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IN THE HIGH COURT OF ANDHRA PRADESH, AMARAVATI
Rakesh Kumar, D. Ramesh, JJ.
Ch.Uma Maheshwari - Petitioner
Versus
State Bank of India and another - Respondents
Writ Petition No.7295, 38662 of 2018 & 3079 of 2019
Decided On : 12-05-2020
Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 – Recovery of Loan – Mortgage of property – Declaration of loan account as Non-Performing Assests – Challenged – Held, It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection - Since for the same relief earlier Writ Petition stood dismissed, there is no reason to again entertain the present Writ Petition. Besides this, had petitioners been aggrieved with the impugned action of the respondent-bank they were having a statutory remedy under the SARFAESI Act for filing an appeal. Time without number the Hon’ble Supreme Court has deprecated interference by the High Courts in such matters – Petition dismissed
Facts of the Case:
Petitioners herein, whose loan accounts were declared as Non Performing Assets (NPAs) long back in the year 2009 and thereafter under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the SARFAESI Act’) demand notices were issued in the year 2009 itself, have succeeded in keeping the litigation alive till date, despite the fact that twice earlier they approached this Court invoking the Writ jurisdiction and, on both occasions, they did not get favourable orders
Finding of the Court;
It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection - Since for the same relief earlier Writ Petition stood dismissed, there is no reason to again entertain the present Writ Petition. Besides this, had petitioners been aggrieved with the impugned action of the respondent-bank they were having a statutory remedy under the SARFAESI Act for filing an appeal. Time without number the Hon’ble Supreme Court has deprecated interference by the High Courts in such matters.
Result; Petition dismissed
ORDER :
Rakesh Kumar, J.
1. The petitioners herein, whose loan accounts were declared as Non Performing Assets (NPAs) long back in the year 2009 and thereafter under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘the SARFAESI Act’) demand notices were issued in the year 2009 itself, have succeeded in keeping the litigation alive till date, despite the fact that twice earlier they approached this Court invoking the Writ jurisdiction and, on both occasions, they did not get favourable orders. This is the third attempt.
2. Petitioner No.1 had obtained loan of Rs.4,00,000/-vide Loan Account No.30011043530, on 30.07.2005, from the respondent-bank and created mortgage by way of depositing title deeds and also personal guarantee of 2nd petitioner. Similarly, 2nd petitioner had obtained loan of Rs.4,00,000/-vide Loan Account No.30011041033, on 25.07.2005, and created mortgage by depositing title deeds and also secured personal guarantee of 1st petitioner. Since both the loan accounts remained irregular, in the year 2009, both accounts were declared NPAs, and demand notices were issued to both the petitioners. Despite issuance of notices, the said accounts were not settled and as such under Section 13(4) of the SARFAESI Act, possession notices were issued on 11.08.2009 and thereafter sale notice too was issued. Petitioners thereafter filed S.A. No.25 of 2011 before the Debts Recovery Tribunal (for short, ‘the DRT’), Visakhapatnam, challenging the sale notice, which was dismissed by the DRT, Visakhapatnam, on 11.12.2012. The order of the DRT, Visakhapatnam, was challenged by the petitioners vide S.A. No.74 of 2013 before the Debts Recovery Appellate Tribunal (for short, ‘the DRAT’), Kolkata, which also stood dismissed on 05.12.2017. Since respondent-bank had already issued 2nd sale notice, dated 07.01.2013, because of the fact that earlier sale was not materialized pursuant to the sale notice, dated 22.01.2011, before final order was passed by the DRAT, Kolkata, the petitioners had preferred a Writ Petition vide W.P. No.1520 of 2016, wherein a prayer was made for expeditious disposal of S.A. No.74 of 2013. As stated in the Writ Petition, the said Writ Petition was disposed of directing the petitioners to move DRAT. After dismissal of S.A. No.74 of 2013, the petitioners again filed a Writ Petition vide W.P. No.42025 of 2017, which stood dismissed on 12.12.2017, leaving it open to the petitioners to pursue remedies available to them in law, if any, in accordance with due procedure. Despite dismissal of the Writ Petition, the petitioners again filed the present Writ Petition with the following prayer:
(i) the notification “sale by means of sealed tender-cum-open auction” dated 07.01.2013 on 08.01.2013 in Deccan Chronicle English Daily;
(ii) conformation of the sale dated 08.02.2013 and the sale certificate dated 12.02.2013 issued in favour of the respondent No.4;
(iii) proceedings dated 04.10.2012 issued by the respondent No.3 as illegal, violative of Articles 14, 19(1)(g) and 300-A of the Constitution of India and the provisions of the SARFAESI Act, 2002 and the Rules framed there under;
(iv) declaring that the petitioners are entitled for the benefits of OTS-2012 scheme and
(v) pass such other orders as this Hon’ble Court may deem fit in the circumstances of the case.”
3. In the Writ Petition, besides arraying the bank and its officials as respondents, the petitioners also impleaded the auction purchaser as 4th respondent. By order dated 06.03.2018, while the Writ Petition was taken up for admission before notice, learned standing counsel for the respondent-bank took notices on respondent Nos.1 to 3, whereas personal notice by registered post upon respondent No.4 was directed and thereaf
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