Allowed

State Bank of India Stess Assets Recovery Branch Thr. Authorised Officer Ramchandra Akulwar v. Manoj Boj Choubey and Ors.

Bombay HC20 Jan 2022WP/627/2022

Case brief

AI extract

What is this about?

The High Court allowed the writ petition, holding that the DRT-III was unjustified in setting aside the ADM's order merely due to an absence of explicit reference to the affidavit in the order. The CM dismissed the challenge to the set-aside but extended the ADMI's order operationally pending the securitisation application's final disposal.

What did the court decide?

The interim order setting aside the Additional District Magistrate's order under Section 14 of SARFAESI Act is quashed; the ADC's order is stayed pending final disposal of the securitisation applicati

State Bank of India Stess Assets Recovery Branch Thr… — Banking and Recovery | Bombay HC (2022)

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Urmila Ingale

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY

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Digitally signed by URMILA URMILAPRAMOD PRAMOD INGALE INGALE Date:2022.01.20 19:00:41 +0530

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CIVIL APPELLATE JURISDICTION

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WRIT PETITION NO. 627 OF 2022

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State Bank of India .. Petitioner Vs. Manoj Boj Choubey and ors. .. Respondents ------------

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Mr. Drupad Sopan Patil a/w Mr. Syyash Sule, for Petitioner. Mr. Ranjeev Carvalho a/w Mr. Mangesh Avhale i/b Mr. Sunil Humbre, for Respondent No.1.

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CORAM : DIPANKAR DATTA, CJ & M. S. KARNIK, J.

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DATE : JANUARY 20, 2022

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P.C. :

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The petitioning bank (the secured creditor) having approached the Additional District Magistrate, Thane by filing an application under section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereafter "the SARFAESI Act', for short), the same was allowed by an order dated November 16, 2019. The Tahsildar, Thane was appointed to take possession of the secured asset. The order of the additional district magistrate was challenged by the borrower, respondent no.1 herein, before the Debts Recovery Tribunal-III (hereafter "DRT-III", for short) in Securitisation Application No. 130 of 2021. By an interim

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order dated November 15, 2021, the DRT - III has set aside the order dated November 16, 2019 and called upon the secured creditor to file its reply to the securitisation application by January 15, 2022. This order dated November 15, 2021 is the subject matter of the challenge in this writ petition at the instance of the secured creditor.

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According to Mr. Patil, learned advocate appearing for the secured creditor, the DRT-III while keeping the securitisation application pending ought not to have set aside the order under section 14 of the SARFAESI Act only on the ground that such order does not refer to the affidavit which the secured creditor was required to file before the additional district magistrate under the first proviso to subsection (1) of section 14 of the SARFAESI Act.

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Mr. Carvalho, learned advocate appearing for the borrower, however, contends that the DRT-III was justified in setting aside the order of the additional district magistrate in view of the satisfaction reached by it that such order is defective.

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This writ petition is entertained having regard to the order dated December 16, 2021 of the Supreme Court of India in Special Leave Petition (C) No. 10911 of 2021 ( State Bar Council of Madhya Pradesh Vs. Union of India ). However, we have not insisted upon the secured creditor to file an appeal before the Debts Recovery Appellate Tribunal, Mumbai because not only is the office of

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the Chairperson vacant but also because of our own satisfaction that this writ petition can be disposed of on a short point.

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We have noticed from the order dated November 16, 2019 passed by the additional district magistrate that he has recorded as follows:

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"I have gone through the papers on the record such as Application, copies of Notice, Acknowledgment receipt & Deed etc."

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The DRT-III does not appear to have considered what the additional district magistrate meant by referring to "etc." in the sentence quoted above. The abbreviated form of Et Cetera is “etc.” The term usually indicates additional, unspecified items in a series (see: Black’s Law Dictionary, Eighth Edition). The DRT-III, therefore, needs to consider whether the requisite affidavit was on record and if so, whether it fits in the abbreviation “etc.”. We are of the opinion that by the interim order, the DRT-III ought not to have granted the principal relief claimed in the securitisation application by the borrower by setting aside the order of the additional district magistrate. The DRT-III having called for a response from the secured creditor to the securitisation application, interest of justice would have been sufficiently served if, instead of setting aside the order of the additional district magistrate, the DRT-III had stayed

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its operation and decided the securitisation application finally once the secured creditor filed its response thereto.

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We therefore clarify that instead of the order under section 14 of the SARFAESI Act passed by the additional district magistrate being set aside, its effect shall remain stayed till the securitisation application is disposed of finally by the DRT-III. We extend the time for the secured creditor to file its response to the securitisation application till January 31, 2022. All contentions of the parties are kept open to be urged before the DRT-III at the time of hearing of the securitisation application. We encourage the DRT-III to hear and decide the securitisation application as expeditiously as possible.

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The writ petition stands allowed to the extent mentioned above. No costs.

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(M. S. KARNIK, J.) (CHIEF JUSTICE)

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State Bank of India Stess Assets Recovery Branch Thr. Authorised Officer Ramchandra Akulwar v. Manoj Boj Choubey and Ors.

Case brief

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What did the court decide?

State Bank of India Stess Assets Recovery Branch Thr. Authorised Officer Ramchandra Akulwar v. Manoj Boj Choubey and Ors.

Case brief

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What did the court decide?

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