Smt. Tejal Rajesh Choksi Kapadia v. State Bank of India & Anr.

Mr. Amrut M. Vernekar with Mr. Harish Pandya and Mr. Ganesh C. Mogre i/b Joy Legal Consultants for the Petitioner. Mr. S. K. Chari i/b M. V. Kini & Co. for the Respondent No.1. CORAM: DR. D. Y. CHANDRACHUD & A. A. SAYED, J.J. DATED : AUGUST 29, 2011. P.C.: The Petitioner has instituted these proceedings under Article 226 of the Constitution to impugn the validity of a demand notice issued by the First Respondent as a lead member of a consortia of banks and a notice under Section 13 (4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. A notice has been issued on 20 July 2011 to the principal borrower proposing to declare the principal borrower as a willful defaulter.

As regards the notice under Section 13 (4), we are not inclined to entertain these proceedings under Article 226 of the Constitution having regard to the law laid down by the Supreme Court in the case of Kanaiyalal Lalchand Sachdev and others v/s. State of Maharashtra and others (2011) 2 SCC 782 and in the case of United Bank of India v/s. Satyawati Tondon and SM 2

928.wp.1481.11 others AIR (2010) SC 3413. The Petitioner has an alternate remedy under Section 17, before the Debts Recovery Tribunal.

Counsel appearing on behalf of the Petitioner, however, submitted that the secured assets inter-alia include a residential flat, which forms the subject matter of the notice at Exhibit-A to the Petition. Counsel for the Petitioner submitted that the Petitioner has two minor children and her husband, who is a director of the principal borrower, is presently in custody together with another Director. In these circumstances, Counsel appearing on behalf of the Petitioner submitted that a limited protection should be granted to the Petitioner in respect of the residential property.

We, accordingly, direct that in respect of the residential property, which has been referred to in the notice dated 27 July 2011 (Exhibit-A to the Petition), the First Respondent shall take in the first instance symbolic possession of the secured asset but shall not take forcible possession for a period of four weeks in order to enable the Petitioner to move the Debts Recovery Tribunal in an application under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. In the event that, no further directions are issued by the Debts Recovery Tribunal within the aforesaid period, it would be open to the First Respondent to take actual possession in accordance with law.

The First Respondent has also issued a notice on 20 July 2011 proposing to declare the principal borrower as a willful defaulter. The notice has been issued in pursuance of a master SM 3

928.wp.1481.11 circular of the Reserve Bank of India in regard to willful defaulters. As the notice indicates, the principal borrower has a remedy of filing representation before the Grievance Redressal Committee of the First Respondent. As a matter of fact, a period of 15 days was granted by the notice dated 20 July 2011. We grant an extension of a further three weeks to submit a representation to the First Respondent against the action proposed. Since a remedy is provided by the circular on willful defaulters of making a representation before the Grievance Redressal Committee, we are of the view that, it would neither be appropriate nor proper at this stage for this Court to express any opinion on the merits of the proposed action.

In view of the aforesaid facts and circumstances, no further directions are necessary. No other direction is sought and no other point is pressed. The Petition is accordingly disposed of. (A. A. SAYED, J.)

(DR. D. Y. CHANDRACHUD, J.)