Karam Chand Vs District Magistrate Sangrur and… — Banking and Recovery | Punjab & Haryana HC (2025)

Karam Chand Vs District Magistrate Sangrur and… — Banking and Recovery | Punjab & Haryana HC (2025)

What the court decided

AI extract

Outcome

Writ petition disposed of with liberty to the petitioner to avail the appropriate statutory remedy under the SARFAESI Act before the DRT and thereafter the DRAT, without commenting on merits.

Issue for consideration

Whether the High Court should exercise jurisdiction under Article 226 of the Constitution in SARFAESI proceedings where the petitioner (borrower/guarantor), challenging a Section 14 SARFAESI order, has not availed the statutory alternative remedy of approaching the DRT and/or DRAT. +1 more

Court's answer

High Courts should refrain from interfering under Article 226 of the Constitution in SARFAESI proceedings; the SARFAESI Act, 2002 is a complete code providing a detailed recovery mechanism and remedies before the Debts Recovery Tribunal (DRT) and thereafter the Debts Recovery Appellate Tribunal (DRAT).

Ratio / Principle

On the averments in the petition, it does not appear that the petitioner has availed the statutory alternative remedy of approaching the DRT and/or DRAT.

Key takeaways

In view of the Apex Court decisions in United Bank of India vs. Satyawati Tondon, Phoenix ARC Private Limited vs. Vishwa Bharati Vidya Mandir and PHR Invent Educational Society versus UCO Bank, this Court declines exercise of jurisdiction under Article 226 of the Constitution.ratio¶22
The petitioner is relegated to avail the appropriate statutory remedy under the SARFAESI Act before the DRT and thereafter before the DRAT.ratio¶23

Detailed headnote1 paragraphs

SARFAESI - Writ petition under Article 226 of the Constitution challenging order dated 25.06.2024 (Annexure P-7) issued under Section 14 of the SARFAESI Act - Petitioner, a borrower/guarantor, had not availed the statutory alternative remedy of approaching the DRT and/or DRAT - Following the Apex Court in United Bank of India vs. Satyawati Tondon, (2010) AIR SC 3413, Phoenix ARC Private Limited vs. Vishwa Bharati Vidya Mandir, (2022) 5 SCC 345, and PHR Invent Educational Society versus UCO Bank, 2024 (6) SCC 579, the High Court declined to exercise jurisdiction under Article 226 and relegated the petitioner to the statutory remedy under the SARFAESI Act before the DRT and thereafter the DRAT - Writ petition disposed of with liberty, without commenting on merits.

CWP-22152-2025

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

106

CWP-22152-2025 Date of decision: 02.08.2025

KARAM CHAND

..PETITIONER

Versus

DISTRICT MAGISTRATE, SANGRUR AND OTHER

..RESPONDENT

CORAM: HON'BLE MR. JUSTICE SHEEL NAGU, CHIEF JUSTICE HON'BLE MR. JUSTICE SANJIV BERRY

Present: Mr. Tarunveer Vashist, Advocate Mr. Shoryaveer Vashist, Advocate for the petitioner.

SHEEL NAGU, C.J. (Oral)

The petitioner, who is borrower/guarantor, has approached this Court challenging order dated 25.06.2024 (Annexure P-7) issued under Section 14 of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( for short SARFAESI Act ), on various grounds.

The Apex Court has consistently held that High Courts should refrain from interfering under Article 226 of the Constitution in SARFAESI proceedings. The SARFAESI Act, 2002 is a complete code which not only

MOHIT GOYAL 2025.08.04 16:10 I attest to the accuracy and integrity of this document

CWP-22152-2025

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provides for a detailed recovery mechanism but also remedies before the Debts Recovery Tribunal (DRT) and thereafter, Debts Recovery Appellate Tribunal (DRAT).

From the averments in the petition, it does not appear that the petitioner has availed the statutory alternative remedy of approaching the DRT and/or DRAT.

In view of the above and the view of Apex Court in United Bank of India vs. Satyawati Tondon, (2010) AIR SC 3413 (Para 17, 27); Phoenix ARC Private Limited vs. Vishwa Bharati Vidya Mandir and others, (2022) 5 SCC 345 (Paras 10, 21); PHR Invent Educational Society versus UCO Bank and others, 2024 (6)SCC 579 (Paras 22 to 41), this Court declines exercise of jurisdiction under Article 226 of Constitution.

The petitioner is relegated to avail the appropriate statutory remedy under the SARFAESI Act before the DRT and thereafter before DRAT.

Accordingly, the writ petition stands disposed of with aforesaid liberty without commenting on merits.

(SHEEL NAGU) CHIEF JUSTICE

(SANJIV BERRY) AUGUST 02^nd , 2025 JUDGE R. Joshi

Whether speaking/reasoned Yes/No Whether reportable Yes/No

MOHIT GOYAL 2025.08.04 16:10 I attest to the accuracy and integrity of this document