IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 9951 of 2025 FOR APPROVAL AND SIGNATURE:

HONOURABLE MR. JUSTICE BHARGAV D. KARIA and HONOURABLE MR.JUSTICE L. S. PIRZADA ================================================================

Approved for Reporting Yes No Yes ================================================================

MANOJ GOVINDBHAI LAKKAD & ANR.

Versus RAJ RADHE FINANCE LTD & ORS.

================================================================

Appearance:

SAUMITRA CHATURVEDI(8369) for the Petitioner(s) No. 1,2 MR S.N.SOPARKAR, LD.SR.ADV WITH MR MONAAL J DAVAWALA(6514)

for the Respondent(s) No. 1 MS NALINI S LODHA(2128) for the Respondent(s) No. 2 ===============================================================

CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA and HONOURABLE MR.JUSTICE L. S. PIRZADA Date : 20/11/2025

ORAL JUDGMENT

(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)

Heard learned advocate Mr.Mitul Shelat with learned advocate Mr.Saumitra Chaturvedi for the petitioners and learned Senior Advocate Mr.S.N.Soparkar with learned advocate Mr.Monaal J. Davawala for the respondent No.1 who appears on advance copy and learned advocate Ms.Nalini S. Lodha for the respondent No.2 through video conference.

1. Rule, returnable forthwith. Learned advocate Mr.Monaal J. Davawala and learned advocate Ms.Nalini Lodha waive service of notice of rule for and on behalf of the respective respondents.

2. By this petition under Article 227 of the Constitution of India, the petitioners have prayed for the following reliefs :

“(B) YOUR LORDSHIPS may be pleased to issue appropriate writ, direction and order quashing and setting aside the impugned judgment dated 12.03.2025 passed by Ld. Presiding Officer, Debts Recovery Tribunal-II, Ahmedabad in Original Application No.68 of 2016 (Annexure-A) in the interest of justice; (C) YOUR LORDSHIPS may be pleased to hold and declare that all the measures undertaken by respondent no.1 under the provisions of the Act are a nullity in the eye of law as respondent no.l is neither a "Bank" nor a "Financial Institution" under the provisions of the Recovery of Debts and Bankruptcy Act, 1993, in the interest of justice;

(D) YOUR LORDSHIPS may be pleased to declare the Assignment Deed dated 30.09.2019 executed by respondent no.2 i.e. Bank of Baroda in favour of respondent no.1 i.e.Raj Radhe Finance Limited as null and void.”

FACTS:

3. The brief facts of the case are as under :

3.1. The petitioners are the guarantors to various credit and financial facilities extended by the respondent No.2-Bank of Baroda to respondent No.3-Company i.e. M/s.Shrinathji Spintex Private Limited (hereinafter referred as ‘the borrower company’), who availed the financial assistance.

3.2. The respondent No.1-Raj Radhe Finance Limited is a Non-Banking Financial Company (for short ‘the NBFC’).

3.3. Initially, the borrower company availed the financial assistance from the Dena Bank who has merged with the respondent No.2-Bank of Baroda. The respondent No.1-NBFC entered into the Assignment Deed with Bank of Baroda and acquired the debt of the borrower company by the Assignment Deed dated 30th September, 2019.

3.4. The borrower company could not pay the outstanding dues and therefore, the debts became a Non-Performing Asset (for short ‘the NPA’). The Dena Bank, at the relevant time, had preferred the Original Application No.68 of 2016 on 20th January, 2016 under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993 (for short ‘the RDB Act’). After merger of the Dena Bank with the respondent No.2-Bank of Baroda, the Bank of Baroda was substituted in the recovery proceedings before the Debt Recovery Tribunal (for short ‘the DRT’). After the Assignment Deed executed between the respondent No.1-NBFC and the respondent No.2- Bank of Baroda, the respondent No.1-NBFC made an application for substitution, being IA No.2801 of 2024 which was objected by the petitioners by filing an affidavit-in-reply raising the contention