Allowed

Mentor Home Loans India Limited v. Hardik Shishangiya and Ors.

DRAT17 May 2024IA/112/2024

Case brief

AI extract

What is this about?

The Appellant appealed against an order directing it to restore possession of secured assets pending an appeal. The Tribunal allowed the appeal, quashed the order, and remitted the matter for fresh consideration given the pending appeal and jurisdictional issues.

What did the court decide?

Impugned order allowing restoration of possession is quashed and set aside; matter remitted to D.R.T for fresh consideration.

Mentor Home Loans India Limited versus Hardik Shishangiya and… — Landlord and Tenant | DRAT (2024)

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BEFORE THE DEBTS RECOVERY APPELLATE TRIBUNAL, AT: MUMBAI Present: Mr. Justice Ashok Menon, Chairperson I.A. No. 112/2024(Stay)

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Misc. Appeal No. 29/2024

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Between

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Mentor Home Loans India Ltd. … Appellant/s

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V/s.

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Hardik Shishangiya & Ors. …Respondent/s Mr Abhinav Mathur, along with Lokesh Pawaskar, Advocate for Appellant.

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An Advocate for Respondents is present.

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-: Order dated: 17/05/2024:-

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The Appellant is a Housing Finance Institution which has come up on appeal impugning the interlocutory order in I.A. No. 3125/2023 in S.A. No. 627/2023 on the files of the Debts Recovery Tribunal – II, Ahmedabad (D.R.T) dated 16.01.2024 allowing the application for restoration of possession filed u/s. 17 (3) the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. (“SARFAESI Act” for short) pending the S.A., directing the appellant institution to restore physical possession of the secured assets in question to the applicants in the S.A. forthwith. It was also clarified that the restoration of possession by the appellant to the applicant at this stage shall be subject to the outcome of the S.A. On reading the impugned order, it is seen that the Ld. Presiding Officer concluded that the appellant is not an institution which is authorized to take action under the SARFAESI Act. The appellant is aggrieved, and hence, in appeal.

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There are notifications relied upon by the Ld. Counsel for the appellant, in particular Circular No. S.O. 2405(E) 17.06.2021,

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wherein it is stated that the only requirement for a Housing Financial Institution to invoke the provisions of the SARFAESI Act is that it should have an asset worth ₹ 100 crores and above.

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The appellant has produced documents to indicate that they have assets worth ₹ 400 crores and therefore it would fall within the classification of an institution entitled to proceed to recover the debt as contemplated under Sec. 2(m)(iv) of the SARFAESI Act. 4. The order of the Ld. Presiding Officer is unsustainable. It is also to be observed that Sec. 17 (3) can be invoked only when the entire Sarfaesi action is taken u/s. 13 (4) is found to be unsustainable. 5. In the instant case, the S.A. is still kept pending. In case it was found that the Sarfaesi measures are bad for want of jurisdiction for the financial institution to proceed, then it would have been sustainable but given the fact that the S.A. is kept pending, the D.R.T could not have invoked the provision of Sec. 17(3) to restore possession of the secured assets pending the S.A.

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Hence, the appeal is allowed, and impugned order is quashed and set aside, and the matter is remitted to the D.R.T for fresh consideration of the question of maintainability keeping open for consideration all the contentions raised in the S.A. which shall be disposed of as expeditiously as possible at any rate within four months from the date of receipt of the copy of this order.

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rm-23

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Mentor Home Loans India Limited v. Hardik Shishangiya and Ors.

Case brief

What is this about?

What did the court decide?

Mentor Home Loans India Limited v. Hardik Shishangiya and Ors.

Case brief

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What did the court decide?

What the court decided

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