The availability of alternative remedies under the SARFAESI Act and the need for judicial caution in exercising jurisdiction under Article 226 of the Constitution.

JUDGMENT :

1. Heard Mr. B.D. Goswami, learned counsel for the petitioners. Also heard Mr. B. Sarma, learned counsel for the respondent Nos. 1 to 3.

2. The challenge in this petition under Article 226 of the Constitution of India is to the action taken against the petitioners by the respondent Bank under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, hereinafter referred to as 'the SARFAESI Act).

3. The petitioners have an efficacious alternative remedy by way of filing an appeal under Section 17 of the SARFAESI Act before the Debts Recovery Tribunal and, therefore, no interference is called for in this petition. We are fortified in our view by the binding decision of the Hon'ble Apex Court in the case of Authorized Officer State Bank of Travancore & Anr -vs- Mathew K.C., reported in AIR 2018 SC 676, wherein it was observed as under:

'9. The statement of objects and reasons of the SARFAESI Act states that the banking and financial sector in the country was felt not to have a level playing field in comparison to other participants in the financial markets in the world. The financial institutions in India did not have the power to take possession of securities and sell them. The existing legal framework relating to commercial transactions had not kept pace with changing commercial practices and financial sector reforms resulting in tardy recovery of defaulting loans and mounting non-performing assets of banks and financial institutions. The Narasimhan Committee I and II as also the Andhyarujina Committee constituted by the Central Government Act had suggested enactment of new legislation for securitisation and empowering banks and financial institutions to take possession of securities and sell them without court intervention which would enable them to realise long-term assets, manage problems of liquidity, asset liability mismatches and improve recovery. The proceedings under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as 'the DRT Act') with passage of time, had become synonymous with those before regular courts affecting expeditious adjudication. All these aspects have not been kept in mind and considered before passing the impugned order.

10. Even prior to the SARFAESI Act, considering the alternate remedy available under the DRT Act it was held in Punjab National Bank v. O.C. Krishnan and others, (2001) 6 SCC 569 : (AIR 2001 SC 3208), that:--

'6. The Act has been enacted with a view to provide a special procedure for recovery of debts due to the banks and the financial institutions. There is a hierarchy of appeal provided in the Act, namely, filing of an appeal under Section 20 and this fast-track procedure cannot be allowed to be derailed either by taking recourse to proceedings under Articles 226 and 227 of the Constitution or by filing a civil suit, which is expressly barred. Even though a provision under an Act cannot expressly oust the jurisdiction of the court under Articles 226 and 227 of the Constitution, nevertheless, when there is an alternative remedy available, judicial prudence demands that the Court refrains from exercising its jurisdiction under the said constitutional provisions. This was a case where the High Court should not have entertained the petition under Article 227 of the Constitution and should have directed the respondent to take recourse to the appeal mechanism provided by the Act.'

11. In Satyawati Tandon (AIR 2010 SC 3413) (supra), the High Court had restrained further proceedings under Section 13(4) of the Act. Upon a detailed consideration of the statutory scheme under the Sarfaesi Act, the availability of remedy to the aggrieved under Section 17 before the Tribunal and the appellate remedy under Section 18 before the Appellate Tribunal, the object and purpose of the legislation, it was observed that a writ petition ought not to be entertained in view of the altern