Rajasthan High Court - Jodhpur

Ashok Kumar Arora vs State Of Rajasthan on 19 August, 2023

Bench: Nupur Bhati

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Civil Writ Petition No. 16248/2021

1. Ashok Kumar Arora S/o Niyamat Ray, Aged About 70 Years, B/c Maheshwari, Resident Of Pawanpuri, Tehsil And District Bikaner At Present Plot No.63, Laxmi Plaza, Near Shiv Temple, Far Bajar, Bikaner (Raj)

2. Smt. Neelam Rani W/o Ashok Kumar Arora, Aged About 69 Years, B/c Maheshwari, Resident Of 98-A, Sudarshana Nagar, Bikaner At Present Plot No.63, Laxmi Plaza, Near Shiv Temple, Far Bazar, Bikaner (Raj)

3. Om Prakash S/o Shankar Ram, Aged About 45 Years, B/c Kumhar, Proprietor Of Laxmi Bhujiya Bhandar Resident Of Nathusar Bas, Bikaner At Present Plot No.63, Laxmi Plaza, Near Shiv Temple, Far Bazar, Bikaner (Raj)

----Petitioners Versus

1. State Of Rajasthan, Through The District Collector And District Magistrate Bikaner (Raj)

2. The State Of Rajasthan, Through The Sub Divisional Magistrate Bikaner (Raj)

3. Diwan Housing Finance Corporation Limited, Through Its Authorized Person Having Its Principle Office At Warden House, Second Floor, Sir P.m Road, Fort, Mumbai-40001

4. Diwan Housing Finance Corporation Limited, Through Its Authorized Person Having Its Local Office At 302/5. Third Floor, Jaipur Tower, M.i Road, Jaipur (Raj)

5. Jasnath Tanwar S/o Late Bhim Raj Tanwar, Laxmi Bhawan /plaza, Near Shiv Mandir, Far Bazar, Bikaner (Raj)

----Respondents

For Petitioner(s) : Mr. Vivek Sharma For Respondent(s) : Mr. Vijay Purohit Mr. SS Ladrecha Mr. Devendra Singh Pidiyar Mr. Harshit Bhurani

HON'BLE DR. JUSTICE NUPUR BHATI

Judgment

Reserved on: 10/08/2023 Pronounced on: 19/08/2023

1. The instant writ petition is filed under Article 226 of the

Constitution of India claiming following reliefs:

(2 of 21) [CW-16248/2021]

"It is, therefore, humbly and respectfully prayed that this writ petition of the petitioner may kindly be allowed:

A. By an appropriate writ order or direction, above impugned (Anexxure-3) issued by the District magistrate Bikaner (Anexxure 3) and Order dated 11/11/2021 issued by the Sub Divisional Magistrate Bikaner may kindly be set aside qua the present petitioners.

B. By an appropriate writ order or direction, Present petitioners may be allowed to stay at the present shops and respondents may be directed to not evict or dispossess the present petitioners from the mortgaged property and possession of the property is not allowed to be taken by the Respondent Banks.

C. By an appropriate writ, order or direction, the respondents may kindly be directed to not restrain from using the rented shop.

D. Any other appropriate writ, order or direction which this Hon'ble Court may deem just and proper in the facts and circumstances of the case may kindly be passed in favour the petitioner."

2. The factual matrix of the case is that the petitioners are the

tenants of part premises of the mortgaged property. The

mortgaged property is a Commercial plaza and has multiple shops

situated at Plot No. 63. Laxmi Bhavan / Plaza, Near Shiv Mandir,

Fad Bazar, Bikaner, (hereinafter referred to as 'property') having a

total area of 2203.9 square Feet, which are rented out by the

petitioners and actual possession of the Shops situated in the

property is with the petitioners who are tenants and are running

the shops and earning their livelihood from the property for the

(3 of 21) [CW-16248/2021]

last 11 years. The owner of the property was Shri Jasnath Tanwar,

Respondent No.5.

