Madras High Court
T.Jansirani vs The Authorized Officer on 9 June, 2021
CRP(MD)Nos.878, 879 & 880 of 2021
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 09.06.2021
CORAM:
THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM
and
THE HONOURABLE MRS.JUSTICE S.ANANTHI
CRP(MD)Nos.878, 879 & 880 of 2021
and
CMP(MD)Nos.4820, 4823 & 4825 of 2021
T.Jansirani ... Petitioner in CRP(MD)No.878 of 2021
A.Philomine Packiyajothi ... Petitioner in CRP(MD)No.879 of 2021
P.Kannimuthukumaran ... Petitioner in CRP(MD)No.880 of 2021
Vs.
1.The Authorized Officer,
Tamilnadu Mercantile Bank Ltd.,
Muhavoor Branch,
29-C/4, Kasi Raja Main Road,
Muhavoor - 626 111,
Virudhunagar District.
2.The Branch Manager,
Tamilnadu Mercantile Bank Ltd.,
Muhavoor Branch,
30-C/4, Kasi Raja Main Road,
Muhavoor - 626 111,
Virudhunagar District.
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CRP(MD)Nos.878, 879 & 880 of 2021
3.The District Collector,
Collectorate Campus,
Virudhunagar.
4.The Tahsildar,
Rajapalayam Taluk,
Virudhunagar District. ... Respondents 1 to 6 in all CRPs
5.A.Philomine Packiyajothi
6.P.Kannimuthukumaran
... Respondents 5 & 6 in CRP(MD)No.878 of 2021
5.T.Jansirani
6.P.Kannimuthukumaran
... Respondents 5 & 6 in CRP(MD)No.879 of 2021
5.A.Philomine Packiyajothi
6.T.Jansirani
... Respondents 5 & 6 in CRP(MD)No.880 of 2021
COMMON PRAYER: Civil Revision Petitions filed under Article 227 of
the Constitution of India to set aside the order, dated 29.01.2021 passed
by the Presiding Officer, Debt Recovery Tribunal, Madurai in IA.No.10
of 2021 in SA.No.2 of 2021.
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CRP(MD)Nos.878, 879 & 880 of 2021
For Petitioner : Mrs.R.Hemalatha
For Respondents : Mr.N.Dilip Kumar for R1 & R2
Mr.R.Baskaran
Standing Counsel for Government
for R3 & R4
COMMON ORDER
[Order of the Court was made by T.S.SIVAGNANAM, J.]
These Revision Petitions have been filed under Article 227
of the Constitution of India, challenging the order passed by the Debt
Recovery Tribunal, Madurai (herein after called as 'Tribunal') in
I.A.No.10 of 2021 in S.A.No.2 of 2021, dated 29.01.2021. By the
impugned order, the Tribunal dismissed the stay petition filed by the
petitioners in the appeal filed challenging the order passed under Section
14 of the Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002, (hereinafter referred to as
“the SARFAESI Act”).
2. We have elaborately heard Mrs.R.Hemalatha, learned
counsel appearing for the petitioners, Mr. R.Baskaran, learned Standing
counsel for the respondents 3 and 4 and Mr.N.Dilip Kumar, learned
Standing Counsel appearing for the respondents 1 and 2/bank.
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CRP(MD)Nos.878, 879 & 880 of 2021
3. The learned counsel for the petitioners would submit that the
order passed by the Tribunal is erroneous, as the Tribunal had failed to
take into consideration that the order of the District Collector under
Section 14 of the SARFAESI Act, is a non-speaking order and liable to
be interfered with. Therefore, it is submitted that the Tribunal should
have taken note of the fact that the petitioners have made out a prima
facie case for grant of stay. In support of her contention, the learned
counsel appearing for the petitioners placed reliance on the Judgment of
the Honourable Division Bench in the case of K.K.Dhanraj vs. The
District Magistrate and District Collector and others reported in 2018
SCC On-Line Madras 13527(DB). This decision is relied on to support
her contention that the order passed by the District Collector under
Section 14 of the SARFAESI Act should be a speaking order and should
reflect satisfaction of the District Collector for ordering taking over of
possession of the secured asset. Further, it is submitted that though
repeatedly, the petitioners had submitted applications for One Time
Settlement and the latest being on 19.03.2021, the respondent/Bank has
not considered the same in accordance with the guidelines issued by the
Reserve Bank of India.
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CRP(MD)Nos.878, 879 & 880 of 2021
4. On the contrary, they have stated that the One Time Settlement
offer is not in accordance with the guidelines of the respondent/Bank,
which guidelines has not been available in the Public Domain. Further, it
is submitted that two of the guarantors are Government Servants and the
respondent/Bank has issued notice threatening to attach their salary.
Therefore, it is submitted that the order impugned is liable to be set aside.
5. Mr.N.Dilip Kumar, learned counsel appearing for the
respondent/Bank submitted that the Tribunal had taken note of the entire
facts and circumstances of the case and that the loan account became a
Non-Performing Asset (NPA) as early as in the year 2016 and thereafter,
action was not initiated under the provisions of the SARFAESI Act and
the petitioners did not take any steps to question the measures taken by
the respondent/Bank under the provisions of the SARFAESI Act, they
did not approach the Tribunal at an earlier point of time. Further, the
respondent/Bank has issued five sale notices and they are not able to
make any headway and therefore, the Tribunal rightly took note of all the
facts and held that the petitioners have not come to the Tribunal with
clean hands. The learned counsel placed reliance on the recent decision
of the Honourable First Bench in the case of Karvy Financial Services
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CRP(MD)Nos.878, 879 & 880 of 2021
Limited Vs. The District Magistrate and District Collector, Chennai
and others reported in 2021 3 CTC 383, wherein, it has been held that
the Authority exercising power under Section 14 of the SARFAESI Act,
once notices the relevant declarations, which have been furnished, such
Authority has to accept the same at the face value and not question the
same or seek to adjudicate thereupon. This finding has been rendered on
the premise that the order passed under Section 14 of the Act is not an
order, which requires adjudication. Therefore, it is submitted that the
order passed by the Tribunal does not call for interference.
