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IN THE HIGH COURT OF DELHI
Rajiv Shakdher, Poonam A. Bamba, JJ.
Naveen Kumar - Appellant
Versus
Canara Bank - Respondent
W.P.(C) 5697 of 2022 & CM Appl. 16976 of 2022
Decided On : 11-04-2022
The court affirmed that objections under the SARFAESI Act must be addressed and any failure to do so allows for further legal recourse.
Headnote:(A) Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 - Section 13(2) and 13(3A) - Writ petition against an order of Debt Recovery Tribunal concerning a notice served under the SARFAESI Act - Petitioners claimed objections to the notice were not disposed of by the bank. (Paras 1-4)
(B) Legal Procedure - The court emphasized procedures regarding objections to notices under the SARFAESI Act which mandates consideration by the bank. (Paras 4-5)
(C) Remedy - The petitioners retained the right to challenge the bank's decision if deemed unfavorable in future legal proceedings. (Paras 4.1)
Facts of the case:
The petitioners challenged the order of DRT regarding a Section 13(2) notice from Canara Bank for non-payment. Objections were raised, but not formally addressed by the bank as per the SARFAESI Act requirements.
Findings of Court:
The court directed the bank to consider the petitioners' communication as a formal objection under Section 13(3A).
Issues: The main issue addressed was whether the objections raised by the petitioners were appropriately considered as required by the SARFAESI Act.
Ratio Decidendi: The court ruled that the bank must treat the communication as a formal objection and reconsider any action based on their decision.
Result: Writ petition disposed of on the terms agreed upon by both parties.
| Table of Content |
|---|
| 1. details of notice served under sarfaesi act (Para 2) |
| 2. arguments regarding the representation and objections (Para 3) |
| 3. court's disposition of the writ petition (Para 4 , 5) |
| 4. closure of pending application (Para 6) |
JUDGMENT
Rajiv Shakdher, J. (Oral)--On the previous date i.e., 05.04.2022, after hearing the counsel for the petitioners, the following had been recorded:
"2. This writ petition, inter alia, is directed against the order dated 01.04.2022, passed by the Debt Recovery Tribunal-I, Delhi [in short, `DRT'] in SA No. 144/2022.
3. A perusal of the impugned order dated 01.04.2022 shows that a notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [in short, `SARFAESI Act'] dated 06.04.2021, has been served on the petitioners by the respondent-bank.
3.1. This fact is not disputed by Mr Kirti Uppal, who appears on behalf of the petitioners.
3.2. Mr Uppal says that objections were preferred by the petitioners to the above-mentioned notice. In this behalf, our attention has been drawn by Mr Uppal to Annexure P-10, appended on page 77 of the case file.
3.3. The document appended to Annexure P-10 is a communication dated 24.05.2021. Facially, this communication has been addressed to the MD and CEO, Canara Bank Ltd. However, the said communication does not, specifically, advert to the Section 13(2) notice issued by the respondent/bank, referred hereinabove.
3.4. According to Mr Uppal, there has been no disposal of the objections preferred by the respondent, as required under Section 13(3A) of the SARFAESI Act.
4. Issue notice to the respondent-bank, via all permissible modes, including e-mail.
5. List the matter on 11.04.2022."
2. Mr Hitesh Sachar has entered appearance on behalf of the respondent/bank.
2.1. Mr Sachar says that the communication dated 24.05.2021 is not a representation or objection, which addresses the aspects alluded to in the Section 13(2) notice dated 06.04.2022 issued under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [in short, `SARFAESI Act'], by the respondent/bank.
3. Notwithstanding the aforesaid contention, Mr Sachar says the respondent/bank will consider the communication dated 24.05.2021.
3.1. Mr Sidharth Chopra, who appears on behalf of the petitioners, says that if such a direction is issued, the petitioners will be satisfied, and will not take the objection that because the respondent/bank is now considering the representation/objection under Section 13(3A) of the SARFAESI Act, the notice dated 06.04.2022 issued under Section 13(2) of the SARFAESI Act would fall by the wayside.
4. Thus, the writ petition is disposed of, based on the statement made by Mr Sachar on behalf of the respondent/bank that they will deal with the communication dated 24.05.2021, as if it was a representation/objection preferred under Section 13(3A) of the SARFAESI Act.
4.1. In case the result of such consideration is not favourable to the cause of the petitioners, the petitioners will have liberty to take recourse to an appropriate remedy, albeit as per law.
5. Needless to add, till the respondent/bank conveys its decision vis-a-vis the communication dated 24.05.2021, no precipitate steps will be taken by the respondent-bank against the petitioners.
6. Consequently, pending application shall stand closed.
