Dismissed

Smt. Vimala @ Akkamma v. Smt.P. Pallavi

Karnataka HC1 Mar 2024MFA/14/2024

Case brief

AI extract

What is this about?

The court dismissed an appeal against a lower court's rejection of a temporary injunction application. The appeal sought to restrain a cooperative bank from taking possession of suit property. The court held the bank was within its rights under the SARFAESI Act.

What did the court decide?

Order 39 Rule 1 application to restrain the bank from taking possession was rejected and the appeal was dismissed.

Smt. Vimala @ Akkamma Vs Smt.P. Pallavi — Banking and Recovery | Karnataka HC (2024)

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1 - NC: 2024:KHC:8778 MFA No. 14 of 2024

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 1^ST DAY OF MARCH, 2024

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BEFORE

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THE HON'BLE MR JUSTICE R. NATARAJ MISCELLANEOUS FIRST APPEAL NO. 14 OF 2024 (CPC)

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BETWEEN:

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SMT. VIMALA @ AKKAMMA, D/O LATE D.H.PILLAPPA, AGED ABOUT 50 YEARS, R/AT DOOR NO. 173, 6^TH CROSS, VENKATAPUR, KORAMANGALA LAST BUS STOP, KORAMANGALA POST, BENGALURU- 560 034.

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Digitally signed by BS RAVIKUMAR Location: HIGH COURT OF KARNATAKA

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SMT.ANUSUYAMMA, D/O LATE D.H.PILLAPPA, AGED ABOUT 47 YEARS, R/AT JAMBIGEMARADAHALLI, SOMENAHALLI POST, GUDIBANDE TALUK, CHIKKABALLAPURA DISTRICT REP. BY THEIR GPA HOLDER.

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SRI.SRINIVAS P., S/O PILLAPPA, AGED ABOUT 57 YEARS, R/AT NO.150, SHIVAKOTE, HESARAGHATTA HOBLI, BENGALURU NORTH TALUK, BENGALURU -560 089.

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…APPELLANTS

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(BY SRI. SHIVASHANKAR K., ADVOCATE)

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2 - NC: 2024:KHC:8778 MFA No. 14 of 2024

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AND:

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SMT.P. PALLAVI, D/O LATE A.P.MUNIYAPPA, AGED ABOUT 31 YEARS.

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KUM. P.MAMATHASHREE, D/O LATE A.P. MUNIYAPPA, AGED ABOUT 29 YEARS.

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SRI. MANJESH KUMAR, S/O LATE A.P. MUNIYAPPA, AGED ABOUT 27 YEARS.

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SMT.PUTTAMMA, W/O A.P.MUNIYAPPA, AGED ABOUT 53 YEARS.

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SMT.SAKAMMA, W/O LATE D.H.PILLAPPA, AGED ABOUT 80 YEARS.

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ALL ARE R/AT NO. 169, NEAR MARAMMA TEMPLE, GOVT. SCHOOL ROAD, AMRUTHAHALLI, SAHAKARANAGAR POST, BENGALURU -560 092.

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THE MANAGER, HANUMANTHANAGARA CO-OPERATIVE BANK, NI., NO.7/29, 3^RD MAIN ROAD, 1^ST CROSS ROAD, HANUMANTHANAGAR, BENGALURU – 560 019, DODDABALLAPURA, BENGALURU RURAL DIST.

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…RESPONDENTS

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THIS MFA FILED U/O 43 RULE 1(r) R/W SECTION 151 OF CPC, AGAINST THE ORDER DATED 18.12.2023 PASSED ON I.A.NO.11 IN OS.NO.3148/2018 ON THE FILE OF THE LV

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3 - NC: 2024:KHC:8778 MFA No. 14 of 2024

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ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BENGALURU CCH-56, REJECTING THE I.A.NO.11 FILED UNDER ORDER 39 RULE 1 AND 2 R/W SECTION 151 OF CPC.

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THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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JUDGMENT

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The plaintiffs in O.S.No.3148/2018 on the file of LV Additional City Civil and Sessions Judge, Bengaluru City have filed this appeal challenging an order dated 18.12.2023, by which an application (I.A.No.11) under Order 39 Rule 1 and 2 to restrain the defendant No.5/respondent No.6 herein from taking possession of the suit schedule property, was rejected.

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The plaintiffs herein filed a suit for partition and separate possession of their share in the suit schedule property. They also sought for a declaration that the Gift deed executed by the defendant No.1 in favour of defendant No.2 dated 03.09.2003 and the rectification deed dated 15.04.2014 executed by defendant No.1 in favour of defendant No.2 did not bind them in any manner whatsoever.

