Madhya Pradesh High Court
Rajeev Sachdeva vs Fullerton India Credit Company Limited on 14 December, 2017
HIGH COURT OF MADHYA PRADESH BENCH AT INDORE
W.P.No.3940/2017
Rajeev Sachdeva & ors. vs.Fullerton India Credit Co. Ltd.& ors.
Indore
14.12.2017
Shri Akshat Agrawal, learned counsel for the petitioner.
Shri Sanjay Pathak, learned Counsel for the respondent No.1.
Ms. Bhakti Vyas, learned GA for the respondent No.2 to 5/State. The petitioner has filed the present petition being aggrieved by order dt. 30.5.2017 passed by the District Magistrate Indore under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 by which the District Magistrate has directed to provide assistance to respondent No.1 for taking possession of the secured assets of the petitioner. By order dt. 30.6.2017 this petition has been entertained with the direction to the petitioner to deposit amount of Rs. 10 lacs within 15 days and further amount of Rs. 10 lacs within 45 days and the status-quo in possession of the mortgaged property was directed to be maintained.
Shri A. Agrawal, informs that the aforesaid order has been complied with and amount of Rs. 20 lacs has been deposited with the Bank. Learned Counsel for the respondent No.1 is not disputing this fact.
On the last date of hearing the Counsel for the respondent No.1 has raised a preliminary objection about the maintainability of the writ petition on the ground that the petitioner is having remedy to approach the DRT under Section 17 of the Sarfaesi Act, 2002, by way of appeal against the order of District Magistrate. Admittedly the petitioner has filed the writ petition before approaching the DRT on the apprehension that his application for stay would not be considered because he has not lost the possession.
This Court in case of W.P. No. 19425/2017 passed in M/s Vishwas Enterprises and others vs. The Additional District Magistrate and ors. dt. 4.12.2017 has taken a view that the borrower or the guarantor is having remedy to appeal under Section 17 of the SARFAESI ACT, 2002 against the order of the District Magistrate also.
The operative part of the order reads as under:-
"7 Shri Abhinav Dhanodkar, learned counsel appearing on advance notice on behalf of the respondent no.3 has raised preliminary objection that the petitioners are having an alternate and efficacious remedy to approach the DRT against the impugned order dated 23/10/2017 and the present writ petition is not maintainable.
8 Shri Vivek Dalal, learned counsel for the petitioner has placed reliance over the judgment delivered in the case of Standard Chartered Bank Vs. V. Noble Kumar and others reported in (2013) 9 SCC 620 and drawn attention of this Court to para -28 of the judgment, in which, the Hon'ble Apex Court has held that appeal under section 17 is available to the borrower only after losing the possession of the secured assets. Para 28 is reproduced below :
28 It can be noticed from the language of the proviso to Section 13(3A) and the language of Section 17 that an "appeal" under Section 17 is available to the borrower only after losing possession of the secured asset. The employment of the words "aggrieved by...taken by the secured creditor" in Section 17(1) clearly indicates the appeal under Section 17 is available to the borrower only after losing possession of the property. To set at naught any doubt regarding the interpretation of Section 17, the proviso 16 to Sub-
section (3A) of Section 13 makes it explicitly clear that either the reasons indicated for rejection of the objections of the borrower or the likely action of the secured creditor shall not confer any right under Section 17.
