Civil suit maintainability under SARFAESI and reasoned interim injunction orders protect title-based claims and status quo.

A civil court can entertain a suit seeking declaration of title and challenge to the authenticity of loan-related documents where no measure under Section 13(4) of the SARFAESI Act has yet been taken, because the DRT bar under Section 34 extends only to matters the Tribunal is empowered to determine. Refusal of ad interim injunction is unsustainable if the order gives no reasons or ignores relevant materials, since interim relief orders must disclose reasons. On the facts discussed, the claimant's disputed status as borrower or guarantor, undisputed share in the property, and risk of coercive action supported a prima facie case, balance of convenience, and irreparable injury, justifying ad interim injunction and preservation of status quo.

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Issues: (i) whether the refusal of ad interim injunction was unsustainable for want of reasons and non-consideration of relevant materials; (ii) whether the civil suit and injunction prayer were maintainable in view of the SARFAESI Act and the remedy before the Debts Recovery Tribunal; (iii) whether the appellant had made out a prima facie case, balance of convenience, and entitlement to ad interim injunction.

Issue (i): whether the refusal of ad interim injunction was unsustainable for want of reasons and non-consideration of relevant materials.

Analysis: The impugned order merely recorded a conclusory refusal without dealing with the rival materials or giving cogent reasons. A judicial order must disclose reasons, and the absence of reasons vitiates the order. Order XXXIX Rule 3-A of the Code of Civil Procedure, 1908 does not dispense with the need to record reasons while granting or refusing interim relief.

Conclusion: The refusal of ad interim injunction was held to be legally unsustainable.

Issue (ii): whether the civil suit and injunction prayer were maintainable in view of the SARFAESI Act and the remedy before the Debts Recovery Tribunal.

Analysis: The Court held that the DRT's jurisdiction under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is triggered only after measures under Section 13(4) are taken, and no such measure had been shown. The reliefs claimed in the suit included declaration of title and challenge to the authenticity and legal effect of the loan-related documents, which are beyond the limited adjudicatory power of the Tribunal. Section 34 bars civil jurisdiction only to the extent the Tribunal is empowered to determine the matter, and that bar was not attracted here. The injunction was also treated as ancillary to the principal civil reliefs founded on title and general law.

Conclusion: The suit and the injunction prayer were held to be maintainable before the civil court, and the SARFAESI bar was held inapplicable.

Issue (iii): whether the appellant had made out a prima facie case, balance of convenience, and entitlement to ad interim injunction.

Analysis: The Court found serious doubt regarding the Bank's stand on whether the appellant was a borrower or a guarantor, particularly because the documents relied on by the Bank did not bear the appellant's signature and an asserted magisterial declaration was not produced. The appellant's 50% ownership in the suit property was undisputed, and coercive steps threatened irreparable injury. The balance of convenience favoured preservation of the property status quo until the injunction application was decided by the trial court. The objection as to the affidavit signatory was also accepted as a strong technical objection under Order XXIX Rule 1 of the Code of Civil Procedure, 1908.

Conclusion: The appellant was held entitled to ad interim injunction.

Final Conclusion: The appellate court interfered with the trial court's order, protected the appellant's possessory and ownership interests in the suit property, and directed expeditious disposal of the interim injunction application by the trial court.

Ratio Decidendi: Where the reliefs in a civil suit concern title and the authenticity of foundational loan documents, and no measure under Section 13(4) of the SARFAESI Act, 2002 has yet been taken, the civil court's jurisdiction is not barred and ad interim injunction may be granted on a prima facie case, balance of convenience, and irreparable injury.

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