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NC: 2024:KHC:8778 MFA No. 14 of 2024

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After the suit was filed, at the stage of further arguments on I.A.No.10 filed by defendant No.5 under Order 7 Rule 11 of CPC, an application was filed by plaintiffs under Order 39 Rule 1 and 2 for an order of temporary injunction restraining the defendant No.5, its officials, agents, authorized persons, power of attorney

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holder or any others from taking possession of suit schedule property till the disposal of the case. This application was contested by defendant No.5 which claimed that the defendant Nos.2 and 3 had raised loan from it on the security of suit property and that proceedings to recover the said loan was initiated before the Joint Registrar of the Co-operative society, which was allowed and an award was passed on 07.11.2017. An execution petition was filed to execute the award passed by the Joint Registrar of the Co-operative Society. A date was fixed to auction the suit schedule property. However the plaintiffs filed the suit and obstructed the public auction. Therefore, it was claimed that grant of an Order of injunction in favour of the plaintiffs would cause

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5 - NC: 2024:KHC:8778 MFA No. 14 of 2024

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hardship and injury to the defendant No.5. It was further claimed that the defendant No.5 had initiated proceedings to recover the outstanding amount in accordance with the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter for brevity referred to as the ‘SARFAESI Act’) and a notice of demand under Section 13 (1) of the SARFAESI Act was issued to the principal borrower as well as the guarantor, but neither of them paid the amount and therefore, the defendant No.5 had issued a possession notice under Section 13(4) of the SARFAESI Act. Thus, it is contended that suit against it was not maintainable. It is further contended that defendant No.5 had filed an application under Order 7 Rule 11 of CPC and when arguments on this application were to be concluded, the plaintiffs filed the instant application.

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The Trial Court after considering the material on record held that the defendant No.5 cannot be restrained by Civil Court from acting in accordance with the

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NC: 2024:KHC:8778 MFA No. 14 of 2024

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provisions of the SARFAESI Act, in view of the bar contained in Section 24 of SARFAESI Act and consequently rejected the application. Being aggrieved by the said order, the plaintiffs have filed this appeal.

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Learned counsel for the plaintiffs contend that plaintiffs also have an undivided share in the suit property and if the defendant No.5 takes possession of the property which comprises of residential houses and auctions it, the plaintiffs would be deprived of their share in the suit schedule property and that the suit itself would be rendered infructuous.

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The conduct of the plaintiffs in filing the application for interim injunction that too at a stage when defendant No.5 had filed an application under Order 7 Rule 11 of CPC to reject the plaint, shows the oblique intention on the part of plaintiffs to some how thwart the statutory proceedings initiated by the defendant No.5. A reading of the plaint does not show any relief sought for against defendant No.5. No attempt is made to challenge the

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NC: 2024:KHC:8778 MFA No. 14 of 2024

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mortgage of the suit schedule property by the defendant Nos.2 and 3 in favour of defendant No.5, though it is stated by the learned counsel for plaintiffs that an application for amendment of the plaint is still pending consideration.

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Be that as it may, the defendant No.5 has advanced loan on the security of the suit schedule property and has initiated proceedings for recovery of the said amount and has obtained an award to recover the outstanding loan from the secured asset. It has also initiated proceedings under the SARFAESI Act. Therefore, the question of restraining the defendant No.5 from encumbering or transferring or taking possession of the said property does not arise. The defendant No.5 being a Co-operative bank as defined under Section 2(c) of the SARFAESI Act is entitled to take all measures that are provided under the SARFAESI Act to recover its dues. If plaintiffs have any independent right in respect of the suit schedule property, they are bound to establish the

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8 - NC: 2024:KHC:8778 MFA No. 14 of 2024

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same before the Civil Court and thereafter seek

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appropriate relief before the Debt Recovery Tribunal as provided under Section 17 of the SARFAESI Act. They cannot, before their right is determined, seek for any interim injunction restraining the defendants from acting in accordance with the provisions of the SARFAESI Act. There is no error committed by the Trial Court in rejecting the application filed by the plaintiffs warranting interference by this Court. Hence this appeal is dismissed, but subject to the observations made above.

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Sd/JUDGE

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GSR

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List No.: 1 Sl No.: 27

Smt. Vimala @ Akkamma v. Smt.P. Pallavi

Case brief

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Smt. Vimala @ Akkamma v. Smt.P. Pallavi

Case brief

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