3. Then thereafter owner Shri Jasnath Tanwar, Respondent No. 5,

took the Loan vide Application No. 01151147 from the Dewan

Housing Finance Corporation Limited (hereinafter referred to as

'DHFL'), Respondent No. 3, against the above said mortgaged

property of Rs. 3,54,50,303/- (Three Crore Fifty Four Lacs Fifty

Thousand Three hundred and Three rupees only). The owner /

borrower has committed defaults in payment of said loan and

neglected to pay the overdue Equal Monthly Installments

(hereinafter referred to as 'EMIs') and additional interest due to

DHFL and then his loan account was classified as Non-Performing

Asset (hereinafter referred to as 'NPA') by DHFL. Then DHFL

proceeded with the matter under Securitisation Reconstruction Of

Financial Assets And Enforcement Of Security Interest Act, 2002

(hereinafter referred to as 'the Act of 2002').

4. Thereafter, an Application under Section 14 of the Act of 2002

was filled by DHFL, Respondent No. 3, in Court of District

Magistrate, Bikaner contending that loan of Rs 3,30,75,570/- was

taken by one Mr. Jasnath Tanwar against commercial property

situated at Plot No. 63. Laxmi Bhavan/Plaza, Near Shiv Mandir.

Fad Bazar. Bikaner. (Raj) having a total area of 2203.9 square feet

from DHFL, Respondent No. 3, vide Loan Agreement No.

00002127 dated 05.04.2016.

5. Thereafter, the District Magistrate, Bikaner, Respondent No. 1,

passed an order dated 23.02.2021 directing the Sub-Division

Magistrate, Bikaner, Respondent No. 2, to hand over the

(4 of 21) [CW-16248/2021]

possession of Commercial property from actual owner to DHFL

situated at Plot No. 63, Laxmi Bhavan/Plaza, Near Shiv Mandir,

Fad Bazzar, Bikaner.

6. The Sub-Divisional Magistrate, Bikaner, Respondent No. 2,

issued a letter dated 11.11.2021 for enforcement of order dated

23.02.2021 passed by the District Magistrate, Bikaner, Respondent

No. 2, while stating that 25.11.2021 is the last date for vacation of

mortgaged/Rented premises.

7. The petitioners are lawful tenants since last 11 years and

paying rent regularly to Sh. Jasanth Tanwar, Respondent No. 5,

and the Petitioner No. 1 is running his shop in the Shop Nos. 9,

10, 11, 12 under the name of Arora General Store, Petitioner No.

2 is running shop in the Shop Nos. 17, 18 and 19 and the

Petitioner No. 3, is running his shop in the Shop No. 1 under the

name of Om Laxmi Bhujiya Bhandar.

8. The DHFL, Respondent No. 3, while admitting the tenancy of

petitioners vide notice dated 17.08.2021 in the mortgaged

property, directed the petitioners to pay the monthly rent in favour

of DHFL, Respondent No. 3, instead of the borrower, i.e; Sh.

Jasanth Tanwar, Respondent No. 5, through Pay order / DD/ by

electronic transfer and in pursuant to the notice dated 17.08.2021

petitioners are paying regular rent to DHFL, Respondent No. 3,

likewise Petitioner No. 1 also paid the rent to DHFL, Respondent

No.3.

9. Hence, the petitioners, being aggrieved by the Order dated

23.02.2021 passed by District Magistrate, Bikaner, Respondent

(5 of 21) [CW-16248/2021]

No. 1, and Order dated 11.11.2021 passed by the Sub-Divisional

Magistrate, Respondent No. 2, filed the present petition.

10. The learned counsel for the petitioners submitted that the

tenancy of all the petitioners is bonafide and it was created before

the property was mortgaged against the loan borrowed by the

owner, Sh. Jasanth Tanwar and also, the petitioners were paying

the rent regularly to the owner Sh. Jasanth Tanwar, Respondent

No. 5 and thereafter to DHFL, the Respondent No. 3, in pursuant

to the notice dated 17.08.2021.

11. The learned counsel for the petitioners further submitted that

the order dated 23.02.2021 passed by District Magistrate, Bikaner,

Respondent No. 1, wherein the direction was given to the Sub-

Divisional Magistrate, Bikaner, Respondent No. 2, for handing over

the physical possession of the property to DHFL, Respondent No.

