The Single Bench dismissed the writ petition seeking quashing of a show cause notice and direction for account statement under the SARFAESI Act, holding it not maintainable due to the existence of an alternative statutory remedy before the Debts Recovery Tribunal and highly disputed factual questions.
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Court No. - 39
Case :- WRIT - C No. - 957 of 2021
Petitioner :- Vinay Kumar Respondent :- State Bank Of India And 2 Others Counsel for Petitioner :- Jyoti Agrawal,Jagadeesh Prasad Chaurasiya Counsel for Respondent :- C.S.C.
Hon'ble Naheed Ara Moonis,J. Hon'ble Dinesh Pathak,J.
Heard learned counsel for the petitioner, learned Standing Counsel for the respondent nos.2 & 3 and Shri Satish Chaturvedi, learned counsel representing the respondent no.1.
The instant petition has been filed seeking following relief:
"(i) Issue a writ, order or direction in the nature of Certiorari quashing the show cause notice dated 17.12.2020 issued by the respondent no.3 duly registered as 8140/Vi. Li. (Annexure No.1 to the writ petition);
(ii) Issue a writ, order or direction in the nature of Mandamus commanding the respondent no.1 to provide the statement of the Account No.30874914358 to the petitioner forthwith;
(ii) Issue writ, order or direction in the nature of mandamus commanding the respondents to grant sometime as per the statement of the bank as provided by the respondent no.1 to the petitioner within stipulated time in installment as directed by this Hon'ble Court."
At the very outset, learned counsel for the respondent-bank, has raised a preliminary objection that against the proceedings initiated under Section 13 (2) and 13 (4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, the "SARFAESI Act"), the petitioner had remedy to approach the Debts Recovery Tribunal under Section 17 of the SARFAESI Act. The respondent bank has approached to the respondent no. 2 under Section 14 of the SARFAESI Act.
We have considered the submissions made at the bar.
The Hon'ble Supreme Court in the case of ICICI Bank Ltd. v. Umakanta Mohapatra, Civil Appeal Nos. 10243-10250 of 2018, decided on 05.10.2018, has held as under:
"Delay condoned.
Leave granted.
Despite several judgments of this Court, including a judgment by Hon'ble Mr. Justice Navin Sinha, as recently as on 30.01.2018, in Authorized Officer, State Bank of Travancore and Another VS Mathew KC., (2018) 3 SCC 85, the High Courts continue to entertain matters which arise under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI), and keep granting interim orders
in favour of persons who are Non-Performing Assets (NPAs).
The writ petition itself was not maintainable, as a result of which, in view of our recent judgment, which has followed earlier judgments of this Court, held as follows:-
The writ petition, in this case, being not maintainable, obviously, all orders passed must perish, including the impugned order, which is set aside.
The appeals are allowed in the aforesaid terms.
Pending applications, if any, shall stand disposed of."
Recently the Hon'ble Apex Court in the case of C. Bright Vs. The District Collector & others, Civil Appeal No. 3441 of 2020 decided on 05.11.2020 has observed as follows:
"21. Even though, this Court in United Bank of India v. Satyawati Tondon & Ors., (2010) 8 SCC 110 held that in cases relating to recovery of the dues of banks, financial institutions and secured creditors, stay granted by the High Court would have serious adverse impact on the financial health of such bodies/institutions, which will ultimately prove detrimental to the economy of the nation. Therefore, the High Court should be extremely careful and circumspect in exercising its discretion to grant stay in such matters. Hindon Forge Private Limited has held that the remedy of an aggrieved person by a secured creditor under the Act is by way of an application before the Debts Recovery Tribunal, how- ever, borrowers and other aggrieved persons are invoking the jurisdiction of the High Court under Articles 226 or 227 of the Constitution of India without availing the alternative statutory remedy. The Hon'ble High Courts are well aware of the limitations in exercising their jurisdiction when effective alternative remedies are available, but a word of caution would be still necessary for the High Courts that interim orders should generally not be passed without hearing the secured creditor as interim orders defeat the very purpose of expeditious recovery of public money.
In view of the availability of alternative remedy and since highly disputed
questions of facts are involved, we are not inclined to entertain this writ petition.
Accordingly, the writ petition is dismissed on the ground of alternative remedy.
Order Date :- 22.1.2021 M. Tariq
2 issues framed by the court
Whether a writ petition challenging proceedings under Section 13 of the SARFAESI Act is maintainable in the High Court when the petitioner is directed to approach the Debts Recovery Tribunal.
Whether the petitioner has availed the alternative statutory remedy available under the SARFAESI Act before approaching the High Court under Article 226.
Colour shows how this judgement treated each authority
ICICI Bank Ltd. v. Umakanta Mohapatra, Civil Appeal Nos. 10243-10250 of 2018Followed¶12
Authorized Officer, State Bank of Travancore and Another VS Mathew KC., (2018) 3 SCC 85Distinguished¶15
Dwarikesh Sugar Industries Ltd. Vs Prem Heavy Engineering Works (P) Ltd and another, (1997) 6 SCC 450Relied on¶18
C. Bright Vs. The District Collector & others, Civil Appeal No. 3441 of 2020Followed¶23
Hindon Forge Private LimitedRelied on¶23
5 provisions across 2 enactments
Vinay Kumar
State Bank of India
Respondent No. 2
Respondent No. 3
Naheed Ara Moonis
Dinesh Pathak
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
