Dr. Yashwant Singh & Anr vs Indian Bank & Anr
2015 Latest Caselaw 4069 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                         Date of decision: 21st May, 2015.

+                 LPA 254/2015 & CM No.7754/2015 (for stay)

       DR. YASHWANT SINGH & ANR.               ..... Appellants
                   Through: Mr. Mohit Chaudhary & Ms. Damini
                            Chawla, Advs.

                                   Versus

       INDIAN BANK & ANR.                               ..... Respondents
                    Through:          Mr. Brijesh Kumar Tamber with Mr.
                                      Arshad Choudhary & Mr. Quaisar Ali,
                                      Advs.
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

RAJIV SAHAI ENDLAW, J.

1. This intra court appeal impugns the judgment dated 23rd April, 2015 of

the learned Single Judge of this Court of dismissal of W.P.(C) No.4021/2015

filed by the two appellants.

2. The writ petition from which this appeal arises was filed impugning

inter alia the decision of the respondent No.1 Bank (respondent No.2 is the

authorized officer of the said Bank) under Section 13(3A) of the

Securitisation and Reconstruction of Financial Assets and Enforcement of

Security Interest Act, 2002 (SARFAESI Act) dismissing / rejecting the

representation filed by the appellants against the notice under Section 13(2)

of the SARFAESI Act. It was the contention of the appellants that the

respondent Bank has taken recourse to the provisions of the SARFAESI Act,

without „jurisdictional facts‟ obtaining in the matter. It was the argument of

the counsel for the appellants before the learned Single Judge that the

mechanism under Section 13 of the SARFAESI Act could not be triggered

till such time as the loan account of the appellants with the respondent Bank

was classified as a Non-Performing Asset (NPA) and which, in the facts and

circumstances of the case it could not have been classified.

3. The learned Single Judge, giving detailed reasons and analysing the

loan account of the appellants with the respondent Bank, has not accepted

the contention that the classification by the respondent Bank of the said loan

account as NPA was faulty. It has further been held that the said pleas could

be taken before the Debts Recovery Tribunal (DRT) in a proceeding under

Section 17 of the SARFAESI Act.

4. When the appeal came up before us on 1st May, 2015, it was the

contention of the counsel for the appellants that the High Courts of Andhra

Pradesh and Jharkhand had held that a writ petition at the stage of Section

13(3A) of the SARFAESI Act was maintainable, though a contrary view had

been taken by the High Courts of Orissa, Madhya Pradesh and Chennai and

that this Court needs to take a view on the matter. We however drew the

attention of the counsel for the appellants to the judgment of this Bench in

Sigma Generators Pvt. Ltd. Vs. Oriental Bank of Commerce 217 (2015

DLT 622) and on the request of the counsel for the appellants, the matter was

adjourned.

5. We further heard the counsel for the appellants on 7th May, 2015 and

reserved judgment.

6. We, in Sigma Generators Pvt. Ltd supra were concerned with a

challenge to the notice under Section 13(2) of the SARFAESI Act. The

learned Single Judge, in that case, relying on Mardia Chemicals Ltd. Vs.

Union of India (2004) 4 SCC 311, had dismissed the writ petition holding

that the notice under Section 13(2) is a pre-condition to an action under

Section 13(4) of the Act and the remedy available to a borrower can be

availed only after the measures under Section 13(4) of the Act had been

taken. The writ petitioner/appellant before us in that case pegged its case on

Sravan Dall Mill P. Ltd Vs. Central Bank of India AIR 2010 Andhra

Pradesh 35 where a Division Bench of the High Court of Andhra Pradesh has

held that the remedy of judicial review under Article 226 of the Constitution

of India is available with respect to a decision of a creditor declaring the

debtor‟s account as an NPA by issuing a notice under Section 13(2) of the

Act. We however held -

(i) that the High Court of Andhra Pradesh in Sravan Dall Mill Pvt.

