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2020 Supreme(Mad) 1141
IN THE HIGH COURT OF MADRAS
M.M. SUNDRESH, KRISHNAN RAMASAMY, JJ.
Canara Bank, Asset Recovery Management Branch – Appellant
Versus
Vasan Medical Centre (India) Pvt. Ltd. and Others – Respondents
C.R.P. No. 790 of 2020, C.M.P. Nos. 4327, 5938 of 2020
Decided On : 18-03-2020
Advocate Appeared:
For the Appellant : M.L. Ganesh.
For the Respondent: David Tyagaraj.
Headnote:
SARFAESI Act - Section 13(2) – Jurisdiction - Possession of property - Issuance of Notice - Since said amount demanded was not paid after expiry of Statutory period symbolic possession of property was taken by Authorized Officer of Petitioner by issuance of possession Notice - It was accordingly published in two leading Newspapers one in vernacular language and other in English language - A challenge was made by Respondents 1 to 4 in S.A. to Notice issued under Section 13(4) of SARFAESI Act - Said Petition was dismissed - Petitioner invoked Section 14 of Act by filing an Application before Chief Metropolitan Magistrate being Jurisdictional Authority for taking possession - In meanwhile Respondents 1 to 3 challenged Sale Notice issued by Petitioner by filing an Application in S.A - An Order was obtained not to confirm sale – Held, Tribunal in our considered view ought to have taken note of Division Bench Judgment of our High Court referred above - Further such an Order ought not to have been passed after Order passed in S.A as nothing else survives thereafter - Court do not find any error in Order passed in Crl M.P particularly with reference to pendency of Interim Order - Said Interim Order is only with respect to confirmation of sale alone and in any case it is nothing but purely academic - As on today Order passed in S.A has become final - Sale has become confirmed - Successful bidder has also come into play - He has deposited entire amount way back in year - Thus looking from any perspective Court are of view that Order passed by Tribunal cannot be sustained in eye of law - Court may also note that Tribunal has also committed another factual error in directing Petitioner to hand over possession when said possession is still with Fourth Respondent - Thus there appears to be an apparent non-application of mind - Though Petitioner has not filed an Appeal which is provided statutorily Court are of view that it is a fit case where power under Article 227 of Constitution of India requires to be exercised - Court have already stated reasons for our interference and Court do not wish to elaborate any further – Petition allowed
JUDGMENT :
M.M. SUNDRESH, J.
1. The Petitioner before us is the Bank which sanctioned a sum of Rs. 34,59,28,000 in favour of Respondents 1 to 3. The Fourth Respondent is the Mortgagor of the property in question. As there was admittedly a default in discharging the Contractual liability, the account was classified as Non-Performing Asset followed by issuance of Notice by the Petitioner under Section 13(2) of the SARFAESI Act, dated 21.07.2017.
2. Since the said amount demanded was not paid, after the expiry of the Statutory period, the symbolic possession of the property was taken by the Authorized Officer of the Petitioner on 29.5.2018 by the issuance of the possession Notice. It was accordingly published in. the two leading Newspapers one in the vernacular language and the other in English language.
3. A challenge was made by Respondents 1 to 4 in S.A. No. 180 of 2018 to the Notice issued under Section 13(4) of the SARFAESI Act. The said Petition was dismissed. Thereafter, the Petitioner invoked Section 14 of the Act by filing an Application before the Chief Metropolitan Magistrate being the Jurisdictional Authority for taking possession. In the meanwhile, Respondents 1 to 3 challenged the Sale Notice issued by the Petitioner by filing an Application in S.A. No. 59 of 2019. An Order was obtained not to confirm the sale.
4. The Chief Metropolitan Magistrate, Egmore, Chennai disposed of Crl. M.P. No. 2995 of 2019 by Order, dated 6.8.2019 by appointing an Advocate Commissioner to take possession of the property in question. Thereafter, S.A. No. 59 of 2019 filed by Respondents 1 to 3 challenging the Auction Notice was dismissed on 23.1.2020.
5. During the interregnum, Respondents 1 to 4 filed another Application in S.A. No. 399 of 2019 challenging the Order, dated 6.8.2019 passed by the Chief Metropolitan Magistrate in Crl. M.P. No. 2995 of 2019.
6. By the impugned Order, dated 4.2.2020, Debts Recovery Tribunal II, Chennai was pleased to allow the Application filed by Respondents 1 to 4 in S.A. No. 399 of 2019, inter-alia, holding that the procedure mandated under Clauses (i) to (ix) of the Proviso to Section 14(1) of the SARFAESI Act has not been complied with by the Petitioner and in any case, the practice of appointing Advocate Commissioner cannot be sustained in the eye of law for lack of legal sanctity. Reliance has been made on the Judgment rendered by the Bombay High Court in Subir Chakravarthy and Another vs. Kotak Mahindra Bank Limited and Another, W.P. (L) No. 28480 of 2019 for the aforesaid conclusion. We may note that incidentally, the Tribunal has also observed that though the power of appointing Advocate Commissioner is available to the Chief Metropolitan Magistrate that is only to be exercised for limited purpose to oversee the functions of the Subordinate Officer. Challenging the said order, the present Civil Revision Petition has been filed seeking to invoke Article 227 of the Constitution of India on the premise that there is not only error apparent on the face of the record but also the Tribunal exercised the jurisdiction which has not been vested in it. A further submission has also been made that it is also a case of exercise of excessive jurisdiction.
7. The learned Counsel appearing for the Petitioner submitted that the Tribunal committed two fundamental errors. Firstly, there is a due compliance of Clauses (i) to (ix) of the Proviso to Section 14(1) of the Act. This can be seen on a perusal of the Order passed by the Chief Metropolitan Magistrate, Egmore, Chennai. Secondly, the Order passed by the Division Bench of this Court in S. Chandramohan vs. The Chief Metropolitan Magistrate, 2014 (2) CWC 758 (DB), which governs the field, the Court has not taken into consideration and so also the other Judgments delivered. In support of the said contention, the learned Counsel placed reliance upon the very provision itself which gives sufficient power to the Chief Metropolitan Magistrate to take appropriate steps for the
