SARFAESI alternative remedy under Section 17 bars writ challenge where factual disputes need Tribunal scrutiny

Writ challenge to SARFAESI notices was held not to be the proper forum where a statutory appeal under Section 17 was available before the Debts Recovery Tribunal. The High Court noted that the bank's invocation of SARFAESI was not without jurisdiction, while objections based on alleged bank negligence, discharge of guarantors under the Contract Act, and validity of a decree passed without the Official Liquidator involved factual inquiry better examined by the Tribunal. The petitions were therefore relegated to the alternative remedy, with the petitioners left free to raise all substantive contentions in appeal.

---

---

Issues: Whether the petitioners could invoke writ jurisdiction to challenge notices issued under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 despite the statutory remedy under Section 17 of the Act.

Analysis: The challenge was directed against recovery measures taken by a secured creditor under the SARFAESI framework. The Court held that Section 17 provides a statutory appeal before the Debts Recovery Tribunal to any aggrieved person, including a person other than the borrower, against measures taken under Section 13(4). The grounds raised by the petitioners, including alleged invalidity of the notices, discharge of guarantor liability, and unenforceability of the decree, involved disputed questions and factual inquiry that were appropriate for determination by the Tribunal. The Court relied on the settled principle that writ jurisdiction is ordinarily not exercised where an efficacious alternative remedy exists, particularly in matters involving recovery of bank dues, and that mere assertion of lack of jurisdiction does not by itself displace the statutory appellate remedy.

Conclusion: The writ petitions were not maintainable in view of the efficacious alternative remedy under Section 17 of the SARFAESI Act, and the petitioners were relegated to the Debts Recovery Tribunal.

Ratio Decidendi: Where the SARFAESI Act provides an efficacious statutory appeal under Section 17 against measures taken under Section 13, the High Court will ordinarily decline writ jurisdiction under Article 226, especially when the challenge raises disputed questions of fact and law amenable to tribunal adjudication.

---