Punjab-Haryana High Court
Kaptan vs Smfg India Credit Co Ltd And Another on 23 January, 2024
Author: Lisa Gill
Bench: Lisa Gill
CWP No. 1541 of 2024(O&M) 1
2024:PHHC:011652-DB
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
CWP No.1541 of 2024(0&M)
Date of Decision:23.01.2024
Kaptan
soseee Petitioner
Versus
SMPFG India Credit Co. Limited and another
sesees Respondents
CORAM:- HON'BLE MRS.JUSTICE LISA GILL
HON'BLE MS. JUSTICE AMARJOT BHATTI
Present: Mr. Rajesh Goyal, Advocate
for petitioner.
oh 35 2K 3k
LISA GILL, J(Oral).
1. Petitioner seeks setting aside of order dated 14.11.2023,
Annexure P-2, passed by learned District Magistrate, Panipat, under Section
14 of Securitisation and Reconstruction of Financial Assets and Enforcement
of Security Interest Act, 2002 (for short 'SARFAESI Act').
2. It is a matter of record that petitioner availed of credit facility
from respondent-SMFG Credit Company Limited in the year 2019.
Subsequent financial indiscipline on his part, for reasons as may be is
admitted. It is submitted by learned counsel for petitioner that respondent
initiated proceedings under SARFAESI Act in an absolutely illegal manner
and straightway obtained order dated 14.11.2023, for possession of land in
question. No notice under Section 13 of SARFAESI Act, it is contended was
ever issued to petitioner. Petitioner on enquiry came to know that his
account had been declared Non Performing Asset on 02.10.2022 and
overdue amount was calculated after adding rate of interest at the rate of
16.40%, which is illegal. He obtained copy of notice under Section 13(2) of
SARFAESI Act, attached as Annexure P-1 with this writ petition. (It is to be
noted that as per notice, Annexure P-1, total outstanding reflected as on
05.07.2023 is Rs. 21,65,617/-). It is also contended that as loan amount in
question is less than €20,00,000/-, proceedings under SARFAESI Act cannot
be initiated against petitioner. Moreover, respondent is not included in the
list published by the Ministry of Finance on 05.08.2016. Therefore, action
being taken by respondent under SARFAESI Act is absolutely illegal,
arbitrary and without jurisdiction.
3. Having heard learned counsel for petitioner, we do not find any
ground for interference in this writ petition. Relief claimed in this writ
petition is admittedly gua a Private Non Banking Financial Company,
therefore this writ petition is not entertainable. Gainful reference in this
respect can be made to judgment of Hon'ble the Supreme Court in Phoenix
ARC Private Limited vs. Vishwa Bharti Vidya Mandir and others, 2022
(1) RCR (Civil) 888, 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
integrity of this document
High Court, Chandigarh
4.
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 v. 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."
Learned counsel for the petitioner is unable to point out any
ground whatsoever which calls for interference by this Court, at this stage.
5.
Keeping in view the facts and circumstances as above, this writ
petition is dismissed with liberty to petitioner to avail the remedy(ies)
available to him in accordance with law. There is no expression of opinion
on the merits of the matter.
(LISA GILL )
JUDGE
(AMARJOT BHATTI)
January 23, 2024. JUDGE
s.khan
Whether speaking/reasoned : Yes/No.
Whether reportable : Yes/No.
