R.Sekar v. The Regional Director

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 18.07.2019

CORAM

THE HON'BLE MRS.VIJAYA K.TAHILRAMANI, CHIEF JUSTICE AND THE HON'BLE MR.JUSTICE M.DURAISWAMY W.P.No.21258 of 2019 R.Sekar .. Petitioner Vs 1.The Regional Director, Reserve Bank of India, Fort Glacis, No.16, Rajaji Salai, Chennai - 600 001.

2.The Regional Manager, Indian Overseas Bank, Regional Office, 12/1, APT Road, IOB Towers, Erode-638 003.

3.The Branch Manager, Indian Overseas Bank, Chennimalai Branch, Erode District.

.. Respondents PRAYER: Petition under Article 226 of the Constitution of India for issuance of a Writ of Certiorarified Mandamus calling for the records in respect of the impugned EAuction sale notice issued under SARFAESI Act, 2002, dated 01.07.2019 by the 2nd respondent, quash the same by consequently directing the 2nd and 3rd respondents to offer reasonable opportunity to the petitioner in respect of repaying the agricultural loan in Ac.No.26703351300001 maintained with the 3rd respondent as per the Supreme Court Guidelines, Government Orders and RBI Guidelines in respect of recovery of default agricultural loans from the small farmers in case of crop failure due to severe draught due

to monsoon failure and the Housing Loan Ac.No.267203351300003 maintained with the 3rd respondent as per the agreed original schedule for the payment of instalments by considering the petitioner's final representation dated 10.07.2019.

For Petitioner : Mr.T.M.Karthikeyan

ORDER

(Order of the Court was made by M.Duraiswamy, J.) The petitioner has filed the above writ petition to issue a Writ of Certiorarified Mandamus challenging the EAuction sale notice dated 01.07.2019 issued by the second respondent.

2. The petitioner has challenged the impugned E-Auction sale notice dated 01.07.2019 without exhausting the alternate remedy by way of appeal available to him under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (in short, 'SARFAESI Act').

3. The Supreme Court in The Authorized Officer, State Bank of Travancore and another Vs. Mathew K.C., reported in (2018) 3 SCC 85 and Agarwal Tracom Private Limited Vs. Punjab National Bank and others, reported in (2018) 1 SCC 626 held that the aggrieved parties cannot challenge the SARFAESI proceedings directly by filing a writ petition under Article 226 of the Constitution of India without exhausting the appeal remedy available to them.

4. In a recent decision of the Supreme Court in ICICI Bank Limited v. Umakanta Mohapatra, reported in 2018 SCC Online SC 2349, the Supreme Court has referred to the decision in Mathew K.C. case, referred supra, and has observed that despite several judgments, including the decision of Mathew K.C., supra, the High Courts continue to entertain matters which arise under the SARFAESI Act and keep granting interim orders in favour of persons who are Non-Performing Assets. Further, the Supreme Court held that writ petition filed by the aggrieved party without exhausting the statutory remedy available under the SARFAESI Act and Recovery of Debts Due to Banks and Financial Institutions Act, is not maintainable.

5. The Supreme Court repeatedly held that the aggrieved party should file appeal before the Debts Recovery Tribunal under Section 17 of the Act challenging the SARFAESI proceedings and the writ petition filed circumventing such procedure should not be entertained.

6. In view of the dictum laid down by the Supreme Court, we are not inclined to interfere with the impugned E-Auction sale notice. Accordingly, the writ petition is dismissed. However, it is open to the petitioner to challenge the impugned E-Auction sale notice dated 01.07.2019 before the Debts Recovery Tribunal in accordance with law. On such appeal being filed, the Debts Recovery Tribunal shall consider the same on merits and in accordance with law. No costs. Consequently, W.M.P.No.20469 of 2019 is closed.

Sd/- Assistant Registrar(CS) //True Copy// Sub Assistant Registrar bbr To, 1.The Regional Director, Reserve Bank of India, Fort Glacis, No.16, Rajaji Salai, Chennai - 600 001.

2.The Regional Manager, Indian Overseas Bank, Regional Office, 12/1, APT Road, IOB Towers, Erode-638 003.

3.The Branch Manager, Indian Overseas Bank, Chennimalai Branch, Erode District.

W.P.No.21258 of 2019 A.SK(14/08/2019) A.SK(05/09/2019)