Punjab-Haryana High Court
M/S Jmd Industrial Corporation ... vs Canara Bank And Ors on 29 April, 2023
Neutral Citation No:=2023:PHHC:061218-DB
108 CWP-8358-2023 -1-
2023:PHHC:061218-DB
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-8358-2023
DATE OF DECISION: 29.04.2023
M/S JMD INDUSTRIAL CORPORATION AND ANOTHER
......PETITIONERS
Vs.
CANARA BANK, HADIABAD BRANCH, PHAGWARA AND
OTHERS
.........RESPONDENTS
CORAM: HON'BLE MR. JUSTICE G.S. SANDHAWALIA
HON'BLE MS. JUSTICE HARPREET KAUR JEEWAN
Present: Mr. Praveen Kumar Bhatia, Advocate,
for the petitioners.
*****
G.S.SANDHAWALIA, J. (ORAL)
1. The present petition has been filed challenging the possession
notice dated 16.02.2023 (Annexure P-2) under Section 13 (4) of the
Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (for short 'the Act') wherein symbolic
possession of the property sought to be taken for the outstandings of
`32,98,313.40/-. The same is in pursuance of the earlier notice dated
20.06.2022 (Annexure P-1) wherein `27,44,957.90/- was the outstanding
amount as per Section 13 (2) notice of the Act.
2. Keeping in view the above, we are of the considered opinion
that the petitioners have an alternate remedy available under Section 17 of
the Act.
3. Section 17 of Act provides a remedy to the person who is
aggrieved under the measures taken under Section 13(4) of the 2002 Act
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which have been time and again settled by the Apex Court and the view
taken in United Bank of India vs. Satyawati Tondon & others, (2010) 8
SCC 110 was followed. In Union Bank of India and another vs.
Panchanan Subudhi, (2010) 15 SCC 552; Kaniyalal Lalchand Sachdev
and others vs. State of Maharashtra and others, (2011) 2 SCC 782; G.M.,
Sri Siddeshwara Co-operative Bank Ltd. & another vs. Sri Ikbal &
others, 2013 (10) SCC 83; M/s Hindon Forge Pvt. Ltd. and another vs.
State of Uttar Pradesh through District Magistrate Ghaziabad and
another, 2018 AIR SC 5383 and Authorized Officer, State Bank of
Travancore & another vs. Mathew K.C., 2018 AIR (SC) 676, the said
view has been further reiterated.
4. Recently, the Apex Court, while dealing with notice of motion
order passed by this Court whereby, the writ petition had been entertained
against the securitization proceedings initiated and interim protection had
been granted whereby loanees had been declared NPA contrary to the order
dated 27.03.2023 passed by the Apex Court was a subject matter of
consideration in SLP No. 17335 of 2022, Authorized Officer, Kotak
Mahindra Bank vs. Anil Kumar Malhotra and another. The Apex Court
set aside the interim order and virtually directed that the petitioner to take
recourse to alternative remedy by passing the following order:-
"1. Leave granted.
2. Heard learned counsel for the parties.
3. This appeal takes exception to the judgment and
order dated 17.01.2022 passed by the High Court
of Punjab and Haryana at Chandigarh in CWP No.
873 of 2022.
4. We are of the considered view that the High
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Court was not justified in passing the impugned
judgment and order.
5. The impugned judgment and order has the effect
of scuttling the proceedings under the
Securitization and Reconstruction of Financial
Assets and Enforcement of Security Interest Act,
2002.
6. If the appellant was aggrieved by an order
passed under Section 13(2) of the the Securitization
and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002, the
appellant had an alternate remedy under the
provisions of the said Act.
7. In that view of the matter, the impugned
judgment and order passed by the High Court is
quashed and set aside and the appeal is allowed.
8. Needless to state that the order passed herein
would not affect the right of the appellant to take
recourse to the alternate remedy.
9. Pending applications, if any, stand disposed of."
5. In SLP (Civil) Nos.22021-22022 of 2022 titled M/s South
Indian Bank Ltd. & others Vs. Naveen Mathew Philip & another, decided
on 17.04.2023, the Apex Court noticed that the challenge was being raised
to Section 13 proceedings while exercising jurisdiction under Article 226
of the Constitution of India. It was noticed that private individuals were
involved over financial transactions, whose action would not come within
the purview of Article 12 of the Constitution of India and in the presence of
alternative remedy being available and the settled proposition of law while
taking into consideration the judgments passed in Federal Bank Ltd. Vs.
Sagar Thomas, (2003) 10 SCC 733 and State Bank of India Vs.
Arvindra Electronics (P) Ltd., 2022 SCC Online SC 1522, it was held
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that the Tribunal is expected to go into the issues of fact and law including
those of statutory violation and it had a wide range of powers to set aside
all illegal orders and grant consequential reliefs, including re-possession
and payment of compensation and costs. Resultantly, the question of law
was again reiterated by holding as under:
"18. While doing so, we are conscious of the fact that the powers
conferred under Article 226 of the Constitution of India are rather
wide but are required to be exercised only in extraordinary
circumstances in matters pertaining to proceedings and
adjudicatory scheme qua a statute, more so in commercial matters
involving a lender and a borrower, when the legislature has
provided for a specific mechanism for appropriate redressal.
19. Reiterating the concern expressed, the present appeals are
disposed of. The Registry is directed to mark a copy of this order to
the High Court of Kerala and the High Court of Punjab & Haryana.
No costs."
6. In such circumstances, keeping in view the settled principle of
law, once securitization proceedings have been initiated after taking
recourse to Section 13(4) and further possession is being taken while taking
recourse to the provisions of the 2002 Act, we are of the considered
opinion that firstly the remedy would lie with the Tribunal. Only in
exceptional cases this Court would exercise its jurisdiction. Nothing has
been shown to bring the case within the ambit of those exceptional
circumstances.
7. Keeping in view the above, we are of the considered opinion
that since possession notice has already been issued, the remedy lies before
the Tribunal. Counsel for the petitioners has not come-forth with any
proposal to show his bona fide to submit 25% of the outstanding amount
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also and therefore, we are not inclined to exercise extra-ordinary writ
jurisdiction.
8. Resultantly, the present writ petition is disposed of with the
aforesaid liberty.
(G.S. SANDHAWALIA)
JUDGE
April 29, 2023 (HARPREET KAUR JEEWAN)
nitin JUDGE
Whether Speaking Yes
Whether Reportable No
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