Madhya Pradesh High Court
Shri Dilip Sharma vs Union Bank on 17 November, 2021
Author: Sheel Nagu
WP. No. 24384/2021
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The High Court of Madhya Pradesh
WP. No.24384/2021
(SHRI DILIP SHARMA Vs UNION BANK)
Jabalpur, Dated: 17/11/2021
Shri Wajid Hyder, learned counsel for the petitioner.
Shri Siddharth Sharma with Shri Ashish Mishra, learned
counsel for the respondent/Bank..
The present petition preferred by petitioner/borrower
under Article 226 of the Constitution prays for following
reliefs:-
(1) To issue a writ in the nature of certiorari
sale/auction notice dated 29.09.2021 and publication
dated 05.10.2021 may kindly be quashed.
(2) To issue a writ in the nature of mandamus
respondent may kindly be restrained to dispossession
of petitioner from the residential house.
(3) Any other writ or direction as the Hon'ble Court
may deems fit in the circumstances of the case.
The principal contention of petitioner as projected by his
counsel is that despite pendency of securitization application
S.A. No.132/2018 preferred before D.R.T. under Section 17 of
Securitisation & Reconstruction of Financial Assets &
Enforcement of Security Interest Act, 2002 (for brevity
"SARFAESI Act, 2002" in which interim protection was
granted allowing the petitioner to submit O.T.S. application
before the Bank subject to deposit of Rs.5 lacs within a certain
period of time, which condition has been complied with; but,
the respondent-Bank has unlawfully issued sale notice under the
provisions of Rule 8(6) of the Security Interest (Enforcement)
Rules, 2002 and the auction held on 22.10.2021 has led to
auction purchaser depositing earnest money equivalent to 25%
of bid amount.
WP. No. 24384/2021
On the other hand, Shri Siddharth Sharma, learned
counsel for the Bank had submitted that though the petitioner
had deposited Rs.5 lacs within time prescribed by the D.R.T. in
its order dated 05.01.2021; but, no application for O.T.S. was
filed. It is submitted by counsel for the Bank that Annexure P/2
and letter dated 05.03.2021 (annexed at Page 19 of the petition)
do not satisfy the pre-requisites of O.T.S. applications. It is
submitted that handwritten letter dated 05.03.2021 (Annexure
P/2) submitted by the petitioner in purported compliance of said
order of D.R.T., is not an application for O.T.S., but a mere
information regarding compliance of the conditions subject to
which interim protection was extended by D.R.T.. As regards
the typed letter dated 05.03.2021(annexed at Page 19 of the
petition) is concerned, it is urged by learned counsel for Bank
that the same does not even have semblance of an O.T.S.
application.
As regards handwritten letter dated 05.03.2021 is
concerned, this Court is in agreement with learned counsel for
the Bank that the same does not satisfy the pre-requisites of an
O.T.S. application; but, as regards the typed letter dated
05.03.2021(annexed at Page 19 of the petition) is concerned,
said letter appears to satisfy the application for O.T.S.
application and, therefore, in the considered opinion of this
Court, the Bank ought to have considered the said application, if
received by it.
The Bank has made a clear statement in the reply in Para
10 that the said typed letter dated 05.03.2021 was not received.
Admittedly, there is no proof in regard to service upon the Bank
of said typed letter dated 05.03.2021. Thus, this Court cannot go
into this disputed question of fact.
Be that as it may, it is too late in the day to interfere in the
matter as the auction has already been held and the auction
purchaser has deposited 25% of the bid amount. Thus, third
WP. No. 24384/2021
party rights have now been created and, therefore, this Court
declines to interfere in the matter.
The judgment of the Division Bench of Allahabad High
Court in AIR 2012 Allahabad 87 (M/s. Shyam Lee & Cold
Storage (P) Ltd. & Others vs. M/s. Syndicate Bank &
Another relied upon by learned counsel for the petitioner is of
no avail, since the said factual scenario attending therein
reveals that notice under Section 13(2) of SARFAESI Act,
2002 was issued when the petitioner therein had moved an
application for O.T.S.. With these facts and circumstances, the
Allahabad High Court was called upon to assess legality and
validity of action of Bank to proceed with the notice under
Section 13(2) under the SARFAESI Act, 2002 without first
deciding the O.T.S. application of the borrower. Thus, the
Allahabad High Court was not faced with the fact situation as
prevailing herein where recourse to auction proceeding
wherein bid has been received and is being considered. Thus,
the fact situation before the Division Bench of Allahabad
High Court is at variance to the factual scenario attending
herein. Consequently, the case of M/s. Shyam Lee (supra) is
of no avail to the petitioner.
Learned counsel for the petitioner has also relied upon
Apex Court's decision in Authorized Officer, Indian
Overseas Bank vs. Ashok Saw Mill reported in AIR 2009 SC
2420. This decision is also of no avail to the petitioner since it
laid down that action of Bank in taking recourse to alternative
modes of recovery available under Section 13(4) of
SARFAESI Act, 2002 are subject to jurisdiction of D.R.T..
There is no dispute in regard to the said law laid down by the
Apex Court.
On the other hand, learned counsel for the Bank relies
upon AIR 2005 Mad 232 (Tamil Nadu Industrial Investment
WP. No. 24384/2021
Corporation Ltd. vs. Millenium Business Solutions Pvt.
Limited & Others) and another decision of Andhra Pradesh
High Court in the case of Meeran Minerals & Others vs.
Central Bank of India & Others as manifested in Para 12 &
13 of the return.
In view of above discussion, what comes out loud and
clear is that SA. No.132/2018 filed by the petitioner before
D.R.T. is still pending consideration. The Bank has proceeded
to conduct auction where bid has been received followed by
deposit of earnest money to the extent of 25% of bid. The
only stage left in the process of recovery is of deposit of
remaining bid amount and issuance of sale certificate. Thus, it
is too late in the day to exercise discretionary jurisdiction
under Article 226 of Constitution in favour of the petitioner.
Consequently, this Court declines to interfere in the
matter and dismisses this petition.
(Sheel Nagu) (Purushaindra Kumar Kaurav)
Judge Judge
mohsin
Digitally signed by MOHAMMED
MOHSIN QURESHI
Date: 2021.11.22 18:31:06 +05'30'
