Dismissed

M/S.for Most, Represented by Managing Partner, v. the Deputy Vice President

Kerala HC25 Jul 2023WP(C)/3051/2023

Case brief

AI extract

What is this about?

Petitioners, an MSME firm, challenged a possession notice under the SARFAESI Act issued by an Asset Reconstruction Company to which the loan account was assigned during a government moratorium. The court dismissed the petition, noting the Supreme Court's stance against writ interference in SARFAESI proceedings absent extraordinary circumstances, directing petitioners to use statutory remedies.

What did the court decide?

Writ petition dismissed without prejudice to the right of petitioners to work out statutory remedies.

M/S.for Most, Represented by Managing Partner, Vs the… — Company and Corporate | Kerala HC (2023)

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WP(C) No.3051 of 2023

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR.JUSTICE C.S.DIAS

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TUESDAY, THE 25TH DAY OF JULY 2023 / 3RD SRAVANA, 1945
WP(C) NO. 3051 OF 2023

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PETITIONER/S:

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1M/S.FOR MOST, REPRESENTED BY MANAGING PARTNER,
DOOR NO.40/7116,7117 & 7118, BHARATH ARCADE, MG
ROAD, ERNAKULAM, KERALA., PIN - 682035

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2K.N. ABDUL GAFOOR,AGED 58 YEARS
MANAGING PARTNER, S/O.C. KASMI, RANGOON, 37/2127 -A,
KATHRIKADAVU, KALOOR, KOCHI-682017., PIN - 682017
BY ADV LIZA P.CHERIAN

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RESPONDENT/S:

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1THE DEPUTY VICE PRESIDENT,OMKARA ASSET
RECONSTRUCTION PRIVATE LTD. ,C/515, KANAKIA ZILLION,
JUNCTION OF LBS. ROAD &CST ROAD, B.K.C ANNEXE, NEAR
EQUINOX, KURLA (WEST), MUMBAI., PIN - 400070

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2THE MANAGER,
INDUSIND BANK LIMITED, KOCHI BRANCH, GOWRINARAYAN,
(OPP. TO NEW JAYALAKSHMI SILKS), 40/8399,8400, M.G
ROAD, KOCHI, KERALA-682035.,

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BY ADVS.
ANISH JOSE ANTONY
RENJITH.R
ANJU MOHAN

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION
ON 25.07.2023, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:

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WP(C) No.3051 of 2023

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C.S DIAS,J.

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--------------------------WP(C) No.3051 of 2023

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----------------------------Dated this the 25^th day of July, 2023^.

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JUDGMENT

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The writ petition is filed challenging Ext P8 notice

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issued by the first respondent.

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The petitioners’ case is that the first petitioner is a partnership firm and the second petitioner is the Managing partner of the first petitioner firm. They had availed financial assistance from the second respondent-

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Bank - by creating an equitable mortgage. Due to reasons beyond their control, they could not pay the instalments on time. The first petitioner is an MSME unit, which is eligible for the benefit of the schemes

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WP(C) No.3051 of 2023

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declared by the Government of India. The second respondent has illegally assigned the loan account in favour of the first respondent during the moratorium period announced by the Government of India. The first respondent has now issued a demand notice threatening to take physical possession of the secured asset under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act (in short, ‘Act’). The entire proceedings leading to Ext P8 notice issued by the Bank are bad in the eyes of law, which are vitiated and are liable to be quashed. Hence, the writ petition.

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WP(C) No.3051 of 2023

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Heard; Smt.Liza P.Cherian, the learned counsel appearing for the petitioners and Sri.R.Renjith, the learned counsel appearing for the respondents.

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Sri.R.Renjith, on instructions, submitted that Ext P8 notice is issued under Sec.13(2) of the Act. Subsequent to the issuance of Ext P8 notice, the first respondent has already initiated proceedings under Sec.14 of the Act before the jurisdictional Magistrate and the first respondent is proposing to take physical possession of the secured asset. The petitioners have an alternative statutory remedy under the Act before the Debt Recovery Tribunal. Hence, the writ petition may be dismissed.

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WP(C) No.3051 of 2023

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The Hon’ble Supreme Court in South Indian Bank Ltd vs. Naveen Mathew Philip (2023 LiveLaw (SC) 320), after adverting to a myriad of earlier judicial

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pronouncements rendered under the Act, has categorically declared that High Courts shall not, unless in extra ordinary circumstances, interfere with proceedings initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, in writ proceedings under Article 226 of the Constitution of India.

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Having considered the pleadings and materials on record and taking note of the stand taken

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by the respondents, I am not inclined to entertain the writ petition by exercising the plenary powers of this

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WP(C) No.3051 of 2023

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Court under Article 226 of the Constitution of India. Nonetheless, it would be up to the petitioners to invoke their statutory remedies under the Act.

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Resultantly, the writ petition is dismissed, without prejudice to the right of the petitioners to work out their remedies, in accordance with law.

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SD/-

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sks/25.7.2023 C.S.DIAS, JUDGE

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WP(C) No.3051 of 2023

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APPENDIX OF WP(C) 3051/2023

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PETITIONER EXHIBITS

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`Exhibit P1`	`THE TRUE COPY` `BY THE PETITI` `GRANTING INTE`	`OF` `ONER` `REST`	`THE` `DAT` `SUB`	`REPRESENTATION SENT` `ED 23/3/2020 FOR` `VENTION SCHEME`
`Exhibit P2`	`THE TRUE COPY`	`OF`	`THE`	`CIBL REPORT`
`Exhibit P3`	`THE TRUE COPY` `BY THE PETITI` `CERTIFICATE D`	`OF` `ONER` `ATED`	`THE` `FOR` `22/`	`REPRESENTATION SENT` `GRANTING SOLVENCY` `1 /2020`
`Exhibit P4`	`THE TRUE COPY` `BY THE PETITI` `GRANTING THE`	`OF` `ONER` `COVI`	`THE` `DAT` `D 19`	`REPRESENTATION SENT` `ED 2/4/2020 FOR` `REGULATORY PACKAGE`
`Exhibit P5`	`THE TRUE COPY` `FOR GRANTING`	`OF` `THE`	`THE` `BENE`	`E MAIL DATED 6/6/2020` `FIT OF ECLGS SCHEME`
`Exhibit P6`	`THE TRUE COPY` `15/11/202 FOR` `CGSSD SCHEME`	`OF` `GRA`	`THE` `NTIN`	`E-MAIL DATED` `G THE BENEFIT OF`
`Exhibit P7`	`THE TRUE COPY` `28/4/2021 ISS` `THE CLASSIFIC`	`OF` `UED` `ATIO`	`THE` `BY T` `N OF`	`LETTER DATED` `HE RESPONDENT STATING` `ACCOUNT AS NPA`
`Exhibit P8`	`THE TRUE COPY` `FIRST RESPOND`	`OF` `ENT`	`THE`	`DATED 1/3/2022 BY THE`
`Exhibit P9`	`THE TRUE COPY` `2/5/2022 SENT`	`OF` `BY`	`THE` `THE`	`13(A) REPLY DATED` `PETITIONER`

M/S.for Most, Represented by Managing Partner, v. the Deputy Vice President

Case brief

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M/S.for Most, Represented by Managing Partner, v. the Deputy Vice President

Case brief

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What did the court decide?

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