Ltd. supra held the remedy of Article 226 of the Constitution of

India to be available as the creditor in that case, after issuing

notice under Section 13(2) and inspite of the debtor representing

/objecting under Section 13(3A) thereagainst, neither passed any

order on the said representation/objection nor took any measure

under Section 13(4) of the Act; it was in view thereof that it was

held that declaring an account as NPA by itself leads to serious

consequences and when measures under Section 13(4) are not

taken by the creditor, the debtor is also deprived of seeking

redressal under Section 17 of the Act;

(ii) per contra, the creditor in Sigma Generators Pvt. Ltd. had

already taken measures under Section 13(4) of the Act and

whereagainst the remedy under Section 17 was available to the

writ petitioner/appellant;

(iii) that by rushing to the High Court immediately after a notice

under Section 13(2) and challenging the same, a person cannot be

allowed to interfere with the scheme of the SARFAESI Act;

(iv) Supreme Court in Devi Ispat Ltd. Vs. State Bank of India

(2014) 5 SCC 762 has held that the remedy of a writ petition

under Article 226 is not available against the notice under Section

13(2) owing to the alternative remedy of making a representation

under Section 13(3A) being available and that upon the debtor

availing of the remedy under Section 13(3A), nothing survived;

(v) Supreme Court prior thereto in Punjab National Bank Vs.

Imperial Gift House (2013) 14 SCC 622 also, finding that the

debtor had filed a representation under Section 13(3A) and which

had been rejected by the creditor held, that the writ petition filed

immediately thereafter was not maintainable;

(vi) Division Bench of the High Court of Madras in N.A.K.G.

Cotfibres Pvt. Ltd. Vs. Zonal Manager MANU/TN/0854/2012

had also taken a view that if the bank has not followed the

procedures contemplated under Section 13(2) or under Section

13(3A) or Section 14 of the SARFAESI Act, appropriate course

open to the person aggrieved is to approach the DRT under

Section 17 and not to rush to the High Court with a writ petition;

(vii) though the High Court of Orissa in Krushna Chandra Sahoo

Vs. Bank of India AIR 2009 Orissa 35 and the High Court of

Jharkhand in Jayant Agencies Vs. Canara Bank AIR 2011

Jharkhand 68 had entertained the writ petition but on their own

peculiar facts and that there were judgments to the contrary of the

High Court of Jharkhand;

(viii) that where a statute lays down a procedure comprising of

successive steps for action thereunder and has also provided a

remedy against such action, after the final step is taken, the rule

of availability of such remedy being a bar to the exercise of

jurisdiction under Article 226 cannot ordinarily be defeated by

invoking the remedy under Article 226 against the intermediary

step and by contending that thereagainst no alternative remedy is

provided; reliance in this regard was placed on Avtar Singh Hit

Vs. Delhi Sikh Gurdwara Committee (2006) 8 SCC 487 and on

Cadre Estate Pvt. Ltd. Vs. Salochana Goyal

MANU/DE/2597/2010.

7. The counsel for the appellants however sought to distinguish our

judgment in Sigma Generators Pvt. Ltd. by contending -

(a) that in Sigma Generators Pvt. Ltd., the creditor had already

taken action under Section 13(4) of the Act and it was this factor

which influenced the decision of this Court; herein no action

under Section 13(4) has been taken;

(b) that an action under Section 13(4) of taking over possession, even

if not actual, physical and only notional, has serious

consequences and thus the remedy against an action under

Section 13(4) is not a remedy against the rejection of

objections/representations under Section 13(3A) and before any

action under Section 13(4) is taken;

(c) that the Supreme Court in Avtar Singh Hit (supra) was concerned

with an election matter and law with respect whereto is a special

law and the principle laid down therein that where the statute lays

down a procedure comprising of successive steps for action

thereunder and has also provided a remedy against such action

after the final step is taken, the rule of availability of such remedy

being a bar to the exercise of jurisdiction under Article 226

cannot ordinarily be defeated by invoking the remedy under

Article 226 against the intermediary step whereagainst no

alternative remedy is available, cannot be made applicable to the

SARFAESI Act the provisions whereof affect the property rights

of the debtors;

