Gujarat High Court
Rameshbhai Rambhai Dodiya vs Authorised Officer, Union Bank Of India on 9 May, 2025
Author: Sunita Agarwal
Bench: Sunita Agarwal
NEUTRAL CITATION
C/LPA/645/2025 ORDER DATED: 09/05/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/LETTERS PATENT APPEAL NO. 645 of 2025
In R/SPECIAL CIVIL APPLICATION NO. 14682 of 2022
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RAMESHBHAI RAMBHAI DODIYA
Versus
AUTHORISED OFFICER, UNION BANK OF INDIA & ANR.
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Appearance:
MR MAULIK NANAVATI FOR MR.KIRIT R CHAUDHARI(3745) for
the Appellant(s) No. 1
MR P A MEHD(3489) for the Respondent(s) No. 2
MS NALINI S LODHA(2128) for the Respondent(s) No. 1
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CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE
SUNITA AGARWAL
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 09/05/2025
ORAL ORDER
(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL)
1. Having heard learned counsels for the parties and perused the record of the Special Civil Application No. 14682 of 2022, which has been summoned by us with the order dated 05.05.2022, pertinent is to record that the Writ petition has been filed by the guarantor of the secured asset, which was sought to be auctioned in a proceeding under the Securitisation and Reconstruction of Financial Assets and Enforcement Of Security Interest Act, 2002 (in short as "SARFAESI Act, 2002").
2. The sequence of events, pertinent to be taken on record Page 1 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025 NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined are that the notice under Section 13(2) while initiating proceedings under the SARFAESI Act, 2002 was served upon the borrower/guarantor on 01.11.2018. The Bank has taken symbolic possession of the secured asset on 09.01.2019. Further, possession notice under Section 13(4) was issued on 22.03.2019. e-auction sale notice was issued further on 27.04.2019.
3. At this stage, the original petitioner/appellant herein filed securitisation application being S.A. No.231 of 2019 before the Debts Recovery Tribunal at Ahmedabad challenging the entire action of the respondent bank including the sale notice dated 27.04.2019. The said Securitisation Application was disposed of vuide order dated 03.09.2019 noticing that the terms and conditions of the sale were uploaded belatedly and there was a breach of Rule 8(6) of the Security Interest (Enforcement) Rules, 2002 and hence, the sale notice was set aside.
4. Thereafter, the Bank had filed an Original Application No. 514 of 2019 on 11.06.2019 before the DRT for recovery of outstanding amount.
5. Another e-auction sale notice was issued on 20.06.2019 for the property in question (secured asset). The petitioner herein filed another Securitisation Application No. 304 of 2019 on 19.07.2019 challenging the sale notice dated 20.06.2019 contending that the reserve price shown in the sale notice was on the lower side and that the bank intended to sell the said properties at a Page 2 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025 NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined throwaway price in connivance with some third party. The said Securitisation Application was disposed of vide order dated 26.07.2019 containing the following directions :-
"14. However, bank may proceed further on the demand notice and possession notice already issued by obtaining fresh valuations. Further, I feel fair to say that bank is required to take action against the valuer in accordance with law if at all that valuer has given exorbitant valuation at the time of sanction of loan.
15. I have not expressed any opinion about the value of the property for which bank put the property on auction nor this Tribunal has expressed any opinion that value is on lower side. This Tribunal has passed this order only on the basis of non-consideration of common plot area and internal road area while arriving at valuation of the property. The bank is directed to obtain valuation from at least two valuers before putting the property on auction".
6. The third auction notice was issued on 22.08.2019 fixing reserve price at Rs.16 crores. The third securitisation application, i.e. S.A. No. 481 of 2019 was filed by the original petitioner/appellant herein challenging the entire action of the respondent Bank under the SARFAESI Act, 2002 including e-auction sale notice dated 22.08.2019 for the auction which was scheduled on 26.09.2019.
7. The auction was, however, successful and the sale certificate was issued in favour of the successful bidder Page 3 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025 NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined on 28.11.2019. A registered sale deed pursuant to the said auction has been executed in favour of respondent no.2 herein on 21.05.2020.
8. In the meantime, the Original Application No. 514 of 2019 filed by the Bank has been allowed by the DRT on 17.11.2020. Pursuant thereto, recovery proceeding has been initiated and execution application has been filed, which is pending. It is sought to be submitted that the order dated 17.11.2020 passed by the Debts Recovery Tribunal in allowing the Original Application No. 514 of 2019 has not been challenged before the appropriate appellate authority. However, a Miscellaneous Application No. 7 of 2021 has been filed before the Presiding Officer seeking for recall of the order on the premise of the same being an ex parte order, which is pending as on date.
