THE HON’BLE THE CHIEF JUSTICE SRI APARESH KUMAR SINGH AND THE HON’BLE SRI JUSTICE G.M.MOHIUDDIN Writ Petition No.21991 of 2025

Order

:

Heard Mr. Manav Gecil Thomas, learned counsel for the petitioner and Mr. B.Rajeshwar Reddy, learned Government Pleader for the State of Andhra Pradesh appearing for respondent No.3.

2. Petitioner is the Bank, with whom certain immovable properties described at paragraph 6 of the writ affidavit, falling within the territorial jurisdiction of the State of Telangana, were mortgaged against the credit facility availed by private respondent No.4 in the year 2013. Private respondents No.5 and 6 are the guarantors. Out of the mortgaged properties, the immovable properties described at para 9 of the writ affidavit were attached by the Government of Andhra Pradesh vide G.O.Ms.No.119 Home (General-A2)

Department dated 01.11.2016.

3. Petitioner-Bank has initiated proceedings under the Recovery of Debts and Bankruptcy Act, 1993 (for short ‘the Debt Recovery Act’), by filing O.A.No.3586 of 2017, which has been decreed on 30.12.2024 in its favour. Petitioner-Bank has also initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Security Interest Act, 2002 (for short ‘the SARFAESI Act’) by issuing demand notice under Section 13(2) on 15.06.2015 and possession notice under Section 13(4) on 07.09.2015 to respondent No.4/borrower and respondents No.5 and 6/guarantors.

4. Petitioner-Bank has assailed the attachment of the mortgaged properties vide G.O.Ms.No.119 Home (General-A2) Department dated 01.11.2016, issued by the State of Andhra Pradesh in exercise of powers under Section 3 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act, 1999 (for short ‘the Act of 1999’).

5. Learned counsel for the petitioner-Bank submits that the impugned action of the State of Andhra Pradesh is in violation of the SARFAESI Act. Reference is made to Sections 26E and 35 thereof.

6. Learned counsel for the petitioner has referred to the decision rendered by a learned Single Bench of the Andhra Pradesh High Court in Canara Bank v. State of Andhra Pradesh, Department of Home (General), rep by its Principal Secretary [W.P.No.21029 of 2017 dated 18.06.2024], whereby attachment of some of the mortgaged properties with the petitioner-Bank under the Act of 1999 were set aside, by a detailed judgment, after referring to the provisions of the Debt Recovery Act, SARFAESI Act and also the decisions rendered by the Apex Court and various other High Courts. However, the petitioner-Bank was permitted to proceed further against the referred properties under the provisions of the SARFAESI Act for recovery of the debt. It is submitted that the State of Andhra Pradesh has filed an appeal, in which an order of status quo has been granted by a learned Division Bench of the High Court of Andhra Pradesh.

7. Learned counsel for the petitioner submits that since the properties were mortgaged with the branch of the petitioner-Bank situated in Hyderabad, State of Telangana, and the mortgaged properties are also situated within the territorial jurisdiction of the State of Telangana, the jurisdiction of this Court has been invoked.

8. Learned counsel for the State of Andhra Pradesh has taken an objection to the maintainability of the writ petition before this Court on the ground that the proceedings for attachment under the Act of 1999 have been initiated on the basis of criminal cases instituted against the private respondent No.4 for cheating the small- time depositors. Criminal case as well as attachment proceedings under the Act of 1999 fall under the jurisdiction of the Special Court created under Section 6 of the said Act. Reference is made to Section 7 of the Act of 1999, which provides a mechanism for hearing the objections and claims of persons interested in the property attached, before the interim attachment is made absolute. It is submitted that the petitioner has approached this Court in 2025, wh