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IN THE HIGH COURT OF ORISSA AT CUTTACK
Jaswant Singh, M. S. Sahoo, JJ.
M/s. Anjali Motors, Kandhamal – Appellant
Versus
Punjab National Bank, Sastra Division, Dwaraka, New Delhi & Ors. – Respondents
Writ Petition (C) No. 37165 of 2022
Decided On : 11-01-2023
SARFAESI Act, 2002 - Defaulting Loanee - Court dismisses Writ Petition seeking direction to DRT for loan account details
Fact of the Case:
The petitioner, a defaulting loanee facing recovery process under the SARFAESI Act, filed a Writ Petition seeking direction to the DRT to provide details of the loan account.
Finding of the Court:
The court found that the prayer made in the Writ Petition was not maintainable as the remedy was available to the petitioner by making a proper application before the DRT itself.
Issues: Maintainability of the Writ Petition seeking direction to DRT for loan account details
Ratio Decidendi: The court declined to invoke its writ jurisdiction and issue any direction to the DRT, stating that the remedy was available to the petitioner by making a proper application before the DRT itself.
Final Decision: The court dismissed the Writ Petition.
JUDGMENT
1. The petitioner is a defaulting loanee facing recovery process under the SARFAESI Act, 2002 for an outstanding liability of around Rs.40 Lakhs together with future interest, charges and expenses. The petitioner is stated to have filed a Securitization Application bearing No.20/2021 assailing the Sale Notice dated 17.11.2021 before the DRT, Cuttack intimating the auction sale of the mortgaged property (offered as a collateral security).
2. The prayer in the present Writ Petition is reproduced below:
'It is therefore, prayed that your Lordships may graciously be pleased to admit the writ petition, call for the records, issue Rule NISI in the nature of Writ of Certiorari/Mandamus calling upon the Opp. Parties, to show cause as to why the Opp. Party Bank shall not be directed not to proceed for taking over possession of the mortgaged properties without intimating the details of the auction sale, if any, and the decision taken on the proposal of the petitioner dated 17.06.2022 vide Annexure-9;
And in the event the Opp. Parties fail to show cause or show insufficient cause, the said Rule be made absolute, Opp. Parties Bank be directed to not to proceed for taking over possession of the mortgaged properties without intimating the details of the auction sale, if any, and the decision taken on the proposal of the petitioner dated 17.06.2022 vide Annexure-9.'
3. Mr. A. K. Jena, learned counsel appearing for the Punjab National Bank/Opposite Party states that the prayer made in the present Writ Petition is not maintainable in view of the settled law, moreso, when the petitioner has already appeared before the DRT.
4. After hearing learned counsel for both the parties, we are not inclined to invoke our writ jurisdiction and issue any direction to the DRT for providing the details of the loan account, which remedy is available to the petitioner by making a proper application before the DRT itself.
5. Accordingly, the present Writ Petitions stands dismissed.
AI
The remedy for seeking details of the loan account was available to the petitioner by making a proper application before the DRT itself.
A secured creditor loses its rights under the SARFAESI Act upon the auction of mortgaged property, precluding further claims for possession under the same Act.
The availability of alternative remedies under the SARFAESI Act, 2002 and the maintainability of parallel proceedings in challenging recovery processes.
The court affirmed the validity of auction proceedings under the SARFAESI Act, emphasizing compliance with mandatory notice provisions is essential, and that prior acknowledgment of debts restricts o....
The court cannot grant the relief of selling secured assets in a writ petition, but the petitioner was allowed to approach the Competent Authority in the bank to make a representation for selling the....
The SARFAESI Act provisions, including the enforcement of security interest, the rights of the borrower, the appeal process, and the non-maintainability of writ petitions against private financial in....
Writ petitions against SARFAESI proceedings are inadmissible given the availability of statutory remedies before the DRT.
The petitioners must seek remedy through DRT for issues arising from bank's proceedings rather than through writ petition.
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