3, was passed without determining and acknowledging the rights

of the petitioners who are lawful tenants of the property and

ignoring the fact that the actual possession of the mortgaged

property is with the petitioners and hence, the order of handing

over possession from petitioners to DHFL, Respondent No.3, is

fundamentally flawed and is liable to be set aside.

12. The learned counsel for the petitioners also submitted that all

the tenancies in the State of Rajasthan are governed by the

Rajasthan Rent Control Act, 2001 (hereinafter referred to as 'the

Act of 2001'), through which the tenancy rights of petitioners are

governed and the Act of 2001 cannot be bypassed through

proceedings under Section 14 of the Act of 2002, and hence the

Order dated 23.02.2021 passed by the District Magistrate,

(6 of 21) [CW-16248/2021]

Bikaner, Respondent No. 1 and Order dated 11.11.2021 passed by

the Sub-Divisional Magistrate, Bikaner, Respondent No. 2, is liable

to be quashed and set aside.

13. The learned counsel for the petitioners further submitted that

no opportunity of hearing was provided to the petitioners by the

District Magistrate while passing the order dated 23.02.2021. It is

also submitted that any rented property cannot be vacated

according to the provisions of the Act of 2002 but only according

to the provisions of the Act of 2001.

14. The learned counsel for the petitioners also submitted that

DHFL, Respondent No. 3, through their application filed under

Section 14 of the Act of 2002 before the District Magistrate,

Bikaner, Respondent No. 1, played fraud as the fact of mortgaged

property being under the possession of lawful tenants, was

intentionally hidden by DHFL and hence, the impugned orders

dated 23.02.2021 and 11.11.2021 passed by District Magistrate,

Bikaner and Sub-Divisional Magistrate, Bikaner, are liable to be set

aside on this ground itself. The DHFL did not array the petitioners

in the proceedings initiated under Section 14 of the Act of 2002,

as well as before this Hon'ble Court in a writ petition SBCWP NO.

14382/21 and it was responsible to bring the factual status of

tenancy before the District Magistrate, Bikaner.

15. The learned counsel for the petitioners placed relaince on the

judgment dated 08.08.2017 passed by the Hon'ble High Court of

Karnataka in WP No. 35597-35601/2017 & 35602-

35604/2017 (GM- RES) M/s. REMO Software Pvt. Ltd. &

(7 of 21) [CW-16248/2021]

Ors. v. HDB Financial Services Ltd & orsJ., wherein the court

held that:

"Thus, as stated above, Section 14 does not exclude the principles of natural justice and therefore, Magistrate should hold an enquiry in the matter. The learned Magistrate cannot act simply on the basis of one sided Affidavit filed by the Bank/Financial Institution under Proviso to Section 14 (1) of the Act. The borrowers have a right to controvert such Affidavit and the tenants in the premises also have a right to be heard in the matter. Secondly, the tenanted premises cannot be directly vacated by such orders under Section 14 of the Act. It is for DRT to decide about the bona fide of the tenancy or otherwise under Section 17 (4A) of the Act, if tenancy is not bonafide and just "created" as a sham and others. defense, such occupants can be evicted by an order under Section 17 (4) of the Act by the DRT, but if the tenancy is long pre-existing before the issuance of notice under Section 13121 of the Act and is found to be bona fide, such tenants and lessees cannot be evicted, without adopting the due process of law for eviction under State Rent Control Law, as held by Hon'ble Supreme Court in Vishal N. Kulsaria's case (supra). It would for the auction purchaser to adopt such due process of law, once he steps in the shoes of landlord/borrower proceeded against under SARFAESI Act 2002."

16. The learned counsel for the petitioners further submitted that

the petitioners are entitled in law to ensure that the secured

creditor acting as a trustee is complying with all statutory

requirements and the possession of the property is not allowed to

be taken by DHFL, Respondent No. 3, in a callous and covert

manner and that the Hon'ble Apex court has also expressed its

opinion where 'right to recovery' and 'protection of right to hold

property' are pitted against each other and it has been held by the

(8 of 21) [CW-16248/2021]

Hon'ble Apex Court that the power to do something in a certain

way should be done in that certain way only or not at all.

