M/S Kisan Motors Having Its Registered v. Canara Bank a Body Corporate Constituted

Uttarakhand HC4 Mar 2022WPMS/384/2022

Case brief

AI extract

What is this about?

Petitioners under the SARFAESI Act faced recovery proceedings after missing loan repayments. Citing the DRT's vacancy and citing Supreme Court precedent, the High Court granted a six-week stay on possession of the secured asset until the DRT appoints an officer.

What did the court decide?

Status quo on secured asset maintained for six weeks or until appointment of Presiding Officer in DRT, Dehradun.

M/S Kisan Motors Having Its Registered Vs Canara… — Banking and Recovery | Uttarakhand HC (2022)

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IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL

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ON THE 4^TH DAY OF MARCH, 2022

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BEFORE:

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HON’BLE SHRI JUSTICE MANOJ K. TIWARI Writ Petition (M/S) No. 384 of 2022

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BETWEEN:

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M/s Kisan Motors & another

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… Petitioners

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(By Mr. Parikshit Saini, Advocate)

AND:

Canara Bank & others

… Respondents

(By Mr. Siddhartha Sah, Advocate)

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JUDGMENT

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1. Petitioners took a loan from Canara Bank, Branch Muzaffarnagar, Uttar Pradesh. Since the loan was not repaid in time, therefore, recovery proceedings were initiated against them by invoking provision of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( in short “SARFAESI Act” ).

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2. According to the petitioners, they have already approached Debt Recovery Tribunal, Dehradun by filing Securitisation Application No. 104 of 2021. It is further the contention of learned counsel for the petitioner that since Debt Recovery Tribunal, Dehradun is lying vacant since last several months; therefore, no order could be passed on the securitisation application of the petitioners. Learned counsel for the petitioner further submits that after filing of securitisation

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application, District Magistrate has passed an order under Section 14 of SARFAESI Act. Thus, according to him, there is every likelihood that physical possession of the secured asset would be taken from the petitioners. Thus, he submits that on account of vacancy in Debt Recovery Tribunal, Dehradun, petitioners are entitled to protection from coercive action at the hands of the respondent bank.

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3. Mr. Siddhartha Sah, learned counsel appearing for the respondent bank submits that petitioners had submitted a proposal of One Time Settlement, however, their proposal was turndown by respondent bank on account of non-fulfilment of the condition of One Time Settlement. He further raised an issue of jurisdiction, however, this Court is not impressed by the submission made on behalf of respondent bank.

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4. Learned counsel for the petitioner has placed reliance upon an order dated 16.12.2021 passed by Hon’ble Supreme Court in the case of State Bar Council of Madhya Pradesh vs Union of India & others passed in SLP No. 10911 of 2021 in support of his contention that in circumstances like the present one, where DRTs/DRATs are unable to function due to nonavailability of Presiding Officer, a borrower can approach jurisdictional High Court under Article 226 of the Constitution, for relief.

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5. Since petitioners have approached DRT, Dehradun, which is under the jurisdiction of this Court,

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therefore, in the peculiar facts of the case, this Court is inclined to grant protection to the petitioners.

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6. Accordingly, the writ petition is disposed of by providing that for a period of six weeks or till appointment of Presiding Officer in DRT, Dehradun, whichever is earlier, status quo qua secured asset shall be maintained.

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(Manoj Kumar Tiwari, J.)

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Aswal

M/S Kisan Motors Having Its Registered v. Canara Bank a Body Corporate Constituted

Case brief

What is this about?

What did the court decide?

M/S Kisan Motors Having Its Registered v. Canara Bank a Body Corporate Constituted

Case brief

What is this about?

What did the court decide?

What the court decided

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