Judgment · High Court

SRI.MOHAN JACOB GEORGE THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.01.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) No.40839 of 2023 2 JUDGMENT Dated this the 8th day of January, 2024 The petitioners had availed a Business Loan from the respondent-Bank to the tune of 50 lakhs on 17.09.2019. ₹ Initially the petitioners were regularly maintaining the loan account. While so, the business of the petitioners collapsed and there occurred default in repayment. Subsequently, the respondent initiated recovery proceedings invoking the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the petitioners were issued with Ext.P1 notice under Section 14. The petitioners submit that they are willing and ready to repay the loan account, if they are granted some time.

The prayer of the petitioners in the writ petition is to direct the respondent to allow the petitioners to pay the loan amount in equal monthly instalments after waiving interest WP(C) No.40839 of 2023 3 and hidden charges and to regularise the same.

Standing Counsel representing the respondent would submit that the total outstanding amount payable by the petitioners is 78,92,013/- as on 05.12.2023. ₹

When the writ petition came up for admission, this Court passed an interim order on 06.12.2023 directing the respondent to defer the coercive proceedings on condition that the petitioners remit an amount of ₹20 lakhs on or before

05.01.2024. The Standing Counsel submits that the petitioners have failed to remit the amount as directed by this Court.

I have heard the learned counsel for the petitioners and the learned Standing Counsel representing the respondent.

The grievance of the petitioners is relating to the proceedings initiated by the respondent under Sections 13 and 14 of the Securitisation Act and the attempt of the WP(C) No.40839 of 2023 4 respondent to take over and sell the secured asset provided by the petitioners.

It is settled law that no writ would lie against the proceedings initiated by a financial institution under the provisions of the SARFAESI Act. In United Bank of India v. Satyawati Tondon and others [(2010) 8 SCC 110], the Hon’ble Apex Court declared that no writ petition shall be entertained against the proceedings initiated under the SARFAESI Act at the instance of a defaulter since the statute provides for an efficacious alternate remedy.

In the judgment in Authorised Officer, State Bank of Travancore v. Mathew K.C. [2018 (1) KLT 784], the Hon’ble Apex Court reiterated that no writ petition would lie against the proceedings under the SARFAESI Act in view of the statutory remedy available under the said Act.

Following the judgment in Satyawati Tondon (supra), a Division Bench of this Court in the judgment in WP(C) No.40839 of 2023 5 Anilkumar v. State Bank of India [2020 (2) KLT 756] declined to exercise jurisdiction under Article 226 of the Constitution of India against the proceedings initiated under the Securitisation Act.

In South Indian Bank Limited v. Naveen Mathew Philip [2023 (4) KLT 29], the Apex Court held that when the legislature has provided a specific mechanism for appropriate redressal, the powers conferred under Article 226 of the Constitution of India shall be exercised only in extraordinary circumstances.

In Jayakrishnan A. v. Union Bank of India and others (W.P.(C) No.30803/2023), this Court held that writ petition challenging any proceedings under the Securitisation Act is not maintainable since the aggrieved person has an effective and efficacious remedy before the Tribunal constituted under the Act which is competent to adjudicate the issues of fact and law, including statutory violations. WP(C) No.40839 of 2023 6 In the light of the categorical pronouncements of law made by the Apex Court and by this Court, the above writ petition is not maintainable and it is dismissed. Sd/- N.NAGARESH JUDGE WP(C) No.40839 of 2023 7 APPENDIX OF WP(C) 40839/2023 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE NOTICE DATED 18/9/2023 ISSUED BY THE ADVOCATE COMMISSIONER IN CRL. M.P. NO. 6040/2023 ON THE FILES OF THE CHIEF JUDICIAL MAGISTRATE COURT, THRISSUR