17. The learned counsel for the petitioners further submitted that

the petitioners are the lawful tenants of the property in question

since 07.10.2010 and are earning their livelihood from the rented

premises in the property and dispossessing the petitioners from

the property without following due process of law, i.e; the

Rajasthan Rent Control Act, 2001, would cause them irreparable

losses.

18. The learned counsel for the petitioners also submitted that the

rent is paid by the petitioners to DHFL, Respondent No. 3, who

has stepped into the shoes of the landlord and hence, the only

remedy available to DHFL, Respondent No. 3, is to get the

premises vacated by following due process of law under the Act of

2001.

19. The learned counsel for the petitioners placed reliance on the

judgment dated 11.09.2019 passed by Hon'ble Supreme Court in

Crl.A. No.-001371-001371/2019, Bajrang Shyam Sundar

Agarwal v. Central Bank of India, wherein the court held that:

"25. In our view, the objective of SARFAESI Act, coupled with the T.P.Act and the Rent Act are required to be reconciled herein in the following manner:

a) If a valid tenancy under law is in existence even prior to the creation of the mortgage, the tenant's possession cannot be disturbed by the secured creditor by taking possession of the property. The lease has to be determined in accordance with Section 111 of the TP Act for determination of leases. As the existence of a prior existing

(9 of 21) [CW-16248/2021]

lease inevitably affects the risk undertaken by the bank while providing the loan, it is expected of Banks/Creditors to have conducted a standard due diligence in this regard. Where the bank has proceeded to accept such a property as mortgage, it will be presumed that it has consented to the risk that comes as a consequence of the existing tenancy. In such a situation, the rights of a rightful tenant cannot be compromised under the SARFAESI Act proceedings.

b) If a tenancy under law comes into existence after the creation of a mortgage, but prior to the issuance of notice under Section 13 (2) of the SARFAESI Act, it has to satisfy the conditions of Section 65 A of the TP Act.

c) In any case, if any of the tenants claim that he is entitled to possession of a secured asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the absence of a registered instrument, if the tenant relies on an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under Section 107 of the T.P. Act."

20. The learned counsel for the petitioners further placed reliance

on the judgment dated 20.01.2016 passed by Hon'ble Apex Court

in Civil Appeal No. 422 of 2016 Vishal N Kalsaria v. Bank of

India, wherein it was held by the court that:

"32. When we read sub-section (1) of Section 17 of the SARFAESI Act, we find that under the said sub-section "any person (including borrower)", aggrieved by any of the measures referred to in sub-section (4) of Section 13 taken by the secured creditor or his authorised officer under the Chapter, may apply to the Debts Recovery Tribunal having jurisdiction in the matter within 45 days from the date on which such measures had been taken. We agree with the Mr. Vikas Singh that the words 'any person' are wide enough to include a lessee also. It is also possible to take a

(10 of 21) [CW-16248/2021]

view that within 45 days from the date on which a possession notice is delivered or affixed or published under sub-rules (1) and (2) of Rule 8 of the Security Interest (Enforcement) Rules, 2002, a lessee may file an application before the Debts Recovery Tribunal having jurisdiction in the matter for restoration of possession in case he is dispossessed of the secured asset. But when we read subsection (3) of Section 17 of the SARFAESI Act, we find that the Debts Recovery Tribunal has powers to restore 5 possession of the secured asset to the borrower only and not to any person such as a lessee. Hence, even if the Debt Recovery Tribunal comes to the conclusion that any of the measures referred to in sub-section (4) of Section 13 taken by the secured creditor are not in accordance with the provisions of the Act, it cannot restore possession of the secured asset to the lessee. Where, therefore, the Debts Recovery Tribunal considers the application of the lessee and comes to the conclusion that the lease in favour of the lessee was made prior to the creation of mortgage or the lease though made after the creation of mortgage is in accordance with the requirements of Section 65A of the Transfer of Property Act and the lease was valid and binding on the mortgagee and the lease is yet to be determined, the Debts Recovery Tribunal will not have the power to restore possession of the secured asset to the lessee. In our considered opinion, therefore, there is no remedy available under Section 17 of the SARFAESI Act to the lessee to protect his lawful possession under a valid lease." The learned senior counsel contends that it is a settled position of law that in the absence of a valid document of lease for more than one year or in case of an invalid lease deed, the relation of tenancy between a landlord and the tenant is still created due to delivery of possession to the tenant and payment of rent to the landlord-owner and such tenancy is deemed to be a tenancy from month to month in respect of such property.

