Punjab-Haryana High Court
Sanjay Kumar And Anr vs Uco Bank And Ors on 1 February, 2024
Author: Lisa Gill
Bench: Lisa Gill
Neutral Citation No:=2024:PHHC:014784-DB
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CWP-21695-2022
2024:PHHC:014784-DB
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-21695-2022
Date of Decision: February 01, 2024
Sanjay Kumar and another ..... Petitioners
Versus
UCO Bank and others ..... Respondents
CORAM:- HON'BLE MRS. JUSTICE LISA GILL
HON'BLE MS. JUSTICE AMARJOT BHATTI
Present: Mr. Arav Gupta, Advocate for the petitioners.
Mr. Rampal Kohli, Advocate for
Mr. T.K. Joshi, Advocate for respondent No. 1.
Mr. Deepak Grewal, DAG, Haryana.
****
LISA GILL, J.
1. Prayer in this writ petition is for quashing proceedings under
Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (for short - 'SARFAESI Act') initiated against the
petitioners.
2. It is submitted that petitioners had availed of credit facility from
respondent - bank on 07.06.2016 while mortgaging the property (residential
house) as described in the writ petition. It is submitted that petitioners were
regularly servicing the loan account till March 2020 but due to outbreak of
pandemic COVID-19 their business was effected on account of which there was
financial indiscipline. Petitioners' account was declared Non Performing Asset
(NPA) on 31.05.2021. Notice(s) under Sections 13(2) and 13(4) of SARFAESI
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Act were issued on 08/15.12.2021 and 25.08.2022, respectively. Notice by the
Duty Magistrate-cum-Naib Tehsildar, Sohna pursuant to order dated 27.06.2022
passed by learned District Magistrate, Gurugram under Section 14 of
SARFAESI Act was illegally affixed on their property. Petitioners, it is
submitted, were ready and willing to deposit the entire overdue amount for
regularization of their loan account but respondent proceeded in an absolutely
arbitrary fashion.
3. Notion of motion was issued in this writ petition on 20.09.2022 by
co-ordinate Bench while noting contention on behalf of petitioners regarding
deposit already made by them and their willingness for depositing the amount
required for regularization of their account. Subject to deposit as detailed in the
said order, it was directed that no coercive action would be taken against the
petitioners including their dispossession from secured asset.
4. Writ petition has been resisted by respondent - Bank while taking
preliminary objection regarding entertainability of the writ petition. It is further
submitted that no effort has been made by petitioners to even carry out assurance
as placed before this Court on 20.09.2022. Action taken under SARFAESI Act is
in strict compliance of provisions thereof. It is, thus, prayed that this writ petition
be dismissed.
5. We have heard learned counsel for parties and have gone through
file with their assistance.
6. Availing of loan facility, subsequent financial indiscipline and
initiation of proceedings under SARFAESI Act are matter of record. It is a
settled position that interference by the High Court in exercise of jurisdiction
under Article 226 of Constitution of India in such like matters has to be minimal
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and actuated only in extra-ordinary and exceptional circumstances. 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;
Varimadugu Obi Reddy v. B. Sreenivasulu and others, 2023(1)
R.C.R.(Civil) 34 and M/s South Indian bank Ltd. and others v. Naveen
Mathew Philip and another, 2023(2) RCR (Civil) 771. Hon'ble the Supreme
Court in the case of M/s South Indian Bank (supra) 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.
xxx xxx xxx
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.
xxx xxx xxx xxx
15. The object and reasons behind the Act 54of 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 or 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.
xxx xxx xxx
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."
7. Learned counsel for petitioners is unable to point out any
extraordinary and exceptional circumstance, which calls for intervention by this
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Court. It is pertinent to note, at this stage, that learned counsel for petitioners had
been afforded an opportunity to seek instruction regarding deposit of overdue
amount, however, no specific or categoric instructions are forthcoming.
8. Keeping in view the facts and circumstances as above, this writ
petition is dismissed with liberty to petitioners to avail remedy(ies) available to
them in accordance with law. However, keeping in view the fact that interim
order in favour of petitioners was granted on 20.09.2022 to the extent that they
would not be dispossessed from secured asset, same shall continue for fifteen
(15) working days to enable petitioners to avail remedy as may be available to
them. In case, petitioners file appropriate application/petition, question of
continuance or otherwise of interim order in petitioners' favour shall necessarily
be within the realm of consideration by the appropriate Forum which will be
considered in accordance with law, without being influenced by any order, which
may have been passed in this writ petition.
9. It is clarified that interim protection afforded to petitioners shall
automatically stand vacated in the absence of any order by the appropriate
authority.
10. It is clarified that there is no expression of opinion on the merits of
matter.
(LISA GILL)
JUDGE
(AMARJOT BHATTI)
February 01, 2024 JUDGE
rts
Whether speaking/reasoned: Yes/No
Whether reportable: Yes/No
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