Madras High Court
S.Elancheliyan vs The Authorised Officer on 13 November, 2018
Author: R.Subbiah
Bench: R.Subbiah, R.Tharani
1
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 13.11.2018
CORAM:
THE HONOURABLE MR.JUSTICE R.SUBBIAH
AND
THE HONOURABLE MRS.JUSTICE R.THARANI
W.P(MD)No.17969 of 2017
and
W.M.P(MD)Nos.14482 and 18910 of 2017
S.Elancheliyan,
Partner,
M/s.Cauvery Agro Agencies,
No.3/9, Boothathalwar Street,
NH-I, Maraimalai Nagar - 603 209.
Kancheepuram District. ... Petitioner
Vs.
1.The Authorised Officer,
Small Industries Development Bank of India,
Having its Branch Office at
Overseas Towers,
No.756L, Anna Salai (Opp. TVS),
Chennai - 600 002.
2.Vista Associates Ltd.,
No.3/347, Redhills Avadi Road,
Lakshmipuram,
Pammadukulam,
Chennai - 600 052.
3.S.Sidesh Kumar ... Respondents
PRAYER: Petition filed under Article 226 of the Constitution of India,
praying for issuance of a writ of Certiorarified Mandamus to call for
the records pertaining to the impugned order passed by the Debt
Recovery Tribunal, Madurai, S.A.No.149 of 2014, dated 23.04.2016
and quash the same and consequently, direct the third respondent
to hand over the possession to the petitioner.
http://www.judis.nic.in
2
For Petitioner : Mr.Veera Kathiravan
Senior Counsel for
Mr.K.K.Ramakrishnan
For Respondent : Mr.J.Alaguram Jothi for R.1
Mr.M.Ajmal Khan
Senior Counsel for
Mr.Y.Prakash for R.3
No appearance for R.2
*****
ORDER
(Order of this Court was made by R.SUBBIAH,J.) This writ petition has been filed seeking a writ of Certiorarified Mandamus to call for the records pertaining to the impugned order passed by the Debt Recovery Tribunal, Madurai, S.A.No.149 of 2014, dated 23.04.2016 and quash the same and consequently, direct the third respondent to hand over the possession to the petitioner.
2. Facts-in-nutshell leading to the filing of this writ petition, briefly stated, are as follows:
2.1. M/s.Cauvery Agro Agencies is a partnership firm and the petitioner is one of the partners. The second respondent - M/s.Vista Associates Limited, a Private Limited Company, obtained loan from the first respondent bank by mortgaging their machinaries worth about Rs.1 Crore. In order to secure the said loan, the property of http://www.judis.nic.in M/s.Cauvery Agro Agencies situated at Salem, which was the 3 subject matter of this writ petition, was given as guarantee by the partners of the said partnership firm. Further, various agriculatural properties situated in Namakkal District in S.Nos.77/1, 88/1B, 88/2-2A, 88/2-A4, 88/2A3, 89/1, 89/2A, 89/2C1, 89/3, 88/1A, 88/2A1 admeasuring 21.51 acres were also given as guarantee by the petitioner and other partners.
2.2. Subsequently, due to financial inability, the second respondent was unable to repay the loan amount and hence, the first respondent bank initiated the proceedings under the SARFAESI Act and sold the movable properties, namely, the machinaries to the tune of Rs.61,75,000/- (Rupees Sixty One Lakhs and Seventy Five Thousand only) and thereafter, initiated the proceedings under the SARFAESI Act in respect of the immovable properties situated at Salem and issued a notice under Section 13(2) of the SARFAESI Act, followed by possession notice under Section 13(4) of the Act and also parallelly initiated the proceedings under the RDBI Act before the Debt Recovery Tribunal, Madurai, in O.A.No.280 of 2011 in respect of all the immovable properties including the agricultural properties.
2.3. The said O.A.No.280 of 2011 was filed against the second respondent and others for recovery of Rs.1,54,60,996.45 (Rupees One Crore Fifty Four Lakhs Sixty Thousand Nine Hundred Ninety Six and Forty Five Paise only). However, the said properties were sold http://www.judis.nic.in 4 without the service of notice to the petitioner under the SARFAESI Act and realised a sum of Rs.61,75,000/- (Rupees Sixty One Lakhs and Seventy Five Thousand only). Subsequently, after serving the memo dated 20.03.2014, the petitioner had taken steps to obtain the documents pertaining to the sale of the properpty and found that the first respondent committed fraud in conducting the sale of the property without serving notice to the owner/guarantor as per the SARFAESI Act.