"15. No ejectment ordinarily to be made if tenant pays or is ready and willing to pay standard rent and permitted

(11 of 21) [CW-16248/2021]

increases.(1) A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, the amount of the, standard rent and permitted increases, if any, and observes and performs the other conditions of the tenancy, in so far as they are consistent with the provisions of this Act." Section 15, thus, restricts the right of a landlord to recover possession of the tenanted premises from a tenant. When we understand the factual matrix in the backdrop of the objectives of the above two legislations, the controversy in the instant case assumes immense significance. There is an interest of the bank in recovering the Non Performing Asset on the one hand, and protecting the right of the blameless tenant on the other. The Rent Control Act being a social welfare legislation, must be construed as such. A landlord cannot be permitted to do indirectly what he has been barred from doing under the Rent Control Act, more so when the two legislations, that is the SARFAESI Act and the Rent Control Act operate in completely different fields. While SARFAESI Act is concerned with Non Performing Assets of the Banks, the Rent Control Act governs the relationship between a tenant and the landlord and specifies the rights and liabilities of each as well as the rules of ejectment with respect to such tenants. The provisions of the SARFAESI Act cannot be used to override the provisions of the Rent Control Act. If the contentions of the learned counsel for the respondent Banks are to be accepted, it would render the entire scheme of all Rent Control Acts operating in the country as useless and nugatory. Tenants would be left wholly to the mercy of their landlords and in the fear that the landlord may use the tenanted premises as a security interest while taking a loan from a bank and subsequently default on it. Conversely, a landlord would simply have to give up the tenanted premises as a security interest to the creditor banks while he is still getting rent for the same. In case of default of the loan, the maximum brunt will be borne by the unsuspecting tenant, who would be evicted from the possession of the tenanted property by the Bank under the provisions of the SARFAESI Act. Under no

(12 of 21) [CW-16248/2021]

circumstances can this be permitted, more so in view of the statutory protections to the tenants under the Rent Control Act and also in respect of contractual tenants along with the possession of their properties which shall be obtained with due process of law."

21. Per Contra, the learned counsel for the respondent raised the

preliminary objection that the writ petition is not maintainable on

the ground that the petitioners have a statutory, alternate and

efficacious remedy available under Section 17 of the Act of 2002.

The relevant portion of Section 17 of the Act of 2002 is

reproduced below:

Section 17- Application against measures to recover secured debts:

(4 A) Where-

(i) any person, in an application under sub-section (1), claims any tenancy or leasehold rights upon the secured asset, the Debt Recovery Tribunal, after examining the facts of the case and evidence produced by the parties in relation to such claims shall, for the purposes of enforcement of security interest, have the jurisdiction to examine whether lease or tenancy,-

(a) has expired or stood determined; or

(b) is contrary to section 65A of the Transfer of Property Act, 1882 (4 of 1882); or

(c) is contrary to terms of mortgage; or

(d) is created after the issuance of notice of default and demand by the Bank under sub-section (2) of section 13 of the Act; and

(ii) the Debt Recovery Tribunal is satisfied that tenancy right or leasehold rights claimed in secured asset falls under the sub-clause (a) or sub-clause (b) or sub-clause (c) or sub-clause (d) of clause (i), then notwithstanding anything to the contrary contained in any other law for the time

(13 of 21) [CW-16248/2021]

being in force, the Debt Recovery Tribunal may pass such order as it deems fit in accordance with the provisions of this Act.

