Repco Home Finance Limited vs A.Savin Nihar
2023 Latest Caselaw 2989 Mad

                                                                              CRP No.415 of 2023

                              IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                           DATED : 23.03.2023

                                                 CORAM :

                             THE HONOURABLE MRS.JUSTICE T.V.THAMILSELVI

                                           CRP No.415 of 2023
                                         & CMP No. 3474 of 2022


              Repco Home Finance Limited,
              A company incorporated under the Companies Act, 1956,
              Having its registered office at
              Repcto Tower,No.33, NorthUsman Road,
              T.Nagar, Chennai – 600 017.
              Repressented by its Authorized Signatory/General Manager,
              Having office at No.55, IV Main Road, Gandhi Nagar,
              Adayar, Chennai 600 020.
                                                                 ….          Petitioner

                                                   -Vs-
              1.A.Savin Nihar
              2.Fysal Khan
              3.Thameem Ansari
              4.Jainul Arabu
              5.H.Shakeela Banu

                                                                      ….     Respondents

              Prayer : Civil Revision Petition under Article 227 of the Constitution of India,
              against the fair and decretal order dated 28.11.2022 passed in I.A No.3 of 2021 in
              O.S No. 5068 of 2019 on the file of learned XIX Additional Judge, City Civil
              Court, Chennai.

              1/7

https://www.mhc.tn.gov.in/judis
                                                                                 CRP No.415 of 2023

                                  For Petitioners : Mr.A.Ilangovan
                                  For Respondents : Not appeared

                                                    ORDER

This Civil Revision petition has been filed against the fair and decreetal

order dated 28.11.2022 passed in I.A No.3 of 2021 in O.S No. 5068 of 2019 on

the file of learned XIX Additional Judge, City Civil Court, Chennai.

2. Originally suit in O.S No. 5068 of 2019 was filed by the first respondent

herein against the petitioner herein and 2 to 5 defendants herein for the relief of

specific performance and other consequential relief based on the alleged sale

agreement dated 31.10.2014, in that suit, the petitioner herein only contested the

suit other parties remain exparte. While so, the petitioner herein filed I.A No. 3 of

2021 in O.S No. 5068 of 2019 to reject the plaint by stating that respondent 2 to

4 by creating equitable mortgage availed huge loan from the petitioner herein

and also failed to repay the loan thereafter that loan was classified as Non

Performing Asset (NPA) on 30.06.2016. Further, recovery proceedings under

SARFAESI Act was initiated and the symbolic possession of the property was

taken on 23.10.2017. After receipt of the notice at the instigation of respondents

2 to 4 herein, the first respondent filed the vexatious suit against the petitioner as

https://www.mhc.tn.gov.in/judis CRP No.415 of 2023

if the unregistered sale agreement was entered between them with regard to

property, which was under the mortgage of this petitioner by depositing title

deeds, in order to evade SARFAESI proceedings the first respondent filed the

suit and also causing delay to the recovery proceedings made by the petitioner

herein. Further, as per Section 34 of SARFAESI Act, no civil Court have

jurisdiction to entertain any suit or proceedings in respect of any matter which a

debts recovery tribunal or the appellate tribunal alone have jurisdiction, as such

suit is not maintainable liable to be rejected for want of jurisdiction. But the Trial

Court held that whether the suit is barred under SARFAESI Act is only decided

at the end of the Trial accordingly dismissed the said application. Challenging

the same the petitioner preferred this petition. Notice was issued to the

respondents but the same was returned as door locked.

3. The learned counsel for the respondent submitted that the Trial Court

failed to take note of the fact that there was equitable mortgage in favour of the

petitioner herein in respect of suit property on the date of alleged sale agreement

dated 31.10.2014. Further the respondent 2 to 4 creating equitable mortgage

availed huge loan from the petitioner herein and also failed to repay the loan

thereafter that loan loan was classified as equitable as Non Performing Asset

https://www.mhc.tn.gov.in/judis CRP No.415 of 2023

(NPA) on 30.06.2016. Further, the recovery proceedings under SARFAESI Act

was initiated and the symbolic possession of the property was taken on

23.10.2017. While so, in order to evade the SARFAESI proceedings the

respondents 2 to 4 clandestinely created sale agreement with the first respondent.

Furthermore, as per Section 34 of SARFAESI Act, no civil Court shall have

jurisdiction to entertain any suit or proceedings in respect of any matter dealt by

debts recovery tribunal or the appellate tribunal, as such suit is not maintainable

liable to be rejected for want of jurisdiction. Therefore he prayed to allow this

petition. Further to support his contention he relied the judgment of the supreme

Court in the case of Jagdish Singh Vs Heeralal & others reported in 2014(1)

CTC 652.

5. On seeing the facts of this case, it clearly reveals that fifth

defendant/petitioner herein issued notice dated 20.09.2016 under 13(2) of

SARFAESI Act, calling upon the defendants 1 to 3 to settle the issue within 60

days, despite receiving notice the said defendants not came forward to settle the

issue, thereafter issued demand notice dated 28.02.2017. Subsequently, the

symbolic possession of the property was taken on 23.10.2017. Further the first

respondent filed writ petition before this Court seeking for prohibiting the

revision petitioner herein to the invoke SARFAESI Act and the same was

https://www.mhc.tn.gov.in/judis CRP No.415 of 2023

dismissed by this Court. Furthermore, the fact reveals that the respondents 2 to 4

have already borrowed loan from the petitioner in the year 2014 thereafter which

was classified as NPA on 30.06.2016, and recovery proceedings was initiated by

the petitioner herein and the notice was issued to the respondent 2 to 4 by

invoking Section 13( 2 ) of SARFAESI Act. Thereafter suit was filed on

26.04.2018 which implies that after initiation of SARFAESI Act, based on un

registered sale agreement plaintiff/first respondent herein filed suit as if

respondents 2 to 4 had entered into an sale agreement with him to sell the

property. Furthermore, as per Section 34 of SARFAESI Act the Civil Court has

not jurisdiction to entertain the suit after initiating SARFAESI Proceedings in the

year 2016 but the said suit was filed in the year 2018 which clearly implies that

in order to delay the recovery proceedings at instigation of respondents 2 to 4

the first respondent initiated the said suit which is vexatious and liable to be set

aside. But the Trial Court without appreciating the above legal aspects dismissed

I.A No.3 of 2021 in O.S No. 5068 of 2019. Hence, the order passed by the XIX

Additional Judge, City Civil Court, Chennai, I.A No.3 of 2021 in O.S No. 5068

of 2019 is hereby set aside.

https://www.mhc.tn.gov.in/judis CRP No.415 of 2023

8. In view of the above and for the reasons stated above, this Civil

Revision Petition is allowed. No costs. Consequently connected miscellaneous

petition is closed.

23.03.2023

Index : Yes/No Internet : Yes/No pbl

https://www.mhc.tn.gov.in/judis CRP No.415 of 2023

T.V.THAMILSELVI, J.

pbl

CRP.No.415 of 2023 & CMP No. 3474 of 2022

23.03.2023

https://www.mhc.tn.gov.in/judis