Parekh Gold House Pvt. Ltd. And 3 ... vs India Sme Asset Reconstruction
2017 Latest Caselaw 4884 Bom

                                                913-WPL-1928-2017.DOC




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       IN THE HIGH COURT OF JUDICATURE AT BOMBAY
            ORDINARY ORIGINAL CIVIL JURISDICTION

                 WRIT PETITION (L) NO. 1928 OF 2017

 1. M/s. Parekh Gold House Pvt. Ltd.
 A Private Ltd Co,. Incorporated under the
 Companies Act, 1956 having its
 Registered Office at 29/A, Siddhipura
 Industrial Estate, Gaiwadi Road, Goregoan
 (West), Mumbai 400 062.
 2. Shri Pravin C. Parekh,
 An Adult, R/at Flat No. 602, Panchvati
 Apartment, Vile Parle (East), Mumbai 400
 057.
 3. Smt. Damyanti P. Parekh,
 R/at. Flat No. 602, Panchvati Apartment,
 Vile Parle (East), Mumbai 400 057.
 4. Shri Chamanlal V. Awtaney
 R/at. A/ 402, Reveira Tower, Lokhandwala
 Township, Kandivali (East), Mumbai 400
 101.                                                ...Petitioners

         Versus

 India SME Asset Reconstruction Co.
 Ltd.
 Plot No.C-11, G Block, Bandra, Kurla
 Complex, Bandra (East), Mumbai 400 051.
                                                  ...Respondent


 Mr. R.D. Soni, with Mr. Chetan Yadav, i/b M/s. Ram &
      Company for the Petitioner.
 Ms. Uma S. Fadia, for the Respondent No.1.




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                                                       913-WPL-1928-2017.DOC




                               CORAM:   B.R. GAVAI AND
                                        RIYAZ I. CHAGLA, JJ.

DATED: 21st July 2017

J U D G M E N T :- (Per Riyaz I. Chagla J.)

1. The Petitioner by the present Petition is challenging the

order dated 7th July 2017 passed by the Debts Recovery

Tribunal No.1,("DRT- I") by which DRT-I declined to pass any

order on the proposal of the Petitioner for disposal of his

residential flat personally to the buyer of his choice and has

held that the question would arise after physical possession

had been taken by the Respondent bank. It is further

recorded that the Respondent bank had agreed to postpone

all further action till 6th August 2017 and the matter was

posted to 10th August 2017.

2. The Petitioner No.1 is a borrower of Axis Bank Ltd and

Bank of India and had offered properties as and by way of

security against the loan to the banks. Petitioner Nos. 2 to 4

are the guarantors. The bank thereafter assigned the loan to

the Respondent. The Petitioners had failed to make payment

of the dues of the banks. The banks prior to assigning their

913-WPL-1928-2017.DOC

debts in favour of Respondent, had filed complaint before the

Chief Metropolitan Magistrate, Esplanade Court, Mumbai

("CMM") under Section 14 of the The Securitisation and

Reconstruction of Financial Assets and Enforcement of

Security Interest Act, 2002 ("SARFAESI" Act). An order came

to be passed by the CMM directing the Assistant Registrar of

the Borivali Centre of Courts to take possession of the

secured properties. The Respondent after being assigned

the bank debts filed an application before the CMM,

Esplanade Court to be added as Applicant in place of the

Assignors / banks. An order came to be passed by CMM on

16th January 2017 appointing an Advocate to take

possession of the properties. The Petitioner submitted OTS of

Rs.1442 lakhs towards full and final settlement of the dues.

The Petitioners and Respondent thereafter deliberated on the

OTS and ultimately the Respondent on 21st April 2017

extended its consent for OTS till 30th April 2017 and called

upon the Petitioners to pay entire settlement amounts to the

Respondent. Upon the Petitioners failure to do so, the

Respondent by letter dated 2nd May 2017 cancelled the

OTS. The Petitioner thereafter requested the Respondent to

913-WPL-1928-2017.DOC

reconsider its decision and has sought NOC from the

Respondent permitting the Petitioners to proposal for sale of

the secured properties. The Petitioners have claimed that the

Respondent by letter dated 7th June 2017 agreed to the

Petitioners proposal for sale of the secured properties. The

Advocate / Commissioner had by notice dated 30th June

2017 informed the Petitioners to handover possession of the

properties by 10th July 2017 and 13th July 2017. The

Petitioners filed Securitisation Application No. 93 of 2017 on

5th July 2017 for setting aside the measures initiated by

Respondent under Section 13(4) of the SARFAESI Act. The

Petitioners had filed an Affidavit dated 5th July 2017 in the

DRT showing their willingness to give possession in respect

of the properties. The Petitioners have also referred to the

proposal of disposal of the residential flat (secured property)

by the Petitioner personally to the buyer of their choice. The

Presiding Officer, DRT - 1 has passed the impugned order

dated 7th July 2017 rejecting the interim Application. The

Petitioners have thereafter filed the present Petition

challenging the impugned order and contending that the

measures adopted by the Respondent in taking

913-WPL-1928-2017.DOC

possession of the secured properties are contrary to the

provisions of the SARFAESI Act.

3. Shri Soni learned Advocate for the Petitioners has

submitted that the Petitioners are willing to settle the dues of

the Respondent and that the Petitioners may be directed to

dispose of the residential flat personally to a buyer of their

choice and utilize the proceeds to meet the dues of the

Respondents. Shri Soni has contended that the Petitioners

had submitted their OTS to the Respondent and that the

Respondent was to provide its concrete answer to the OTS.

The Petitioners had found the buyer for the secured property

and the Petitioners are willing to settle the dues of the

Respondent at the earliest. Shri Soni has contended that the

DRT-I had not passed any orders on the proposal of the

Petitioners despite the Petitioners attempting to settle the

dues of the Respondent and had held that the proposal could

only be considered after the physical possession had been

taken by the Respondent. Shri Soni has submitted that the

Petitioners proposal ought to have been accepted by the DRT

913-WPL-1928-2017.DOC

- I and, therefore, the impugned order ought to be set aside

with proper directions being issued by this Court.

4. Smt Uma Fadia, learned Advocate for the Respondent

has vehemently opposed the Petition and submitted that the

Petitioners have time and again brought up their OTS with

the Respondent and had promised to settle the Respondent's

dues, but till date failed to do so. Smt. Fadia has contended

that the Respondent is not interested in considering the

proposal of the Petitioners until physical possession of the

secured property is handed over to the Respondent. Smt.

Fadia has submitted that in any event the Respondent has

agreed before the DRT to postpone all actions till 6th August

2017 and that the matter was to be heard by the DRT - I as

recorded in the impugned order on 10th August 2017.

5. We are of the considered view that there is no infirmity

in the impugned order. The Petitioners have an alternate

remedy and which is already availed of in the DRT and their

application has been posted on 10th August 2017 by the

impugned order. We are not inclined to interfere with the DRT

913-WPL-1928-2017.DOC

proceedings. The impugned order has itself recorded that the

proposal of the Petitioner for disposal of the residential flat /

secured property will arise after physical possession is taken

by the Respondent. There is also an order passed by the

CMM operating against the Petitioners and directing the

Advocate appointed as Commissioner to take possession of

the secured properties.

6. We accordingly dismiss the Petition. There shall be no

order as to costs.

       (RIYAZ I. CHAGLA J.)                 ( B.R. GAVAI J.)