6. After elaborately hearing the learned counsel for the parties, we
are of the view that the present Civil Revision Petitions are not
maintainable before this Court on the ground that the petitioners have an
effective alternate remedy before the Debts Recovery Appellate Tribunal
and the said remedy is not only efficacious but effective as well. The
Appellate Tribunal will be able to re-appreciate the facts, which is not
expected to be done in a Civil Revision Petition under Article 227 of
Constitution of India. Therefore, the proper Forum before which the
petitioners have to agitate their rights is the Debts Recovery Appellate
Tribunal. This would be sufficient to dismiss the Civil Revision Petitions.
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CRP(MD)Nos.878, 879 & 880 of 2021
So far as the manner in which the District Collector has to act under
Section 14 of the Act has been clearly spelt out in the recent decision in
the case of Karvy Financial Services Limited versus The District
Magistrate and District Collector and others reported in 2021 3 CTC
383, wherein, it has been held that the order is not an adjudicatory order.
The relevant portion of the order reads as follows:-
"7. It is not necessary to go beyond such stage
for the purpose of the present proceedings since the
operation of Section 14 of the Act comes at such stage
where the secured creditor requires executive
assistance for the purpose of obtaining possession of
the secured asset or documents pertaining thereto.
Section 14 of the Act permits certain classes of
officials to receive a request under Section 14 of the
Act. The extent of the assistance that may be sought
would pertain to obtaining possession of any
immovable property or possession of or access to
certain documents. The authority approached under
Section 14 of the Act has only to look into the
documents filed by the relevant secured creditor in
support of the request. One of such documents ought
to be the various declarations as required to be
furnished under Section 14 of the Act. Once the
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CRP(MD)Nos.878, 879 & 880 of 2021
authority notices the relevant declarations to have
been furnished, such authority has to accept the same
at face value and not question the same or seek to
adjudicate thereupon."
7. In fact, in the decision of the Hon’ble Division Bench in the
case of K.K.Dhanraj vs. The District Magistrate and District Collector
and others reported in 2018 SCC OnLine Madras 13527(DB), referred
to by the learned counsel appearing for the petitioners, the Court does
accept the fact that the order passed under Section 14 of the Act, does not
require adjudication.
8. Therefore, we are of the view that there is no conflicting view
between the two decisions of the Hon’ble Division Bench. In any event,
we did not proceed to make any further observation in this regard being
conscious of the fact that the order impugned in these Civil Revision
petitions is an order in an interlocutory application and the main appeal is
still pending before the Debt Recovery Appellate Tribunal. So far as the
allegation that there is a threat of attachment of salary of the two
guarantors, we are informed by the learned counsel for the respondent
Bank that unless the respondent Bank moves the Tribunal and files
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CRP(MD)Nos.878, 879 & 880 of 2021
appropriate original application and seeks for attachment, such orders
will not be passed. This submission is placed on record.
9. For all the above reasons, the Civil Revision Petitions are
dismissed, giving liberty to the petitioners to file an appeal before the
Debt Recovery Appellate Tribunal. Parallely, the petitioners are given
liberty to submit a genuine One Time Settlement proposal with the
respondent Bank, which shall be considered in accordance with the
norms and guidelines, which are prevalent in force, as on date, more
particularly, when the respondent Bank in their communication, dated
30.03.2021, addressed to the petitioners/borrowers has stated that the
value of the property given by the borrowers, is inadequate to cover the
loan liability. Bearing this aspect in mind, the respondent Bank can take a
conscious decision in the application to be submitted for One Time
Settlement, provided there is a bonafide and genuinity in such an offer.
10. Since we have granted liberty to the petitioners to submit a
genuine offer for One Time Settlement and also taking note of the
pandemic situation prevailing as on date and one of the secured assets
being a dwelling house, we direct the respondent Bank not to initiate any
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CRP(MD)Nos.878, 879 & 880 of 2021
coercive action against the dwelling house for a period of 30 days from
today (i.e. 09.06.2021). However, this protection will enure to the
petitioners only if they submit the genuine One Time Settlement offer
within seven days from today ( i.e. 09.06.2021).
11.With the above observations, these Civil Revision Petitions are
dismissed. No Costs. Consequently, connected miscellaneous petitions
are closed.
[T.S.S., J.] & [S.A.I., J.]
09.06.2021
Index : Yes / No
Internet : Yes / No
mbi/rm
Note: In view of the present lock down owing to COVID-19 pandemic,
a web copy of the order may be utilized for official purposes, but,
ensuring that the copy of the order that is presented is the correct copy,
shall be the responsibility of the advocate/litigant concerned.
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CRP(MD)Nos.878, 879 & 880 of 2021
To
1.The District Collector,
Collectorate Campus,
Virudhunagar.
2.The Tahsildar,
Rajapalayam Taluk,
Virudhunagar District.
https://www.mhc.tn.gov.in/judis/
CRP(MD)Nos.878, 879 & 880 of 2021
T.S.SIVAGNANAM, J.
and
S.ANANTHI, J.
mbi/rm
CRP(MD)Nos.878, 879 & 880 of 2021
09.06.2021
https://www.mhc.tn.gov.in/judis/
