Andhra Pradesh High Court - Amravati
Dommeti Krishna Rao vs The State Of Ap on 24 September, 2020
Author: M.Satyanarayana Murthy
Bench: M.Satyanarayana Murthy
THE HON'BLE SRI JUSTICE M.SATYANARAYANA MURTHY
WRIT PETITION NO.13958 of 2020
ORDER:
This writ petition is filed under Article 226 of the Constitution of India seeking the following relief:
"to issue a Writ, Order or direction more particularly one in the nature of Writ of Mandamus declaring the action on the part of the 4th and 5th respondents herein thrown out the petitioners 1st and 2nd who are senior citizens and the 3rd petitioner, an unmarried woman who is the dependant, from their rented House i.e. D.No.68-5-5, Flat No.C3, Tirumula Residency, Gandhipuram 4, III Town, Rajamundry on 8th July 2020 and locked same including the total house hold articles and clothes and some money of the petitioners (presently homeless and are moving from one place to another as relatives are also refusing to provide temporary shelter) without following Due Process of law/without any notice under the Covid pandemic by violation of principles of natural justice, violative of the provisions of the constitution of India under Fundamental rights guaranteed is illegal, arbitrary and consequentially direct the 2 to 5 respondents to allow the petitioners family to enter into the above rented house forthwith under the Serious Covid-19 Pandemic situation considering the Petitioners come under the High risk category as they are senior citizens including the dependant woman who is unmarried to get infected by the deadly Covid19 virus, without any shelter including clothes they are homeless and are suffering tremendously"
The case of the petitioners in nut-shell is that petitioner No.1 is aged about 68 years and petitioner No.2 is aged about 65 years, they are senior citizens and petitioner No.3 is aged about 40 years, who is unmarried. The petitioners are residing in a rented house bearing D.No.68-5-5, Flat No.C3, Tirumala Residency, Gandhipuram, III Town, Rajamundry.
In the absence of petitioner No.1, on 08.07.2020 all of sudden, respondent Nos.4 and 5 along with respondent No.6 and advocate- commissioner came to the house, directed petitioner Nos.2 and 3 to MSM,J WP_13958_2020 2 come out and informed them about seizing of the house. Petitioner Nos.2 and 3 immediately informed the same to petitioner No.1 and petitioner No.1 requested respondent Nos.4 and 5 to allow them continue to stay there for at least 2 or 3 months because of the Covid-19 situation as they fall under the high risk category being citizens and if they removed abruptly from their home, they would become homeless and irreparable loss would be caused to them. The request of the petitioners was denied by respondent Nos.4 and 5 and they were forcibly thrown out without considering the fact that there are two woman (petitioner Nos.2 and 3). Again, in the evening at 04.00 p.m. petitioner No.1 joined his family members along with the elders in the area, requested respondent Nos.4 and 5, but there is no reply from them and the entire household necessities including clothes money were also seized. Due to the same, presently, the petitioners are homeless and facing severe problems being in the risk of getting infected by the deadly Covid virus by moving from one place to another to safeguard their health. Due to the Covid Pandemic, the relatives are refusing to provide them shelter, temporarily.
It is specifically contended that though the petitioners are the tenants in the residential house of respondent No.6, he never informed the petitioners about the bank authorities or respondent No.5 - bank authorities did not bring to the notice of the petitioners about the public auction under the guidelines of the bank authorities or about the notice for taking possession of the property by following the procedure in the rightful manner. Respondent Nos.4 and 5 forcibly thrown out the petitioners without considering that they are MSM,J WP_13958_2020 3 senior citizens including unmarried lady during Covid pandemic, the said action of respondent Nos.4 and 5 is illegal and arbitrary.
It is further contended that if respondent Nos.5 and 6 brought the fact situation to the notice of the petitioners as tenants, certainly the petitioners would have taken precautionary measures which would include vacating the house without the added pressure of the Covid situation. Even though the residential house was taken possession and the tenants who are the petitioners were thrown out, due to the above irresponsibility of respondent Nos.4 and 5 the entire family of the petitioners are facing high risk of being infected by Covid-19 virus. To safeguard the family, petitioner No.1 made a representation to respondent No.5 bank on 23.07.2020 requesting them to allow the petitioners family to enter into the house temporarily for at least 6 months, but there is no response from them even though the household articles including basic necessities like clothes and money, lying in the house under the lock and key.
