The High Court held that the writ petition was not maintainable as the objections regarding principal amount and limitation were mixed questions of fact and law. The court refused to adjudicate and directed the petitioner to approach the Debts Recovery Tribunal under Section 17(1) of the SARFAESI Act.
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THE HON’BLE SRI JUSTICE V.V.S.RAO AND
THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY
WRIT PETITION No.7652 OF 2009
March 05, 2012
Between:
Polynex Polymers Pvt. Ltd., represented by its Managing Director, Smt.Asha Devi, W/o.Jagdeesh
Petitioner
And
State Bank of Hyderabad, represented by its Authorised Officer-cum-Chief Manager, Habsiguda Branch, Hyderabad
... Respondent
THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY
WRIT PETITION No.7652 OF 2009
ORDER: (Per Hon’ble Sri Justice V.V.S.Rao)
The petitioner company availed credit facilities from the State Bank of Hyderabad in 1994. As there was default, the bank filed mortgage suit being O.S.No.1387 of 1994 on the file of the Court of the Fifth Additional Judge, City Civil Court, Hyderabad for a decree for an amount of Rs.3,07,779.78 ps with interest at 18% per annum. The suit was decreed on 30.10.1995. The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the Act) came into force on 26.1.2002. By invoking the provisions of the Act, the respondent issued notice of demand dated 06.5.2006 calling upon the petitioner to pay the amount due (Rs.5,26,221.75) within 60 (sixty) days from the date of the notice. The petitioner did not pay the amount. The respondent, therefore, issued possession notice on 10.6.2006. The petitioner sent a representation purportedly under Section 13(3A) of the Act on 09.8.2006. When there was no response, the petitioner filed W.P.No.16532 of 2006. This Court disposed of the writ petition on 11.8.2006 directing the respondent to consider the representation made by the petitioner.
The respondent issued another notice under Section 13(2) of the Act on 24.3.2008. The petitioner sent yet another objection petition on 23.5.2008 and allegedly the same was not considered. But the respondent issued sale notice on 14.3.2009 aggrieved by
which the present writ petition is filed.
The Counsel for the petitioner would contend that the principal amount due to the bank being less than Rs.1.00 lakh the provisions of the Act cannot be invoked under Section 31(h) of the Act. Secondly he would urge that as per Section 36 of the Act, the recovery of the loan is barred by limitation. In support of the second submission he relied on CCE v Hongo India (P) Ltd[1] and the decisions of Allahabad, Gauhati, Jharkhand and Patna High Courts reported in Malhotra Tractors v State Bank of India[2] , Jagrit [3] Foods Pvt. Ltd v United Bank of India , D.N. Motors v State Bank of India[4] and Neelu Gupta v State Bank of India[5] .
We have given serious consideration to the two submissions made by the learned Counsel. Both the questions raised are not pure questions of law. They are mixed questions of fact and law. Therefore it is not proper for this Court to adjudicate the same. Section 17(1) of the Act enables any person aggrieved by any measures under Section 13(4) of the Act to file an application before the Debts Recovery Tribunal (DRT) having jurisdiction over the matter. Under Section 17(3) of the Act the DRT is conferred with wide powers and can even declare the recourse to any one of the measures under Section 13(4) of the Act induldge/involve and restore possession to the secured creditors. The DRT can decide all the questions including the questions in relation to Sections 31 and 36 of the Act. Further in many decisions the Supreme Court laid down that in view of Sections 17(1) and 18 of the Act ordinarily the writ petition cannot [6] be entertained (United Bank of India v Satyawati Tondon , Kanaiyalal Lalchand Sachdev v State of Maharashtra[7] , Indian Overseas Bank v
[8] [9] Ashok Saw Mill and Transcore v Union of India ). In view of the above while giving liberty to the petitioner to approach the DRT and leaving open all the questions raised before us open we dismiss the writ petition as not maintainable.
The writ petition, with the above observations, is accordingly dismissed. The miscellaneous application shall stand dismissed. No costs.
_______________ (V.V.S.RAO, J)
________________________________ (G.KRISHNA MOHAN REDDY, J)
March 05, 2012 YS
[1] (2009) 5 SCC 791
[2] AIR 2009 All 150 : I (2010) BC 176 (DB) (All)
[5] II (2010) BC 183 (Patna)
3 issues framed by the court
Whether this High Court can adjudicate disputed questions of fact and law regarding the applicability of Section 31(h) and the bar of limitation under Section 36 of the Act.
Whether the writ petition is maintainable despite objections raised regarding the threshold limit under Section 31(h) and the limitation period under Section 36.
Whether the Debts Recovery Tribunal is the appropriate forum for determining all questions including those under Sections 31 and 36 of the Act.
Colour shows how this judgement treated each authority
CCE v Hongo India (P) LtdReferred¶17
(2009) 5 SCC 791 · Who else cites this
Malhotra Tractors v State Bank of IndiaReferred¶17
AIR 2009 All 150 · Who else cites this
Jagrit Foods Pvt. Ltd v United Bank of IndiaReferred¶17
I (2009) BC 266 (Gauhati)
D.N. Motors v State Bank of IndiaReferred¶17
I (2009) BC 331 (Jharkhand)
Neelu Gupta v State Bank of IndiaReferred¶17
II (2010) BC 183 (Patna)
United Bank of India v Satyawati TondonReferred¶18
(2010) 8 SCC 110 · Who else cites this
Kanaiyalal Lalchand Sachdev v State of MaharashtraReferred¶18
(2011) 2 SCC 782 · Who else cites this
Indian Overseas Bank v Ashok Saw MillReferred¶18
(2009) 8 SCC 366 · Who else cites this
Transcore v Union of IndiaReferred¶18
(2008) 1 SCC 125 · Who else cites this
5 provisions across 1 enactments
Polynex Polymers Pvt. Ltd.
State Bank of Hyderabad
V.V. Rao
G. Krishna Mohan Reddy
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
