SARFAESI civil court bar limits injunctions against secured creditors, and appellate restraint applies to discretionary interim orders.

Section 34 of the SARFAESI Act, 2002 bars civil court intervention in matters falling within the DRT or DRAT domain, including steps taken against secured assets, with only a narrow exception for fraud or claims so untenable that no inquiry is needed. The statutory remedies under Sections 17 and 18 remain available to the aggrieved party, so civil injunctive relief cannot ordinarily restrain a secured creditor from proceeding under the Act. In interlocutory matters, appellate interference with a discretionary injunction order is limited to cases of perversity, arbitrariness, or error in principle; a reasoned order vacating interim protection should not be displaced merely because another view is possible.

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Issues: (i) Whether the civil court could restrain the secured creditor from proceeding against the secured asset in view of the statutory bar under the SARFAESI Act, 2002; (ii) Whether the Division Bench was justified in interfering with the Single Judge's discretionary order vacating the interim injunction.

Issue (i): Whether the civil court could restrain the secured creditor from proceeding against the secured asset in view of the statutory bar under the SARFAESI Act, 2002.

Analysis: Section 34 bars civil court jurisdiction in respect of matters that a Debts Recovery Tribunal or Appellate Tribunal is empowered to determine, including matters in respect of which action may be taken under the Act. The limited exception recognised by precedent is confined to cases of fraud or claims so absurd and untenable that no inquiry is required. The statutory remedies under Sections 17 and 18 remain available to an aggrieved party. On the facts, the challenge did not fall within the narrow exception.

Conclusion: The civil court could not restrain the secured creditor from taking steps under the SARFAESI Act, 2002.

Issue (ii): Whether the Division Bench was justified in interfering with the Single Judge's discretionary order vacating the interim injunction.

Analysis: In an appeal against exercise of discretion in interlocutory matters, interference is warranted only when the discretion is shown to be arbitrary, capricious, perverse, or contrary to settled principles. The Single Judge had vacated the interim protection on the basis of the statutory bar, which was a legally sustainable view. The Division Bench substituted its own discretion without satisfying the limited grounds for appellate interference.

Conclusion: The Division Bench was not justified in interfering with the Single Judge's order.

Final Conclusion: The appellate interference was unsustainable, and the order restoring the bank's right to proceed against the secured property stood revived.

Ratio Decidendi: Section 34 of the SARFAESI Act, 2002 bars civil court intervention in matters within the DRT's domain except in narrowly confined cases of fraud or manifestly untenable claims, and an appellate court should not disturb a reasoned discretionary injunction order unless the discretion is shown to be perversely exercised.

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