Thus, the action of respondent Nos.4 and 5 is high handed in nature and rights of the tenants in occupation of the property cannot be infringed in the guise of order of the Court and requested to issue a direction as stated above.
Though the petitioners directed to serve notice on the respondents, they sent notice by E-mail and also served notice on the counsel, but none appeared for the respondents. Proof of service is also filed.
Sri Bokka Satyanarayana, learned counsel for the petitioners, vehemently contended that when the secured asset is in possession and enjoyment of the tenant in occupation, the tenant cannot be deprived of their right to enjoy the property. Therefore, taking MSM,J WP_13958_2020 4 possession, throwing the petitioners from the possession of property is a serious illegality. On account of such forcible dispossession of the petitioners, who are tenants in occupation of the property, tenancy rights are being infringed. A tenant can be evicted through process of law viz. following the procedure prescribed under Rent Control Act, but cannot be evicted in a short-cut method of taking possession of secured asset and placed reliance on judgment of Karnataka High Court in "M/s. REMO Software Private Limited v. HDB Financial Services Limited" (Writ Petition No.35597- 35601/2017 and 35602-35604/2017 (GM-RES)) to contend that the tenant in occupation cannot be thrown out. In the said judgment, the Karnataka High Court referred a Judgment of the Apex Court in "Vishal N.Kalsaria v. Bank of India1", wherein a similar situation camp up for consideration and the Apex Court held in favour of the tenant in the said case. Taking advantage of the principle laid down therein, learned counsel for the petitioners insisting this Court to issue a direction to reinduct the petitioners in possession of the property to continue as tenants.
Though notices were served on the respondents, none appeared and standing counsel for the bank, though received notice, also did not appear before the Court.
As seen from the material on record, the petitioners are claiming to be the tenants in occupation of the house bearing D.No.68-5-5, Flat No.C3, Tirumala Residency, Gandhipuram, III Town, Rajamundry. But the affidavit is silent as to the date of commencement of tenancy and monthly rent payable for the premises or any other terms and conditions of the tenancy. Except 1 (2016) 3 SCC 762 MSM,J WP_13958_2020 5 making a bald allegation that the petitioners are in occupation of the property as tenants and they were thrown out by respondent Nos.4 and 5 along with the advocate-commissioner appointed by Chief Judicial Magistrate, Rajamundry, no piece of paper is produced to substantiate the contention of the petitioners that they are in occupation of the property as tenants. In the absence of any documentary evidence and the details of tenancy including commencement of tenancy, monthly rent etc., it is highly difficult to believe the landlord and tenant relationship between the petitioners and debtor of respondent No.6, secured creditor. If really, the petitioners are in possession and enjoyment of the property covered by Rent Control Act, they would have produced any document to substantiate that they are tenants in occupation of the premises or at least, they would have disclosed the details if it is oral tenancy. Therefore, in the absence of any details, I am unable to believe the case of the petitioners that the petitioners are in occupation of the property in dispute as tenants. It is not known whether petitioner No.1 is the tenant, who obtained the premises or all the three petitioners obtained the premises from the owner.
The material produced along with the petition, more particularly, the warrant issued by the Chief Judicial Magistrate, Rajamundry shows that the disputed property was declared as Non Performing Asset (NPA) and notice under Section 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short "SARFAESI Act") was issued to take possession of the property. Respondent No.6
- Bank authorities approached the Chief Judicial Magistrate, Rajamundry by filing Crl.M.P.No.61 of 2020 and the Court appointed MSM,J WP_13958_2020 6 advocate-commissioner to take possession of the property, handover the same to Bank Authorities, and directed to execute the warrant and file report before the Court.
In pursuance of the warrant issued by the Chief Judicial Magistrate, Rajamundry to the advocate-commissioner, notice dated 06.03.2020 was issued proposing to execute warrant on 11.03.2020 and a memo was also served on the counsel for debtor and respondent therein. Thus, in execution of the warrant by the advocate-commissioner appointed by the Chief Judicial Magistrate, Rajamundry, East Godavari District, the possession of the property was taken.
