Delhi High Court - Orders
Rajni Pathak & Anr vs Union Of India & Anr on 10 December, 2021
Author: Prateek Jalan
Bench: Prateek Jalan
$~2644 (2021 Cause List)
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 14082/2021
RAJNI PATHAK & ANR. ..... Petitioner
Through: Mr. Gautam Singhal &
Mr. Vaibhav Jain, Advocates
[9650843200]
versus
UNION OF INDIA & ANR. ..... Respondent
Through: Mr. Santosh Kumar Rout,
Advocate for R-2/PNB.
CORAM:
HON'BLE MR. JUSTICE PRATEEK JALAN
ORDER
% 10.12.2021 The proceedings in the matter have been conducted through hybrid mode [physical and virtual hearing].
CM APPL. 44423/2021 (exemption) Exemption allowed, subject to all just exceptions. The application is disposed of.
W.P.(C) 14082/2021 & CM APPL. 44422/2021 (stay)
1. Issue notice. Mr. Santosh Kumar Rout, learned counsel, accepts notice on behalf of the respondent No. 2- Punjab National Bank ["the Bank"]. Notice to the respondent No.1-Union of India is not required in view of the order that I propose to pass.
2. The petitioners assail an order dated 29.10.2021, passed by the Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:11.12.2021 00:04:55 W.P.(C) 14082/2021 Page 1 of 5 Chief Metropolitan Magistrate ["CMM"] under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 [hereinafter, "SARFAESI Act"] on the application filed by the Bank, by which a Receiver has been appointed over the petitioners' property [EM of Flat No. G-18, Block G, 3rd Floor (with roof rights) Naveen Shahdara, Delhi-110032] ["the property"]. By a notice dated 06.12.2021, the Receiver has proposed to take physical possession of the property on 12.12.2021.
3. The petitioners availed credit facilities of approximately ₹45 lakhs from the Bank, but defaulted in payments and their accounts were therefore declared as Non Performing Assets ["NPA"] on 31.03.2019. Pursuant to the accounts being declared as NPA, a notice under Section 13(2) of the SARFAESI Act was issued on 06.05.2019. Symbolic possession of the property was taken by a notice dated 29.12.2020 under Section 13(4) of the SARFAESI Act. The respondents thereafter approached the CMM, which led to the impugned measures against the petitioners' property. The petitioners have filed proceedings under Section 17 of the SARFAESI Act before the Debts Recovery Tribunal ["DRT"]- II vide Diary No. 153/2021 dated 08.12.2021. However, as the DRTs in Delhi are presently non-functional for want of Presiding Officers, the petitioners have been compelled to approach this Court under Article 226 of the Constitution.
4. In view of the fact that the DRTs and the Debts Recovery Appellate Tribunal ["DRAT"] in Delhi are presently without Presiding Officers, this Court has had occasion to consider similar petitions and has taken the view that it is preferable to enable the parties to approach the Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:11.12.2021 00:04:55 W.P.(C) 14082/2021 Page 2 of 5 statutory tribunal rather to entertain writ petitions on merits. I am of the view that this is consistent with the settled jurisprudence of the Supreme Court relating to maintainability of writ petitions against measures under the SARFAESI Act including inter alia in the judgment of the Supreme Court in United Bank of India vs. Satyawati Tandon and Others (2010) 8 SCC 110 and Authorized Officer, State Bank of Travancore and Another vs. Mathew K.C. (2018) 3 SCC 85 [paragraphs 5, 9 to 15], and the recent judgment in C. Bright vs. District Collector and Others (2021) 2 SCC 392 [paragraph 22]. With this objective, in appropriate cases, this Court has also transferred proceedings pending before the DRTs in Delhi to a functional DRT within the jurisdiction of the DRAT, Delhi on grounds of urgency, invoking the provisions of Section 17(7) of the SARFAESI Act and 17A(2) of the Recovery of Debts and Bankruptcy Act, 1993 ["RDB Act"].
5. In the present case, however, Mr. Gautam Singhal, learned counsel for the petitioners, states that the petitioners are willing to make a substantial deposit of approximately ₹15 lakh in the next two months, as against the Bank's claimed dues of approximately ₹45-48 lakhs. Mr. Singhal also submits that the petitioners would like to settle the matter with the Bank. Mr. Santosh Kumar Rout, learned counsel for the Bank, does not dispute that the quantum of dues of the Bank are in the region of ₹45-48 lakhs as of today.
6. In these circumstances, I am of the view that it is preferable to relegate the parties to the remedies before DRT-II, Delhi, rather than to transfer the matter to DRT, Jaipur. DRT, Jaipur is the only functional DRT within the jurisdiction of DRAT, Delhi to which the petitions can be Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:11.12.2021 00:04:55 W.P.(C) 14082/2021 Page 3 of 5 transferred under Section 17(2) of the RDB Act. DRT, Jaipur is already hearing several urgent petitions transferred from DRTs in Delhi, in addition to its own board. I have also been informed in connected proceedings that the process for appointment of Presiding Officers in DRTs in Delhi is at an advanced stage, and the possibility of conferring additional charge upon some other officers is also under consideration.
7. For the reasons aforesaid, the writ petition is disposed of with the following directions:
a. The Receiver is directed to defer the proceedings for taking possession of the property until 15.02.2022 at 11:00 AM, subject to any orders to be passed by the DRT-II, Delhi on the petitioners' Securitization Application. No further notice will be required to be given to the petitioners for taking possession of the property on the said date, subject to orders of the DRT-II, Delhi.
b. Mr. Singhal states that the petitioners will deposit a sum of ₹15 lakh with the Bank in three equal instalments of ₹ 5 lakhs each, the first of which will be deposited today itself, i.e., 10.12.2021. The subsequent instalments of ₹5 lakhs each will be deposited by
08.01.2022 and 05.02.2022 respectively. The aforesaid amounts will be deposited and accepted without prejudice to the rights and contentions of the parties and subject to the orders that may be passed by DRT.
c. The parties will be at liberty to seek expeditious hearing of their Securitisation Application, at least on the question of interim relief, once the Presiding Officer is appointed in the concerned DRT, or any alternative arrangement is made for entrustment of additional Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:11.12.2021 00:04:55 W.P.(C) 14082/2021 Page 4 of 5 charge to any other officer. The DRT is requested to consider the request of the parties keeping in mind the aforesaid timeline for physical possession of the property.
d. In the event the concerned DRT is still non-functional as on 24.01.2022, the petitioners may approach the DRAT, Delhi or this Court for transfer of the proceedings to a functional DRT, or for any such other relief as they may be entitled to in law.
8. Mr. Singhal submits that the petitioners would like to make an offer of One-Time Settlement ["OTS"] to the Bank, but the Bank's procedure requires a deposit of 10% of the proposed OTS amount. As the petitioners are depositing ₹5 lakhs immediately, which covers more than 10% of the total dues, even according to the Bank, Mr. Rout states that the Bank will consider the OTS proposal upon deposit of the first instalment, in accordance with the policies of the Bank and in its own discretion.
9. It is made clear that this Court has not entered into the merits of the petitioners' case which are to be decided by the DRT, in accordance with law.
10. The writ petition, alongwith the pending application, is disposed of with these directions.
PRATEEK JALAN, J DECEMBER 10, 2021/'hkaur' Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:11.12.2021 00:04:55 W.P.(C) 14082/2021 Page 5 of 5