(d) that classification of an account as a NPA is a jurisdictional fact

and the Supreme Court in Arun Kumar Vs. UOI 2006 (9)

SCALE 320 has held that if a Court or Authority wrongly

assumes the existence of a jurisdictional fact, the order can be

questioned by a writ of certiorari; the underlying principle is that

by erroneously assuming existence of such jurisdictional fact, no

Authority can confer upon itself jurisdiction which it otherwise

does not possess;

(e) similarly, Supreme Court in

(i) Raza Textiles Ltd. Vs. Income Tax Officer (1973) 1 SCC

633 has held that the question whether the jurisdictional fact

has been rightly decided or not is a question that is open for

examination by the High Court in a writ of certiorari;

(ii) Godrej Sara Lee Ltd. Vs. Assistant Commissioner (AA)

(2009) 14 SCC 338 has held that when an order of statutory

authority is questioned on the ground that the same suffers

from lack of jurisdiction, alternative remedy may not be a

bar;

(iii) State of Madhya Pradesh Vs Sardar D.K. Jadav (1968) 2

SCR 823 has held that it is the duty of the High Court to

decide the jurisdictional fact and if the High Court reaches

the conclusion that the jurisdictional fact does not exist, it

would be open to the High Court to grant a writ under

Article 226 of the Constitution of India.

(f) The judgement in Sigma Generators Pvt. Ltd (supra) is per in

curiam to the aforesaid extent.

8. We have weighed the aforesaid contentions and are of the considered

opinion, for the reasons following, that neither is there any need for

reconsideration of the view taken in Sigma Generators Pvt. Ltd. called for

nor is there any merit in the arguments urged:

(A) SARFAESI Act, as per its statement of objects and reasons, was

enacted as a result of slow pace of recovery of defaulting loans under

the existing legal framework and resultant mounting levels of NPAs of

the banks and financial institutions and to fulfil the need for change in

the legal system in respect of these areas and for facilitating

securitisation of financial assets of banks and financial institutions by

taking possession and sale thereof without the intervention of the

Court.

(B) When a new law is brought to fill the gaps in the earlier law on

the subject, the Courts are not entitled to allow their vision and

interpretation of the new law to be coloured by the principles evolved

in the implementation and working of the old law and finding fault

wherewith the new law was enacted. An interpretation which

promotes the purpose underlying the Act needs to be preferred over

that which defeats or impedes the same. The Supreme Court, in the

context of SARFAESI Act itself, in United Bank of India Vs.

Satyawadi Tondon (2010) 8 SCC 110 held that the High Court should

not ordinarily entertain a petition under Article 226 if an effective

remedy is available and that this rule applies with greater rigour in

matters involving recovery of dues of banks and other financial

institutions; it was further held that while dealing with the petitions

involving challenge to the action taken for recovery of public dues, the

High Court must keep in mind the legislations enacted for recovery of

such dues are code unto themselves inasmuch as they not only contain

comprehensive procedure for recovery of the dues but also envisage

constitution of quasi-judicial bodies for redressal of the grievances of

aggrieved persons; therefore, the High Court must insist that before

availing remedy under Article 226, a person must exhaust the

remedies available under the statute. The Supreme Court also

expressed concern, at the High Courts notwithstanding such a clear

position in law, continuing to entertain writ petitions and passing

orders therein having serious adverse impact on the right of banks and

financial institutions to recover their dues and expressed hope that

High Courts in future will exercise greater caution, care and

circumspection.

