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2016 (12) TMI 364 - GUJARAT HIGH COURT

2016 (12) TMI 364 - GUJARAT HIGH COURT - TMI - Notice under SARFAESI Act challenged - Held that:- It is trite that the High Court exercising jurisdiction under Article 226 of the Constitution would be loath to entertain the petition straightway when aggrieved person has got an alternative statutory remedy. The remedy before the Tribunal is not only statutory remedy available, it is efficacious remedy where the parties can lead evidence in support of their case. All the contentions which are soug .....

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nal in the Appeal which they may opt to prefer. Dismissed as above. - SPECIAL CIVIL APPLICATION NO. 5364 of 2016 - Dated:- 5-12-2016 - MR. N.V.ANJARIA, J. FOR THE PETITONER : MR BK. RAJ, ADVOCATE FOR THE RESPONDENT : MR ROHAN YAGNIK, AGP, MR VIVEK B GUPTA, ADVOCATE CAV JUDGMENT Heard learned advocate Mr.B.K. Raj for the petitioners and learned advocate Mr.Vivek Gupta for the fourth respondent. Learned Assistant Government Pleader Mr.Rohan Yagnik appeared for the respondent authority. 2. It is wi .....

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t the petitioners in the year 2007 obtained loan of ₹ 17,54,000/- under Loan Account No.10997669 under an Agreement mortgaging property being 2, Siddhi Row House, Nr.Varun Hospital, Opp.Sindhu Seva Samiti School, Nr.Snesh Sankul Wadi, Anand Mahal Road, Adajan, Surat . Since the agreed installment was not paid regularly, the loan facility came to be recalled by the respondent No.3-City Financial Consumer Finance India Limited. It demanded ₹ 18,69,074/- from the petitioners. Because of .....

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iled the impugned notice on the ground that Arbitrator has passed the award and execution proceedings in respect thereof was pending, taking action by the fourth respondent-Kotak Mahindra Bank under the SERFAESI Act would not be permissible in law and would amount to doubly prosecuting the petitioners. 4.1 On the other hand, learned advocate for the fourth respondent relied on decision of this Court in Ketanbhai Umedsinh Padhiar Vs Kotak Mahindra Bank being Special Civil Application No.11377 of .....

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, 1949, the said Bank had proceeded by invoking provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 to recover the amount from the petitioners. The Kotak Mahindra Bank Limited having stepped into the shoe of the original borrower, is entitled to take recourse to the provisions of the Act. Thereby it cannot be said, as sought to be contended, that there was duality of action or that the petitioners would suffer a double jeopardy, .....

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ecover due amount from the petitioner. 5.1 As noted above, steps by respondent No.4 Bank under the SERFAESI Act reached at the stage of Section 13(4) of the Act. The stage is obtained where the petitioners have a clear alternative statutory remedy available in terms of preferring Appeal under Section 17 of the Act as mended as per the Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Act, 2016. 5.2 In Kanaiyalal Lanchand Sachdrv Vs State of Maha .....

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rticular Sections 13 and 17, this Court held as under : "35. In order to prevent misuse of such wide powers and to prevent prejudice being caused to a borrower on account of an error on the part of the banks or financial institutions, certain checks and balances have been introduced in Section 17 which allow any person, including the borrower, aggrieved by any of the measures referred to in sub-section (4) of Section 13 taken by the secured creditor, to make an application to the DRT having .....

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any such action invalid and also to restore possession even though possession may have been made over to the transferee. 39. We are unable to agree with or accept the submissions made on behalf of the appellants that the DRT had no jurisdiction to interfere with the action taken by the secured creditor after the stage contemplated under Section 13(4) of the Act. On the other hand, the law is otherwise and it contemplates that the action taken by a secured creditor in terms of Section 13(4) is op .....

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under Section 13(4) of the Act, by providing for an appeal before the DRT. 5.3 The same principle of relegating the aggrieved person to remedy under Section 17 were reasserted and reiterated in (i) Dr. K. Venkatesh Vs Indian Overseas Bank, Hyderabad delivered on 30th July, 2015 by the Andhra Pradesh High Court; (ii) Issan Overseas Limited Vs Union of India [2012(0) GLHEL-HC 228186]; (iii) Bharatbhai Ramniklal Sata Vs Collector and District Magistrate [AIR 2010 Gujarat 72] and (iv) Sonali Sunil .....

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fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc., the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi judicial bo .....

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