Dismissed

M. Srikanth v. Neeraj Jayawanth Kanchi

Telangana HC8 Sept 2023WP/24971/2023

Case brief

AI extract

What is this about?

The High Court dismissed a writ petition challenging a Section 13(4) SARFAESI notice issued by Res. No. 2. The court held that the petitioner has an alternative remedy under Section 17, no extraordinary circumstances existed to bypass it, and the writ did not lie.

What did the court decide?

The writ petition was disposed of without entertaining it; liberty was reserved to the petitioner to seek remedy under Section 17 of the SARFAESI Act.

M. Srikanth Vs Neeraj Jayawanth Kanchi — Cheque Dishonour | Telangana HC (2023)

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[³³⁷⁷ ]

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HIGH COURT FOR THE STATE^{OF TELANGANA} AT HYDERABAD (Special Original Jurisdiction)

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FRIDAY, THE EIGHTH^DAYOF SEPTEMBER TWO THOUSAND AND^{TWENTY THREE}

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PRESENT

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THE HON'BLE THE^{CHIEFJUSTICE ALOK ARADHE} AND THE HON'BLE SRI JUSTICE^{N. V. SHRAVAN KUMAR}

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WRIT PETITION NO:24971^{OF 2023}

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Between:

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M. Srikanth, S/o M. Devadas^{Rao Aged about 60 Year'Occ- BusinessR/o} Flat No. 301, Alankrutha^{ResidencyShilpa Hills, Road No.2,Khanamet,} Ranga Reddy District, Telangana^state- 50008

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...pETtIoNER

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AND

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Neerai Javawanth^{Kanchi, S/o Lakshmipat Jayawanth KanchiAged about38} occ- dusi'ness Rl/o. falt No. 1405,^{14th floor, Vasudeva Bloomfield Elation,} Khaiaquda, Near Lanco^{Hills, Gachibowli'Ranga reddy district.}

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Z. Srir6ni Cni[ tinance,^{Represented by its branchmanager Having franchise at} Basheer Bagh, Hyderaba

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..REspoNDENTs

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Petition under Article 226^{of the Constitutionof lndiapraying that in the} circumstances stated in the^{affidavit filedtherewith, the High Court may be} pteased to issue an appropriate writ, order or direction^{more particularly onein the} nature of WRIT of Mandamus , considering^{the act of Respondent No.2, in Taking} Symbolic Possession of the^{flat No. 402, 4th floorwith built up area of 1230 Sq'} feet, including common atea, car^{Parking area, together with undivided share of} land admeasuring 40 Sq.^ya.d ot 33.44^{Sq. meter(out of total 385 Sq. yard) in the} complex known as Grandoise^{Apartments, construed on Plot No. 105in survey} No. 78 situated at Madhapur^{village, Serilingampally Municipaloffice and GHMC} circle, RR District.

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Surrounded and bounded bY

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	Boundariesof c plex
North	PlotNo.104ofV.Venkat^Rao
South	A.P.LLCLand
East	Neighbors.Plot
West	30-0 wideroad

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Boundaries of Flat

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North : Open to sky South : Open to Sky East Open to Sky West : Lift, Staircare and corridor

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Under Section 13(4), through its notice, by Pasting on the Flat, Dated 231081 2023 as same is lllegal, arbitrary, inconsequentially to quash the same, as Violative of Sarfasei act ( as there exist No secured and debtor relation in between Petitioner and respondent No.2)

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lA NO: 1 OF 2023

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Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the^petition, the High Court may be pleased to Suspend all the Proceedings arising out the Notice, Pasted by respondent No.2, Under section 13(4) of the SARFAESI ACT

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Counsel for the Petitioner: SRI M. RATHAN SINGH

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Counsel for Respondents: ---

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The Court made the following: ORDER

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THE HON'BLE THE CHIEF JUSTICE ALOK ARADHE AND

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THE HON'BLE SRI WSTICE N.V.SHRAVAN KIIMAR

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WRIT PETITION No.2 4977 of 2o23

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ORDER: Per the Hon,ble the CheI Justice ALok Aradhe)

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Mr. M.Rathan Singh, learned counsel for the petitioner.

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In this writ petition under Article 226 of the Constitution of India, the petitioner has assailed the validity of the notice issued by the Shriram Chit Finance Company under Section i 3(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2OO2 (briefly referred to hereinafter as the 'SARFAESI Act').

