Punjab-Haryana High Court
M/S Pargati Feeds And Another vs The Indian Overseas Bank And Others on 25 April, 2024
Author: Lisa Gill
Bench: Lisa Gill
Neutral Citation No:=2024:PHHC:056718-DB
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232
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-10119-2022
Date of Decision:- 25.04.2024
M/S PARGATI FEEDS & ANOTHER ...Petitioners
Vs.
INDIAN OVERSEAS BANK & OTHERS ...Respondents
CORAM:- HON'BLE MRS. JUSTICE LISA GILL
HON'BLE MS. JUSTICE AMARJOT BHATTI
Present:- Mr. Suresh Kumar Jindal, Advocate for petitioners.
Mr. Deepak Grewal, DAG, Haryana
Mr. K.K. Goel, Advocate along with Mr. Ankush Bharti,
Advocate for respondent- Bank.
Mr. Gunjan Rishi, Advocate for respondent No.4.
*****
LISA GILL, J.
1. Prayer in this writ petition is for quashing notice (s) dated
02.04.2022 (Annexures P-9 & P-10) issued under Rules 8 (6) and 9 (1) of
Security Interest (Enforcement) Rules, 2022 and subsequent proceedings
initiated by respondent - Bank.
2. Availing of financial credit as is detailed in para No.3 of writ
petition i.e. Cash Credit Loan of Rs.4.30 crores and term loan of
Rs.5,69,70,000/- by petitioners vide sanction letter dated 05.08.2013 are
matter of record. The factory, land & buildings as well as plant &
machinery etc. were mortgaged along with agricultural land and residential
house, as detailed in para No.3 of the writ petition. Residential house was
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also mortgaged in respect to housing loan of Rs.29 lakhs availed of by
petitioner No.2 namely Satish Kumar and three others. Financial
indiscipline on the part of petitioners for reasons as may be is not denied
leading to declaration of petitioners' account non-performing asset ('NPA')
on 31.03.2019 with notice (s) under Section 13 (2) being issued on
24.04.2019 & 30.04.2019 respectively (Annexures P-3 and P-4). Various
sale notices were issued with sale notice (s) dated 02.04.2022 (Annexures
P-9 & P-10) being subject matter of challenge in present writ petition.
3. Learned counsel for petitioners submits that property in
question i.e. the residential house was undervalued. Moreover, there has
been complete violation of applicable provisions of law insofar as
proceedings under Securitization and Reconstruction of Financial Assets
and Enforcement of Security Interest Act, 2002 (for short 'SARFAESI
Act') initiated against petitioners are concerned. Reserve price of the
property as per sale notice dated 30.06.2020 was Rs.1,18,08,200/-
thereafter increased to Rs.1,32,89,700/- vide sale notice dated 02.12.2020.
However, as per impugned sale notice dated 02.04.2022 it was reduced to
Rs.1,15,54,000/-. It is submitted that this action has been taken only to the
benefit of auction purchaser i.e. respondent No.4 in collusion and in
conspiracy with each other. Residential house was mortgaged in two of the
loan accounts once of which stands settled. It is, thus, prayed that this writ
petition be allowed while setting aside the impugned notices and
subsequent sale in favour of respondent No.4.
4. Learned counsel for respondent - Bank has opposed this writ
petition while raising the ground of entertainability of the writ petition
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itself. It is further submitted that entire proceedings have been undertaken
inconsonance with the applicable provisions. There is huge outstanding of
Rs.22 crores from petitioners. Even after the sale of the property in
question the only objective of petitioners is to delay the recovery
proceedings. The property in question has been auctioned for a total sale
consideration of Rs.1,86,54,000/- on 27.04.2022. There is no question of
undervaluation of the property in any manner. Dismissal of writ petition is
sought.
5. Heard learned counsel for the parties and perused the file. It is
pertinent to note that SARFAESI Act is complete code in itself providing
for remedy (ies) for any grievance which may arise on account of action
taken thereunder. Interference in such like matters in exercise of
jurisdiction under Article 226/227 of the Constitution of India has to be
minimal and restricted to exceptional or extraordinary circumstances.
Gainful reference in this regard can be made to judgments of Hon'ble the
Supreme Court in Union Bank of India v. Satyawati Tandon and others
2010(8) SCC 110 and M/s South Indian Bank Ltd. and others v.
Naveen Mathew Philip and another, 2023(2) RCR (Civil) 771. While
reiterating its earlier judgments, Hon'ble the Supreme Court in M/s. South
Indian Bank has held as under:-
"13.......We may, however, reiterate the settled position of law
on the interference of the High Court invoking Article 226 of
the Constitution of India in commercial matters, where an
effective and efficacious alternative forum has been
constituted through a statute.
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14. A writ of certiorari is to be issued over a decision when
the Court finds that the process does not conform to the law
or statute. In other words, courts are not expected to substitute
themselves with the decision-making authority while finding
fault with the process along with the reasons assigned. Such a
writ is not expected to be issued to remedy all violations.
When a Tribunal is constituted, it is expected to go into the
issues of fact and law, including a statutory violation.
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15. The object and reasons behind the Act 54 of 2002 are
very clear as observed by this Court in Mardia Chemicals Ltd.
v. Union of India, (2004) 4 SCC 311. While it facilitates a
faster and smoother mode of recovery sans any interference
from the Court, it does provide a fair mechanism in the form
of the Tribunal being manned by a legally trained mind. The
Tribunal is clothed with a wide range of powers to set aside
an illegal order, and thereafter, grant consequential reliefs,
including re-possession and payment of compensation and
costs. Section 17(1) of the SARFAESI Act gives an expansive
meaning to the expression "any person", who could approach
the Tribunal.
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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."
6. Learned counsel for petitioners is unable to point out any
extraordinary or exceptional circumstances which call for any interference
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by this Court at this stage. All arguments as raised before us are very well
within the realm of consideration by the appropriate Authority/Tribunal as
provided under the Act.
7. Keeping in view the facts and circumstances, we do not find
any ground for interference in this writ petition. Writ petition is,
accordingly, dismissed with liberty to petitioners to avail remedy (ies)
available to them in accordance with law. There is no expression of opinion
on merits of the matter.
8. Pending miscellaneous application(s), if any, stand disposed of
accordingly as well.
(LISA GILL)
JUDGE
(AMARJOT BHATTI)
JUDGE
24.04.2024
snd
Whether speaking/reasoned: Yes/No.
Whether reportable: Yes/No
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