Dismissed

Luxamee Kutir Udyog Liquor Division and Ors. v. Hdfc Bank

DRT10 Nov 2022SA/82/2022

Case brief

AI extract

What is this about?

In a Special Appeal under Section 17(1) of the SARFAESI Act, the Debt Recovery Tribunal held that the Section 13(2) notice issued by the bank's Authorised Officer was valid. The Tribunal also found the appeal barred by limitation as it was filed beyond 45 days from the impugned order of the District Magistrate, dismissing the application.

What did the court decide?

Section 13(2) and 13(4) notices upheld; Special Appeal dismissed; pending IA. dismisssed; restrain order vacated.

Luxamee Kutir Udyog Liquor Division and Ors. versus Hdfc Bank — Banking and Recovery | DRT (2022)

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DEBTS RECOVERY TRIBUNAL – 1, KOLKATA JeevanSudha Bldg. 9^TH Floor, 42/C, J.L.Nehru Road, Kolkata - 700071 Before Shri Ambuja Mohan Das, Presiding Officer

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SA No. 82 of 2022

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Luxamee Kutir Udyog Liquor Division, a partnership firm,were engaged in its business from Dag No. 33, Mouza Khalia NH 6,Kona ,Howrah-711323(Now 711 114)West Bengal

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Rama Narula;

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Ritesh Narula,

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2 and 3 are partners, were engaged in their business from Dag No. 33 ,Mouza Khalia,NH 6,Kona,Howrah-711 323(Now 711 114)West Bengal, also residing at 2^nd floor,Latika Cooperative Husing Sciety Ltd. 9/3 Picaso Bithi(Hungerford Street)Kolkata -700 017

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Applicants

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HDFC Bank Limited, a banking company carries its business under license granted by Reserve Bank of India and registered under Banking Regulation Act,1949 carrying on its business from Jardine House,1^st Floor,4 Clive Row Kolkata-700 001.

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2.The Authorised Officer HDFC Bank Jardine House, 1^st Floor, 4 Clive Row, P.S. Hare Street, Kolkata-700 001.

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Respondents.

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Present:

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For Applicant: Mr. D. Roy Chowdhury and Ms. S. Roy Chowdhury, Ld. Counsels.

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For Defendant : Mr. Nimesh Mishra, and Ms. K. Deb, Ld. Counsels

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JUDGEMENT

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Delivered on 10^th November, 2022.

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This SA has been filed by the Applicants under Section 17(1) of the SARFAESI Act, 2002 (hereinafter referred to as ‘Act of 2002’) seeking relief

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to set aside demand notice dated 31.05.2019 and 13(4) notice dated 11.11.2019, setting aside the order dated 01/12/2020 of the District Magistrate and direction upon Respondents not to proceed with the SARFAESI action till disposal of the SA. Affidavit in opposition, affidavit in reply and supplementary affidavit and written notes of argument filed by the parties are taken into consideration.

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In brief, applicant no. 1 is a Partnership Firm, applicant no.2 and 3 are partners. It is a alleged by the Sarfaesi Applicant in December,2013 one Mr. Debapriya Mitra introducing himself as Relationship Manager of the HDFC Bank to transfer the loan account to their Bank by way of assignment. The Applicant No. 1 relying on the representation of the personnel of Respondent Bank got the loan account of the Applicant Bank no. 1 with Indian Overseas Bank assigned to the Respondent Bank i.e. HDFC Bank Ltd.

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The Sarfaesi Applicant contended that due to some financial crisis the Applicant could not make regular payment in respect of the loan account for which the Respondent Bank has issued notice u/s 13(2) of the SARFAESI Act on 02/07/2015. The said 13(2) notice was withdrawn by the Bank and fresh demand notice u/s 13(2) was issued on 31/05/2019. Copy of which is annexed as Annexure ‘B’. The Sarfaesi Applicant also alleged that the said notice was issued by the Manager of the Bank representing himself as Authorised Office which is clear violation of the SARFAESI Act 2002. As per the said Rule Section 13(2) notice should not be issued by the not less than the Chief Manager. As Section 13(2) is in clear violation of the SARFAESI Rule the subsequent action in 13(4) dated 11/11/2019, corrigendum dated 27/11/2019 and possession notice dated 02/12/2019 are bad in the eyes of the law.

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Subsequently, the Respondent Bank obtained an order on 1^st December, 2020. It is alleged by the Applicant that the personnel of the

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Respondent Bank who come to visit the premises of the Applicant in absence of the valid notice u/s 13(2) and one u/s 13(4) of the SARFAESI Act 2002.

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The Applicant has filed Writ Petition before the Hon’ble High Court in WPO No. 1048 of 2022 as the post of Hon’ble Tribunal was lying vacant. Hon’ble Supreme Court also by order requested the Hon’ble High Court to entertain Writ Petitions on the issued in view of subsisting vacancy in various DRTs. The Hon’ble High Court has disposed of the writ petition and directed to approach the DRT,Kolkata.

