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2018 DIGILAW 223 (MP)

Ajit v. L and T Housing Finance Limited

2018-02-26

PRAKASH SHRIVASTAVA

body2018
ORDER 1. By this writ petition the petitioner has challenged the order dated 12.2.2018 passed by learned Additional District Magistrate under section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest, Act 2002. 2. Against the said order the petitioner has remedy of approaching the Debt Recovery Tribunal under section 17 of the Securitisation Act. 3. The Division Bench of this Court considering the similar issue vide order dated 21st December, 2017 passed in Writ Appeal No. 489/2016 in the matter of India Sem Asset Reconstruction Co. Ltd v. State of MP and ors has held as under : “15. In the case of Kanhaiyalal Lalchand Sachdev and others v. State of Maharashtra and others (supra), the apex Court held that against an action taken under section 14 of the SARFAESI Act, the remedy lies to move an application to the Tribunal. The Court observed thus : “22. We are in respectful agreement with the above enunciation of law on the point. It is manifest that an action under section 14 of the Act constitutes an action taken after the stage of section 13(4) and, therefore, the same would fall within the ambit of section 17(1) of the Act. Thus, the Act itself contemplates an efficacious remedy for the borrower or any person affected by an action under section 13(4) of the Act, by providing for an appeal before the DRT. 23. In our opinion, therefore, the High Court rightly dismissed the petition on the“ground that an efficacious remedy was available to the appellants under section 17 of the Act.It is well settled that ordinarily relief under Articles 226/227 of the Constitution of India is not available if an efficacious alternative remedy is available to any aggrieved person.” 16. In the case of United Bank of India v. Satyawati Tondon, reported as (2010)8 SCC 110 , the Supreme Court held that the expression “any person” in section 17 would include borrowers, guarantors or any other person. It observed in para 42 which reads as under : “42. There is another reason why the impugned order should be set aside. If respondent 1 had any tangible grievance against the notice issued under section 13(4) or action taken under section 14, then she could have availed remedy by filing an application under section 17(1).The expression “any person”. used in section 17(1) is of wide import. There is another reason why the impugned order should be set aside. If respondent 1 had any tangible grievance against the notice issued under section 13(4) or action taken under section 14, then she could have availed remedy by filing an application under section 17(1).The expression “any person”. used in section 17(1) is of wide import. It takes within its fold, not Dalbir Singh 201408.12 12:07 I attest to the accuracy of this document High Court Chandigarh CWP No. 15324 of 2014 (OandM) [3].only the borrower but also the guarantor or any other person who may be affected by the action taken under section 13(4) or section 14. Both, the Tribunal and the Appellate Tribunal are empowered to pass interim orders under sections 17 and 18 and are required to decide the matters within a fixed time schedule. It is thus evident that the remedies available to an aggrieved person under the SARFAESI Act are both expeditious and effective.” 17. In another case Jagdish Singh v. Heeralal and others, reported as (2014)1 SCC 479 the apex Court held that the jurisdiction of Civil Court is barred in respect of an action under section 13(4) of the SARFAESI Act, the remedy being only under section 17 of the SARAFESI“ Act. It observed in paras 24 and 25 as under : “24. Statutory interest is being created in favour of the secured creditor on the secured assets and when the secured creditor proposes to proceed against the secured assets, sub-section (4) of section 13 envisages various measures to secure the borrower’s debt. One of the measures provided by the statute is to take possession of secured assets of the borrowers, including the right to transfer by way of lease, assignment or realizing the secured assets. Any person aggrieved by any of the “measures” referred to in sub-section (4) of section 13 has got a statutory right of appeal to the DRT under section 17. The opening portion of section 34 clearly states that no civil Court shall have jurisdiction to entertain any suit or proceeding “in respect of any matter” which a DRT or an appellate Tribunal is empowered by or under the Securitisation Act to determine. The expression ‘in respect of any matter’ referred to in section 34 would take in the “measures” provided under sub-section (4) of section 13 of the Securitisation Act. The expression ‘in respect of any matter’ referred to in section 34 would take in the “measures” provided under sub-section (4) of section 13 of the Securitisation Act. Consequently if any aggrieved person has got any grievance against any “measures” taken by the borrower under sub-section (4) of section 13, the remedy open to him is to approach the DRT or the Appellate Tribunal and not the civil Court. Civil Court in such circumstances has no jurisdiction to entertain any suit or proceedings in respect of those matters which fall under sub-section (4) of section 13 of the Securitisation Act because those matters fell within the jurisdiction of the DRT and the Appellate Tribunal. Further, section 35 says, the Securitisation Act overrides other laws, if they are inconsistent with the provisions of that Act, which takes in section 9 CPC as well. “25. We are of the view that the civil Court jurisdiction is completely barred, so far as the “measure” taken by a secured creditor under sub- section (4) of section 13 of the Securitisation Act, against which an aggrieved person has a right of appeal before the DRT or the appellate Tribunal. to determine as to whether there has been any illegality in the “measures” taken. The bank, in the instant case, has proceeded only against secured assets of the borrowers on which no rights of respondents No. 6 to 8 have been crystalised, before creating security interest in respect of the secured assets. In such circumstances, we are of the view that the High Court was in error in holding that only civil Court has jurisdiction to examine as to whether the “measures” taken by the secured creditor under sub-section (4) of section 13 of the Securitisation Act were legal or not. In such circumstances, the appeal is allowed and the judgment of the High Court is set aside. There shall be no order as to costs.” 18. In the case of Harshad Goverdhan Sondagar (supra), the apex Court in para 29 observed that the remedy under section 17 of the SARFAESI Act is not available to the lessee in the case of his dispossession by the secured creditor. The lessee has a liberty to challenge the order passed by the District Magistrate in accordance with power conferred under Article 226 of the Constitution before the High Court. 19. The lessee has a liberty to challenge the order passed by the District Magistrate in accordance with power conferred under Article 226 of the Constitution before the High Court. 19. In the case of Jabalpur Bus Operators Association and Others v. State of M.P. and another, reported as 2003(1) JLJ 105 = 2003(1) MPLJ 513 , the five Judges Bench of this Court has held that in case of conflict between the two decisions of the apex Court, Benches comprising of equal number of Judges, decision of earlier Bench is binding unless explained by the latter Bench of equal strength, in which case later decision is binding. 20. In the case of State Of M.P. And others v.Balveer Singh and Others, reported as 2001 RN 343= 2001(2) MPLJ 644 , the Full Bench has held that if there is conflict of view between the co-equal Benches of the apex Court, the High Court has to follow the judgment, which appears to it to state the law more elaborately and more accurately and in conformity with the scheme of the Act. 21. In the case of M/s. Ambika Solvex Ltd. v. State Bank of India, (supra), we have not considered the decisions passed in United Bank of India v. Satyawati Tondon (supra), and Jagdish Singh v. Heeralal and others (supra), since the same were not brought to the notice of the Division Bench. Even otherwise, the writ petition of M/s. Ambika Solvex Ltd (supra), was dismissed. The Division bench in para 15 has upheld the view taken by the learned writ Court by holding that the writ petition is entertainable against the order passed under section 14 of the SARFAESI Act by the District Judge.” 4. The same was the view taken by the earlier division bench of this Court by order dated 21st September, 2010 in Writ Appeal No. 296/2010 in the matter of Velocity Ltd. Indore v. State Bank of India. 5. Having regard to the aforesaid and considering the fact that since the petitioner has an alternative efficacious remedy available under the Securitization Act, I am of the opinion that no case is made out to entertain the writ petition directly at this stage. 6. Writ petition is accordingly dismissed, however with liberty to avail the remedy of appeal. 7. 5. Having regard to the aforesaid and considering the fact that since the petitioner has an alternative efficacious remedy available under the Securitization Act, I am of the opinion that no case is made out to entertain the writ petition directly at this stage. 6. Writ petition is accordingly dismissed, however with liberty to avail the remedy of appeal. 7. Let the certified copy of the impugned order be returned to the counsel for the petitioners on placing on record the photocopy of the same.