(C) SARFAESI Act, by Section 13(2) thereof, empowers a secured

creditor to, upon finding that the borrower has made a default in

repayment of secured debt or any instalment thereof and that his

account in respect of such a debt is classified as a NPA, 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 empowers the secured creditor to exercise all or any of the

rights under sub-Section (4) i.e. of taking possession of the secured

assets and sale/transfer thereof etc.

(D) Section 13(3) of the said Act requires the notice to be issued

under Section 13(2) to contain the details of the amount payable and

the secured assets intended to be enforced in the event of non payment

of secured debt by the borrower.

(E) SARFAESI Act in its original form did not provide for any

consideration by the secured creditor of the response, if any, made by

the borrower to the notice under Section 13(2).

(F) Supreme Court however in Mardia Chemicals Ltd. supra

observed that the purpose of serving a notice upon the borrower under

section 13(2) is that a reply maybe submitted by the borrower

explaining the reasons as to why the measures under section 13(4)

need not be taken and that the creditor must apply its mind to the

objections raised in response to such notice and an internal mechanism

must be evolved to consider such objections. It was further held that

once such a duty is envisaged on the part of the creditor, it would only

be conducive to the principles of fairness that the borrower be apprised

of the reasons for not accepting the objections in the reply to the notice

under section 13(2), before the creditor proceeds under section 13(4).

The Supreme Court however hastened to add that the communication

of the reasons for not accepting the objections be not taken to give an

occasion to the borrower to resort to such proceedings which are not

permissible under the act. It was held that the communication of the

reasons not to accept the objections raised in the representation by the

borrower was only for the purposes of knowledge of the borrower. It

was further held that issue of notice under section 13(2) to a borrower

by a creditor does not attract the principles of natural justice and, no

hearing can be demanded by the borrower at this stage. It was yet

further held that the communication of reasons for not accepting the

objections in the representation was only for purposes of

knowledge/information of the borrower, without giving rise to any

right to approach the DRT under section 17 at that stage and which

right is available after measures under section 13(4) have been taken.

Such a person against whom steps under Section 13(4) are likely to be

taken, cannot be denied the right to know the reason for non-

acceptance of his objection, even though he may not be entitled to

challenge the said reasons until the action under Section 13(4) is taken.

(G) The same led to the amendment w.e.f. 11th November, 2004 of

the SARFAESI Act and Section 13(3A) was introduced providing that

if the borrower makes any representation or raises any objection under

Section 13(2), the secured creditor shall consider such representation

or objection and if the secured creditor does not find any merit therein

he shall communicate so to the borrower within 15 days of receipt of

such representation/objection. The proviso to Section 13(3A)

expressly provides that the rejection of the representations/objections

or the reasons given therefor will not confer any right upon the

borrower to prefer an application to the Debt Recovery Tribunal under

Section 17 of the Act.

(H) It is significant that Supreme Court in Mardia Chemicals Ltd.

did not hold that the remedy of judicial review would be available

against a notice under Section 13(2). On the contrary the decision on

the objections/representations if any, to the notice under Section 13(2)

was left to the secured creditor who has further been obliged to

communicate the reasons for rejection thereof but without vesting in

the borrower any remedy thereagainst at that stage.

(I) It would thus be seen that Supreme Court in Mardia Chemicals

Ltd. has expressly ruled that the scheme of SARFAESI act does not

envisage any remedy between the13(2) and 13(4) stage. The Supreme

Court has further held that the borrower does not even have any right

of hearing at the stage of Section 13(3A). Once that is so, there can

possibly be no right in favour of the borrower to seek judicial review

of the decision of the creditor on the objections in the reply to the

notice under Section 13(2). The purpose of communicating the reasons

for rejection of the objections, we re-iterate, as per Mardia Chemicals

Ltd., is only to furnish to the borrower the basis for the challenge

under Section 17 against the action at the Section 13(4) stage.

