Sathish Ninan, J.

1. The appeal is directed against the order dated 08.04.2016 in R.P No.981 of 2014 in W.P.(C) No.8259 of 2009, by the petitioners in the writ petition who were respondents 1 and 2, in the Review Petition.

2. The subject matter relates to the proceedings under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, SARFAESI Act). The first respondent in the appeal is the secured creditor, who is the 1st respondent in the writ petition and the petitioner in the review petition. The second respondent company was the borrower. The appellants were the original Directors of the second respondent company. They have guaranteed the due repayment of the credit facilities. The third respondent in the appeal is the assignee of the shares of the appellants in the second respondent company. For the sake of convenience, hereinafter, the appellants are referred to as guarantors; the 1st respondent as the creditor; the 2nd respondent as the borrower company; and the 3rd respondent as the 3rd respondent.

3. From the year 1994, various credit facilities were availed of by the borrower company from the creditor bank. Towards security for the credit facilities, immovable properties of the borrower company, as well as of the guarantors were equitably mortgaged in favour of the creditor. While so, as is seen from the records, as per Exts.P1 and P2 share transfer forms, the shares held by the guarantors in the company were transferred by them to the third respondent. Since the accounts became irregular and nonperforming assets, proceedings were initiated by the creditor for recovery of the debt under the SARFAESI Act. Notices under Section 13(2) of the SARFAESI Act dated 26.11.2008, marked as Exts.P3 and P4, were issued by the creditor. Since the amounts as demanded were not paid and the liabilities were not settled, the creditor continued with the steps under the SARFAESI Act. The proceedings under the SARFAESI Act were sought to be intercepted by the guarantors/appellants by filing the writ petition.

4. The contention of the guarantors in a nut-shell is that, the borrower company and its assets are to be proceeded against by the creditor bank initially, for recovery of its debts and the guarantors and their assets should be proceeded against only for the balance amounts, if any, remaining unsatisfied from the assets of the borrower company. Towards security for the credit facilities availed by the borrower company, immovable properties belonging to the company were mortgaged in favour of the creditor bank. The properties mortgaged by the guarantors are residential properties. The entire loan amounts could be recovered by the creditor from the assets of the borrower company, and that if there is any balance amounts due to the creditor bank after proceeding against the borrower company, then only the guarantors/appellants and their assets are to be proceeded against. There was a further contention for the guarantors that pursuant to Exts.P1 and P2 share transfer agreements, on 20.12.2006 all the shares held by the guarantors, who were the erstwhile Directors of the company, were sold by them to the third respondent. As per clause 4(a) of Ext.P1 agreement, the third respondent who is the purchaser, had undertaken to take over all the liabilities due from the borrower company to the creditor bank. It is further alleged that the creditor bank was made aware of Exts.P1 and P2 share transfer agreements and that the creditor bank had assured the guarantors/appellants that no action will be taken against them. Exhibit P5 dated 12.12.2008 is a letter stated to have been sent by the guarantors to the creditor bank in reply to Exts.P3 and P4 notices. In Ext.P5, it is stated that the guarantors are discharged from the liability to the bank consequent to the transfer of the company by them to the third respondent and that the consent of the bank had been obtained to the said eff