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2015 (12) TMI 573 - HC - Companies LawSARFAESI Act - proceedings initiated by the 2nd respondent-bank herein, under Section 13(4) of the SARFAESI Act, against the scheduled property - whether the procedings are void, illegal and arbitrary - petitioners seeking a writ of mandamus to direct the 2nd respondent-bank to give a valid discharge of the liability over the scheduled property; and to deliver the documents/execute a sale deed in favour of the petitioners - Held that:- a private company carrying on banking business as a scheduled bank, cannot be termed as an institution or a company carrying on any statutory or public duty. A private body or a person may be amenable to writ jurisdiction only where it may become necessary to compel such body or association to enforce any statutory obligations or such obligations of public nature casting positive obligation upon it. We dont find such conditions are fulfilled in respect of a private company carrying on a commercial activity of banking. Merely regulatory provisions to ensure such activity carried on by private bodies work within a discipline, do not confer any such status upon the company nor put any such obligation upon it which may be enforced through issue of a writ under Article 226 of the Constitution. Present is a case of disciplinary action being taken against its employee by the appellant Bank. The respondents service with the Bank stands terminated. The action of the Bank was challenged by the respondent by filing a writ petition under Article 226 of the Constitution of India. The respondent is not trying to enforce any statutory duty on the part of the Bank. That being the position, the appeal deserves to be allowed Division bench held that an agreement of sale was not prohibited by Section 13(13) of the SARFAESI Act; if at all entered into, that would be subject to the mortgage already created by the borrower in favour of the bank; and it could not, therefore, curtail the rights of the banks in any manner whatsoever. As this finding is binding inter-parties, this question could not have been re-agitated before the Division bench and the Division Bench ought not to have re-examined this question to hold that the sale in favour of the petitioners was void ab initio in view of the interdict contained under Section 13(13) of the SARFAESI Act. To the extent the Division bench, examined this question, in a subsequent proceeding inter-parties, the order under review suffers from an error apparent on the face of the record and necessitates being reviewed. Point No.2 is answered in favour of the review petitioners. While point Nos.1 and 2, decided by the Division bench necessitate being reviewed, and the conclusions recorded thereunder being set aside, we see no reason to review the order on point No.3. Consequently the contentions urged by the petitioner, on the validity of the order of the Debt Recovery Tribunal cannot be examined on merits. To the extent that the petitioner has been relegated to the remedy of a statutory appeal, under Section 18(1) of the SARFAESI Act, the review petition fails and is, accordingly, dismissed.
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