Dismissed

Annamma Paulose v. Kerala Gramin Bank

Kerala HC9 Jan 2020WA/823/2017

Case brief

AI extract

What is this about?

This writ appeal challenged a High Court judgment allowing time for loan repayment and conditional sale of mortgaged land. The Kerala High Court held that it could not interfere, citing Supreme Court precedents establishing that Article 226 writ petitions are barred where statutory remedies under the SARFAESI Act exist, dismissing the appeal.

What did the court decide?

Writ appeal dismissed; impugned judgment of the High Court dated 30.3.2017 affirmed.

Annamma Paulose Vs Kerala Gramin Bank — Banking and Recovery | Kerala HC (2020)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR

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THE HONOURABLE MR. JUSTICE SHAJI P.CHALY

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THURSDAY, THE 09TH DAY OF JANUARY 2020 / 19TH POUSHA, 1941

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WA.No.823 OF 2017

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AGAINST THE JUDGMENT IN WPC 10717/2017 DATED 30-03-2017 OF HIGH COURT OF KERALA

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APPELLANT/PETITIONER IN W.P.(C):

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MRS.ANNAMMA PAULOSE AGED 78 YEARS W/O.LATE POULOSE, KANDACHERIYIL HOUSE, KAIPPILLI LANE, ELAMAKKARA, ERNAKULAM.

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BY ADVS.

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SRI.R.LAKSHMI NARAYAN SRI.M.ASHOK KINI SMT.R.RANJANIE

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RESPONDENT/RESPONDENT IN W.P.(C):

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KERALA GRAMIN BANK

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KGB TOWERS, H O MALAPPURAM, REP. BY ITS AUTHORIZED OFFICER, REGIONAL OFFICE, COSTAL TOWERS (KARITHATT), SAMSKARA JUNCTION, PIPE LINE, PALARIVATTOM, KOCHI - 682 025.

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THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 09.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WA.No.823 OF 2017

JUDGMENT

S.MANIKUMAR,CJ

Appellant challenged possession notice dated 18.3.2017 (Ext.P15)

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and attempted sale of mortgaged property of 12 cents. Writ court after considering the submissions, ordered thus;

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“5. If the advance amounts as seen from Ext.P13 is not paid, within the time directed herein above, the Bank shall proceed with the recovery. If it is paid then the petitioner shall produce the purchaser before the Bank within three months and shall ensure payment of the balance consideration within three months from the date of initial payment. Then the bank shall consider installments for payment of the balance dues and on failure shall proceed with the sale.”

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Being aggrieved, instant writ appeal is filed.

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Though, Mr.R.Lakshmi Narayan, learned counsel for appellant, made submissions with reference to the grounds raised, we are not inclined to interfere with the judment dated 30.3.2017 for the reasons that, the Hon'ble Supreme Court has time and again held that proceedings initiated under Securitisation and Reconstruction of Financial Assets and

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WA.No.823 OF 2017

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Enforcement of Security Interest Act, 2002 should not be entertained.

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In the case on hand, loan has been declared as a Non Performing Asset in 2012 and as on 15.3.2017, total amount due to the bank comes to Rs.48,01,424/-. Despite indulgence granted by the writ court, appellant was not in a position to pay the amount within the time frame granted. In this appeal, the appellant has taken a contention that, she is ready and willing to remit the full amount by selling 3 cents of land. But it has not been done despite directions. Challenge in the writ petition is to the possession notice and sale. At this juncture, reference can be made to a few decisions of the Hon'ble Supreme Court. In United Bank of India v. Satyawati Tondon and others [(2010) 8 SCC 110], though the High Court restrained further proceedings under Section 13(4) of the Act, upon a detailed consideration of the statutory scheme under the SARFAESI Act, availability of remedy to the aggrieved under Section 17 before the Tribunal and the appellate remedy under Section 18 before the Appellate Tribunal, object and purpose of the legislation, Honourable Apex Court observed that a writ petition ought not to be entertained in view of the availability of alternate statutory remedy and para 46 is relevant to the context is extracted;

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WA.No.823 OF 2017

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“43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute.

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It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection.”

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4. In Civil Appeal Nos.10243-10250 of 2018 [ICICI Bank Ltd. v.

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WA.No.823 OF 2017

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Umakanta Mohapatra and Others] , by order dated 5.10.2018, the Hon'ble Apex Court reaffirmed the legal position that High Court has no jurisdiction to entertain writ petitions under Article 226 of the Constitution of India, relating to matters coming under the purview of SARFAESI Act, 2002, where a statutory remedy is available by filing an application under Section 17 of the said Act.

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In the light of the above discussion and decisions of the Hon'ble Supreme Court, we are not inclined to interfere with the impugned judgment dated 30.3.2017. Accordingly writ appeal is dismissed.

Sd/-

S.MANIKUMAR

CHIEF JUSTICE

Sd/-

SHAJI P.CHALY

Smv 9.1.2019