Writ petitions against private financial institutions under the SARFAESI Act are not maintainable; statutory remedies must be pursued instead.

JUDGMENT :

Anil K. Narendran, J.

The appellant-petitioner filed W.P.(C)No.48356 of 2025, invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, seeking the following reliefs;

“i. To call for the records in connection with Exhibit P8 application, Exhibit P12 stay application and Exhibit P13 order and stay all further proceedings in Exhibit P13 order, granting reasonable time to the petitioner to challenge the same before the learned Debt Recovery Appellate Tribunal. ii. To direct the learned Advocate Commissioner to grant reasonable time to the petitioner to avail the appellate legal remedy under Section 18 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 and not to proceed further in the matter of taking physical possession of the properties of the petitioner, as per the proceedings in MC No.853 of 2025 on the files of the Additional Chief Judicial Magistrate Court, Ernakulam.”

2. The proceedings initiated against the appellant-petitioner, under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (SARFAESI Act) is in respect of a term loan for Rs.4.60 Crores availed by him along with respondents 3 to 7, from the 1^st respondent Hero Fincorp Ltd., which is a non-banking financial company (NBFC), for a term of 180 months, for the expansion of their business. A copy of the loan sanction letter dated 12.10.2015 is marked as Ext.P1. On account of the default committed by the petitioner and respondents 3 to 7 in effecting repayment of the loan amount, the account was classified as a non-performing asset (NPA) and proceedings were initiated under the provisions of the SARFAESI Act, by issuing Ext.P4 notice dated 29.04.2024 under Section 13 (2) of the said Act. Seeking assistance of the court to take physical possession of the secured asset, the 1^st respondent NBFC filed M.C.No.964 of 2024, under Section 14 of the SARFAESI Act before the Additional Chief Judicial Magistrate, Ernakulam, and the Advocate Commissioner appointed in that proceedings issued Ext.P5 notice dated 01.01.2025.

3. The appellant-petitioner had earlier approached this Court in W.P.(C)No.2057 of 2025 and the said writ petition was disposed of by Ext.P6 judgment dated 17.01.2025, in view of the judgment dated 17.01.2025 in W.P.(C)No.1945 of 2025, leaving open all the questions agitated. By the judgment dated 17.01.2025, the learned Single Judge disposed of W.P.(C)No.1945 of 2025 filed by Nellimattathil Agencies and four others, including the appellant-petitioner, by directing that if they remit an amount of Rs.10 Lakhs on or before 31.01.2025 and makes appropriate proposal for settlement of loan account, the 1^st respondent Hero Fincorp Limited shall consider the same and take appropriate decision. In the said judgment it was made clear that if they remit Rs.10 Lakhs as directed above, coercive proceedings shall stand deferred till the 1^st respondent NBFC takes a decision in the matter. Challenging Ext.P6 judgment dated 17.01.2025 in W.P.(C)No.2057 of 2025, the appellant- petitioner filed W.A.No.337 of 2025, which was disposed of by Ext.P7 judgment dated 18.02.2025. Paragraphs 2 and 3 of that judgment read thus;

“2. Against the action taken under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act (SARFAESI Act), the Appellant/Writ Petitioner approached this Court despite the settled position of law that the Debts Recovery Tribunal is the proper Forum.

3. The mandate of the Hon'ble Supreme Court in various decisions rega