Madras High Court
S.Jeyapal vs The Authorised Officer on 2 November, 2021
W.P(MD)No.5019 of 2019
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 02.11.2021
CORAM:
THE HONOURABLE MR.JUSTICE M.DURAISWAMY
AND
THE HONOURABLE MR.JUSTICE K.MURALI SHANKAR
W.P(MD)No.5019 of 2019
and
W.M.P(MD)Nos.3994 to 3996 of 2019
S.Jeyapal ... Petitioner
Vs.
1.The Authorised Officer,
Bank of Baroda,
Kamagoundapatti,
Theni District.
2.S.Joseph Patric ... Respondents
PRAYER: Petition filed under Article 226 of the Constitution of India,
praying for issuance of a writ of Declaration by declaring that the
action initiated by the first respondent under the SARFAESI Act
starting with Demand Notice dated 10.07.2015 ending with sale
notice dated 11.01.2019 in respect of the property, more
particularly stated in the Demand Notice dated 10.07.2015 as null
and void and in consequence thereof to pass an order by quashing
the sale notice dated 12.10.2018 and sale held on 31.10.2018, sale
certificate issued and registered on 12.12.2018 in respect of item
No.1 of the property and sale held on 31.01.2019 in respect of item
No.2.
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W.P(MD)No.5019 of 2019
For Petitioner : Mr.S.Rengasamy
For Respondents : Mr.Pala Ramasamy
for R.1
: Mr.S.Sivathilakar
for R.2
*****
ORDER
(Order of this Court was made by M.DURAISWAMY,J.)
The petitioner has filed the above writ petition to declare the
action initiated by the first respondent under the SARFAESI Act
starting with the demand notice, dated 10.07.2015 ending with the
sale notice, dated 11.01.2019 in respect of the property, more
particularly stated in the demand notice, dated 10.07.2015 and
consequently to quash the sale notice, dated 12.10.2018 and the
sale held on 31.10.2018, sale certificate issued and registered on
12.12.2018 in respect of item No.1 of the property and the sale
held on 31.01.2019 in respect of item No.2.
2.The petitioner has virtually challenged all the proceedings
initiated under the SARFAESI Act in this Writ Petition. It is settled
law that the aggrieved party in respect of the proceedings initiated
under the SARFAESI Act has to file an appeal under Section 17 of
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W.P(MD)No.5019 of 2019
the SARFAESI Act before the Debts Recovery Tribunal. In the case
on hand, the petitioner has filed the writ petition challenging the
demand notice, sale notice, the sale and also the sale certificate.
3. The Honourable Supreme Court in the following judgments
held that the aggrieved party, in respect of the proceedings initiated
under the SARFAESI Act, must file an appeal before the Debts
Recovery Tribunal under Section 17 of the SARFAESI Act and the
writ petition filed challenging the proceedings initiated under the
SARFAESI Act, is not maintainable.
(i) In United Bank of India Vs. Satyawati Tondon
reported in (2010) 8 SCC 110, the Honourable Supreme Court has
held as follows:-
“43.Unfortunately, the High Court overlooked the
settled law that the High Court will ordinarily not entertain a
petition under Article 226 of the Constitution if an effective
remedy is available to the aggrieved person and that this
rule applies with greater rigour in matters involving recovery
of taxes, cess, fees, other types of public money and the
dues of banks and other financial institutions. In our view,
while dealing with the petitions involving challenge to the
action taken for recovery of the public dues, etc., the High
Court must keep in mind that the legislations enacted by
Parliament and State Legislatures for recovery of such dues
are code unto themselves inasmuch as they not only contain
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W.P(MD)No.5019 of 2019
comprehensive procedure for recovery of the dues but also
envisage constitution of quasi judicial bodies for redressal of
the grievance of any aggrieved person. Therefore, in all such
cases, High Court must insist that before availing remedy
under Article 226 of the Constitution, a person must exhaust
the remedies available under the relevant statute.
.............
55.It is a matter of serious concern that despite
repeated pronouncement of this Court, the High Courts
continue to ignore the availability of statutory remedies
under the DRT Act and SARFAESI Act and exercise
jurisdiction under Article 226 for passing orders which have
serious adverse impact on the right of banks and other
financial institutions to recover their dues. We hope and trust
that in future the High Courts will exercise their discretion in
such matters with greater caution, care and circumspection.”
(ii) In Authorized Officer, State Bank of Travancore and
another Vs. Mathew K.C reported in (2018) 3 SCC 85, the
Honourable Supreme Court has held as follows:-
“16.The writ petition ought not to have been
entertained and the interim order granted for the mere
asking without assigning special reasons, and that too
without even granting opportunity to the Appellant to
contest the maintainability of the writ petition and failure to
notice the subsequent developments in the interregnum.
The opinion of the Division Bench that the counter affidavit
having subsequently been filed, stay/modification could be
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W.P(MD)No.5019 of 2019
sought of the interim order cannot be considered sufficient
justification to have declined interference.”
