Punjab-Haryana High Court
Suresh Kumar Sharma vs Poonawalla Fincorp Ltd. And Anr on 6 September, 2023
Author: Lisa Gill
Bench: Lisa Gill
CWP-9758-2022 (O&M) 2023:PHHC:117879-DB 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH (107+256) CWP-9758-2022 (O&M) Date of Decision: 06.09.2023 Suresh Kumar Sharma ...Petitioner Versus Poonawalla Fincorp. Ltd. and another ...Respondents CORAM: HON'BLE MRS. JUSTICE LISA GILL HON'BLE MRS. JUSTICE RITU TAGORE Present: Mr. Mohan Singh Rana, Advocate for the petitioner. Mr. Sandeep Suri, Advocate Mr. Vijiyesh Malhotra, Advocate Mr. Raghav Garg, Advocate for respondent No.1. Mr. Sandeep Jain, Addl. AG, Punjab. ok 36 ok LISA GILL, J (ORAL)
1. Prayer in this writ petition is for setting aside notice/s dated 26.04.2022 (Annexure P-6 and P-7) passed by Tehsildar-cum-Executive Magistrate, Ludhiana (East), pursuant to order dated 07.04.2022 passed by District Magistrate, Ludhiana under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short "SARFAESI Act") for taking possession of secured asset/mortgaged property of the petitioner.
2. Notice of motion was issued in this writ petition on 09.05.2022 by Coordinate Bench while directing that subject to the petitioner depositing a sum of Rs.10 lakhs by 12.05.2022, and balance amount of Rs.12 lakhs towards overdue EMIs by 31.05.2022, the petitioner shall not be dispossessed wanpreet sinc LOM the secured asset by respondent No.1. It was further directed that 2023.09.15 15:46 I attest to the accuracy and authenticity of this order/judgment CWP-9758-2022 (O&M) 2023:PHHC:117879-DB 2 petitioner shall continue to pay the EMIs on time as they fell due. It was clarified that in the event of failure to comply with this order, interim order in favour of the petitioner would stand vacated. Though petitioner deposited a sum of Rs.10,00,000/- in terms of order dated 09.05.2022, balance amount of Rs.12,00,000/- towards overdue EMIs was not deposited and petitioner filed CM-8245-CWP-2022 seeking extension of time for compliance of order dated 09.05.2022. Vide order dated 27.05.2022 passed in this writ petition, time for deposit of the balance amount of Rs.12,00,000/- towards overdue EMIs was extended upto 24.06.2022 and it was directed that subject to compliance thereto, petitioner be not dispossessed.
3. Thereafter, CM-13382-CWP-2022 was filed by the petitioner seeking consideration of its proposal for One Time Settlement (OTS) of the loan accounts in terms of his representation dated 02.08.2022. Notice of the application was issued on 21.11.2022 while directing that pending further orders, respondent No.1 would consider petitioner's request for OTS within four weeks and communicate its decision to the petitioner. Learned counsel for the petitioner submits that during pendency of the writ petition, possession of the secured asset has been illegally wrested from the petitioner on 28.08.2023, despite interim order in his favour. Moreover, petitioner's proposal was not considered. Entire proceedings under the SARFAESI Act are claimed to be illegal and in violation of the provisions of law. It is thus prayed that possession of the property should be restored and this writ petition be allowed.
4. Per contra, it is contended by learned counsel for the respondent that present writ petition is not maintainable as the petitioner has an efficacious alternate remedy available to him under the SARFAESI Acct. It is further brought to our notice by learned counsel for respondent that though MANPREET SINGH 2023.09.15 15:46 I attest to the accuracy and authenticity of this order/judgment CWP-9758-2022 (O&M) 2023:PHHC:117879-DB 3 amount of Rs.10,00,000/- and Rs.12,00,000/- as mentioned in orders dated 09.05.2022 and 27.05.2022 has been deposited, there was non-compliance of order dated 09.05.2022 inasmuch as EMIs have not been deposited by the petitioner. Learned counsel for respondents submits that once petitioner did not deposit EMIs as and when they arose, interim order in his favour necessarily stands vacated. Thus, respondent was well within its rights to take possession of the property in question pursuant to notice dated 13.07.2023. It is further submitted that OTS proposal submitted by the petitioner was duly considered in terms of order dated 21.11.2022 passed in this writ petition and same was rejected on 02.12.2022 and duly conveyed to the petitioner. OTS proposal of the petitioner for a sum of Rs.20,00,000/- was rejected as it was found to be neither viable or feasible in view of the total outstanding of Rs.1,70,48,046 as on 30.11.2022. Copy of letter dated 02.12.2022 filed in Court today, is taken on record subject to just exception.