9. In the meantime, the Securisation Application No 418 of 2019 challenging the e-auction sale notice dated 22.08.2019 has been dismissed on 21.06.2022 by the Debts Recovery Tribunal and the sale held on 26.09.2019 has been upheld.
10. At this stage, instead of approaching the Debt Recovery Appellate Tribunal by filing an appeal under Section 18 of the SARFAESI Act, 2002, the original petitioner has filed the Writ petition, out of which the present appeal has arisen. From a perusal of the Writ petition, we may record that while challenging the order passed by the DRT, the petitioner also challenged the proceedings Page 4 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025 NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined initiated under the SARFAESI Act, 2002 by issuing notices issued under Sections 13(2) and 13(4) of the SARFAESI Act, 2002. The question, therefore, would be as to whether the petitioner can be permitted to challenge the initiation of the proceedings under the SARFAESI Act, 2002 after disposal of two Securitisation Applications filed by him on previous occasion.
11. Be that as it may, it is more than evident that the petitioner instead of approaching the competent statutory appellate authority, has approached this Court to challenge the order passed by the DRT in upholding the sale in the third round of challenge to the auction notice dated 22.08.2019. The challenge was not maintainable as such. The Writ petition filed on 27.07.2022, however was initially entertained, but has been dismissed on the ground that the findings of fact arrived by the Tribunal with regard to e-auction sale notice dated 22.08.2019 issued by the respondent Bank cannot be examined within the scope of Article 226 of the Constitution of India. The learned Single Judge in the judgment impugned has noted that the issue as to whether the sale conducted by the Bank contrary to the statutory provisions would fall outside the the jurisdiction of this Court, inasmuch as, it would require a factual inquiry into the issues raised by the original petitioner.
12. Having noted the facts of the present case, insofar as the observations made by the learned Single Judge in the Page 5 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025 NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined judgment impugned, we find that the appropriate statutory remedy to challenge the order passed by the DRT under Section 17 of the SARFAESI Act, 2002 before the petitioner was to approach the appellate authority under the provisions of Section 18 of the SARFAESI Act, 2002. The Writ petition cannot be treated as an alternative remedy to challenge the order passed by the DRT which would require a factual inquiry. The action of the petitioner in approaching this Court invoking extraordinary discretionary jurisdiction under Article 226 of the Constitution of India was not entertainable. The judgment impugned could not be successfully challenged on merits.
13. However, it is sought to be submitted that the Writ petition remained pending and was dismissed only on 08.02.2023, and, moreover, the reasoned order of dismissal was not uploaded for about one year. As the dismissal order was uploaded only on 09.05.2024, the option with the petitioner to approach the alternative forum of appeal stood frustrated. The contention is that the impugned order passed by the learned Single judge is liable to be set aside being without jurisdiction in view of the judgment of the Apex Court in Ratilal Jhaverbhai Parmar v. State of Gujarat [2024 SCC OnLine SC 2985].
14. Having noticed the above, once we find on an independent appreciation of fact and the law pertaining to the proceedings under the SARFAESI Act' 2002, that Page 6 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025 NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined the challenge to the order dated 21.06.2022 passed by the DRT in the writ petition was a calculated chance taken by the petitioner, we only provide that the petitioner is at liberty to file a statutory appeal under Section 18 of the SARFAESI Act, 2002, if so advised. In case such an appeal is filed, the third party in whose favour rights have been created pursuant to the sale deed dated 21.05.2020, viz. the respondent no.2 herein would be necessary party apart from the respondent Bank, which has initiated proceedings under the SARFAESI Act, 2002. The appeal shall have to be filed along with a proper application to explain the delay in filing the same. In case such an appeal is filed along with the delay condonation application, we further provide that the time period spent in uploading the judgment of dismissal by this Court between 08.02.2023 to 09.05.2024 which has caused prejudice to the appellant, shall have to be excluded from the computation of the period of delay. For the remaining period of delay, the original petitioner/appellant herein would have to furnish his explanation.
15. With the above, as we reach at the same conclusion as arrived by the learned Single judge in the judgment impugned, setting aside the same would serve no useful purpose. Therefore, while modifying the judgment and order dated 08.09.2023 passed by the learned Single Judge, subject to the observations and directions made above, the present appeal stands disposed of. No order as to costs.
Page 7 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025NEUTRAL CITATION C/LPA/645/2025 ORDER DATED: 09/05/2025 undefined Pending civil application, if any, stands disposed of.
(SUNITA AGARWAL, CJ ) (PRANAV TRIVEDI,J) BIJOY B. PILLAI Page 8 of 8 Uploaded by BIJOY B. PILLAI(HC00202) on Wed May 14 2025 Downloaded on : Wed May 14 23:15:17 IST 2025