TaxTMI 
TaxTMI 
2010 (7) TMI 284
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.... District : Raigad, Maharashtra State. (3)Factory land and building at Survey No.158, Hissa No.2-B, Village Nadhal, Taluka : Khalapur, District : Raigad, Maharashtra State. (4)Factory land and building at Survey No.159, Hissa No.1, Village Nadhal, Taluka Khalapur, District : Raigad, Maharashtra State. All the aforesaid properties will be referred as "mortgage properties" for the sake of convenience. 3. The facts which have given rise to the filing of the instant petition are as follows : It is the case of the petitioner that pursuant to the request of the respondent No.3 for grant of various credit facilities, the petitioner have from time-to-time granted the credit facilities to respondent No.3 and last such credit facility was granted, vide Sanction Advise dated 10th April, 2007 and working capital term loan of Rs.10 crore was carved out and the balance of Rs.7.97 crore was retained as packing credit limit. 4. Respondent No.3 and the mortgagors/guarantors have executed necessary documents for securing the debts of the respondent No.3. It is submitted that pursuant to the restructuring of the credit facilities, the respondent No.6 in his personal capacity as a owner of the im....
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....titioner at latter point of time filed application under section 14 of the SARFAESI Act before the District Collector/ Magistrate bearing Application No.39 of 2008. The District Collector/ Magistrate by his order dated 17th July, 2008 allowed the application and provided necessary assistance to the petitioner-bank in taking possession of the secured assets. 8. The learned counsel for the petitioner has submitted that the respondent Nos.3 to 6 filed Securitisation Application No.8 of 2009 under section 17 of the SARFAESI Act, inter alia, challenging the action initiated by the petitioner under section 14 of the SARFAESI Act. Apart from the other grounds raised in the said application, the respondent Nos.3 to 6 also raised a specific ground that no action under the SARFAESI Act can be initiated against two of the properties, viz., Survey No.158, Hissa No.2-B and Survey No.159, Hissa No.1 situate at Village Nadhal, Taluka Khalapur, District Raigad as the same were agricultural lands. The petitioner opposed the said application by filing their reply. After hearing the parties and considering the pleadings, the Presiding Officer MDRT-1 vide order dated 15th December, 2009 was pleased t....
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....for plant and machinery ; and the other from Mehek Overseas (P.) Ltd. for Rs.15,55,00,000 for land and building and Rs.1,00,00,000 for plant and machinery. 13. It is further submitted that on 19th April, 2010, just before the commencement of public auction at 3 PM, the petitioner was served with the copy of the order dated 19th April, 2010 passed by the District Collector/Magistrate, Alibagh, purportedly passed en an application filed by respondent Nos.3 to 6 on 17th April, 2010, without notice to the petitioner, inter alia, directing the petitioner to cancel the public auction, remove the aforesaid properties from the purview of action under SARFAESI Act and further directed the petitioner to hand over the possession of the two lands, viz., Survey No.158, Hissa No.2-B and Survey No.159, Hissa No.1. Being aggrieved by the order dated 19th April, 2010 passed by the District Magistrate, the petitioner has filed the present petition and questioned the propriety and validity of the said order. The counsel for the petitioner has contended that the learned District Magistrate failed to appreciate that the powers under section 14 of the SARFAESI Act were very limited and ministerial in n....
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....ended that since the land bearing Survey No.158, Hissa No.2-B and Survey No.159, Hissa No.1 in Village Nadhal, Taluka Khalapur, District Raigad, Maharashtra State are the agricultural land, hence, provisions of section 31(0 of the SARFAESI Act are not applicable to these lands and, therefore, the impugned order of the District Magistrate is just and proper and is sustainable in law. 17. The learned counsels for the respondent Nos.3 to 6 further submitted that it was obligatory on the petitioner-bank to consider before approaching the District Magistrate for an order under section 14 of the SARFAESI Act whether section 31 of the SARFAESI Act excludes application of sections 13 and 14 thereof. However, in the instant case the petitioner-bank filed application No.39 of 2008, failed to disclose this aspect in the said application which was under section 14 of the SARFAESI Act and were allowed by the District Magistrate, vide order dated 17th July, 2008. It is contended that the power exercised by the District Magistrate under section 14 is of the ministerial nature. The District Magistrate was entitled to modify, revoke and alter the same in view of section 21 of The General Clauses A....
