Andhra Pradesh High Court - Amravati
Koppavarau Swaroop Rajesh vs Bank Of Baroda on 23 August, 2024
APHC010370872024 IN THE HIGH COURT OF ANDHRA [3483]
PRADESH
AT AMARAVATI
WRIT PETITION NO: 18751 of 2024
Koppavarapu Swaroop ...Petitioner
Rajesh
Vs.
Bank Of Baroda and Others ...Respondent(s)
**********
Mr.T. V. P. Sai Vihari, Advocate(s) for Petitioner(s)
CORAM : THE CHIEF JUSTICE DHIRAJ SINGH THAKUR
SRI JUSTICE RAVI CHEEMALAPATI
DATE : 23rd August 2024
PER DHIRAJ SINGH THAKUR, CJ (Oral):
The petitioner claims to be in physical possession of a property in
capacity as a lessee. It is stated that the lease was created in his favour by
respondent No.2 for a period of five years with effect from March, 2021 on a
monthly rent of Rs.9,200/-.
2. The property in question is stated to have been mortgaged with the
Bank of Baroda/respondent No.1 herein. A notice under Section 13(2) of the
Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (hereinafter, referred to as "the Act") was issued by
the Bank on 05.05.2022. Subsequently, an auction notice, dated 17.05.2024
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was issued by the Bank for auction of the secured asset. The petitioner claims
that he approached the Bank authorities and contended that the auction could
not be permitted in law inasmuch as no notice was given to the petitioner who
was in physical possession of the same. However, it is stated that the Bank
authorities informed the petitioner that he too could participate in the auction
and could retain the possession, if he was successful in the same.
3. The petitioner claims that he participated in the auction and was
declared as a successful bidder for a total sale consideration of
Rs.1,45,62,000/- out of which 25% of the sale amount i.e., Rs.36,40,500/- was
paid on 07.06.2024. It is stated that the Bank issued an email, dated
11.06.2024, confirming the status of the petitioner as a successful bidder. The
petitioner claims that while he was willing to deposit the balance
consideration, respondent Nos.2 and 3 challenged the auction by way of S.A.
No.382 of 2023 before the Debts Recovery Tribunal, Visakhapatnam, which
vide its order, dated 20.06.2024, granted an interim stay of all further
proceedings. It is further stated that on 24.06.2024, the respondent Bank
issued an email stating that as per the opinion obtained, they were cancelling
the e-auction conducted on 06.06.2024 and refunding the amount to the
petitioner.
4. The petitioner claims that it has approached the DRT by way of filing an
application for impleadment in S.A. No.382 of 2023 and the application is
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pending consideration. In the meantime, it is stated that the Advocate
Commissioner, appointed by the Chief Judicial Magistrate, affixed notice,
dated 16.08.2024, on the premises in question directing the petitioner to
vacate the premises by 27.08.2024. It is stated that the order of the Chief
Judicial Magistrate was illegal inasmuch as the DRT had granted stay of all
further proceedings initiated by the Bank under the Act.
5. Apart from this, learned counsel for the petitioner also placed reliance
upon the Apex Court judgment in the case of Bajarang Shyamsunder
Agarwal v. Central Bank of India 1 and submits that the rights of tenancy
have to be determined by the Chief Metropolitan Magistrate and therefore, it is
stated that the petitioner had accordingly approached the Chief Judicial
Magistrate, Vijayawada, by way of an application, which was pending
consideration. It is in that context stated that if the petitioner was to be evicted
from the premises in question by the Advocate Commissioner before Chief
Judicial Magistrate had an occasion to consider the petitioner's application, it
would cause serious and irreparable loss to the petitioner and hence, prays
that this Court issue directions with a view to protect the interest of the
petitioner.
6. We have heard learned counsel for the petitioner.
(2019) 9 SCC 94
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7. The argument that the petitioner needs to be protected pending the
adjudication by the Chief Judicial Magistrate on the right of the petitioner to
remain in possession of the leased premises is an argument, which is bereft of
any legal basis inasmuch as it has been clearly held by the Apex Court in
Balkrishna Rama Tarle v. Phoenix Arc Private Limited 2 that the powers
exercisable by the Chief Metropolitan Magistrate/District Magistrate under
Section 14 of the Act are ministerial steps and that Section 14 of the Act does
not involve any adjudicatory process. It was held:
"18. Thus, the powers exercisable by CMM/DM under Section 14 of
the SARFAESI Act are ministerial steps and Section 14 does not involve any
adjudicatory process qua points raised by the borrowers against the secured
creditor taking possession of the secured assets. In that view of the matter
once all the requirements under Section 14 of the SARFAESI Act are
complied with/satisfied by the secured creditor, it is the duty cast upon the
CMM/DM to assist the secured creditor in obtaining the possession as well as
the documents related to the secured assets even with the help of any officer
subordinate to him and/or with the help of an advocate appointed as
Advocate Commissioner. At that stage, the CMM/DM is not required to
adjudicate the dispute between the borrower and the secured creditor and/or
between any other third party and the secured creditor with respect to the
secured assets and the aggrieved party to be relegated to raise objections in
the proceedings under Section 17 of the SARFAESI Act, before Debts
Recovery Tribunal."
8. In view of the aforesaid ratio of the Apex Court, the remedy which the
petitioner ought to resort to would be one before the Debts Recovery Tribunal
(2023) 1 SCC 662
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and not before the Chief Metropolitan Magistrate/ Chief Judicial Magistrate.
Since the petitioner has already approached the DRT, it would be open to the
petitioner to avail his remedy before the said forum. We do not find any merit
in the present petition, which is accordingly dismissed. No costs.
Pending miscellaneous applications, if any, shall stand closed.
DHIRAJ SINGH THAKUR, CJ RAVI CHEEMALAPATI, J
AKN
127 HCJ & RC, J
HON'BLE MR.JUSTICE DHIRAJ SINGH THAKUR, CHIEF JUSTICE
&
HON'BLE MR. JUSTICE RAVI CHEEMALAPATI
WRIT PETITION No.18751 of 2024
DATE :23.08.2024
AKN
