A writ petition under Article 226 is not maintainable if an efficacious statutory remedy of appeal is available under Section 18 of the SARFAESI Act for any person aggrieved, including auction purchasers.

Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased toTo issue a writ of mandamus or any other appropriate writ order or direction declaring theorder passed in S.A.No.503 of 2017 (old S.A.No.324 of 2015) passed by the Hon'ble Debts Recovery Tribunal-II at Hyderabad in setting aside the sale held on 27.03.2015 is illegal, arbitrary and consequently set aside the same and to pass

IA NO: 1 OF 2019

Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased To suspend the orders 21-05-2018 passed in S.A.No.503 of 2017 (old S.A.No.324 of 2015) passed by the Hon'ble Debts Recovery Tribunal-II at Hyderabad pending disposal of the above writ petition and to pass

The Court made the following:

ORDER:

(Per Hon’ble Sri Justice Cheekati Manavendranath Roy)

1. This writ petition for a mandamus is filed challenging the legal validity of the order dated 21.05.2018 passed in S.A.No.503 of 2017 by the Debts Recovery Tribunal-II, Hyderabad, setting aside the sale held on 27.03.2015 as illegal.

2. Heard Mr.N.Aswartha Narayana, learned counsel for the writ petitioner, Mr.O.Udaya Kumar, learned Standing Counsel for 1st respondent-bank and Mr.Ch.Venkata Challa Rao, learned counsel representing Mr.K.B.Ramanna Dora, learned counsel for the 2nd respondent.

3. The 2nd respondent is the principal borrower who availed loan from the 1st respondent-bank. As he committed default in repayment of the loan amount, the 1st respondent-bank has initiated measures under the SARFAESI Act and sold away the secured asset in the public auction that was held on 27.03.2015. The writ petitioner participated in the said auction and he was declared as highest bidder and he has paid the entire sale consideration. Therefore, the writ petitioner is the auction purchaser of the secured asset in the auction that was held on 27.03.2015 by the 1st respondent-bank.

4. The 2nd respondent-principal borrower has challenged the validity of the said sale before the Debts Recovery Tribunal-II, Hyderabad, in S.A.No.503 of 2017. The said securitization application was allowed by the impugned order dated 21.05.2018 and the Tribunal has set aside the sale dated 27.03.2015 held in favour of the writ petitioner.

5. Aggrieved by the impugned order of the Tribunal, the writ petitioner/auction purchaser has preferred the present writ petition challenging the order of the Tribunal. Section 18 of the Act is relevant in the context to consider. It provides a right of appeal to an aggrieved person against the order passed by the Tribunal. Section 18 starts with the wording and expression “any person aggrieved”. Therefore, it covers not only the principal borrower, guarantor and the bank relating to the loan transaction, but also any person who is aggrieved by the order passed by the Tribunal. The petitioner, who is the auction purchaser, squarely falls within the ambit of the said expression “any person aggrieved” as contemplated under Section 18 of the Act. Therefore, when the statute provides an efficacious remedy of appeal to an aggrieved person against the order of the Tribunal, the writ petitioner/auction purchaser, being the aggrieved person by the order of the Tribunal has to prefer an appeal to the appellate authority. Without preferring the appeal to the appellate authority, he cannot maintain the writ petition challenging the order of the Tribunal.

6. Learned counsel for the writ petitioner placed reliance on the judgment of the Apex Court rendered