Chapter III of SARFAESI Act deals with enforcement of security interest. Section 13 (2) of the SARFAESI Act says that where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect of such debt is classified by the secured creditor as non-performing asset, then, the secured creditor may require the borrower by notice in writing to discharge in full his liabilities to the secured creditor within sixty days from the date of notice failing which the secured creditor shall be entitled to exercise all or any of the rights under sub-section (4).
Provided that--
(i) the requirement of classification of secured debt as non-performing asset under this sub-section shall not apply to a borrower who has raised funds through issue of debt securities; and
(ii) in the event of default, the debenture trustee shall be entitled to enforce security interest in the same manner MSM,J WP_13958_2020 7 as provided under this section with such modifications as may be necessary and in accordance with the terms and conditions of security documents executed in favour of the debenture trustee.
Thus, respondent No.6 is entitled to take possession of the secured asset invoking Section 13 (2) of the SARFAESI Act.
Section 14 of the SARFAESI Act obligates the Chief Judicial Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset. According to Section 14 (1) of the SARFAESI Act, where the possession of any secured asset is required to be taken by the secured creditor or if any of the secured asset is required to be sold or transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured assets, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or as the case may be, the District Magistrate shall, on such request being made to him, take possession of such asset and documents relating thereto.
The obligation of the Chief Metropolitan Magistrate or District Magistrate is to assist respondent No.6 - secured creditor in taking possession of the property. Issuing warrant to the advocate- commissioner for taking possession of the property is only by exercising statutory power conferred on Chief Judicial Magistrate or District Magistrate under Section 14 of the SARFAESI Act and no act of the Chief Metropolitan Magistrate or the District MSM,J WP_13958_2020 8 Magistrate [any officer authorised by the Chief Metropolitan Magistrate or District Magistrate] done in pursuance of this section shall be called in question in any court or before any authority in view of sub-section (3) of Section 14 of the SARFAESI Act. Therefore, there is a clear interdict on the power of the Court to declare the act of Chief Judicial Magistrate as illegal. However, it is not the request of the petitioners to declare the action of the Chief Judicial Magistrate, Rajamundry as illegal and request of the petitioners is to reinduct them as tenants into the property in dispute.
It is evident from the record that the alleged dispossession of the petitioners, who are claiming to be the tenants in occupation of the property, is only in pursuance of the warrant issued by the Magistrate exercising power under Section 14 of the SARFAESI Act on the application filed by secured creditor, to take possession of the property after issuing notice under Section 13 (2) of the SARFAESI Act. Such order or dispossession can be challenged only before Debts Recovery Tribunal.
The main endeavour of the learned counsel for the petitioners is that even if any proceedings are initiated under Section 13 of SARFAESI Act, the rights of the tenants are protected since the provisions of the SARFAESI Act will not override the State Rent Control Acts. Moreover, the same view was expressed by the Karnataka High Court in "M/s. REMO Software Private Limited v. HDB Financial Services Limited" (Writ Petition No.35597- 35601/2017 and 35602-35604/2017 (GM-RES)) following the judgment of the Apex Court in "Vishal N.Kalsaria v. Bank of India" (referred supra). In the said judgment, the Apex Court held as follows:
MSM,J WP_13958_2020 9 "In view of the above legal position, if we accept the legal submissions made on behalf of the Banks to hold that the provisions of SARFAESI Act override the provisions of the various Rent Control Acts to allow a Bank to evict a tenant from the tenanted premise, which has become a secured asset of the Bank after the default on loan by the landlord and dispense with the procedure laid down under the provisions of the various Rent Control Acts and the law laid down by this Court in catena of cases, then the legislative powers of the state legislatures are denuded which would amount to subverting the law enacted by the State Legislature. Surely, such a situation was not contemplated by the Parliament while enacting the SARFAESI Act and therefore the interpretation sought to be made by the learned Counsel appearing on behalf of the Banks cannot be accepted by this Court as the same is wholly untenable in law."
No quarrel about the law declared by the Apex Court, reiterated by the Karnataka High Court, but this Court cannot reinduct the petitioners into the possession of the property on the basis of alleged tenancy between the petitioners and debtor, owner of the property while exercising power of judicial review under Article 226 of the Constitution of India for the simple reason that a statutory remedy is available under Section 17 of the SARFAESI Act read with Rule 13A of the Security Interest (Enforcement) Rules, 2002. Time and again, the Apex Court consistently held that the High Court cannot exercise jurisdiction under Article 226 of the Constitution of India in a routine manner when proceedings are initiated under the provisions of SARFAESI Act since remedy is available under Section 17 of the SARFAESI Act, aggrieved by the orders passed under Section 17 of the Act, an appeal lies to the appellate authority. When a person approached this Court circumventing the law invoking the jurisdiction under Article 226 of the Constitution of India, this Court cannot exercise such discretionary jurisdiction to grant relief. Therefore, on the ground of primacy to the right of a tenant, reinduction of the petitioners cannot be ordered.
