TaxTMI 
TaxTMI 
2011 (3) TMI 1463
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....a private limited company, registered with Registrar of Companies, Madhya Pradesh, having its registration No. 3374 of 1986. The Company had taken certain amount of loan from respondent-Bank as credit facilities against the following heads :- Nature of facility Sanctioned Limit (a) Cash Credit (Hyphothecation) Rs. 55,00,000 (b) OD against book debts Rs. 20,00,000 (c) Funded interest term loan Rs. 26,66,000 (d) Working capital term loan Rs. 12,00,000 (e) Inland/Foreign L/C Rs. 25,00,000 TOTAL Rs.1,38,66,000 The Company did not pay the amount to the bank, hence, the total amount of Rs. 15,53,26,318 was due to the bank on 12-12-2007. The account of the company was classified as non-performing asset in accordance with the guidelines of the bank and Reserve Bank. The bank instituted a suit for recovery of the aforesaid amount before the district court Vidisha. After coming into force the SARFAESI Act, 2002, the suit was transferred to the Debt Recovery Tribunal, Jabalpur and it was registered as T.A. No. 149/98 and it is pending for adjudication. The company created equitable mortgage as security of the liability of the company and it also mortgaged t....
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....thus evident that the remedies available to an aggrieved person under the SARFAESI Act are both expeditious and effective. 43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute. 44.....
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....whether the High Court of Assam should have entertained the writ petition filed by the appellant under Article 226 of the Constitution questioning the order passed by the Commissioner of Taxes under the Assam Sales Tax Act, 1947. While dismissing the appeal, the Court observed as under: (SCC p. 1423, para 7) "7. ... The jurisdiction of the High Court under Article 226 of the Constitution is couched in wide terms and the exercise thereof is not subject to any restrictions except the territorial restrictions which are expressly provided in the articles. But the exercise of the jurisdiction is discretionary: it is not exercised merely because it is lawful to do so. The very amplitude of the jurisdiction demands that it will ordinarily be exercised subject to certain self-imposed limitations. Resort to that jurisdiction is not intended as an alternative remedy for relief which may be obtained in a suit or other mode prescribed by statute. Ordinarily the Court will not entertain a petition for a writ under Article 226, where the petitioner has an alternative remedy, which without being unduly onerous, provides an equally efficacious remedy. Again the High Court does not generally enter....
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....wkesford in the following passage: (ER p. 495) "... There are three classes of cases in which a liability may be established founded upon a statute. ... But there is a third class viz., where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it. ... The remedy provided by the statute must be followed, and it is not competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adhered to." The rule laid down in this passage was approved by the House of Lords in Neville v. London Express Newspapers Ltd. and has been reaffirmed by the Privy Council in Attorney-General of Trinidad and Tobago v. Gordon Grant & Co. Ltd. and Secy. of State v. Mask & Co. It has also been held to be equally applicable to enforcement of rights, and has been followed by this Court throughout. The High Court was therefore justified in dismissing the writ petitions in limine.' 49. The views expressed in Titaghur Paper Mills Co. Ltd. v. State of Orissa were echoed in CCE v. Dunlop India Ltd. in the following words: (SCC p. 264, para 3) '3. ... Articl....
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....s, when there is an alternative remedy available, judicial prudence demands that the Court refrains from exercising its jurisdiction under the said constitutional provisions. This was a case where the High Court should not have entertained the petition under Article 227 of the Constitution and should have directed the respondent to take recourse to the appeal mechanism provided by the Act.' 51. In CCT v. Indian Explosives Ltd. the Court reversed an order passed by the Division Bench of the Orissa High Court quashing the show-cause notice issued to the respondent under the Orissa Sales Tax Act by observing that the High Court had completely ignored the parameters laid down by this Court in a large number of cases relating to exhaustion of alternative remedy. 52. In City and Industrial Development Corpn. v. Dosu Aardeshir Bhiwandiwala the Court highlighted the parameters which are required to be kept in view by the High Court while exercising jurisdiction under Article 226 of the Constitution. Paras 29 and 30 of that judgment which contain the views of this Court read as under: (SCC pp.175-76) '29. In our opinion, the High Court while exercising its extraordinary jurisdiction unde....
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.... be invoked. After examining the scheme of the Act, the Court observed: (SCC p. 781, paras 31-32) '31. When a statutory forum is created by law for redressal of grievance and that too in a fiscal statute, a writ petition should not be entertained ignoring the statutory dispensation. In this case the High Court is a statutory forum of appeal on a question of law. That should not be abdicated and given a go-by by a litigant for invoking the forum of judicial review of the High Court under writ jurisdiction. The High Court, with great respect, fell into a manifest error by not appreciating this aspect of the matter. It has however dismissed the writ petition on the ground of lack of territorial jurisdiction. 32. No reason could be assigned by the appellant's counsel to demonstrate why the appellate jurisdiction of the High Court under section 35 of FEMA does not provide an efficacious remedy. In fact there could hardly be any reason since the High Court itself is the appellate forum.' 54. In Modern Industries v. SAIL the Court held that where the remedy was available under the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993, the High Cour....
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.... search report, on 7-6-2010, the following are the Directors of the Company:- S. No. Name of Director Father's Name Date of Appointment Residential Address 1. Narbada Prasad Sharma Shri Kishan Prasad Sharma 16-4-1986 Khari Pathak Road, Vidisha, M.P. 2. Pratap Bhanu Sharma Late Shri Krishna Gopal Sharma 16-4-1986 Shri Ram Nagar, Vidisha, M.P. 3. Chandra Bhanu Sharma Late Shri Krishna Gopal Sharma 16-4-1986 Shri Ram Nagar, Vidisha, M.P. The first subscribers of the company have also been mentioned and the persons are the same, hence, it has been mentioned that there is no change in Directors, which is as under:- There is no change in Director. 7. First Subscribers of the company : at the time of Incorporation of the Company: 1. Narbada Prasad Sharma Shri Kishan Prasad Sharma Residential Address Occupation 2. Pratap Bhanu Sharma Late Shri Krishna Gopal Sharma Khari Pathak Road, Vidisha, M.P. Business 3. Chandra Bhanu Sharma Late Shri Krishna Gopal Sharma Shri Ram Nagar, Vidisha, M.P. Business It means that Mr. Narbada Prasad Sharma, Mr. Pratap Bhanu Sharma and Chandra Bhanu Sharma are the Directors of the Company-M/s. Union Pesticides Pvt. Ltd. f....