeding against the properties mortgaged, which is situated in Mumbai, was before the District Magistrate, Thane. The order of the DM, Mumbai, Exhibit P14 dated 19.11.2016 is prior to the order of the CJM, Alappuzha at Exhibit P12 dated 23.11.2016. Both these were also also produced in the earlier writ petition. There was no contention taken at that point of time that the petitioner had attempted a SA under Section 17 before the DRT at Ernakulam against Exhibit P14 order of the DM, Thane. As noticed earlier this Court is in the dark as to the nature of the proceedings initiated before the DRT, Ernakulam and the contentions raised there.
There was no contention taken at that point of time that the petitioner had attempted a SA under Section 17 before the DRT at Ernakulam against Exhibit P14 order of the DM, Thane. As noticed earlier this Court is in the dark as to the nature of the proceedings initiated before the DRT, Ernakulam and the contentions raised there. This Court would have called for further details but for the fact that an identical writ petition filed earlier was closed and the petitioner cannot be heard in an identical writ petition when there is no fresh cause of action. 7. As noticed above, the present writ petition filed is a verbatim reproduction of the earlier writ petition. No fresh cause of action arises from the facts pleaded, grounds raised or the reliefs sought. The Exhibits too are similar to those produced earlier with the exception of Exhibit P17. Exhibit P17 is a document in Marathi; which this Court has attempted to translate through a person conversant with the language and the general purport of the same is as follows: "Orders have been passed to confiscate the property of Sri.Govindan Nair, B-11, Lakshmi Apartments, V.P.Road, Saraswat Colony, Dombivali (East), Thane - 421 201 and to hand over the possession of the property to the Indian Overseas Bank, Mumbai. Hence, it is requested that the assistance of a police officer and a lady police officer may be made available (to give effect to the above said attachment, as per the orders), at 2.00 p.m. On 22.02.17". This is a consequence of Exhibit P14 order and cannot be said to be a fresh cause of action. Any measure taken by the secured creditor under Section 13 (4) of the Act can be challenged under Section 17, and such measures are those provided under clause (a) to (d) of sub-section (4) of Section 13. At first blush the measures provide an independent cause of action and cannot be clubbed together. The proceedings taken before the CJM, Alappuzha and that taken before the DM, Thane are independent measures. But this Court would not say finally on the same since that has first to be urged before the DRT.
At first blush the measures provide an independent cause of action and cannot be clubbed together. The proceedings taken before the CJM, Alappuzha and that taken before the DM, Thane are independent measures. But this Court would not say finally on the same since that has first to be urged before the DRT. The present writ petition, is not maintainable since an identical writ petition filed earlier was closed leaving liberty to agitate all contentions before the appropriate forum and the argument addressed here was never addressed before Court at that instance. The said contention too could be agitated before the appropriate forum. The writ petition is dismissed for reason of an identical writ petition having been dismissed earlier.