(J) The entire case of the appellant is premised on the argument

that the decision of the secured creditor classifying the account of the

borrower as NPA, is a „jurisdictional‟ one and the remedy of judicial

review is available thereagainst. The counsel for the appellants has

however though picked up the term "jurisdictional decision" but not

even attempted to argue how a jurisdictional decision is different from

any other decision pursuant whereto an authority under a statute is

entitled to take action as provided therein. We have wondered

whether all decisions, on the making whereof an action under a statute

is predicated, would be jurisdictional decisions.

(K) We, at the outset only are unable to agree with such a

proposition. If every decision on the taking whereof a statutory

provision were to get invoked / activated, the need for the Supreme

Court in the judgments relied upon by the counsel for the appellants to

label the fact / decision as jurisdictional one would not have arisen.

(L) Moreover, if it was to be said that every fact upon the

happening/existence whereof an action under a statute can be taken or

an administrative authority is entitled to take action were to be held to

be a jurisdictional fact and a writ to the High Court upon the same

being challenged were to be maintainable, it would imply that a writ

can be filed in all cases.

(M) At least in the context of the SARFAESI Act, the same would

totally nullify the purpose of enactment thereof. We therefore hold that

every such fact / decision cannot be a jurisdictional one.

(N) Section 13(2) permits a secured creditor to issue the notice

provided thereunder to the borrower if (a) the borrower has made a

default in repayment of secured debt or any instalment thereof; and,

(b) the borrower‟s account in respect of such debt is classified by the

secured creditor as an NPA.

(O) It thus follows that a mere default in payment of the debt or any

instalment thereof does not ipso facto make the borrowers account an

NPA.

(P) „NPA‟ is defined in Section 2(o) of the Act as an asset or

account of a borrower which has been classified by a bank or financial

institution as substandard, doubtful or loss asset in accordance with the

directions or guidelines relating to assets classifications by the Reserve

Bank of India (RBI) or by any other authority or body which is

administrating or regulating the bank or financial institution

concerned.

(Q) The appellants have alongwith the appeal filed a copy of the

letter dated 2nd July, 2012 of the RBI to all commercial banks

enclosing therewith the updated "Master Circular relating to Prudential

Norms on Income Recognition, Assets Classification and Provisioning

pertaining to Advances". Clause 2.1.1 thereof provides that asset

become a non performing asset when it ceases to generate income for

the bank and clause 2.1.2 thereof defines NPA as a loan or an advance

where the interest and / or the instalment of principal remains overdue

for a period of more than 90 days in respect of a term loan (which the

appellants admitted to have taken from the respondent bank). Clause

2.1.3 thereof provides that bank should classify an account as NPA

only if the interest due and charged during any quarter is not serviced

fully within 90 days from the end of the quarter. Thus as per the said

circular of the RBI, read with Section 13(2), the notice under Section

13(2) can be issued not immediately on default in payment or any

instalment thereof but on such default remaining overdue for more

than 90 days.

(R) What emerges thus is, whether a decision of the bank that the

default on the part of the borrower in repayment has remained over

due for more than 90 days or not, can be called a jurisdictional

decision / fact.

(S) At this stage the plea of the appellants in this respect may be

noticed. The appellants do not dispute that they availed of secured

credit from the respondent bank. Their case is, (i) that as per the order

dated 23rd October, 2013 of the DRT in an earlier proceeding between

the parties, the loan account was ordered to be restructured and was

restructured on 10th September, 2014; (ii) that the quarter in which the

loan account was so restructured ended on 31st December, 2014; (iii)

that even if the appellants were in default of payment for the said

quarter, 90 days therefrom ended on 31st March, 2015 and thus the

action of the respondent bank of declaring account as a NPA prior

thereto on 9th February, 2015 was wrong.

