Maxim Traders (P) Ltd. and Another vs Authorised Officer, HDFC Bank Ltd. and Another

V. Chitambaresh, J.—The jurisdiction under Article 227 of the Constitution of India is called in aid by the petitioners to challenge Ext. P8 interim order of the Debts Recovery Tribunal in IA No. 2029/2013 in SA No. 507/2013. SA No. 507/2013 has been filed by the petitioners u/s 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act challenging the measures taken by the second respondent bank to enforce the security interest. The security interest is a BMW car bearing Reg. No. KL 07 BP 5005 for which a loan of about Rs. 75,00,000/- (Rupees Seventy five lakhs only) was availed by the petitioners. The Debts Recovery Tribunal passed Ext. P7 order dated 11/07/2013 in IA No. 2030/2013 in SA No. 507/2013. The relevant portion of the order is extracted herein below.

Meanwhile, as of now without going into the merits of the contentions, taking note of the persuasive submissions made by the learned Counsel, as also the bona fide of the petitioners/applicants, considering the balance of convenience and on grounds of equity and fair play, and to secure the ends of justice, the respondent/defendants are restrained from proceeding with any further action (including any coercive measures towards physical possession) under the impugned measures, tilt 15/07/2013 subject to the condition that the petitioners/applicants shall deposit a sum of Rs. 3,25,000/- on or before 30/07/2013; a sum of Rs. 3,25,000/- on or before 30/08/2013; and a sum of Rs. 3,25,000/- on or before 28/09/2013, to the respondents/defendants either by way of bank draft/pay order or cash, to be appropriated by the respondents/defendants to the credit of the petitioners''/applicants'' dues recoverable under the impugned action. And thereafter, from October, 2013 onwards, the petitioners/applicants should continue to remit the monthly installments along with the interest thereon (payable on or before the stipulated due date as per the original terms of sanction), until further orders of the Tribunal.

Thus the petitioners were obliged to deposit a sum of Rs. 3,25,000/- (Rupees Three lakhs twenty five thousand only) on or before 30/07/2013 and a sum of Rs. 3,25,000/- (Rupees Three lakhs twenty five thousand only) on or before 30/08/2013 and a further sum of Rs. 3,25,000/- (Rupees Three lakhs twenty five thousand only) on or before 28/09/02013. The petitioners are obliged to pay the equated monthly installments for the balance amount due to the second respondent until further orders. It is a conceded fact that Ext. P7 order has not been annulled or varied till date even though a motion is said to have been made by the second respondent bank. The second respondent bank is obliged to honour and respect Ext. P7 order so long as the same is not annulled or varied in accordance with law. The specific case of the petitioners is that the sum of Rs. 3,25,000/- (Rupees Three lakhs twenty five thousand only) due on 30/07/2013 was not accepted by the second respondent even though tendered. The counsel for the petitioners passed on a Demand Draft dated 13/08/2013 for a sum of Rs. 6,50,000/- (Rupees Six lakhs Fifty thousand only) to the counsel for the second respondent bank which takes in the dues upto 30/08/2013. The counsel for the second respondent bank was in no mood to accept the sum and hence the Demand Draft was taken back by the counsel for the petitioners. It should therefore be treated that the petitioners are eager and willing to comply with Ext. P7 interim order of the Debts Recovery Tribunal as a condition for stay of further coercive steps.

Ext. P8 order impugned in this Writ Petition declines the prayer of the petitioners to de-freeze the current account (No. 15132000000955) maintained by the petitioners in the second respondent bank. The petitioners lament that there is no necessity to de-freeze their current account when the Debts Recovery Tribunal has passed a conditional order of stay as evident by Ext. P7 order. I find force in the submission since there is no necessity to freeze the current account when the petitioner is eager and willing to comply with Ext. P7 conditional order of the Debts Recovery Tribunal. I should note that the present Writ Petition relates only to the loan account No. 16391783 and no coercive steps shall be taken in respect of that loan account in view of Ext. P7 conditional order of stay. The stand of the Debts Recovery Tribunal that it has no jurisdiction to direct de-freezing of the account under the SARFAESI Act is palpably wrong and Ext. P8 order passed declining the prayer of the petitioners in this regard is wholly unreasonable. Ext. P8 order suffers from an error of jurisdiction apparent on the face of the record and is liable to be set at naught. I do so and allow IA No. 2029/2013 in SA No. 507/2013 on the file of the Debts Recovery Tribunal. The petitioners lament that a sum of Rs. 34,29,821.89 has been un- authorisedly appropriated by the second respondent bank from current account maintained by the petitioners and that too after Ext. P7 conditional order of the Debts Recovery Tribunal. It is upto the petitioners to move the Debts Recovery Tribunal by proceeding in contempt or for a direction to the second respondent bank to put the money back in the current account. This Writ Petition does not deal with any other loan transaction of the petitioners with the second respondent bank and is confined to loan account No. 16391783 only. The contention of the second respondent that a Writ Petition against a scheduled bank will not lie is puerile since only the jurisdiction under Article 227 of the Constitution of India against Ext. P8 interim order of the Debts Recovery Tribunal is invoked.

The Writ Petition is allowed. No costs.