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.... conditions are fulfilled, he cannot refuse to pass an order under section 14. 5.Remedy provided under section 17 of the NPA Act is available to the borrower as well as the third party. 6.Remedy provided under section 17 is an efficacious alternative remedy available to the third party as well as to the borrower where all grievances can be raised. 7.In view of the fact that efficacious alternative remedy is available to the borrower as well as to the third party, ordinarily, writ petition under articles 226 and 227 of the Constitution of India should not be entertained. 8.In exceptional cases of gravest injustice, a writ petition could be entertained by this court. 9.Great care and caution must be exercised while entertaining a writ petition because in a given case it may result in frustrating the object of the NPA Act. 10.Even if a writ petition is entertained, as far as possible, the parties should be relegated to the remedy provided under section 17 of the NPA Act before the DRT by passing an interim order which will protect the secured assets. Adjudication and final order should be left to the DRT as far as possible." 21. The above referred observations clearly show that....
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....t and not by the Magistrate, who is only vested with limited jurisdiction, to provide necessary assistance to take over the physical possession of the property, if it is a secured asset. This court finds support in this regard, from the decisions rendered by this court, as reported in Singhu v. State of Kerala [2008] 2 KLT 736/AIR 2008 Ker. 65) and Muhammed Asharaf v. Union of India [2008] 3 KLT 1/AIR 2009 Ker. 14." 23.1 It is, therefore, evident that even if contention is canvassed before the District Magistrate in view of section 31(i) "of the SARFAESI Act that the secured asset is an agricultural land and, therefore, provisions of this Act are not applicable in respect of the said lands, same cannot be considered by the District Magistrate for want of jurisdiction to adjudicate in this regard. The aggrieved person will have to approach the appropriate forum for the said purpose. The power vested in the District Magistrate under section 14 is only to assist secured creditor in taking possession of the secured assets only. 24. The view expressed by the learned Single Judges is consistent with the law declared by the Division Bench of this court in the case of Trade Well (supra).....
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.... petitioner, however, requested the petitioner for time to make payment. (iv)As respondent Nos.3 and 6 failed to discharge their liability, the petitioner issued notice dated 4th January, 2008 to respondent No.3 and called upon it to hand over possession on 16th January 2008. Petitioner taken symbolic possession on 16th January, 2008. (v)On 17th January, 2008 the petitioner filed an application bearing No.39 of 2008 under section 14 of the SARFEASI Act before the District Magistrate. The District Magistrate, vide order dated 17th July, 2008 directed Talathi to assist the petitioner to take possession of the secured assets. (vi) The District Magistrate at the behest of the concerned respondents, reviewed/reconsidered his order dated 17th July, 2008 in view of the provisions of section 31(i) and directed the petitioner to cancel the public auction which was scheduled on 20th April, 2010 and to hand over the possession of the lands, viz., Survey No.158, Hissa No.2B and Survey No.159, Hissa No.1 to the respondent No.3. It is this order which is impugned in the present petition. 28. It is not in dispute that the petitioner has given description of the immovable properties mortgaged ....
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....sidering the issue raised by the respondent Nos.3 to 6 concluded that the property, viz. Survey No.158 and Survey No.159 are not the agricultural lands arid, therefore, provisions of section 31(i) of the SARFEASI Act were not attracted and dismissed the securitisation application filed by the respondent Nos.3 to 6. 30. The contention canvassed by the learned counsels for respondent Nos.3 to 6 that the order passed by the CMM or DM under section 14 of the SARFEASI Act and though there is no provision in the said Act for review of the said order, the respondent Nos.3 to 6 invoked the provisions of section 21 of the General Clauses Act, 1897 for reconsideration of the earlier order passed by the District Magistrate and it is also permissible for the CMM and DM to amend, vary or rescind his own order, in our view, is incorrect for the following reasons. 31. In order to appreciate the said contention, it is necessary to consider the scope and ambit of the power provided under section 21 of the Act of 1897 in the context of provisions of section 14 of the SARFEASI Act. Section 14 of the SARFEASI Act is procedural in nature and the procedure stipulated therein enabled the secured credit....
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....jurisdiction in him by applying the provisions of section 21 of the Act of 1897 would amount to re-writing the provisions of section 14, which is impermissible in law, since court can merely interpret the provisions of the statute, it cannot re-write, recast or redesign the section of the statute. In view of this legal position the contention canvassed by the learned counsels for respondent Nos.3 to 6 in this regard is devoid of substance. 32. Before we part with the judgment, we want to express that in the instant case the respondent Nos.3 to 6 after admitting the claim of the petitioner- bank in the year 2007 itself succeeded in preventing the auction of the secured assets though the possession thereof was taken by the petitioner-bank on 17th July, 2008. The respondent Nos.3 to 6 knowing fully well that the Additional Commissioner, Konkan Division, Mumbai did not have any jurisdiction, filed appeal before him and challenged the order dated 17th July, 2008 passed by the DM under section 14 of the SARFEASI Act and the Additional Commissioner was also pleased to grant ex parte order. The Additional Commissioner though at latter point of time vide order dated 1st April, 2010 dispose....