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2018 DIGILAW 864 (ALL)

GREEN LAND FRUITS AND VEGETABLES PVT. LTD. v. STATE OF Uttar Pradesh

2018-04-11

A.P.SAHI, SHASHI KANT

body2018
JUDGMENT By the Court.—Heard Sri B.K. Srivastava, learned counsel for the petitioner and Sri Sanjai Singh for the respondent-bank. 2. The issues raised in this writ petition have been substantially answered by us in the judgment delivered by us in Writ C No. 11706 of 2018 (Dheerendra Kumar and another v. Authorized Officer Aadhar Housing Finance Ltd. and another) dated 2.4.2018. 3. In addition thereto, Sri Srivastava, learned Senior Counsel for the petitioner has submitted that the outcome of the decision of the Full Bench in the case of N.C.M.L. Industries Ltd. and others v. Debt Recovery Tribunal, Lucknow and another, 2018(3) ADJ 102 , is that the petitioner would be deprived of approaching this Court under Article 226 of the Constitution of India and at the same time stands deprived of the opportunity to avail of the remedy under Section 17 of the SARFAESI Act, 2002 upon Section 13(4) thereof being invoked by the creditor Bank. His submission is that this situation has arisen where the remedies prescribed under law being denied results in driving the borrower to the wall that crystallizes into what the Apex Court in our opinion has described in paragraph No. 13 of the judgment in the case of Union of India and others v. Filip Tiago De Gama Of Vedem Vasco De Gama, 1990 (1) SCC 277 . Paragraph 13 is extracted hereinunder : “13. This submission reminds us of the words of Shakespeare in The Merchant of Venice, where Launcelot tells Jessica: “Truly then I fear you are damned both by father and mother: thus when I shun Scylla, your father, I fall into Charybdis your mother: well, you are gone both ways.” 4. It is in these circumstances, he submits that the very purpose of providing an opportunity to the borrower for filing his objections and getting it considered under Section 13(3A) of the 2002, Act gets frustrated. He submits, that the concern of the borrower at that stage, which is made known to him cannot be made subject-matter of challenge in view of the statutory bar contained in the proviso to Section 13(3A) of the 2002, Act read with the explanation appended to Sub-Section (2) of Section 17 thereof. He submits, that the concern of the borrower at that stage, which is made known to him cannot be made subject-matter of challenge in view of the statutory bar contained in the proviso to Section 13(3A) of the 2002, Act read with the explanation appended to Sub-Section (2) of Section 17 thereof. Consequently, the borrowers fate is sealed, as he can neither file a writ petition nor can he derive any benefit of the objections taken by him as giving of reasons at that stage will not come to the aid of the petitioner. Reliance is placed by him on the judgment in the case of ITC Ltd. v. Blue Coast Hotels Ltd. and others, 2018 SCC Online 237, decided on 19th March, 2018. It is urged that the said judgment holds Section 13(3A) to be mandatory, and therefore after the steps are initiated under Sub-Section (4) of Section 13, the petitioner should be allowed to avail of the remedy of filing an application/appeal in terms thereof against any of the measures taken under Section 13(4) of the 2002, Act. 5. As held in our judgment refer to hereinabove, the entertaining of the writ petition has been set at rest by the pronouncement of the Apex Court in the case of Authorized Officer, State Bank of Travancore and others v. Mathew K.C., 2018 (3) SCC 85 . Further, what we find is that the Apex Court in the same judgment in paragraph No. 17 thereof, clearly, issues a direction that the High Courts should exercise restraint in entertaining any writ petition. 6. It is contended by Sri Srivastava that without taking a decision on the objections as contemplated under Section 13(3A), which is a mandatory process, no further action can be undertaken for taking possession. The submission is that by avoiding a mandatory provision the consequential action as well as non-compliance thereof is subject to judicial review that cannot be denied. In essence the contention is that if the creditor proceeds by violating law with the breach of a mandatory provision, then the same is clearly actionable as it is arbitrary and open to scrutiny under Article 226 of the Constitution of India. Reliance is placed on paras 26 to 34 of the SCC Online reported decision in the case of ITC Ltd (supra). 7. Reliance is placed on paras 26 to 34 of the SCC Online reported decision in the case of ITC Ltd (supra). 7. We are of the opinion that the law having been declared by the Apex Court, the question of non compliance would again be a fact that can be gone into by the Tribunal after any of the measures to secure the interest is taken by the creditor upon the borrower invoking the provisions of Section 17 of the 2002, Act. It is therefore not correct to say that there is no scope for raising a challenge before the appropriate forum. Thus it is not necessary to entertain a writ petition without prejudice to the rights of an aggrieved person to approach the Tribunal or inexceptionally rare cases approach this Court as well subject to the caution sounded by the Apex Court in the case of Authorized Officer, State Bank of Travancore (supra). 8. The next submission of Sri Srivastava also deserves notice. He contends that the borrower can always question the measures taken, for which he relies on the judgment in the case of Standard Chartered Bank v. V. Noble Kumar, 2013 (9) SCC 620 , paragraph Nos. 28 to 30. He submits that possession can be lost symbolically as well on the invoking of Section 13(4) of the Act, inasmuch as, the creditor can resort to such a measure and any failed attempt authorizes the creditor to secure possession through the methods that have been explained in paragraph No. 36 of the same report. Thus Section 17 can be invoked to question any of such measures. He has fortified his submissions with the latest judgment of the Apex Court in the case of ITC Ltd. (supra) paragraph Nos. 58 to 60 in particular. 9. This aforesaid judgment dated 19.3.2018 that is subsequent to the Full Bench judgment of this Court in the case of NCML Industries (supra), has ruled that taking of symbolic possession is a well known device in law. It is therefore correct to infer that such a step under Section 13(4) is a measure under the 2002, Act. 10. In the aforesaid background, we are of the considered opinion that the present writ petition cannot be entertained but the same is without any prejudice to the rights of the petitioner to avail of the remedy under Section 17 of the 2002, Act. 11. 10. In the aforesaid background, we are of the considered opinion that the present writ petition cannot be entertained but the same is without any prejudice to the rights of the petitioner to avail of the remedy under Section 17 of the 2002, Act. 11. We may further put on record that such a remedy would be subject to the outcome of the decision of the Apex Court in the case of M/s Hindon Forge Pvt. Ltd and another v. The State of Uttar Pradesh Thr. District Magistrate Ghaziabad and another in Special Leave to Appeal No. 5895 of 2018 where the challenge has been raised to the Full Bench judgment dated 6.2.2018 in the case of NCML Industries Ltd. (supra). 12. The writ petition, is accordingly, dismissed subject to the observations made hereinabove.