Exhaustion of statutory remedy of appeal before approaching the High Court under Article 226 of the Constitution of India.

ORDER :

1. Heard Mr. S. Mitra, learned counsel for the petitioners. Also heard Ms. S. Chakraborty, learned counsel for the respondents.

2. By way of this petition under Article 226 of the Constitution of India, the petitioners have prayed for the following relief:

“It is therefore, prayed that Your Lordships may be pleased to admit this Application, issue Rule and call for Records, directing the Respondents to Show Cause as to why an appropriate Writ in the nature of Mandamus or any other appropriate Writ should not be issued thereby setting aside and quash the Sale Notices dated 27.10.2022 (ANNEXURE-R) issued by the respondent No. 4 and/or also pass such other order or orders as Your Lordships may deem fit and proper in the facts and circumstances of the case.

AND

Pending disposal of the Rule your Lordship would be pleased to keep in abeyance the Sale Notices dated 27.10.2022 (ANNEXURE-R) and also keep in abeyance any coercive action against the Petitioners and/or also pass such other order or orders as to Your Lordships may deem fit and proper in the facts and circumstances of the case.”

3. It is an admitted position that the petitioners have not filed any representation as provided under Section 13(3A) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002. They have also not produced on record any order passed by the DRT under Section 14 of the SARFAESI Act and even the notice under Section 13(4) of SARFAESI Act.

4. As the petitioners have an efficacious remedy of filing an appeal as provided under Section 17 of the SARFAESI Act before the DRT, we do not find it appropriate to exercise our extra-ordinary jurisdiction under Article 226 of the Constitution of India.

5. We are fortified in our view by the latest judgment of the Hon’ble Apex Court in the case of Varimadugu Obi Reddy vs. B. Sreenivasulu and Others in Civil Appeal No. 8470 of 2022 decided on 16.11.2022 wherein the Hon’ble Apex Court has observed as thus:

“32. The order of the Tribunal dated 1st August, 2019 was an appealable order under Section 18 of the SARFAESI Act, 2002 and in the ordinary course of business, the borrowers/person aggrieved was supposed to avail the statutory remedy of appeal which the law provides under Section 18 of the SARFAESI Act, 2002 in the absence of efficacious alternative remedy being availed, there was no reasonable justification tendered by the respondent borrowers in approaching the High Court and filing writ application assailing order of the Tribunal dated 1st August, 2019 under its jurisdiction under Article 226 of the Constitution without exhausting the statutory right of appeal available at its command.

33. This Court in the judgment in United Bank of India vs. Satyawati Tondon and Others, (2010) 8 SCC 110, was concerned with the argument of alternative remedy provided under the SARFAESI Act, 2002 and dealing with the argument of alternative remedy, this Court had observed that where an effective remedy is available to an aggrieved person, the High Court ordinarily must insist that before availing the remedy under Article 226 of the Constitution, the alternative remedy available under the relevant statute must be exhausted. Paras 43, 44 and 45 of the said judgment are relevant for the purpose and are extracted below:

“43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, 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 a code unto