MSM,J WP_13958_2020 10 Section 17 of the SARFAESI Act permits any person (including borrower), aggrieved by any of the measures referred to in sub- section (4) of section 13 taken by the secured creditor or his authorised officer under this Chapter, [may make an application along with such fee, as may be prescribed] to the Debts Recovery Tribunal having jurisdiction in the matter within forty- five days from the date on which such measure had been taken. The action taken by respondent No.5 is only under Section 13 (4) i.e. taking possession of the secured asset after serving notice under Section 13 (2) of the SARFAESI Act. Thus, the petitioners, if aggrieved by such measure i.e. taking possession of the secured asset can approach the Debts Recovery Tribunal. Rule 13 of the Security Interest (Enforcement) Rules, 2002 prescribes certain fee payable on the applications and appeals under Section 17 and 18 of the SARFAESI Act. Rule 13A further specifies every application under sub-section (1) of section 17 filed by lessee or tenant of the secured assets shall be accompanied by a fee specified in sub-clause (c) and sub-clause
(d) of sub-rule (2) of rule 13, as the case may be. The application to be made by the lessee or the tenant under sub-section (1) of section 17 of the Act, shall be in the form specified in Appendix X annexed to the rules. Thus, it is clear from various provisions under the Act and rules framed thereunder, even a tenant or lessee can file an application before the Debts Recovery Tribunal under Section 17 of the SARFAESI Act, if they are aggrieved by the measures taken by respondent No.5 under Section 13 (4) of the SARFAESI Act. Thus, a statutory remedy is available to the petitioner under SARFAESI Act, but instead of invoking the jurisdiction of Debts Recovery Tribunal, the petitioners approached this Court invoking the discretionary jurisdiction of the Court under Article 226 of the Constitution of MSM,J WP_13958_2020 11 India without disclosing any details including commencement of lease, monthly rent etc. When a statutory remedy is available under Section 17 of the SARFAESI Act, the petitioners have to exhaust the same. If any adverse order is passed, the remedy available under Section 18 of the SARFAESI Act is to file appeal before Debts Recovery Appellate Tribunal. But, without availing statutory remedy under the SARFAESI Act, the petitioners approached this Court, which is impermissible, in view of the law declared by the Supreme Court in "Genpact India Private Limited v. Deputy Commissioner of Income Tax and another2".
When a statutory remedy is available, the Court cannot be entertain a writ petition in view of the law declared in "United Bank of India v. Satyawati Tandon and others3", wherein the Apex Court reminded the High Court not to interfere with the proceedings under the SARFAESI Act, in view of alternative remedy provided under Section 17(1) of the Act, in which expression 'any person' includes even guarantor or any other person, who may be affected by the action taken under Section 13(4) or Section 14 of the Act.
In view of the law declared by the Apex Court in the judgments referred above, this Court cannot issue any direction exercising power of judicial review under Article 226 of the Constitution of India, which is purely discretionary in nature.
It appears from the record that the petitioners suppressing real facts i.e. taking possession of the property invoking the provisions of 2 (2019) 108 Taxman 340 (Delhi) 3 (2010) 8 SCC 110 MSM,J WP_13958_2020 12 SARFAESI Act, approached this Court questioning the action of the police, who assisted the Advocate-Commissioner in execution of the warrant issued by Chief Judicial Magistrate, Rajamundry, exercising power under Section 14 of the SARFAESI Act. Thus, the petitioners circumventing the law filed the present petition with unclean hands. Consequently, the petitioners are disentitled to claim the discretionary relief under Article 226 of the Constitution of India. On this ground also, the petition is liable to be dismissed.
In the result, the writ petition is dismissed. No costs. The miscellaneous petitions pending, if any, shall also stand closed.
_________________________________________ JUSTICE M. SATYANARAYANA MURTHY 24.09.2020 Ksp