22. The learned counsel for the respondent placed reliance on the

judgment dated 27.04.2018 passed by this Court in SBCWP

16965/2017, ICICI Bank Ltd. v. Krishna Kumar & Ors.,

wherein the court held that:

"There is another way to look at the dispute in hand. Admittedly, in the present case, no eviction of the respondent No. 1, the alleged tenant, is being sought on the grounds as mentioned in Section 9 of the Rent Act of 2001 except in pursuance to the order passed by the District Magistrate on an application under Section 14 of the SARFAESI Act. In these circumstances, the respondent No. 1, the alleged tenant, aggrieved with the order seeking possession could invoke subsection (4-A) of Section 17 of the SARFAESI Act, under which the possession of his property is being taken, which lays down in clear terms that any person who claims tenancy or leasehold rights could resort to this provision for examining the leasehold or the tenancy rights upon the secured assets. Sub-section (4-A) has been incorporated for special circumstances and issues as involved in the present case with respect to the lease or tenancy being contrary to Section 65 of the Transfer of Property Act, 1882 or contrary to the terms of mortgage or having been created after the issuance of notice of default.

It was keeping the said fact in mind that the learned Single Bench of the High Court of Karnataka at Bengaluru in the case of Sri. B.V. Vidyanatha & anr. Vs. The Authorized Officer, National Co-operative Bank Ltd. & anr. (Writ Petition Nos. 21388 to 21390 of 2017 [GM-RES]) decided on 10.08.2017 disposed of the petitions filed by the tenants and the lessees, who had directly approached the High Court challenging the possession notice on the ground that the same cannot be enforced except under the State Rent Control Law, with liberty to file their applications before the

(14 of 21) [CW-16248/2021]

concerned Debt Recovery Tribunal under Section 17(4-A) of the SARFAESI Act by observing in Para 20 as under :-

"20. Here, since the petitioners have an effective, alternative remedy under Section 17 (4A) of the SARFAESI Act, 2002 now available to them, where the Debt Recovery Tribunal can go into the question of validity of tenancy as per the said provisions, this Court would not make any observation on the merits of the contentions raised by the parties and the petitions are therefore disposed of with a liberty and direction to the petitioners to file their Applications before the concerned Debt Recovery Tribunal under Section 17(4-A) of the SARFAESI Act, 2002, within a period of two weeks from today and for a period of four weeks only from today, without any extension of time further by this Court, it is directed that the Respondent - Financial Institution, in execution of the impugned order under Section 14 of the SARFAESI Act, 2002, dated 20/05/2017 shall not take coercive measures for seeking physical and vacant possession of the said tenanted portions of the premises from the petitioners provided further that the petitioners will give an undertaking in writing to the Respondent No.1, Financial Institution/Bank that all arrears of rent and the current rentals due to be paid by them to the Respondent lessors/landlords will be made over to the respondent No.1 - Financial Institution within the aforesaid period of two weeks and they shall continue to deposit the rent with the Respondent No.1 - Financial Institution till they hold the possession of the said premises under their Lease/Rent Agreement. The operation of impugned order under Section 14 of the Act would abide by the orders to be passed by the DRT under Section 17(4A) of the Act."

The Apex Court in the case of Authorized Officer, State Bank of Travancore & another Vs. K.C. Mathew (Civil Appeal No. 1281 of 2018) (arising out of SLP (C) No. 24610 of 2015) decided on 30.01.2018 as well showed its displeasure with

(15 of 21) [CW-16248/2021]

respect to the interim injunction granted in favour of the borrower and against the secured creditor and set aside the impugned orders holding that the High Court was not justified in entertaining the writ petition against the notice under Section 13(2) of the Act and thereby quashing the proceedings initiated by the bank.

Before incorporation of sub-section (4-A) and substitution of sub-section (3) in Section 17 of the SARFAESI Act as above, there was no remedy available to a tenant who was being dispossessed under the SARFAESI Act and hence, it was in those circumstances that the judgment in the case of Vishal N. Kalsaria (supra) was passed. The amended Act and incorporation of sub-section (4-A) in Section 17 of the SARFAESI Act as well as sub-section (3) of Section 17 of the SARFAESI Act sufficiently empowered the tenant to challenge the proceedings qua his dispossession as a lessee or a tenant, in case, action is being initiated against him for dispossession under the SARFAESI Act."