9 It is not disputed that against the notice under section 13(3) of the SARFAESI Act, 2002, the petitioners have already approached the DRT at Jabalpur by filing Secularization Appeal. The said secularization appeal has been dismissed due to non-appearance of the petitioners / borrowers. Thereafter, the Bank has initiated the proceedings under section 13(4) of the SARFAESI Act, 2002 before the Additional District Magistrate. The petitioner appeared, but later on they have been proceeded ex-parte and now they are challenging the order of the Additional District Magistrate on merits as well as on the ground that they have bonafide intentions to repay the loan amount. In the present case, the petitioners have mortgaged the plots and residential houses. They are still in possession of their factory and according to which, the factory is in running condition. Even if the Bank takes possession of the secured assets, the petitioners would continue to run the factory, therefore, by taking possession of the secured assets, in order to recover the loan amount, production is not going to be affected and still the petitioner is having opportunity to repay the Bank's loan to the Bank and regularize his account. The order passed under section 13(4) of the SARFAESI Act, 2002 by the Additional District Judge is nothing, but permission to give assistance by police and revenue authority to the Bank in order to take possession. In the case of Standard Chartered Bank (supra) in para 40, Hon'ble Apex Court has held that the scope of Section 17 recorded earlier would normally have been open to the respondent to prefer an appeal challenging the order passed under section 14 by raising the objection regarding the illegality of the decision of the Magistrate. Para 40 is reproduced below :
40 In view of our conclusion on the scope of Section 17 recorded earlier it would normally have been open to the Respondent to prefer an appeal under Section 17 raising objections regarding legality of the decision of the Magistrate to deprive the Respondent of the possession of the secured asset. But in view of the fact that the Respondent chose to challenge the decision of the magistrate by invoking the jurisdiction of the High Court under Article 226 of the Constitution and in view of the fact that the Respondent does not have any substantive objection as can be discerned from the record, we make it clear that the Respondent in the instant case would not be entitled to avail the remedy under Section 17 as the Respondent stalled the proceedings for a period of almost 4 years. It is worthwhile remembering that the Respondent did not even choose to raise any objections to the demand issued under Section 13(2) of the Act. However, we make it clear that it is always open to the Respondent to seek restoration of his property by complying with Sub-section 8 of Section 13 of the Act.
10 In the present case, the petitioners had already approached the DRT against section 13(2) of the SARFAESI Act, 2002, in which they were having opportunity to regularize their account and repay the bank loan. Under Article 226 of the Constitution of India, this Court cannot exercise the job of Debt Recovery Tribunal.
11 The Hon'ble Apex Court in the case of Kanaiyalal Lalchand Sachdev & others Vs. State of Maharashtra & others 2011 (2) SCC 782 has held as under:
"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 17of 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. (See: Sadhana Lodh Vs. National Insurance Co. Ltd., Surya Dev Rai Vs. Ram Chander Rai & State Bank of India Vs. Allied Chemical Laboratories).
24. In City and Industrial Development Corporation Vs. Dosu Aardeshir Bhiwandiwala, this Court had observed that:
"30. The Court while exercising its jurisdiction under Article 226 is duty-bound to consider whether:
(a) adjudication of writ petition involves any complex and disputed questions of facts and whether they can be satisfactorily resolved;
(b) the petition reveals all material facts;
(c) the petitioner has any alternative or effective remedy for the resolution of the dispute;
(d) person invoking the jurisdiction is guilty of unexplained delay and laches;
(e) ex facie barred by any laws of limitation;
(f) grant of relief is against public policy or barred by any valid law; and host of other factors."
25. In the instant case, apart from the fact that admittedly certain disputed questions of fact viz. Nonreceipt of notice under Section 13(2) of the Act, noncommunication of the order of the Chief Judicial Magistrate etc. are involved, an efficacious statutory remedy of appeal under Section 17 of the Act was available to the appellants, who ultimately availed of the same. Therefore, having regard to the facts obtaining in the case, the High Court was fully justified in declining to exercise its jurisdiction under Articles 226 and 227 of the Constitution."
Shri A.Agrawal, learned Counsel for the petitioner submits that the petitioner is ready to approach the DRT if the DRT is ready to entertain the application for interim relief. The petition is dismissed with the liberty to approach the DRT. The interim protection granted to the petitioner shall continue for the period of 30 days from today. Meanwhile, learned DRT may entertain appeal as well as application for interim relief.
Shri S. Pathak, learned Counsel for respondent No.1 submits that if the appeal is filed before DRT Jabalpur, within 30 days from today, Bank would not raise the issue of limitation.
With the aforesaid liberty, the petition is disposed of finally. CC as per rules.
(Vivek Rusia) Judge M.Jilla.
Maharukh jilla 2017.12.18 10:39:13 +05'30'