5. We have heard learned counsel for the parties.
6. It is not denied that EMIs as falling due have not been deposited by the petitioner in terms of order dated 09.05.2022, which is admittedly a conditional order. Argument that by virtue of subsequent order dated 27.05.2022, petitioner would be discharged of his liability to deposit the EMIs as there is no mention of the same therein is totally untenable, hence rejected.
Admittedly, petitioner has an efficacious remedy for redressal of the grievance/es as raised in this writ petition. Learned counsel for the petitioner has been unable to point out any extra-ordinary or exceptional circumstance calling for interference in this matter in exercise of jurisdiction under Article 226 of the Constitution of India. At this stage, gainful reference can be made to judgments of Hon'ble the Supreme Court in Union Bank of India vs. MANPREET SINGH 2023.09.15 15:46 I attest to the accuracy and authenticity of this order/judgment CWP-9758-2022 (O&M) 2023:PHHC:117879-DB 4 Satyawati Tandon and others, 2010 (8) SCC 110, Varimadgugu Obi Reddy vs. B. Sreenivasulu and others, 2023 (1) R.C.R. (Civil) 34, M/s South Indian Bank Ltd. and others vs. Naveen Mathew Philip and others, 2023 (2) R.C.R. (Civil) 771.
7. Moreover, relief claimed in this writ petition is qua a private Non-Banking Financial Institution. It has been held by Hon'ble the Supreme Court in Phoenix ARC Private Limited vs. Vishwa Bharti Vidya Mandir and others, 2022 (1) R.C.R. (Civil) 888 as under :-
MANPREET SINGH 2023.09.15 15:46 I attest to the accuracy and authenticity of this order/judgment"12. Even otherwise, it is required to be noted that a writ petition against the private financial institution - ARC - appellant herein under Article 226 of the Constitution of India against the proposed action/actions under Section 13(4) of the SARFAESI Act can be said to be not maintainable. In the present case, the ARC proposed to take action/actions under the SARFAESI Act to recover the borrowed amount as a secured creditor. The ARC as such cannot be said to be performing public functions which are normally expected to be performed by the State authorities. During the course of a commercial transaction and under the contract, the bank/ARC lent the money to the borrowers herein and therefore the said activity of the bank/ARC cannot be said to be as performing a public function which is normally expected to be performed by the State authorities. If proceedings are initiated under the SARFAESI Act and/or any proposed action is to be taken and the borrower is aggrieved by any of the actions of the private bank/bank/ARC, borrower has to avail the remedy under the SARFAESI Act and no writ petition would lie and/or is maintainable and/or entertainable. Therefore, decisions of this Court in the cases of Praga Tools Corporation v. Shri C.A. Imanual and others, (1969) 1 SCC 585 and Ramesh Ahluwalia vs. State of Punjab, (2012) 12 SCC 331 relied upon by the learned counsel CWP-9758-2022 (O&M) 2023:PHHC:117879-DB 5 appearing on behalf of the borrowers are not of any assistance to the borrowers."
8. In view of above, no ground is made out for interference in this writ petition. We do not deem it appropriate to express any opinion on the merits of the matter lest prejudice is caused to any of the parties. At this stage, it is agreed by learned counsel for respondent that in case appropriate application is filed by the petitioner before learned Debts Recovery Tribunal, within next 15 working days, no objection qua limitation shall be raised.
9. Keeping in view the facts and circumstances as above, this writ petition is disposed of with liberty to the petitioner to avail statutory remedy/remedies as available to him in accordance with law.
10. Pending miscellaneous applications, if any, stand disposed of accordingly.
(LISA GILL) JUDGE (RITU TAGORE) JUDGE September 06, 2023 Manpreet Whether speaking/reasoned Yes/No Whether reportable : Yes/No MANPREET SINGH 2023.09.15 15:46 I attest to the accuracy and authenticity of this order/judgment