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The contention of the Applicant is in violation of the statutory rule, subsequent action of the Respondent Bank are illegal including order of the District Magistrate dated 01/12/2020. On the above ground the Applicant pray for declaration of notice u/s. 13(2) void and ineffective and setting aside 13(4) Notice, Possession Notice , 8(1) as well as other steps and setting aside the order of the District Magistrate dated 01/12/2020.

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The Respondent filed their affidavit in opposition to the SA contending that this application is barred by limitation as the order of the District Magistrate dated 01/12/2020 and this SA was filed on 08/03/2022 which is more than 45 days. The Respondents further contend that Section 13(2) Notice is valid , Section 13(4) , Possession Notice and order of the District Magistrate dated 01/12/2020 are also valid. This SA is not maintainable both on the measures taken by the Respondent Bank according to the Rule and also on the ground of limitation. The Respondents contended that the officer who issued 13(2) Notice has been duly authorised by the Board of Directors of the Respondent Bank. The Respondent has annexed the certified copy of the Resolution passed by the Board of Directors meeting on 21/07/2018 in which the Bank has appointed several officers as Authorised officer including the Officer who issued Section 13(2) Notice Mr. Anantharaman Ramanathan appointed as Authorised Officer by the Board of Directors of the HDFC Bank.

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The basic question in this SA whether 13(2) Notice issued by the Authorised Officer of the Bank is valid or not?.

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Rule 2(a) of the SARFAESI Act defined that

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“ authorised officer ” means an officer not less than a chief manager of a public sector bank or equivalent, as specified by the Board of Directors or Board of Trustees of the secured creditor or any other person or authority exercising powers of superintendence, direction and control of the business or affairs of the secured creditor, as the case may be, to exercise the rights of a secured creditor under the Act.”

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In this case Section 13(2) notice has been issued by Mr. Anantharaman Ramanathan, Authorised Officer who issued 13(2) notice is an equivalent officer appointed by the Board of Directors. Hence, there is no violation of Rule 2(a) by appointing Mr. Anantharaman Ramanathan, Authorised Officer to issue Section 13(2) Notice. The Sarfaesi Applicant has not challenged other measures of the Respondent Bank for violation of the statutory Rules and Act.

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Therefore Section 13(2) Notice and subsequent action of the Respondent Bank are legal. It is found that Section 13(2) Notice is valid. Therefore the Sarfaesi Applicant has no cause of action against the Respondent Bank.

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Ld. Advocate for the Respondent Bank has raised question of limitation of order of the District Magistrate dated 01/12/2020 but the Sarfaesi Application was filed on 08/03/2022 beyond the period of limitation which is 45 days. It appears from the order the Hon’ble High Court dated 25/02/2022 in WPO No. 1048 of 2022 that notice under challenge is of December ,2020 the Writ Petitioner has been given liberty to approach the DRT-Kolkata to challenge the same ,if otherwise maintainable in law. So Hon’ble High Court did not direct the Applicant to file SA and left the question of maintainability open to be decided by this Tribunal.

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Hence, both on the ground of limitation as well as Section 13(2) being valid this SA is not maintainable.

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O R D E R

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For the reasons given above, instant S.A. is liable to be dismissed on contest against the Respondents. Accordingly, instant S.A. 82 of 2022 is dismissed. Consequently, pending I.A.s are also dismissed. Restrain order, if any, is vacated. No costs.

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Copy of the judgement/final order be uploaded in the Tribunal’s website.

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File be consigned to the Record Room.

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(Dictated to P.S. transcribed by her and corrected and signed by me and delivered in court on this the 10^th day of November, 2022).

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(AMBUJA MOHAN DAS) PRESIDING OFFICER DRT-I, KOLKATA

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Rina. S. P.S.

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Order Sheet ( continuation)

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Case No.SA./	82/2022 Luxamee Kutir Udyog Liquor Division & ors vs. HDFC Limited & Anr.	Bank
Date of Order	Order with signature	Office action with date and dated signature of parties when necessary
10/11/2022	Present: For Applicant: Mr. D. Roy Chowdhury and Ms. S. Roy Chowdhury, Ld. Counsels.
	For Defendant : Mr. Nimesh Mishra, and Ms. K. Deb, Ld. Counsels In this matter Judgement delivered in the Court, which is kept in separate sheets containing five pages. S.A. 82 of 2022 is dismissed. Consequently, pending I.A.s are also dismissed. Restrain order, if any, is vacated. No costs.
	(AMBUJA MOHAN DAS) PRESIDING OFFICER DRT-I, KOLKATA
R.S/P.S.

Luxamee Kutir Udyog Liquor Division and Ors. v. Hdfc Bank

Case brief

What is this about?

What did the court decide?

Luxamee Kutir Udyog Liquor Division and Ors. v. Hdfc Bank

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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