Limited & Ors vs Reserve Bank Of India & Ors
2021 Latest Caselaw 6640 Cal

24-12-2021
 ct no. 13
  Sl.14
    sp

                          WPA 20908 of 2021
             M/s. Glamour World Ayurvedic Company Private
                           Limited & Ors.
                              -Versus-
                      Reserve Bank of India & Ors.
                        (Via Video Conference)

               Mr. Haradhan Banerjee,
               Mr. Amitava Pyne,
               Mr. Subhadip Biswas,
               Ms. Priyanka Anand Sharma
                                                  ...for the petitioners

               Mrs. Soni Ojha,
               Mr. S. Banerjee
                                  ...for the respondent nos. 2 to 7

A notice dated September 9, 2021 under

Section 13(2) of the Securitization and

Reconstruction of Financial Assets and

Enforcement of Security Interest Act, 2002

issued by the respondent bank is challenged

before this Court.

It is submitted that the bank has

calculated interest on interest during the period,

which the Hon'ble Supreme Court in W.P. (S)

Civil No. 825 of 2020 (Gajendra Sharma vs.

Union of India & Ors.) and W.P. (C) No. 476 of

2021 (Small Scale Industries Manufacturing

Association (Regd.) vs. Union of India.

The petitioners submit that the notice

under Section 13(2) of the SARFAESI Act has

clearly indicated interest that was charged by

the bank, during the said period which has been

expressly prohibited by the Hon'ble Supreme

Court. Reliance is placed on a decision of a Co-

ordinate bench of this Court dated September

27, 2021 in WPO 841 of 2021 (The Fabworth

Promoters Private Limited & Ors. vs. Reserve

Bank of India & Ors.).

On the question of maintainability,

portions of the aforesaid Fabworth Promoters

Private Limited judgment are placed by the

counsel for the petitioners to indicate that the

writ Court, with limited disputed questions of

facts, could entertain a writ petition where

question of jurisdiction is involved or natural

justice is violated or any statutory procedure is

not complied with.

The relevant decisions of the Hon'ble

Supreme Court, in this regard have been set out

by the Co-ordinate bench in the Fabworth

Promoters Private Limited (supra). It is also

submitted that in view of the recent dicta of the

Hon'ble Supreme Court, the High Courts under

Article 226 of the Constitution of India have

been mandated to entertain such proceedings,

inter alia, under the SARFAESI Act, since the

Presiding Officer had not been appointed by the

Central Government. The said case arose out of

a proceeding from the Debt Recovery Tribunals

Act, Bombay.

Having carefully considered the

arguments of the respondent/bank, this Court

notices that there is a marked difference, in

facts, between the Fabworth decision (supra)

and in the instant case. In the Fabworth

decision (supra), the bank had not taken steps

after issuance of notice under Section 13(2) of

the said Act and has only contemplated for

taking further steps. The jurisdiction of the writ

Court was invoked then.

In the instant case, the bank has already

issued notice under Section 13(4) of the

SARFAESI Act, 2002, where possession appears

to have been taken on November 23, 2021.

However, let us assume for the sake of

argument that the writ Court's jurisdiction

would still not be ousted for serious impropriety

committed by the respondent/bank in binding

dicta of the Hon'ble Supreme Court as regards

the declaration of accounts as non-performing

assets.

This Court is of the view that even

entering into such question would involve

getting into the disputed questions of facts.

Mathematically calculation of interest would

have to examined and scrutinized, which cannot

be otherwise looked into, without the help of

experts on the subject or otherwise by trial on

evidence.

In that view of the matter, this Court is of

the view that the writ Court should not

entertain the instant writ application.

The last argument of the learned counsel

for the petitioner is that the dicta of the Hon'ble

Supreme Court recently is that the High Courts

should entertain the writ petition challenging

the order under the SARFAESI Act.

It is however submitted by the counsel for

the bank that the Debt Recovery Tribunal at

Kolkata are functional. The DRT no. 2 is not

only functional but also in-charge of the

determination of the DRT no.1. It is also

submitted that all urgent matters are being

taken up.

In view of the above and the given fact

that relief under Article 226 of the Constitution

of India is discretionary, the writ petition shall

stand dismissed with liberty, however, with

liberty reserved to the petitioners to approach

the DRT at Kolkata on the self-same cause of

action.

It is made absolutely made clear that if

approached, the DRT shall decide the

petitioners' grievances, inter alia, under Section

17 of the SARFAESI Act uninfluenced by any

observation made by this Court hereinabove.

Since no affidavits have been used by the

respondents, the allegations made in the writ

application shall not be deemed to have been

admitted by this Court.

There shall be no order as to costs.

All parties shall act on the server copy of

this order duly downloaded from the official

website of this Court.

(Rajasekhar Mantha, J.)