23. The learned counsel for the respondent further submitted that

DHFL, Respondent No. 3 & 4, is a Non-Banking Financial Company

(hereinafter referred to as NBFC), which is not a 'State' as per

Article 12 of the Constitution of India. In support of this argument,

the learned counsel placed reliance on the judgment dated

06.05.2009 passed by the Jaipur Bench of this Court in SBCWP

3248/2002, Govind Prasad Varshney v. The Bank of

Rajasthan Ltd., wherein the court held that:

"76. Thus, in view of the ratio decided by the Hon'ble Supreme Court in the case of Federal Bank Ltd. Vs. Sagar Thomas & Ors. (supra), which squarely covers the present controversy because as per the Memorandum of Settlement dated 29.10.1993 arrived at between the management of 58 banks and their employees, the Federal Bank Ltd. is included in Schedule I in the Memorandum of Settlement dated 29.10.1993 and the Hon'ble Supreme Court in the

(16 of 21) [CW-16248/2021]

case of Federal Bank Ltd. Vs. Sagar Thomas & Ors. (supra) has observed that a private company carrying on business as a scheduled bank cannot be termed as carrying on statutory or public duty and it was therefore held that any business or commercial activity, whether it may be banking, manufacturing units or related to any other kind of business generating resources, employment, production and resulting in circulation of money which do have an impact on the economy of the country in general, cannot be classified as one falling in the category of those discharging duties or functions of a public nature. It was held that the jurisdiction of the High Court under Article 226 could not have been invoked in that case."

24. The learned counsel for the respondent further submitted that

there is no need to give notice to the petitioners while the District

Magistrate, Bikaner passed an order dated 23.02.2021 and in

support of this argument, the learned counsel for respondents

placed reliance on the judgment dated 25.11.2022 passed by the

Hon'ble High Court of Uttar Pradesh in WRIT-C No. - 22594 of

2022, Shipra Hotels Ltd. And Another v. State of Uttar

Pradesh, wherein the court held that:

"52. In view of the above discussion, it is held that the CMM/DM acting under Section 14 of the SARFAESI Act, 2002 is not required to give notice to the borrower at the stage of the decision or passing order as no hearing can be demanded by the borrower at this stage. However, it is clarified that the order passed by such Magistrate has to be duly served upon the borrower before taking any steps for his forcible dispossession by such steps or use of force, as may be necessary in the opinion of the Magistrate, and the date fixed for such forcible action shall be duly intimated to such borrower in advance giving him sufficient time to remove his belongings, or to make alternative arrangement."

(17 of 21) [CW-16248/2021]

25. The learned counsel for the respondent also placed reliance on

the judgment dated 26.09.2022 passed by the Hon'ble Apex Court

in the case of Balkrishna Rama Tarle Dead Thr Lrs. & Anr. v.

Pheonix ARC Private Limited & Ors., wherein the court held

that:

"Thus, the powers exercisable by CMM/DM under Section 14 of the SARFAESI Act are ministerial step and Section 14 does not involve any adjudicatory process qua points raised by the borrowers against the secured creditor taking possession of the secured assets. In that view of the matter once all the requirements under Section 14 of the SARFAESI Act are complied with/satisfied by the secured creditor, it is the duty cast upon the CMM/DM to assist the secured creditor in obtaining the possession as well as the documents related to the secured assets even with the help of any officer subordinate to him and/or with the help of an advocate appointed as Advocate Commissioner. At that stage, the CMM/DM is not required to adjudicate the dispute between the borrower and the secured creditor and/or between any other third party and the secured creditor with respect to the secured assets and the aggrieved party to be relegated to raise objections in the proceedings under Section 17 of the SARFAESI Act, before Debts Recovery Tribunal. Under the circumstances in the present case no error has been committed by the High Court in setting aside the order dated 27.08.2021 passed by the designated authority keeping the application pending till the secured creditor initiates the legal proceedings for eviction of the tenant cannot get the possession in an application under Section 14 of the SARFAESI Act. The High Court has rightly directed the designated authority to proceed further with the application under Section 14 of the SARFAESI Act, and to dispose of the same in accordance with the provisions of Section 14 of the SARFAESI Act.