(iii) In C.Bright Vs. District Collector and others reported
in (2021) 2 SCC 392, the Honourable Supreme Court has held as
follows:-
“22.Even though, this Court in United Bank of India
v. Satyawati Tondon & Ors. held that in cases relating to
recovery of the dues of banks, financial institutions and
secured creditors, stay granted by the High Court would
have serious adverse impact on the financial health of such
bodies/institutions, which will ultimately prove detrimental
to the economy of the nation. Therefore, the High Court
should be extremely careful and circumspect in exercising
its discretion to grant stay in such matters. Hindon Forge
Private Limited has held that the remedy of an aggrieved
person by a secured creditor under the Act is by way of an
application before the Debts Recovery Tribunal, however,
borrowers and other aggrieved persons are invoking the
jurisdiction of the High Court under Articles 226 or 227 of
the Constitution of India without availing the alternative
statutory remedy. The Hon’ble High Courts are well aware
of the limitations in exercising their jurisdiction when
affective alternative remedies are available, but a word of
caution would be still necessary for the High Courts that
interim orders should generally not be passed without
hearing the secured creditor as interim orders defeat the
very purpose of expeditious recovery of public money.”
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W.P(MD)No.5019 of 2019
(iv) In ICICI Bank Limited and others Vs. Umakanta
Mohaptra and others reported in (2019) 13 SCC 497, the
Honourable Supreme Court has held as follows:-
“3.The writ petition itself was not maintainable, as a
result of which, in view of our recent judgment, which has
followed earlier judgments of this Court, held as follows:-
“17. We cannot help but disapprove the approach of
the High Court for reasons already noticed in Dwarikesh
Sugar Industries Ltd. vs. Prem Heavy Engineering Works
(P) Ltd. and Another, (1997) 6 SCC 450 , observing:-
'32. When a position, in law, is well settled as a
result of judicial pronouncement of this Court, it would
amount to judicial impropriety to say the least, for the
subordinate courts including the High Courts to ignore the
settled decisions and then to pass a judicial order which is
clearly contrary to the settled legal position. Such judicial
adventurism cannot be permitted and we strongly
deprecate the tendency of the subordinate courts in not
applying the settled principles and in passing whimsical
orders which necessarily has the effect of granting wrongful
and unwarranted relief to one of the parties. It is time that
this tendency stops.'”
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W.P(MD)No.5019 of 2019
4.The writ petition, in this case, being not
maintainable, obviously, all orders passed must perish,
including the impugned order, which is set aside.
5.The appeals are allowed in the aforesaid terms.
Pending applications, if any, shall stand disposed of.”
(v) In Agarwal Tracom Private Limited Vs. Punjab
National Bank and others reported in (2018) 1 SCC 626, the
Honourable Supreme Court has held as follows:-
“33. In the light of the foregoing discussion, we are
of the considered opinion that the Writ Court as also the
Appellate Court were justified in dismissing the appellant's
writ petition on the ground of availability of alternative
statutory remedy of filing an application under Section
17(1) of the SARFAESI Act before the Tribunal concerned to
challenge the action of PNB in forfeiting the appellant's
deposit under Rule 9(5). We find no ground to interfere
with the impugned judgment of the High Court.
The appellant is, accordingly, granted liberty to file an
application before the concerned Tribunal (DRT)
under Section 17(1) of the SARFAESI Act, which has
jurisdiction to entertain such application within 45 days
from the date of this order. In case, if the appellant files
any such application, the Tribunal shall decide the same on
its merits in accordance with law uninfluenced by any of
the observations made by this Court and the High Court in
the impugned judgment.”
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W.P(MD)No.5019 of 2019
4. Since the petitioner has challenged the SARFAESI
proceedings in the present Writ Petition, following the ratio laid
down by the Honourable Supreme Court in the above referred
judgments, we are not inclined to entertain the writ petition.
Accordingly, the Writ Petition is dismissed. It is open to the
petitioner to prosecute the SARFAESI appeal pending before the
Debts Recovery Tribunal in accordance with law. The Debts
Recovery Tribunal, Madurai is directed to dispose of the SARFAESI
appeal in S.A.No.518 of 2017, on merits and in accordance with law,
within a period of four months from the date of receipt of a copy of
this order. No costs. Consequently, the connected Miscellaneous
Petitions are also dismissed.
[M.D.,J] [K.M.S.,J.]
02.11.2021
Index :Yes/No
Internet :Yes/No
SSL
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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W.P(MD)No.5019 of 2019
To
The Authorised Officer,
Bank of Baroda,
Kamagoundapatti,
Theni District.
https://www.mhc.tn.gov.in/judis/
W.P(MD)No.5019 of 2019
M.DURAISWAMY,J.
and
K.MURALI SHANKAR,J.
SSL
W.P(MD)No.5019 of 2019
02.11.2021
https://www.mhc.tn.gov.in/judis/
