The Securitisation Act empowers the secured creditor to enforce the security interest without the intervention of the Court or Tribunal under Section 13(4) and prohibits the Civil Court from entertaining suits or proceedings in respect of matters empowered by the Act under Section 34.

Petitioners in this writ application have challenged the order dated 09.09.2008 passed by the Sub-Judge-II, Dhanbad in Title (M) Suit No. 87 of 1993 whereby the petitioners’ prayer for an order of injunction restraining the Respondent No. 1 from putting the petitioners’ properties on auction sale and from encashing the cheques obtained from the petitioners, was rejected.

2. Facts of the case lie in narrow compass and stated briefly are as follows :

The Respondent No. 1 namely the State Bank of India had filed a suit against the present petitioners/defendants on 22.05.1993 before the Court below for a decree for recovery of a sum of Rs. 1,14,384.92 from the defendants. The claim related to the loan borrowed by the defendants from the plaintiff Bank and the same was sought to be recovered as the outstanding dues assessed by the plaintiff from the defendants.

The petitioners/defendants had appeared in the suit and had filed their written statements denying and disputing the claim of the plaintiff. Defendant Nos. 3 and 4 filed a counter claim against the plaintiff Bank in the aforesaid suit for a sum of Rs. 4,93,045.19.

The proceedings in the suit had almost reached the stage of final argument, but before that, the respondent Bank had initiated measures under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (Securitisation Act), firstly, by issuing a demand notice to the defendants to pay the outstanding dues and 60 days thereafter, by issuing a notice dated 26.06.2008 to the defendants informing them that the Bank had taken over possession of the properties secured against the debts, with an intent to sell the same for realization of its dues, under the provisions of Section 13(4) of the Securitisation Act.

During the pendency of the suit, considering the apprehensions expressed by the parties, the learned Court below had passed an order of injunction on 25.05.1999 restraining the Defendant No. 4 from selling away or transferring in any manner the part of the suit property which was in his possession and custody.

On receipt of the notice dated 26.06.2008 under Section 13(4) of the Securitisation Act the petitioners/defendants, filed a petition praying for an order of injunction restraining the plaintiff Bank from interfering with the order of injunction as passed by the Trial Court on 25.05.1999. Such prayer was made on the ground that by proceeding to take possession of the suit property and with the intention of selling away the property for realization of its purported dues, the plaintiff Bank was in fact proposing to change the status of the suit property and such act on the part of the plaintiff Bank would amount to violation of the order of injunction passed by the Court.

The defendants prayer was contested by the plaintiff Bank on the ground that the plaintiff’s act of taking possession of the suit property was in lawful exercise of its authority under Section 13(4) of the Securitisation Act and further, that the suit property was never transferred to the custody of the Court and had, for all practical purposes, remained in the custody of the Defendant No. 4 and in terms of the conditions of loan availed by the defendants, the plaintiff Bank had every right to take possession of the suit property and sell the same for realization of its outstanding dues from the defendants and if the prayer of the defendants for an order of injunction against the plaintiff Bank is allowed, it would amount to interfering with the powers of the Bank under the Securitisation Act.

3. The learned Court below vide its impugned order, had rejected the defendants’ prayer for injunction on the ground that it has no jurisdiction to entertain any petition filed against the action taken by the plaintiff Bank under the Securitisation Act as per the prohibition under the provisions of Section 34 of the Act.

4. The petitioners/defendants have challenged the aforesaid order of th