2.4. It is contended by the petitioner that the first respondent bank having knowledge about the change of address from No.116, Kamarajar Avenue 2nd Street, Adyar, Chennai, to No.3/9, Boothathalawar Street, NH-I, Maraimalai Nagar – 603 209, with fraudulent intention sent notice to the old address at Adyar. Hence, it is proved that auction sale was conducted without service notice affecting the right of redemption by depositing the entire due amount. In such circumstances, the petitioner filed S.A.No.149 of 2014 before the Debt Recovery Tribunal, Madurai, raising the question of validity of sale conducted on 24.03.2014 and consequential relief of handing over the possession to the petitioner by setting aside the sale certificate dated 24.03.2014, however, the said S.A.No.149 of 2014 filed by the petitioner was erroneously dismissed. Challenging the same, the present writ petition came to be filed.
http://www.judis.nic.in 5
3. When the matter is taken up for hearing, Mr.M.Ajmal Khan, learned Senior Counsel appearing for the third respondent has raised a ground as to the maintainability of the writ petition as against the order passed by the Debt Recovery Tribunal, Madurai, by placing reliance on the recent judgment of the Honourable Supreme Court dated 05.10.2018 in ICICI Bank Limited v. Umakanta Mohapatra, Civil Appeal Nos.10251 – 10265 of 2018 arising out of SLP(C)Nos.16758 – 16772 of 2015 and submitted that when there is an alternative remedy available, the writ petition is not maintainable and should not be entertained and hence, prayed for the dismissal of this writ petition.
4. However, Mr.Veera Kathiravan, learned Senior Counsel appearing for the petitioner, by way of reply, submitted that when there is a fraud committed on the part of the first respondent in conducting the sale of the property in question without serving notice to the petitioner, the same can be questioned by filing the writ petition under Article 226 of the Constitution of India.
5. Heard the submissions of the learned Counsel for the parties and perused the materials available on record. http://www.judis.nic.in 6
6. In the recent judgment of the Honourable Supreme Court dated 05.10.2018 in ICICI Bank Limited v. Umakanta Mohapatra, Civil Appeal Nos.10251 – 10265 of 2018 arising out of SLP(C)Nos.16758 – 16772 of 2015, it is held as follows:
"Despite several judgments of this court, including a judgment by Hon'ble Mr.Justice Navin Sinha, as recently as on 30.01.2018, in Authorized Officer, State Bank of Travancore and Anr., vs. Mathew K.C., (2018) 3 SCC 85, the High Courts continue to entertain matters which arise under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI), and keep granting interim orders in favour of persons who are Non-Performing Assets (NPAs).
The writ petition itself was not maintainable, as a result of which, in view of our recent judgment, which has followed earlier judgments of this Court, held as follows:-
18. We cannot help but disapprove the approach of the High Court for reasons already noticed in Dwarikesh Sugar Industries Ltd., vs. Prem Heavy Engineering Works (P) Ltd., and Another, (1997) 6 SCC 450, observing:-
"32. When a position, in law, is well
settled as a result of judicial
http://www.judis.nic.in pronouncement of this Court, it would
7
amount to judicial impropriety to say the least, for the subordinate courts including the High Courts to ignore the settled decisions and then to pass a judicial order which is clearly contrary to the settled legal position. Such judicial adventurism cannot be permitted and we strongly deprecate the tendency of the subordinate courts in not applying the settled principles and in passing whimsical orders which necessarily has the effect of granting wrongful and unwarranted relief to one of the parties. It is time that this tendency stops."
The writ petition, in this case, being not maintainable, obviously, all orders passed must perish, including the impugned order, which is set aside."
7. In view of the recent judgment of the Honourable Supreme Court, we are of the opinion that the present writ petition is not maintainable and the appropriate remedy available for the petitioner is to file appeal before the Debt Recovery Appellate Tribunal and thus, the present writ petition fails.
8. In the result, this writ petition stands dismissed, however, granting liberty to the petitioner to file appeal before the Debt http://www.judis.nic.in 8 Recovery Appellate Tribunal in accordance with law. No costs. Consequently, W.M.P(MD)No.14482 of 2017 is dismissed and W.M.P(MD)No.18910 of 2017 is closed.
Index :Yes/No (R.P.S.,J.) (R.T.,J.)
Internet :Yes/No 13.11.2018
rsb
http://www.judis.nic.in
9
R.SUBBIAH,J.
AND
R.THARANI,J.
rsb
W.P(MD)No.17969 of 2017
and
W.M.P(MD)Nos.14482 and 18910 of 2017
13.11.2018
http://www.judis.nic.in