Punjab-Haryana High Court
Som Nath Jain vs The Authorized Officer, Kogta ... on 2 November, 2023
SUNIL
120 2023:PHHC: 139962-DB
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
CWP-19258-2023 (O&M)
Date of Decision: 02.11.2023
SOMNATH eee Petitioner(s)
Versus
THE AUTHORIZED OFFICER, KOGTA FINANCIAL INDIA LIMITED
AND OTHERS 2 ee Respondent(s)
CORAM:- HON'BLE MRS. JUSTICE LISA GILL
HON'BLE MRS. JUSTICE RITU TAGORE
Present: Mr. K.S. Brar, Advocate
for the petitioner.
kK
LISA GILL, J.
1. Prayer in this writ petition is for quashing demand notice dated
09.02.2023 (Annexure P-1) under Section 13(2) of Securitization and
Reconstruction of Financial Assets and Enforcement of Security Interest Act,
2002 (hereinafter referred to as the SARFAESI Act) and possession notice dated
25.04.2023 (Annexure P-3) under Section 13(4) of SARFAESI Act. There are
further prayers for directing respondents no.1 and 2 to settle loan account of
petitioner and not to take physical possession of mortgaged property of
petitioner.
2. Heard learned counsel for the parties.
3. Admittedly this writ petition has been filed seeking relief qua
respondent-institution, which is admittedly a non-banking financial institution.
Apart from the fact that petitioner has an efficacious remedy for redressal of his
grievance(s) qua proceedings initiated against him under SARFAESI Act,
present writ petition is not entertainable against a private non-banking
2023.11.08 09:20
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CWP-19258-2023 (O&M) -2-
financial institution. Gainful reference in this regard can be made to judgment
of Hon'ble the Supreme Court in Phoenix ARC Private Ltd. Vs. Vishwa
Bharati Vidya Mandir and others, 2022 AIR (SC) 1045, wherein it has been
held as under:-
"Even otherwise, it is required to be noted that a writ petition
against the private financial institution - ARC - appellant
herein under Article 226 of the Constitution of India against
the proposed action/actions under Section 13(4) of the
SARFAESI Act can be said to be not maintainable. In the
present case, the ARC proposed to take action/actions under
the SARFAESI Act to recover the borrowed amount as a
secured creditor. The ARC as such cannot be said to be
performing public functions which are normally expected to
be performed by the State authorities. During the course of a
commercial transaction and under the contract, the
bank/ARC lent the money to the borrowers herein and
therefore the said activity of the bank/ARC cannot be said to
be as performing a public function which is normally
expected to be performed by the State authorities. If
proceedings are initiated under the SARFAESI Act and/or
any proposed action is to be taken and the borrower is
aggrieved by any of the actions of the private
bank/bank/ARC, borrower has to avail the remedy under the
SARFAESI Act and no writ petition would lie and/or is
maintainable and/or entertainable. Therefore, decisions of
this Court in the cases of Praga Tools Corporation v. Shri
C.A. imanual, (1969) 1 SCC 585 and Ramesh Ahluwalia
Vs. State of Punjab, (2012) 12 SCC 331 relied upon by the
learned counsel appearing on behalf of the borrowers are not
of any assistance to the borrowers."
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CWP-19258-2023 (O&M) -3-
4. Keeping in view the facts and circumstances of the matter, this
writ petition is dismissed with liberty to petitioner to avail statutory
remedy(ies) available to him, in accordance with law. Needless to say, all
pleas/arguments as raised on behalf of petitioner are in the realm of
consideration by learned Tribunal. There is no expression of opinion on merits
of the controversy.
(LISA GILL)
JUDGE
(RITU TAGORE)
JUDGE
02.11.2023
Sunil Whether speaking/reasoned: Yes/No
Whether reportable: Yes/No
SUNIL
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