The SARFAESI Act provides for the relative concept of possession and an efficacious remedy for the borrower under Section 17, emphasizing the need for adjudication of the borrower's claim.

G.S. Sandhawalia, J.

The present writ petition has been filed under Articles 226/227 of the Constitution of India for quashing notice dated 07.06.2012 (Annexure P-4), issued under Section 13(2) of the Securitization & Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity, the 'SARFAESI Act') and notice dated 07.11.2012 (Annexure P-7), wherein the authorised officer of the respondent-Bank called upon the petitioner to deliver possession of the secured assets on or after 08.12.2012.

2. The pleaded case of the petitioner is that the petitioner stood as guarantor for securing loan sanctioned to respondent No.3 by mortgaging property measuring 16 kanals 6-1/9 marla situated at Village Gill Patti, Tehsil and District Bhatinda, which was agricultural land on which popular trees were planted and wheat crops had been sown.

3. Respondent No.3, M/s D.G.Exports had been sanctioned the fund based limit (FBL) of Rs. 50 lacs and the foreign letter of credit (FLC) of Rs.1800 lacs. The property had also been mortgaged in favour of the Bank to secure the credit facilities to M/s S.N. Oversees which was a proprietorship concern of M/s Neeru Garg.

4. Counsel for the petitioner has vehemently submitted that the property in question is agricultural land and, therefore, the Bank's resort to the provisions of the SARFAESI Act was not justified. Reference was made to Section 31(i) to contend that the SARFAESI Act would not apply to any security interest created in agricultural land. It was next contended that action under Section 13(4) had not been initiated and, therefore, the action of the Bank in directly seeking the assistance of the police authority without approaching the District Magistrate under Section 14 was not permissible.

5. The said submissions of the counsel for the petitioner are without any basis. A perusal of the annexures appended with the petition shows that the property is situated at Gali No.9, Adarsh Nagar, Goniana Road, Bhatinda and the nature of the land is a mixed area since civic amenities are available nearby and the locality is served by bus, car, scooter etc. A street abutting in the South and road in West side of the plot in question exists, as per the report of the evaluator. Therefore, prima facie, it cannot be said that the plot in question, is agricultural land though it might be described in the revenue records as such. Further, the plot may fall within the municipal limits and is in a developed colony. The nature of the land being agricultural or not would require adjudication after leading evidence and whether the popular trees are planted, photographs of which are appended, would be considered by the Tribunal while determining the jurisdiction of the Bank to resort to the provisions of the SARFAESI Act.

6. On the next submission of the learned counsel for the petitioner relating to no action having been taken under Section 13(4) and, therefore, it cannot approach the Tribunal in the absence of any action under Section 13(4) is also without any basis. A perusal of the notice dated 07.06.2012 under Section 13(2) of the Act shows that the account of the borrower has been classified as nonperforming asset and the Bank had communicated to the concerned parties including the petitioner that they were unable to permit continuation of the facilities granted and recalled and revoked the above facilities. The amount due to the Bank was Rs. 12,04,75,884/- plus interest and other charges w.e.f. 01.06.2012. The borrower had represented on 28.07.2012, wherein he had taken the plea that he had arranged fund of 5 crores for starting of operations which was to be deposited towards the foreign letter of credits and, thereafter also, submitted another representation dated 22.08.2012, praying for various relaxations. It was only, then, that the Bank issued possession notice dated 07.11.2012 wherein it had sought the borrower and the petitioner to deliver possession of the secured assets b