(T) The respondent bank in its decision on the

objections/representations of the appellants to the notice under Section

13(2) of the Act has reasoned -

(a) That the term loan had remained unpaid and was classified

as a NPA on 1st December, 2009 and thereafter action under

Section 13(2) and 13(4) was initiated;

(b) thereagainst the proceeding aforesaid in the DRT under

Section 17 was filed;

(c) that in compliance with the order of the DRT, the loan

account was restructured and the revised Statement of Account

was communicated on 1st September, 2014 and again on 10th

September, 2014;

(d) that the appellants though raised objections thereto but failed

to respond with any specific error in the Statement of Account and

instead filed an application in the disposed of proceedings in the

DRT for recalculation of the interest and which application was

dismissed on 31st January, 2015;

(e) the DRT in the said order itself directed the appellants to pay

the admitted debt of Rs.19,49,043/- within 45 days;

(f) that no payment was made in the said loan accounts since

1stSeptember, 2014 and the amount of Rs.4,63,84,456.88 had

fallen due with a principal amount of Rs.3,97,34,719.77 was

outstanding in one loan account and a principal amount of

Rs.24,97,556.55 was outstanding in another loan account;

(g) that thus the loan account of the appellant had correctly been

classified as a NPA.

(U) The learned Single Judge in the impugned judgment has held-

(a) that amounts were due and payable by the appellants to

the respondent Bank with effect from October, 2014 and the

challenge by the appellants to the Statement of Accounts had

already been rejected by the DRT.

(b) that the respondent bank in the said proceedings before

the DRT itself had informed that the subject accounts had once

again become a NPA and that the bank had therefore recalled

the loan.

(c) that the DRT in the concluding part of the order dated

30th January, 2015 had also recorded that the bank had already

recalled the loans.

(d) that thus the amounts were due and payable by the

appellants as on October, 2014 could in accordance with the

Master Circular of the RBI be declared as NPA on 31st

December, 2014.

(V) We see no reason to, in letters patent jurisdiction, interfere with

the decision of the learned Single Judge on the challenge by the

appellants to the accounts being classified NPA in accordance with

RBI circular on 31st December, 2014 and fully concur with the same.

(W) A jurisdictional fact is one on existence of which depends the

jurisdiction of a Court, Tribunal or an Authority. If the jurisdictional

fact does not exist, the Court or Tribunal cannot act (see Ramesh

Chandra Sankla Vs. Vikram Cement (2008) 14 SCC 58).

(X) Supreme Court in Smt. Shrisht Dhawan Vs. M/s. Shaw

Brothers (1992) 1 SCC 534 explained that error in assumption of

jurisdiction should not be confused with mistake, legal or factual in

exercise of jurisdiction. Applying the said fact, we hold that it is not as

if it is not within the jurisdiction of the Bank to determine whether the

account of the Bank is a NPA or not. The mistake if any by the Bank

in holding the account to be an NPA would thus be a mistake in

exercise of jurisdiction and not a mistake in assuming jurisdiction.

(Y) We draw strength for the aforesaid proposition from Section

2(o) of the SARFAESI Act which vests the secured creditor with the

power to classify an account as an NPA. The authority of the secured

creditor in this regard cannot be questioned. Such authority of the

secured creditor to classify the account of a borrower as an NPA has

been recognized in Mardia Chemicals Ltd. and in Transcore Vs.

Union of India (2008) 1 SCC 125. All that was observed in Mardia

Chemicals Ltd. was that there must exist a specified internal channel

which should settle the doubts in asset classification. The introduction

of Section 13(3A) has fulfilled the said requirement also. We find a

Single Judge of the Calcutta High Court in Core Ceramics Ltd. Vs.

Union of India AIR 2008 Cal 88 also to have taken a view that once

the bank authorities have classified an account as NPA, the writ Court

would have little or no role to play in deciding such an issue in view

of the complete autonomy of the Banks and financial institutions in

asset classification under the SARFAESI Act and upheld in Mardia

Chemicals Ltd. and Transcore. Similarly, a Division Bench of Madras

High Court in Gain-N-Nature Food Products Vs. Union of India

MANU/TN/0555/2008 has held that if a Bank or financial institution

forms an opinion that an account of a borrower has become an NPA,

such opinion is not justiciable in a Court exercising jurisdiction under

Article 226 of the Constitution because Section 13(2) does not use the

expression "and his account in respect of such debt has become a Non

Performing Asset" but uses the expression "and his account in respect

of such debt is classified by the secured creditor as Non Performing

Asset".