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Learned counsel for the petitioner submitted that the petitioner is neither a borrower nor a guarantor and therefore, the petitioner does not have the remedy of filing an appeal under Section L7 of the SARFAESI Act Alternatively, it is submitted that since the petitioner is

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neither a^{borrower nor aguarantor,inextraordinarY} circumstances,^{this writ petition shouldbe entertained'}

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We^{have consicleredthe submissions made by} learned^{counselfor the petitioner'}

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5 The relevant^{extractof Section 17(1) of the SARFAESI} Act reads^{as under:}

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L7. Application^{againstmeasures to} recover^{secured debts-- (1) Any person (including} borrower),^{aggrievedby any ofthe measures} referred^{to in sub-section (4) of section13 takenby} the secured^{creditoror his authorised officer under} this Chapter,^{may make an application along with} such fee,^{as may be prescribed'to the Debts} Recovery^{Tribunalhavingjurisdictionin the matter} within forty^{five days from the date on which such} measure^{hadbeen taken'}

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Provided^{that differentfeesmaybe prescribed} for making^{the application by the borrowerand the} person other^{than the borrower'}

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Explanation.-'For^{the removalof doubts'it is} hereby^{declaredthat the communication of the} reasons to^{the borrowerby the securedcreditorfor} not having^{accepted his represeniationor objection} or the tikely^{action of thp secured creditor at the}

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stage of communicat.ion of reasons to the borrower shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under sub-section (1) of section 17.

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Thus, it is evident that any person, including a borrower, aggrieved by the measures taken under section 13(a) of the SARFAESI Act can file an appeat before the Debts Recovery Tribunal. The right to appea-l is a creature of statute. The aforesaid right of appeal has not been confined only to either borrower or a guarantor. Therefore, the contention of the petitioner that since the petitioner is neither the borrower nor the guarantor, he cannot file an appeal, is misconceived.

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The Hon,ble Supreme Court in United Bank of India v. Satyawati Tondonr has deprecated the practice of the High Courts 1n entertaining the writ petitions despite availability of an alternative remedy. The aforesaid view has also been reiterated by Hon'ble Supreme Court in

i (2olo) 8 scc 110

Varimadugu Obi^{Reddy v. B.Sreenivasulu2'The relevant}

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extract of^{para 36 reads as under:}

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"36. In the instant case,^{although lhe} respondent borrowers^{initiallyapproachedthe Debts} Recovery Tribunal by^{frling an applicationunder Section} 17 of the SARFAESI^{AcL, 2OO2,but the order of the} Tribunal indeed^{was appealableunder Section18 of the} Act subject to *re^{compliance of conditionof pre-deposit} and wlthout exhausting^{the statutoryremedyof appeal,} the respondent^{borrowers approachedthe High Courtby} hling the writ application^{underArlicle 226 of the} Constitution.^{We deprecate such practice of entertaining} the w t application^{by the High Court in exercise of} jurisdiction under Article 226 ol the^Constitution without exhausting the^{alternatrvestatutoryremedy} available under^{the law. This circuitous routeappearsto} have been adopted^{to avoidthe condition of prc-deposit} contemplated^{under 2na provisoto Section18 of the} 2OO2 Act"

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The aforesaid enunciation^{of law laid dou'n by the} Hon'ble Supreme^{Court binds this Court'However,} subsequently the^{Hon'ble SupremeCourt in M/s' South} Indian Bank^{Limitedv' Naveen Mathew Philip3held that} in extraordinary^{circumstances the jurisdiction of this}

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2 (2023], 2 SCC 168

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3 2023 SCC OnLine sc 435

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Court under Article 226 of the Constitution of India can be

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invo ked.

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In the present case, no extraordinar5r circumstances exist so as to permit the petitioner to bypass the remedy of appeal provided under Section 17 of the SARFAESI Act.

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For the a-forementioned reasons, we are not inclined to entertain the writ petition. However, liberty is reserved to the petitioner to take recourse to the remedy provided under Section 77 of the SARFAESI Act.

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1 1. With the a_foresaid liberty, the writ petition IS disposed of.

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Miscellaneous applications pending, if any, shall

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stand closed. However, there shall be no order as to costs

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SD/.MOHD. SANAULLAH^ANSARI ASSISTANT BEGISTRAR //rRUE coPY// ( Jl. I SECTION^OFFICER

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To, 1. One CC to^{Sri M Rathan SinghAdvocate [OPUC]} 2. Two CD CoPies MBC BS

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HIGH COURT