7. Now so far as the reliance placed upon the decision of this Court in the case of Vishal N. Kalsaria (supra) by the

(18 of 21) [CW-16248/2021]

learned counsel appearing on behalf of the petitioner is concerned, the said decision shall also not be applicable to the facts of the case on hand. In the said decision, the question before this Court was of conflict of claim under the Maharashtra Rent Control Act, 1999 and the provisions of the SARFAESI Act, and which law will prevail. The scope and ambit of the powers to be exercised under Section 14of the SARFAESI Act were not directly in question before this Court. Even as observed and held by this Court in the aforesaid decision, a judgment cannot be interpreted and applied to fact situations by reading it as a statute. One cannot pick up a word or sentence from a judgment to construe that it is the ratio decidendi on the relevant aspects of the case (para 33)."

26. Heard the learned counsels for both the parties and perused

the record of the case and also judgments cited at the bar.

27. This court finds that the Hon'ble Apex Court in the case of

Balkrishna Rama Tarle Dead Thr Lrs. & Anr. v. Pheonix ARC

Private Limited & Ors.(Supra), has held that:

"At that stage, the CMM/DM is not required to adjudicate the dispute between the borrower and the secured creditor and/or between any other third party and the secured creditor with respect to the secured assets and the aggrieved party to be relegated to raise objections in the proceedings under Section 17 of the SARFAESI Act, before Debts Recovery Tribunal. Under the circumstances in the present case no error has been committed by the High Court in setting aside the order dated 27.08.2021 passed by the designated authority keeping the application pending till the secured creditor initiates the legal proceedings for eviction of the tenant cannot get the possession in an application under Section 14 of the SARFAESI Act. The High Court has rightly directed the designated authority to proceed further with the application under Section 14 of the

(19 of 21) [CW-16248/2021]

SARFAESI Act, and to dispose of the same in accordance with the provisions of Section 14 of the SARFAESI Act."

28. This court is of the view that it is a settled law that when a

statutory forum is created by law for redressal of a grievance, a

writ petition should not be entertained ignoring the statutory

dispensation unless it is demonstrated that the alternative

statutory is not an efficacious remedy. This court further observes

that there is an efficacious statutory alternate remedy under

Section 17 (4) the Act of 2002 in the form of appeal as reproduced

hereinabove.

29. This court further observes that when alternate remedy is

available, then the petition should only be entertained if there has

been violation of any of the fundamental rights of the petitioner,

there has been grave violation of any principles of natural justice

and the proceedings which had taken place are wholly without

jurisdiction. This court further observes that the petitioners have

failed to demonstrate the above mentioned three conditions when

the writ can be entertained even after the alternate remedy is

available.

30. The Hon'ble Apex Court in it's judgment dated 12.01.2022 in

the case of Phoenix ARC Private Limited v. Vishwa Bharati

Vidya Mandir & Ors., wherein the court held that:

"15. Thus, while it can be said that this Court has recognised some exceptions to the rule of alternative remedy i.e. where the statutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions

(20 of 21) [CW-16248/2021]

which are repealed, or when an order has been passed in total violation of the principles of natural justice, the proposition laid down in Thansingh Nathmal case [Thansingh Nathmal v. Supt. of Taxes, AIR 1964 SC 1419] , Titaghur Paper Mills case [Titaghur Paper Mills Co. Ltd. v. State of Orissa, (1983) 2 SCC 433] and other similar judgments that the High Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to the aggrieved person or the statute under which the action complained of has been taken itself contains a mechanism for redressal of grievance still holds the field. Therefore, when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation."

31. This court thus, observes that in the absence of efficacious

alternative remedy being availed, there is no reasonable

justification tendered by the petitioners-tenants in approaching

this Court under Article 226 of the Constitution of India by filing

this writ petition asailing the orders dated 23.02.2021 passed by

the District Magistrate, Bikaner, Respondent No. 1, and order

dated 11.11.2021 passed by the Sub-Divisional Magistrate,

Bikaner, Respondent No. 2, without exhausting the statutory right

of appeal available. The order dated 23.02.2021 passed by the

District Magistrate, Bikaner, Respondent No. 1, is appealable under

Section 17 (4-A) of the Act of 2002 and the petitioner ought to

have availed the statutory and efficacious remedy available to