Back
2020 Supreme(AP) 718
IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
Akula Venkata Sesha Sai, K. Suresh Reddy, JJ.
Meridian Promoters Pvt. Ltd. – Appellant
Versus
Harini and Co. and Ors. – Respondents
Civil Miscellaneous Appeal No. 497 of 2019
Decided On : 10-12-2020
Advocate Appeared:
For the Appellant :A. Radhakrishna, Advocate
For the Respondent:Sudha Madhuri Govindu, Advocate
A party cannot maintain two applications and pursue two remedies before two fora simultaneously.
Headnote:
INJUNCTION - SECURED ASSETS - SECTION 34 OF THE SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT, 2002 - SUMMARY
Fact of the Case:
The appellant filed a suit for recovery of money and permanent injunction against the respondents. The appellant also filed an application for an ad interim injunction to restrain the respondents from selling or alienating the suit schedule property. The 1st respondent did not contest the application, but the 2nd respondent, Karnataka Bank Ltd., filed a counter resisting the application. The trial court dismissed the application, holding that the suit was barred under Section 34 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the Act). The appellant challenged the trial court's order by way of an appeal.
Finding of the Court:
The court held that the appellant could not maintain two applications and could not be allowed to pursue two remedies before two fora simultaneously. The court also held that the trial court erred in making certain observations touching the merits of the suit, which were not warranted having regard to the controversy in the case. However, the court observed that the suit and the securitization application and the I.A. filed therein shall be disposed of without being influenced by the observations in the order impugned before this court, passed in I.A. No. 534 of 2019.
Issues: 1. Whether the appellant could maintain two applications and pursue two remedies before two fora simultaneously? 2. Whether the trial court erred in making certain observations touching the merits of the suit?
Ratio Decidendi: 1. The court held that the appellant could not maintain two applications and could not be allowed to pursue two remedies before two fora simultaneously because the appellant had already approached the Debts Recovery Tribunal, Visakhapatnam by way of filing S.A. No. 347 of 2019 prior to passing of the impugned order and also filed an application seeking stay of sale of the property. 2. The court held that the trial court erred in making certain observations touching the merits of the suit, which were not warranted having regard to the controversy in the case, because the said observations would impact ultimately adjudication in the main suit.
Final Decision: The court disposed of the appeal, keeping it open for the appellant to pursue the interlocutory application in S.A. No. 349 of 2019 before the DRT, Visakhapatnam and also by observing that the suit and the securitization application and the I.A. filed therein shall be disposed of without being influenced by the observations in the order impugned before this court, passed in I.A. No. 534 of 2019.
JUDGMENT :
Akula Venkata Sesha Sai, J.
1. The plaintiff in O.S. No. 160 of 2019 on the file of the Court of II Additional District Judge, Visakhapatnam is the appellant in this Civil Miscellaneous Appeal, preferred under Order 43 Rule 1 of the Code of Civil Procedure, 1908 (for brevity "CPC).
2. The appellant herein instituted the said suit for recovery of a sum of Rs. 6,45,82,700/- from the 1st defendant/1st respondent herein and for permanent injunction to restrain the defendant Nos. 1 and 2 from selling or otherwise alienating the suit schedule property so long as charge over the same in favour of the plaintiff is in force. The plaint schedule property is an extent of 326.16 square yards or 272.66 square meters of site together with RCC commercial building consisting of entire Cellar floor admeasuring 2400 sft and entire Ground floor admeasuring 2400 sft and entire First floor admeasuring 2400 sft and entire Second floor admeasuring 2400 sft, bearing D. No. 47-1-107, situated at 5th lane, Dwarakanagar, Visakhapatnam.
3. Along with the said suit, the appellant herein also filed I.A. No. 534 of 2019 under the provisions of Order 39 Rules 1 and 2 r/w. 151 CPC praying for an ad interim injunction to restrain the defendants and their men from selling or otherwise alienating the suit schedule property. The 1st defendant/1st respondent herein did not contest the application. The 2nd defendant/2nd respondent-the Karnataka Bank Ltd., filed a counter resisting the said application. The learned II Additional District Judge, Visakhapatnam, by way of the impugned order, dated 01-10-2019, dismissed the said I.A. No. 534 of 2019. This appeal, filed under Order 43 Rule 1 of CPC, challenges the validity and legal sustainability of the said order.
4. Heard Sri. A. Radhakrishna, learned counsel for the appellant/plaintiff and Sravan Kumar Mannava, learned counsel for the 2nd respondent. The appeal against the 1st defendant/1st respondent is dismissed as withdrawn as not pressed by the appellant.
5. It is contended by Sri. A. Radhakrishna, learned counsel for the appellant/plaintiff that the questioned order is highly erroneous, contrary to law and opposed the very spirit and object of the provisions of Order 39 Rules 1 and 2 CPC; that the learned II Additional District Judge grossly erred in making certain observations touching the merits of the main suit; that except sale deed, dated 09-02-2016 and Memorandum of Understanding, dated-2-2016, the learned II Additional District Judge did not consider any of the documents available on record; that the findings of the learned II Additional District Judge that the civil suit is barred under Section 34 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity "the Act") is neither sustainable nor tenable in the eye of law; that the Debts Recovery Tribunal (DRT) is only a forum with limited jurisdiction and is not empowered to examine complicated questions of fact and law and cannot grant decree for recovery of money in favour of the appellant, who is the third party to the securitization proceedings under the Act and who is claiming lien over the property on which the security interest is said to have been created by the 1st respondent in favour of the Bank; that Section 34 of the Act does not prohibit any suit or other proceeding by a third party to the proceedings initiated before the DRT by the Bank. It is further submitted by the learned counsel for the appellant that the DRT is empowered to examine the validity of the measures taken in terms of the provisions of Section 13(4) of the Act only. It is also the submission of the learned counsel for the appellant that the learned II Additional District Judge failed in noting that the ratio of the judgments, cited on behalf of the 2nd respondent, is of no application to the case on hand since in the said cases the debtor who created the security interest filed either the suits or writ petition