(Z) The question, whether declaration of an account as an NPA is a

jurisdictional fact is no longer res integra. A Division Bench of this

Court in Triton Corporation Limited Vs. Karnataka Bank Limited

MANU/DE/1129/2011 held that a jurisdictional fact is one on the

existence of which depends the jurisdiction of a Court, tribunal or an

authority and which fact if does not exist, the Court or tribunal cannot

act. In contradiction, it was further held that the determination by the

Bank whether the account of a borrower is a NPA or not, cannot be

classified as jurisdictional fact but would fall in the category of

adjudicatory facts relating to the merits.

(ZA) As far as the judgments cited by the counsel for the appellants

are concerned, they all relate to adjudicatory authorities. Arun Kumar

as well as Raza Textile Ltd. supra were with respect to the jurisdiction

exercised by the income tax officers; Godrej Sara Lee Ltd. supra was

again with respect to the assessment by the authorities concerned

under the Kerala Value Added Tax Act, 2003 and Sardar D.K. Jadav

supra was with respect to the proceedings before the Jagir

Commissioner under the Abolition of Jagirs Samvat, 2008. In all the

said cases the adjudicatory authorities, only if having jurisdiction,

were required to adjudicate the respective claims. It was in this

context held that if the authority had no jurisdiction it could not

proceed with the adjudication .However the creditor bank / financial

institutions in exercise of powers under Section 13 of the SARFAESI

Act does not exercise any adjudicatory function and after an account

has been classified as NPA is not required to adjudicate anything

further and is only required to take over the asset. The process under

Section 13(3A) can by no stretch of imagination be said to be

adjudicatory. Moreover the question whether a borrower has

committed any default in repayment and whether the account has been

correctly classified as a NPA or not is a factual dispute which even

otherwise ordinarily in writ jurisdiction is not to be entertained

particularly when the fora for adjudication thereof in the event of the

bank taking further action, is prescribed.

(ZB) The Supreme Court in the judgments relied upon by the counsel

for the appellant held that the proceedings before an authority which

had no jurisdiction would not serve any purpose. However as

aforesaid there are no proceedings before a bank after classifying

borrower account as NPA and forum for appeal thereagainst, if any,

shifts to the DRT. Thus the judgment cited by the counsel for the

appellants have no application.

(ZC) The matter may be looked from another point of view. Even vis-

a-vis jurisdictional fact the Supreme Court in D.P. Maheshwari Vs.

Delhi Administration (1983) 4 SCC 293 has held that the writ High

Court should refrain from entertaining writ petitions against decisions

on preliminary issues inasmuch as the same holds up the decision on

the final stage and the challenge if any could be made after the final

decision has been made. The said aspect was not argued and

considered in the judgments cited by the counsel for the appellants.

9. We accordingly do not find any merit in the appeal which is

dismissed. We also find the conduct of the appellants to be litigious. Though

the appellants earlier invoked the jurisdiction of the DRT but inspite of DRT

in its order dated 30th January, 2015 directing the appellants to pay the

admitted amount within 45 days the appellants did not pay the same. The

reasons for the appellants having filed the present proceedings are clearly

dilatory and vexatious. The appellants before the DRT had recovered

substantial cost from the respondent Bank. Having regard to the same, while

dismissing this writ petition we impose costs of Rs.1 lakh on the appellants

payable to the respondent bank within 30 days hereof.

RAJIV SAHAI ENDLAW, J.

CHIEF JUSTICE MAY 21, 2015 „bs/m‟