Sri. G. Jayaram and Others vs The Authorised Officer and Chief Manager Union Bank of India

B.S. Patil

In these writ petitions, petitioners are calling in question the order dated 01.07.2011 passed by the 7th Additional Chief Metropolitan Magistrate, Bangalore, in C. Misc. No. 4109/2011. Petitioners are also challenging the entire proceedings initiated by the respondent-Bank under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short ''the Act'').

On 07.10.2011, this Court has directed Emergent notice to the respondent. Petitioners were also directed to implead the respective owners/mortgagees as party respondents. Subject to each of the writ petitioner depositing a sum of Rs. 20,000/-before this Court within two weeks, Interim stay of the operation of the order passed by the Magistrate for a period of four weeks has been granted.

Learned counsel for the petitioners submits that pursuant to the direction issued by this Court, all the petitioners except the 6th petitioner-Smt. Baby Anil, have deposited the amount before this Court.

Petitioners have filed a memo for extension of the interim order. Notice issued to the Bank is not served.

I have heard the learned counsel for the petitioners.

In the case of Authorized Officer, Indian Overseas Bank and Another Vs. Ashok Saw Mill, , the Apex Court has held in paragraphs 22 and 23 that in order to prevent misuse of wide powers and to prevent prejudice being caused to a borrower, certain checks and balances have been introduced in Section 17 which allow any person, including the borrower, aggrieved by any of the measures referred to in Sub-Section (4) of Section 13 taken by the secured creditor, to make an application to the Debts Recovery. Tribunal having jurisdiction in the matter. Dealing with the intention of the legislature, the Apex Court has held that the Debts Recovery Tribunal is vested with authority after conducting an adjudication into the matter to declare any such action taken by the Bank as invalid and also to restore possession even though possession may have been made over to the transferee. it is further observed in paragraph 23 that the legislature by including Sub-Section (3) in Section 17 has gone to the extent of vesting the Debts Recovery Tribunal with authority to even set aside a transaction including sale and to restore possession to the borrower in appropriate cases. In another decision in the case of United Bank of India v. Satyawati Tondon and Others - (2010) 8 SCO 110 the Apex Court has held that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution of India, if an effective remedy is available to the aggrieved person and that the said rule applies with grater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions.

In the instant case, though the petitioners claim that they are the bonafide tenants in occupation of the premises, this is a question of fact to be decided by the Tribunal before Whom the petitioners have got an efficacious alternative remedy. Instead of approaching the Tribunal, petitioners have rushed to this Court. No doubt, they have an imminent threat of dispossession as the Bank has obtained an order against them from the Magistrate for taking over possession with the help of police. Considering the said aspect, this Court has granted an interim order for a limited period protecting their interest on condition that each of the petitioner deposits a sum of Rs. 20,000/- before this Court. However, as the petitioners have an alternative efficacious remedy u/s 17 of the Act, the disputed question regarding their occupation as bonafide tenants can only be dealt with by the Tribunal and not by this Court in exercise of its powers under Article 226 of the Constitution of India. Therefore, I am of the view that the petitioners have to approach the Tribunal by availing the alternative remedy. Further, having regard to the imminent threat of dispossession by virtue of the order passed by the learned Magistrate and keeping in mind the submission made by the learned counsel for the petitioners that the Tribunal is not regularly sitting rendering it difficult for the petitioners to move the Tribunal and secure urgent orders in the matter, I am inclined to grant two weeks'' time to the petitioners to approach the Tribunal with necessary application u/s 17 of the Act.

Interim order already granted by this Court on 07.10.2011 is extended for a further period of two weeks from today. The amount deposited before this Court is ordered to be returned to the petitioners.

Writ petitions filed by petitioners 1 to 5 and 7 are disposed of in terms stated above.

As the 6th petitioner has not complied with the interim order granted by depositing the amount of Rs. 20,000/- and as it is submitted by the learned counsel for the petitioners that she has got the matter settled with the owner, the writ petition filed by the 6th petitioner is dismissed.