Madras High Court
Pari vs The Assistant General Manager And on 5 September, 2022
W.P.No.21846 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 05.09.2022
CORAM :
THE HON'BLE MR.MUNISHWAR NATH BHANDARI, CHIEF JUSTICE
AND
THE HON'BLE MRS.JUSTICE N.MALA
W.P.No.21846 of 2022
Pari ... Petitioner
Vs
The Assistant General Manager and
The Authorized Officer,
Stressed Assets Management Branch (16454)
No.1112, Rajaplaza First Floor,
Avinashi Road,
Papanaikanpalayam,
Coimbatore-641 037. ... Respondent
Prayer : Petition filed under Article 226 of the Constitution of India
praying for a writ of certiorarified mandamus calling for the records of
letter dated 01.06.2022 bearing No.SAMB/CBE/CLO-I/168 on the file
of the respondent bank and quash the same as illegla and direct the
respondent bank to refund the Earnest Money Deposit (EMD) amount
after adjusting the expenses.
For the Petitioner : Mr..Lakshmi Narayanan
for Mr.M.Jayaprakash
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W.P.No.21846 of 2022
ORDER
(Order of the Court was made by the Hon'ble Chief Justice)
Heard Mr.V.Lakshmi Narayanan, learned counsel for the
petitioner.
2. A challenge is made to the letter dated 1.6.2022 forfeiting the
EMD amount of Rs.20 lakh, being 10% of the reserve price, deposited
by the petitioner.
3. The petitioner participated in the e-auction pursuant to the
proceedings under Section 13(4) of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 [for brevity, "the Act of 2002"] held on 25.5.2022
and became the successful bidder. The counsel for the petitioner has
cited two judgments, namely, W.P.Nos.13341 and 13342 of 2021
[K.Kayalvizhi v. The Branch Manager, Axis Bank, Chennai] and
C.R.P.Nos.1892 and 2282 of 2021 [Shanmugavelu v. The
Authorised Officer, Central Bank of India, Chennai] to submit that
there cannot be forfeiture of the amount without assessing the loss.
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https://www.mhc.tn.gov.in/judis
W.P.No.21846 of 2022
We are of the view that the issue raised above was addressed by
the Debts Recovery Tribunal therein while the petitioner has not
taken that remedy in this case.
4. Accordingly, the writ petition is dismissed in view of the
availability of an alternative remedy of appeal. It is, however,
made clear that reference of the two judgments has been given
only to show availability of remedy of appeal to the petitioner
before the Debts Recovery Tribunal and not for its application on
the issue of forfeiture of EMD, because it would be open for the
financial institution to submit that it is falling under Section 74 of
the Indian Contract Act, 1872 [for short, "the Act of 1872"] and not
under Section 73 of the Act of 1872 and accordingly the issue may
be addressed in reference to the judgments of the Apex Court.
There will be no order as to costs.
(M.N.B., CJ.) (N.M., J.)
05.09.2022
Index : Yes/No
bbr
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https://www.mhc.tn.gov.in/judis
W.P.No.21846 of 2022
To:
The Assistant General Manager and
The Authorized Officer,
Stressed Assets Management Branch (16454)
No.1112, Rajaplaza First Floor,
Avinashi Road,
Papanaikanpalayam,
Coimbatore-641 037.
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https://www.mhc.tn.gov.in/judis
W.P.No.21846 of 2022
THE HON'BLE CHIEF JUSTICE
AND
N.MALA,J.
bbr
W.P.No.21846 of 2022
05.09.2022
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https://www.mhc.tn.gov.in/judis
