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2020 DIGILAW 731 (TS)

H. Anuradha v. Canara Bank

2020-10-09

A.RAJASEKHAR REDDY, T.VINOD KUMAR

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JUDGMENT : A. Rajasekhar Reddy, J. 1. This writ petition is filed against order dated 6.8.2019 in IA No. 2044 of 2019 in OA No. 171 of 2018 wherein and whereby the application filed by the petitioners under Section 19(1) of the Recovery of Debts and Bankruptcy Act, 1993 (for short 'the Act of 1993') for appointment of Commissioner is dismissed. 2. Heard Sri Vedula Srinivas, learned Counsel representing Sri A.P. Suresh, learned Counsel for the petitioners, Sri Deepak Bhattacharjee, learned Senior Counsel for 1st respondent Bank, Sri Y. Srinivasa Murthy, learned Counsel for respondent Nos. 2 and 3 and Smt. Shireen Sethna Baria, learned Counsel for respondent Nos. 4, 6, 7 to 13. 3. Sri Vedula Srinivas, learned Counsel for the petitioners submit that the Tribunal has power under sub-section (18) of Section 19 for appointment of receiver and the 1st respondent-Bank has also admitted in the counter-affidavit in IA No. 2044 of 2019 in OA No. 171 of 2018 stating no objection for appointment of receiver. When movable properties are sold by appointing receiver, the amount fetched will be sufficient for discharge of the major portion of the debt, but without considering the said aspects, the Tribunal erroneously dismissed the application. 4. On the other hand, Sri Deepak Bhattacharjee, learned Senior Counsel for the 1st respondent Bank and Sri Y. Srinivasa Murthy, learned Counsel for respondents 2 & 3 submits that the application itself is not maintainable, because the 1st respondent Bank alone is entitled to file such application under Section 19(1) of the Act. Learned Senior Counsel submits that it is the prerogative of the creditor to proceed against any one of the secured assets for recovering the debts and borrower has no right to dictate terms to the respondent Bank to proceed against anyone. They also submit that the application is filed when the O.A. is coming up for arguments. They also submit that the respondent Bank is also proceeding against immovable properties under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short 'the Act of 2002') and conducted auction also, as such, no interference is called for. They also submit that against the impugned order, petitioners have alternate remedy under Section 20 of the Act of 1993. 5. They also submit that against the impugned order, petitioners have alternate remedy under Section 20 of the Act of 1993. 5. In this case, it is to be seen that though, against the impugned order, petitioners have alternate remedy under Section 20 of the Act of 1993, since the both the learned Counsel have argued the main case on merits elaborately, we feel it appropriate to dispose of the writ petition on merits instead of driving the party to alternate remedy. 6. It is well settled law that the secured creditor can proceed against any of the secured assets for recovering debts, which is not disputed by the learned Counsel for the petitioners. For the sake of convenience, Section 19(1) of the Act of 1993 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: Provided that the bank or financial institution may, with the permission of the Debts Recovery Tribunal, on an application made by it, withdraw the application, whether made before or after the Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Act, 2004 for the purpose of taking action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002), if no such action had been taken earlier under that Act; Provided further that any application made under the first proviso for seeking permission from the Debts Recovery Tribunal to withdraw the application made under sub-section (1) shall be dealt with by it as expeditiously as possible and disposed of within thirty days from the date of such application; Provided also that in case the Debts Recovery Tribunal refuses to grant permission for withdrawal of the application filed under this sub-section, it shall pass such orders after recording the reasons therefore". 7. 7. A perusal of Section 19(1) of the Act of 1993 go to show that only the Bank is entitled to make application under said section. It is also not in dispute that the application is filed when the O.A. is coming up for arguments. It is also not in dispute that the Bank has already proceeded against the immovable properties and conducted auction. As rightly observed by the Tribunal, the petitioners want to settle the inter se disputes between the partners and same is not permitted in the proceedings initiated under this Act. 8. In view of the admitted legal position, we do not find any infirmity or error in the order passed by the Tribunal and no extraordinary circumstances are brought to the notice of this Court for exercising jurisdiction under Article 226 of the Constitution of India. 9. Accordingly, the writ petition is dismissed. There shall be no order as to costs. As a sequel thereto, miscellaneous applications, if any, pending shall stand dismissed.