SARFAESI action against guarantor may continue despite insolvency proceedings, and writ relief is barred by statutory remedy.

SARFAESI sale notices issued against a guarantor could proceed despite pending insolvency proceedings against the corporate debtor, because the IBC moratorium was not treated as a bar to action against the guarantor. The Court also applied the settled principle that an efficacious statutory remedy under the SARFAESI Act ordinarily excludes writ jurisdiction, absent recognised exceptions. On that basis, the writ petition challenging the demand and sale notices was held not maintainable and liable to dismissal.

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Issues: Whether the writ petition challenging SARFAESI sale notices was maintainable in view of the pending insolvency proceedings before the National Company Law Tribunal and the statutory remedy under the SARFAESI Act.

Analysis: The petitioner had offered personal properties as security for the corporate debtor. The secured creditor had proceeded under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 after issuing demand and sale notices. The controlling principle applied was that SARFAESI proceedings against a guarantor can continue notwithstanding pendency of corporate insolvency resolution proceedings against the corporate debtor. The moratorium under the Insolvency and Bankruptcy Code, 2016 was held not to bar such proceedings against the guarantor. The Court also applied the settled rule that where an efficacious statutory remedy is available under Section 17 of the SARFAESI Act, writ jurisdiction ought not to be invoked except in recognised exceptions, none of which was made out.

Conclusion: The writ petition was not maintainable and was liable to be dismissed.

Ratio Decidendi: Pendency of corporate insolvency proceedings does not bar SARFAESI action against a guarantor, and the existence of an efficacious remedy under Section 17 of the SARFAESI Act ordinarily excludes exercise of writ jurisdiction.

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