M/S. Talent Steel Melt Pvt Ltd v. The Authorised Officer

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED: 22.11.2018 CORAM :

THE HON'BLE MRS.V.K.TAHILRAMANI, CHIEF JUSTICE AND The HON'BLE MR.JUSTICE M.DURAISWAMY W.P. No.13035 of 2018 and W.M.P.No.15315 of 2018 M/s.Talent Steel Melt Pvt Ltd., S.F.No.476, K.G.Palayam Post, Kariampalayam, Coimbatore - 638 697 rep by its Managing Director D.Rajiv Mohan .. Petitioner Vs.

1.The Authorized Officer, Canara Bank, Asset Recovery Branch, No.166, T.V.Samy Road (West), R.S.Puram, Coimbatore - 641 002.

2.C.S.Shiyam Sunder .. Respondents Petition filed under Article 226 of the Constitution of India praying for issue of Writ of declaration to declare that the Sale Certificate dated 28.03.2018 issued by the 1st respondent in favour of the 2nd respondent in respect of properties situated at Old No.141, New No.111, Kottivakkam Village, Saidapet Taluk, Chengalpattu MGR District as null and void and violative of Rule 9(5) of the Security Interest Enforcement Rules, 2002.

For Petitioner : Mr.Ar.L.Sundaresan, Senior Counsel for Mr.I.Abrar Md Abdullah For Respondents: Mr.S.Raghunathan for M/s.T.S.Gopalan & Co. (R1) R2 - no appearance

O R D E R

(Order of the Court made by M.DURAISWAMY,J.) The petitioner has filed the above Writ Petition to issue a Writ of declaration to declare that the Sale Certificate dated 28.03.2018 issued by the 1st respondent in favour of the 2nd

respondent as null and void and violative of Rule 9(5) of the Security Interest Enforcement Rules, 2002.

2.It is the case of the petitioner that when the property was brought to sale on the earlier occasion, the 1st respondent has not followed Rule 9(5) of the Security Interest Enforcement Rules and has not forfeited the amount as per the said Rule and has allowed the same to be used in a subsequent auction, which is against the provisions of Rule 9(5).

3.The petitioner has filed an appeal in S.A.No.128 of 2017 on the file of the Debts Recovery Tribunal, Coimbatore, to quash the Sale Notice dated 04.03.2017 and also the possession notice dated 27.11.2015. In the S.A., the petitioner has also filed two applications in I.A.Nos.843 of 2018 and 846 of 2018 seeking for an order of stay and status-quo, respectively, in respect of the auction sale held on 08.05.2017 and 14.12.2017 and to direct the respondent - Bank not to issue/register the Sale Certificate. The Debts Recovery Tribunal, by order dated 19.04.2018, dismissed both the applications. However, the petitioner has not challenged the order passed by the Debts Recovery Tribunal before the Debt Recovery Appellate Tribunal so far. Now, the petitioner has filed the Writ Petition challenging the Sale Certificate dated 28.03.2018.

4.It is settled position that the petitioner should approach the Debts Recovery Tribunal under the SARFAESI Act for challenging the proceedings initiated under the Act. When there is an alternative remedy available to the petitioner, without exhausting the same, the Writ Petition cannot be filed. 5.The Hon'ble Supreme Court of India in the judgments reported in (2018) 3 Supreme Court Cases 85 [Authorized Officer, State Bank of Travancore and another Vs. Mathew K.C.]; (2018) 1 Supreme Court Cases 626 [Agarwal Tracom Private Limited Vs. Punjab National Bank and others] and in Civil Appeal Nos.10251 to 10265 of 2018 in the case of ICICI Bank Ltd., v. Uma Kantha Mohapatra Etc., by order dated 05.10.2018, held that the aggrieved party cannot challenge the SARFAESI proceedings directly by filing a Writ Petition under Article 226 of the Constitution of India without exhausting the alternative remedy available to them.

6.The ratio laid down by the Apex Court in the above referred judgments squarely applies to the present case. 7.In these circumstances, we are not inclined to entertain the Writ Petition. Accordingly, the same is dismissed. However, it is open to the petitioner to challenge the order dated 19.04.2018 passed by the Debts Recovery Tribunal, Coimbatore, before the Debt Recovery Appellate Tribunal, Chennai in

accordance with law. It is also open to the petitioner to challenge the Sale Certificate dated 28.03.2018 before the Debts Recovery Tribunal in accordance with law. No costs. Consequently, the connected miscellaneous petition is closed s/d- Assistant Registrar(CS VIII) True Copy Sub-Assistant Registrar va To 1.The Authorized Officer, Canara Bank, Asset Recovery Branch, No.166, T.V.Samy Road (West), R.S.Puram, Coimbatore - 641 002 W.P. No.13035 of 2018 and W.M.P.No.15315 of 2018 BS(CO) SP(05/12/2018)