TaxTMI 
TaxTMI 
2013 (9) TMI 1199
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....rcement of Security Interest Act, 2002 (hereinafter referred to as the SARFESI Act) having come into force, recourse to the provisions of Section 13 of the said Act was taken by the bank. Post issuance of notice under Section 13(2) of the said Act, objections being filed and the notice being issued under Section 13(4) of the said Act, the petitioner filed S.A. No. 112 of 2010 under Section 17 of the said Act. In the SA, on 18.11.2009, after hearing both the parties, it was directed that "there shall be a stay of all further proceedings of the 1st respondent under the provisions of the SARFESI Act till further orders". The reference to respondent No. 1 was to the authorized officer, Central Bank of India. It appears that the Central Bank of India exasperated by the lapse of period of time in which no recovery was made against the petitioner took a conscious business decision to assign its debts under the assignment agreement dated 29.03.2011. The SA and OA were both consolidated, as appears from the order dated 22.07.2011, from which the dispute in question starts. The petitioner alleged that the assignment deed was in violation of the order dated 18.11.2009 and filed I.A. No.....
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....under Article 226 of the Constitution of India. We have heard learned senior counsel for the petitioner for better part of an hour and a half. Learned senior counsel endeavoured to take us through the scope of different provisions of the SARFESI Act even though we repeatedly emphasized that the scope of scrutiny of this Court would only be qua the lis before us i.e. whether there was any violation of the order dated 18.11.2009 by the Central Bank of India in its act of assignment of the debt to IARC Limited as per the assignment deed dated 29.03.2011. The substratum of the submission of learned senior counsel for the petitioner is that the IARC Limited could have acquired the debt under Section 5 of the SARFESI Act, but the bank in turn would be assigning the debt to the asset reconstruction company only in pursuance to Section 13(4) of the said Act. It is, thus, submitted that the act of assignment fell within the purview of the interim order and, thus, there had been violation of the order. Apart from this, learned senior counsel also sought to canvass before us that there have been inconsistent pleas of the Central Bank of India qua what had been done under the assignment ....
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....e proceedings are pending without interim orders and an assignment deed took place, the same was found non-operative, as it was felt that prior permission was necessary. We may, however, note that there is considerable factual matrix on how the borrower endavoured to settle the matter by offering certain amounts and the assignment took place for a lesser amount. Of course, learned senior counsel for the petitioner seeks to suggest that the petitioner in the present case also made such similar endeavours, though there is nothing on record to suggest that the offer of the value of the assignment deed was ever made, though there were apparently earlier offers of lesser amounts. On the other hand, learned counsel for the respondent No. 2 contends that the petitioner wants to pay on its own terms and has been using pressurizing tactics by initiating one proceeding or the other including criminal proceedings towards the said objective. He further submits that the law which would govern the matter in issue was laid down by the Hon'ble Supreme Court in ICICI Bank Ltd. Vs Official Liquidator of APS Industries Ltd. & others, 2010(10) SCC 1. In respect of the aforesaid, learned counsel ....
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.... in the assets. None of the clauses of the impugned Deed of Assignment transfers any obligations of the assignor towards the assignee. In the case of Khardah Company Ltd. v. Raymon and Co. (India) Private Ltd. reported in (1963) 3 S.C.R. 183 the Supreme Court has held that the law on the subject of assignment of a contract is well settled. An assignment of a contract might result by transfer either of the rights or by transfer of obligations thereunder. There is a well recognized distinction between the two classes of assignments. As a rule, obligations under a contract cannot be assigned except with the consent of the promisee, and when such consent is given, it is really a novation resulting in substitution of liabilities. That, rights under a contract are always assignable unless the contract is personal in its nature or unless the rights are incapable of assignment, either under the law or under an agreement between the parties. A benefit under the contract can always be assigned. That, there is, in law, a clear distinction between assignment of rights under a contract by a party who has performed his obligation thereunder and an assignment of a claim for compensation which one....
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....ay be mentioned that the said SARFAESI Act, 2002 was enacted enabling specified SPV to buy the NPAs from banks. However, from that it does not follow that banks inter se cannot transfer their own assets. Hence the said SARFAESI Act, 2002 has no relevance in this case. 22. Before concluding, we may state that NPAs are created on account of the breaches committed by the borrower. He violates his obligation to repay the debts. One fails to appreciate the opportunity he seeks to participate in the "Transfer of Account Receivable" from one bank to the other." (emphasis supplied) We have given our thoughtful consideration to the matter and find that the writ petition is completely meritless. We must note at the inception that this Court is exercising jurisdiction under Article 226 of the Constitution of India and not as an Appellate Forum and, thus, occasion for invocation of such a jurisdiction in the context of the statutory provisions of the SARFESI Act would only arise when there is perversity in the impugned order. We find no such perversity in the impugned order of the Debts Recovery Appellate Tribunal. Rather, the order is completely valid and legal in the context of the ....